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Criticism is allowed. Undue flaming is not. Take a second to think your post through before you submit.
Bans will be handed out.
Should go without saying, but don't link restreams here either. |
So, i checked all the SEC fillings and this is the money invested in MLG
2011-11-23 - debt + option -2 500 000 dollars
2011-08-12 - debt + option - 3 083 328
2010-12-30 - equity - 3 333 353 dollars
2009-08-31 - equity - 3 499 995 dollars
2008-12-31 - equity + option - 7 500 000 dollars
2007-06-18 - equity - 1 400 000 dollars
2006-11-20 - equity - 25 000 000 dollars
2006-07-31 - equity - 10 000 000 dollars
As you can see, in 6 years and a half, they have filled for a small fortune. I think this kind of numbers give a better idea on how expensive an operation like MLG is.
I'm not saying you should pay 20 dollars per event, but it is clear to me that have a desperate need to monetize the scene.
My informed point of view is you must be mentally challenged to invest any money on e-sports (except, maybe, for a small community based operation like TL, but without expecting any huge ROI). But well, good luck to MLG.
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On February 15 2012 05:48 drgoats wrote:Show nested quote +On February 15 2012 05:28 TheToast wrote:I didn't see this posted yet, it's an interesting twitter conversation from Sundance: @fspikec
@MLGSundance 1 YEAR of gold is $30. 1 Weekend event is $20. How does that make sense at all?
Sundance DiGiovanni @MLGSundance
@fspikec guy who priced an created Gold did bad math and built in too much. Trying to move beyond it.
Somehow this doesn't have the level of professionalism that I would expect from an organization like MLG. First I'm having trouble with the idea that MLG premium rates were determined by just one guy. Basically Sundance is saying the price point is $20 because some guy fucked up.... huh? Nooo. He is saying that gold is only $30 because some guy fucked up.
So does that mean the $20 price is so high because they didn't take in enough cash from premium memberships? Or is it that the reason they had to go to a PPV format?
I'm curious to know what the gold account subscription fee 'should' have been.
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Calgary25963 Posts
On February 15 2012 05:38 Quenchiest wrote:Show nested quote +On February 15 2012 05:34 cz wrote:On February 15 2012 05:33 legaton wrote:On February 15 2012 05:04 iky43210 wrote:On February 15 2012 04:19 legaton wrote:
Well, i guess we are just hearing the bubble pop
Today's business model is just not sustainable. Costs in the e-sports industry and specially in SC2 are extremely high. To run a LAN, you must face a huge investment for the location of the hall (several thousands dollars, if not more, for an MLG sized event). But SC2 LAN are specially expensive because you truly have a globalized game, so someone (either the teams or the event organizers) has to pay a small fortune on plane tickets. You also need a lot of fairly new computers as you could run into graphic lag if you use PC with bad graphic cards, and you need a top of the notch internet connection as you depend on it to play the game.
On the other hand, revenues are scarce. For a long time, the only sources of revenue were the entry fees of viewers (non existent on a closed door event as this one) and the ad revenue. Problem is the ad revenue is way smaller most people believe it is. Most events end up with red numbers, and huge event organizers are losing money. MLG only survives thanks to the gullibility of some venture capitalists that poured millions on a "booming" industry, but you can't ride for free forever. It is fair for them to try to cut their losses.
Sadly, MLG is fucked over. The ppp system works for sports events because they have a total monopoly on some sports. In boxing or in the UFC, you either pay or you don't see anything. In Starcraft, a 1000 euros monthly cup as the MSI/Millenium tournament has a roster as good as MLG. This business model is bound to fail too.
Bye bye SC2, it was nice knowing you. people ought to not use the word bubble when they have no idea what they're talking about. Also you provide alot of speculation with no citation whatsoever. MLG has been running for 10+ years, I doubt their previous ad-based model was constantly putting them in the red. Companies don't operate, even expand, on the basis of being red for so many years. So much for your speculations This isn't a case of "cutting your loses", its about attempting to use a new business model to achieve more profit. Simple as that. Nobody is dumb enough to "cut your loses" by paying tens of thousands of dollars ahead of time to fly everyone around the globe to NY, in addition to hire a huge list of expensive casters. Its an experimentation at the new model I'm going to show you something, it is called a SEC form: http://www.sec.gov/Archives/edgar/data/1371551/000137155111000001/xslFormDX01/primary_doc.xmlYou will see it was filled by MLG and they are selling debt + options on their business. They sold 3,1 millions. They have done this several times on the last years: You just need to search the SEC archives. http://www.sec.gov/cgi-bin/browse-edgar?company=Major League Gaming Inc.&match=&CIK=&filenum=&State=&Country=&SIC=&owner=exclude&Find=Find Companies&action=getcompanyThe MLG costs a lot of money. It's a super expensive operation and they've been fairly successful at securing venture capital, but it seems they are burning money to exist. Everybody here is so delusional about the financial state of the "e-sports" scene. Not all of us. The e-sports audience is one of the most difficult audiences to monetize. It's full of people who are used to pirating / not paying for things and/or don't have credit cards / don't have much money. Really tough. It's not even so much that. It's that when you charge above and beyond what others are charging (or not charging) for similar events you're not going to get a lot of bites. I don't doubt there's some people that don't get it, but I'd say the majority probably realize this is an expensive business to run. That said, you can't just start gouging people because you need money and expect them to pay up.
But everyone is losing money. The lesson here is that ESPORTS just isn't profitable. You either give it away undervalued like everyone else, or charge what it costs and get labeled "gouging". Lose/Lose.
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So based off of Sundance's tweets MLG sounds like they are pulling off a nice bait and switch.
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On February 15 2012 05:51 Kralic wrote:Show nested quote +On February 15 2012 05:49 m4inbrain wrote:On February 15 2012 05:44 Kralic wrote:On February 15 2012 05:43 m4inbrain wrote:On February 15 2012 05:34 Chill wrote:On February 15 2012 05:25 m4inbrain wrote:On February 15 2012 05:22 Chill wrote:On February 15 2012 05:19 Chicane wrote:On February 15 2012 05:02 T.O.P. wrote:On February 15 2012 03:50 Kuni wrote:
Are none of the other good tournaments (Dreamhack, IPL etc) making any money? Because if it is only MLG, then there is something wrong that won't be fixed by PPV.
Viewers will drop significantly with PPV. I wonder if less exposure is a good thing. Doubt it. All the big tournaments lose money. Actually all the big tournaments profit. Link to their balance sheets please. Isnt the fact that theyre still around "evidence" enough? Do you really think a tournament will survive if they lose money for 10 years straight? Do you actually think an organisation would even consider to rescue a "business" which paints red numbers for 10 years? Well. I actually do believe that they are in the blacks, without seeing their balance sheets. Again, the fact that theyre still here is proof enough. Edit: although it was a joke, i stick to my opinion.  A tournament that would make consistenly a - at the end of the year wouldnt be around for so long. Look at history. The majority of major ESPORTS companies have been farces based on non-payment and then a quick declaration of bankruptcy. It's easy to get some initial investments, take a loss, and then hope that the numbers stack up to make it sustainable. MLG trimmed all their fat, cut all their extra production, fired all the writers, and started charging PPV on the stream. If that doesn't ring bells in your ears then I don't know what will. I don't think this is a case of a greed, I think it's a desire to actually tun a profit. MLG trimmed all their fat, so thats why they hold their tournament in NYC? Because their offices and studio where this tournament will be taking place are there? So having a studio in one of the most expensive cities in the world is smart then, yes? "Cant be trimmed down, we have to have a more expensive tournament, because we have our studio in the most expensive town in the western hemisphere - and thats smart.". Sorry. I dont want to sound insulting, but that actually is completely no argument, at all. Even more so, it feels a bit stupid to me, and "two-faced" (dont know the right word in english). So moving to another location to set up a new studio makes sense? Hindsight is 20/20 I am sure when MLG started as a company in the early 2000's they did not forsee themselves hosting a tournament like this.
What? They were established under the pretense of being a tournament organization.
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Sundance DiGiovanni @MLGSundance
@fspikec guy who priced an created Gold did bad math and built in too much. Trying to move beyond it.
Wow.... its almost like the guy in charge, the CEO, is throwing a guy that works for him under the bus.
Bad math? You didn't check his math? You are the CEO and you let someone else make a mistake on your revenue plan and then went live to market with it?
Where is the personal responsibility? This is just getting ugly.
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On February 15 2012 05:52 Chill wrote:Show nested quote +On February 15 2012 05:38 Quenchiest wrote:On February 15 2012 05:34 cz wrote:On February 15 2012 05:33 legaton wrote:On February 15 2012 05:04 iky43210 wrote:On February 15 2012 04:19 legaton wrote:
Well, i guess we are just hearing the bubble pop
Today's business model is just not sustainable. Costs in the e-sports industry and specially in SC2 are extremely high. To run a LAN, you must face a huge investment for the location of the hall (several thousands dollars, if not more, for an MLG sized event). But SC2 LAN are specially expensive because you truly have a globalized game, so someone (either the teams or the event organizers) has to pay a small fortune on plane tickets. You also need a lot of fairly new computers as you could run into graphic lag if you use PC with bad graphic cards, and you need a top of the notch internet connection as you depend on it to play the game.
On the other hand, revenues are scarce. For a long time, the only sources of revenue were the entry fees of viewers (non existent on a closed door event as this one) and the ad revenue. Problem is the ad revenue is way smaller most people believe it is. Most events end up with red numbers, and huge event organizers are losing money. MLG only survives thanks to the gullibility of some venture capitalists that poured millions on a "booming" industry, but you can't ride for free forever. It is fair for them to try to cut their losses.
Sadly, MLG is fucked over. The ppp system works for sports events because they have a total monopoly on some sports. In boxing or in the UFC, you either pay or you don't see anything. In Starcraft, a 1000 euros monthly cup as the MSI/Millenium tournament has a roster as good as MLG. This business model is bound to fail too.
Bye bye SC2, it was nice knowing you. people ought to not use the word bubble when they have no idea what they're talking about. Also you provide alot of speculation with no citation whatsoever. MLG has been running for 10+ years, I doubt their previous ad-based model was constantly putting them in the red. Companies don't operate, even expand, on the basis of being red for so many years. So much for your speculations This isn't a case of "cutting your loses", its about attempting to use a new business model to achieve more profit. Simple as that. Nobody is dumb enough to "cut your loses" by paying tens of thousands of dollars ahead of time to fly everyone around the globe to NY, in addition to hire a huge list of expensive casters. Its an experimentation at the new model I'm going to show you something, it is called a SEC form: http://www.sec.gov/Archives/edgar/data/1371551/000137155111000001/xslFormDX01/primary_doc.xmlYou will see it was filled by MLG and they are selling debt + options on their business. They sold 3,1 millions. They have done this several times on the last years: You just need to search the SEC archives. http://www.sec.gov/cgi-bin/browse-edgar?company=Major League Gaming Inc.&match=&CIK=&filenum=&State=&Country=&SIC=&owner=exclude&Find=Find Companies&action=getcompanyThe MLG costs a lot of money. It's a super expensive operation and they've been fairly successful at securing venture capital, but it seems they are burning money to exist. Everybody here is so delusional about the financial state of the "e-sports" scene. Not all of us. The e-sports audience is one of the most difficult audiences to monetize. It's full of people who are used to pirating / not paying for things and/or don't have credit cards / don't have much money. Really tough. It's not even so much that. It's that when you charge above and beyond what others are charging (or not charging) for similar events you're not going to get a lot of bites. I don't doubt there's some people that don't get it, but I'd say the majority probably realize this is an expensive business to run. That said, you can't just start gouging people because you need money and expect them to pay up. But everyone is losing money. The lesson here is that ESPORTS just isn't profitable. You either give it away undervalued like everyone else, or charge what it costs and get labeled "gouging". Lose/Lose.
Because everyone is fishing in the same small water tank. Tournaments are everywhere all the time. Less would be better in this situation. But I guess survival of the fittest will apply here as well.
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On February 15 2012 05:52 TheToast wrote:Show nested quote +On February 15 2012 05:48 drgoats wrote:On February 15 2012 05:28 TheToast wrote:I didn't see this posted yet, it's an interesting twitter conversation from Sundance: @fspikec
@MLGSundance 1 YEAR of gold is $30. 1 Weekend event is $20. How does that make sense at all?
Sundance DiGiovanni @MLGSundance
@fspikec guy who priced an created Gold did bad math and built in too much. Trying to move beyond it.
Somehow this doesn't have the level of professionalism that I would expect from an organization like MLG. First I'm having trouble with the idea that MLG premium rates were determined by just one guy. Basically Sundance is saying the price point is $20 because some guy fucked up.... huh? Nooo. He is saying that gold is only $30 because some guy fucked up. So does that mean the $20 price is so high because they didn't take in enough cash from premium memberships? Or is it that the reason they had to go to a PPV format? I'm curious to know what the gold account subscription fee 'should' have been.
They probably just assumed more customers for Gold than they got... Now it's not enough for their allready made plans so they need to charge extra.
Misscalculation .
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On February 15 2012 05:34 Chill wrote:Show nested quote +On February 15 2012 05:25 m4inbrain wrote:On February 15 2012 05:22 Chill wrote:On February 15 2012 05:19 Chicane wrote:On February 15 2012 05:02 T.O.P. wrote:On February 15 2012 03:50 Kuni wrote:
Are none of the other good tournaments (Dreamhack, IPL etc) making any money? Because if it is only MLG, then there is something wrong that won't be fixed by PPV.
Viewers will drop significantly with PPV. I wonder if less exposure is a good thing. Doubt it. All the big tournaments lose money. Actually all the big tournaments profit. Link to their balance sheets please. Isnt the fact that theyre still around "evidence" enough? Do you really think a tournament will survive if they lose money for 10 years straight? Do you actually think an organisation would even consider to rescue a "business" which paints red numbers for 10 years? Well. I actually do believe that they are in the blacks, without seeing their balance sheets. Again, the fact that theyre still here is proof enough. Edit: although it was a joke, i stick to my opinion. A tournament that would make consistenly a - at the end of the year wouldnt be around for so long. Look at history. The majority of major ESPORTS companies have been farces based on non-payment and then a quick declaration of bankruptcy. It's easy to get some initial investments, take a loss, and then hope that the numbers stack up to make it sustainable. MLG trimmed all their fat, cut all their extra production, fired all the writers, and started charging PPV on the stream. If that doesn't ring bells in your ears then I don't know what will. I don't think this is a case of a greed, I think it's a desire to actually tun a profit.
SC2 pro scene is one and a half years old and still growing very good. It is not a big cash cow yet.
We need more viewers and a PPV stream won't get us this.
And isn't MLG flying 32(!) Players to New York to have tournament with no audience? Thats way more expensive than everything they cut.
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On February 15 2012 05:34 Chill wrote:
Look at history. The majority of major ESPORTS companies have been farces based on non-payment and then a quick declaration of bankruptcy.
It's easy to get some initial investments, take a loss, and then hope that the numbers stack up to make it sustainable.
MLG trimmed all their fat, cut all their extra production, fired all the writers, and started charging PPV on the stream. If that doesn't ring bells in your ears then I don't know what will. I don't think this is a case of a greed, I think it's a desire to actually tun a profit.
They may cut as many corners as they want, but PPV for 20$, for 3 days is to much. Sory. I don't take this like a case of a greed... it's like more Apple company, big money for not that good hardware.
On February 15 2012 05:34 cz wrote:
Not all of us. The e-sports audience is one of the most difficult audiences to monetize. It's full of people who are used to pirating / not paying for things and/or don't have credit cards / don't have much money. Really tough.
I bought f**** game for 199PLN in first day that's like 60 dolars... i'm pirate?
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On February 15 2012 05:52 Chill wrote:Show nested quote +On February 15 2012 05:38 Quenchiest wrote:On February 15 2012 05:34 cz wrote:On February 15 2012 05:33 legaton wrote:On February 15 2012 05:04 iky43210 wrote:On February 15 2012 04:19 legaton wrote:
Well, i guess we are just hearing the bubble pop
Today's business model is just not sustainable. Costs in the e-sports industry and specially in SC2 are extremely high. To run a LAN, you must face a huge investment for the location of the hall (several thousands dollars, if not more, for an MLG sized event). But SC2 LAN are specially expensive because you truly have a globalized game, so someone (either the teams or the event organizers) has to pay a small fortune on plane tickets. You also need a lot of fairly new computers as you could run into graphic lag if you use PC with bad graphic cards, and you need a top of the notch internet connection as you depend on it to play the game.
On the other hand, revenues are scarce. For a long time, the only sources of revenue were the entry fees of viewers (non existent on a closed door event as this one) and the ad revenue. Problem is the ad revenue is way smaller most people believe it is. Most events end up with red numbers, and huge event organizers are losing money. MLG only survives thanks to the gullibility of some venture capitalists that poured millions on a "booming" industry, but you can't ride for free forever. It is fair for them to try to cut their losses.
Sadly, MLG is fucked over. The ppp system works for sports events because they have a total monopoly on some sports. In boxing or in the UFC, you either pay or you don't see anything. In Starcraft, a 1000 euros monthly cup as the MSI/Millenium tournament has a roster as good as MLG. This business model is bound to fail too.
Bye bye SC2, it was nice knowing you. people ought to not use the word bubble when they have no idea what they're talking about. Also you provide alot of speculation with no citation whatsoever. MLG has been running for 10+ years, I doubt their previous ad-based model was constantly putting them in the red. Companies don't operate, even expand, on the basis of being red for so many years. So much for your speculations This isn't a case of "cutting your loses", its about attempting to use a new business model to achieve more profit. Simple as that. Nobody is dumb enough to "cut your loses" by paying tens of thousands of dollars ahead of time to fly everyone around the globe to NY, in addition to hire a huge list of expensive casters. Its an experimentation at the new model I'm going to show you something, it is called a SEC form: http://www.sec.gov/Archives/edgar/data/1371551/000137155111000001/xslFormDX01/primary_doc.xmlYou will see it was filled by MLG and they are selling debt + options on their business. They sold 3,1 millions. They have done this several times on the last years: You just need to search the SEC archives. http://www.sec.gov/cgi-bin/browse-edgar?company=Major League Gaming Inc.&match=&CIK=&filenum=&State=&Country=&SIC=&owner=exclude&Find=Find Companies&action=getcompanyThe MLG costs a lot of money. It's a super expensive operation and they've been fairly successful at securing venture capital, but it seems they are burning money to exist. Everybody here is so delusional about the financial state of the "e-sports" scene. Not all of us. The e-sports audience is one of the most difficult audiences to monetize. It's full of people who are used to pirating / not paying for things and/or don't have credit cards / don't have much money. Really tough. It's not even so much that. It's that when you charge above and beyond what others are charging (or not charging) for similar events you're not going to get a lot of bites. I don't doubt there's some people that don't get it, but I'd say the majority probably realize this is an expensive business to run. That said, you can't just start gouging people because you need money and expect them to pay up. But everyone is losing money. The lesson here is that ESPORTS just isn't profitable. You either give it away undervalued like everyone else, or charge what it costs and get labeled "gouging". Lose/Lose.
If the lesson is that esports is losing money then why did so many tournaments pop up in 2011? Why is esports still alive after existing for over a decade? Organizations arent going to run tournaments for years on end if its losing them money, and if it is losing them money then they learn to adapt as IEM did with the wc3 bubble. People don't invest into industries because they think it'll be great for the community, they invest in them for a return. To say that esports is not profitable is completely bullshit.
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On February 14 2012 07:54 Grumbels wrote:
Please don't let this become a 100 page thread filled with bitter arguments and complaints. :o
147 to be exact
Yea awful idea, 20 bucks for 3 days is garbage idc how many games they show
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On February 15 2012 05:53 Ricemagical wrote:Show nested quote +On February 15 2012 05:51 Kralic wrote:On February 15 2012 05:49 m4inbrain wrote:On February 15 2012 05:44 Kralic wrote:On February 15 2012 05:43 m4inbrain wrote:On February 15 2012 05:34 Chill wrote:On February 15 2012 05:25 m4inbrain wrote:On February 15 2012 05:22 Chill wrote:On February 15 2012 05:19 Chicane wrote:On February 15 2012 05:02 T.O.P. wrote:
[quote]
All the big tournaments lose money. Actually all the big tournaments profit. Link to their balance sheets please. Isnt the fact that theyre still around "evidence" enough? Do you really think a tournament will survive if they lose money for 10 years straight? Do you actually think an organisation would even consider to rescue a "business" which paints red numbers for 10 years? Well. I actually do believe that they are in the blacks, without seeing their balance sheets. Again, the fact that theyre still here is proof enough. Edit: although it was a joke, i stick to my opinion. A tournament that would make consistenly a - at the end of the year wouldnt be around for so long. Look at history. The majority of major ESPORTS companies have been farces based on non-payment and then a quick declaration of bankruptcy. It's easy to get some initial investments, take a loss, and then hope that the numbers stack up to make it sustainable. MLG trimmed all their fat, cut all their extra production, fired all the writers, and started charging PPV on the stream. If that doesn't ring bells in your ears then I don't know what will. I don't think this is a case of a greed, I think it's a desire to actually tun a profit. MLG trimmed all their fat, so thats why they hold their tournament in NYC? Because their offices and studio where this tournament will be taking place are there? So having a studio in one of the most expensive cities in the world is smart then, yes? "Cant be trimmed down, we have to have a more expensive tournament, because we have our studio in the most expensive town in the western hemisphere - and thats smart.". Sorry. I dont want to sound insulting, but that actually is completely no argument, at all. Even more so, it feels a bit stupid to me, and "two-faced" (dont know the right word in english). So moving to another location to set up a new studio makes sense? Hindsight is 20/20 I am sure when MLG started as a company in the early 2000's they did not forsee themselves hosting a tournament like this. What? They were established under the pretense of being a tournament organization.
Yes, and by that they would go on a circuit rent out a venue, have the players go there on their own expense to compete. They have changed that business model for the Arena events. It is a risk that they are taking. It is not like they did this and went "Caching ez money!" on this. This might sink their company or make it profitable.
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On February 15 2012 05:50 Adreme wrote:Show nested quote +On February 15 2012 05:49 m4inbrain wrote:On February 15 2012 05:44 Kralic wrote:On February 15 2012 05:43 m4inbrain wrote:On February 15 2012 05:34 Chill wrote:On February 15 2012 05:25 m4inbrain wrote:On February 15 2012 05:22 Chill wrote:On February 15 2012 05:19 Chicane wrote:On February 15 2012 05:02 T.O.P. wrote:On February 15 2012 03:50 Kuni wrote:
Are none of the other good tournaments (Dreamhack, IPL etc) making any money? Because if it is only MLG, then there is something wrong that won't be fixed by PPV.
Viewers will drop significantly with PPV. I wonder if less exposure is a good thing. Doubt it. All the big tournaments lose money. Actually all the big tournaments profit. Link to their balance sheets please. Isnt the fact that theyre still around "evidence" enough? Do you really think a tournament will survive if they lose money for 10 years straight? Do you actually think an organisation would even consider to rescue a "business" which paints red numbers for 10 years? Well. I actually do believe that they are in the blacks, without seeing their balance sheets. Again, the fact that theyre still here is proof enough. Edit: although it was a joke, i stick to my opinion. A tournament that would make consistenly a - at the end of the year wouldnt be around for so long. Look at history. The majority of major ESPORTS companies have been farces based on non-payment and then a quick declaration of bankruptcy. It's easy to get some initial investments, take a loss, and then hope that the numbers stack up to make it sustainable. MLG trimmed all their fat, cut all their extra production, fired all the writers, and started charging PPV on the stream. If that doesn't ring bells in your ears then I don't know what will. I don't think this is a case of a greed, I think it's a desire to actually tun a profit. MLG trimmed all their fat, so thats why they hold their tournament in NYC? Because their offices and studio where this tournament will be taking place are there? So having a studio in one of the most expensive cities in the world is smart then, yes? "Cant be trimmed down, we have to have a more expensive tournament, because we have our studio in the most expensive town in the western hemisphere - and thats smart.". Sorry. I dont want to sound insulting, but that actually is completely no argument, at all. Even more so, it feels a bit stupid to me, and "two-faced" (dont know the right word in english). People have business offices in New York because it is strategically a smart business decision to do so.
Yeah. Sounds really smart to me, especially if you claim to do red numbers all the time (which may be true - i dont believe it, but that doesnt matter).
Maybe stop doing "smart" business decisions, and start doing "reasonable". You see, it maybe good for your image to have an office in big apple, but its bad for your image when you start to look two-faced. If you dont make money, you should not be in new york, its that easy.
Cut your expenses, even if that means to give up the "strategically smart" office in NY. Which screws you and your fans over, if you think about it (thats why the pass is that expensive, Hotel and stuff, studiorent etc - it could be so much cheaper).
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Hm, pretty bad call. Not that I don't want to pay for additional/HD content, but imho the "pay 20 bucks for everything or gtfo" approach doesn't offer sufficient diversity.
Sure, for the real enthusiast, 20 dollars for an entire weekend of full coverage might be a good deal. But what about the others who are just interested in a good quality stream, while not caring for VoDs, behind the scenes stuff etc?
Just offer another option somewhere in between "nothing" and "full access" for a reasonable price and I suppose most of uproar will vanish instantly. The success of ESL/HSC should be proof enough (for those of you who don't know what I'm talking about: The HomeStoryCup run by the ESL got two different payments options for HD content: Either get a 30/90/360 days ESL subscription for about 3-4 bucks a month. Or pay five bucks for "just" the three day coverage of HSC alone)
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On February 15 2012 05:52 TheToast wrote:Show nested quote +On February 15 2012 05:48 drgoats wrote:On February 15 2012 05:28 TheToast wrote:I didn't see this posted yet, it's an interesting twitter conversation from Sundance: @fspikec
@MLGSundance 1 YEAR of gold is $30. 1 Weekend event is $20. How does that make sense at all?
Sundance DiGiovanni @MLGSundance
@fspikec guy who priced an created Gold did bad math and built in too much. Trying to move beyond it.
Somehow this doesn't have the level of professionalism that I would expect from an organization like MLG. First I'm having trouble with the idea that MLG premium rates were determined by just one guy. Basically Sundance is saying the price point is $20 because some guy fucked up.... huh? Nooo. He is saying that gold is only $30 because some guy fucked up. So does that mean the $20 price is so high because they didn't take in enough cash from premium memberships? Or is it that the reason they had to go to a PPV format? I'm curious to know what the gold account subscription fee 'should' have been.
Well, I am not really one to speak for them I was just applying a little reading comprehension to his tweet.
If I was to guess, $20 is the right amount that MLG has determined to maximize their profits in the long run all things considered while $30 for a year's pass was too small of a number. It is possible that part of the $20 is paying for past mistakes. However, it is pretty difficult to determine that without the proper information. Since they are going to hold 4 of these things (I think) it will cost us $80 for all of them if the price stays the same. So I would put the price for the correct gold pass to be at around that price. And then that would be comparable to the GSL price for a yearly membership, albeit less content.
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On February 15 2012 05:34 Chill wrote:Show nested quote +On February 15 2012 05:25 m4inbrain wrote:On February 15 2012 05:22 Chill wrote:On February 15 2012 05:19 Chicane wrote:On February 15 2012 05:02 T.O.P. wrote:On February 15 2012 03:50 Kuni wrote:
Are none of the other good tournaments (Dreamhack, IPL etc) making any money? Because if it is only MLG, then there is something wrong that won't be fixed by PPV.
Viewers will drop significantly with PPV. I wonder if less exposure is a good thing. Doubt it. All the big tournaments lose money. Actually all the big tournaments profit. Link to their balance sheets please. Isnt the fact that theyre still around "evidence" enough? Do you really think a tournament will survive if they lose money for 10 years straight? Do you actually think an organisation would even consider to rescue a "business" which paints red numbers for 10 years? Well. I actually do believe that they are in the blacks, without seeing their balance sheets. Again, the fact that theyre still here is proof enough. Edit: although it was a joke, i stick to my opinion. A tournament that would make consistenly a - at the end of the year wouldnt be around for so long. Look at history. The majority of major ESPORTS companies have been farces based on non-payment and then a quick declaration of bankruptcy. It's easy to get some initial investments, take a loss, and then hope that the numbers stack up to make it sustainable. MLG trimmed all their fat, cut all their extra production, fired all the writers, and started charging PPV on the stream. If that doesn't ring bells in your ears then I don't know what will. I don't think this is a case of a greed, I think it's a desire to actually tun a profit.
yes, because obviously the proper solution to a sustain and noticeable growth is to try to gain profit now.
your entire reasoning comes down to the assumption that there are enough investments every year, and the fact that people are willing to investing in a red business, to offsets the debts..
Again full of speculation with no evidence backing. You can't claim something like "esport makes no profit" without some evidence
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On February 15 2012 05:34 Chill wrote:
Look at history. The majority of major ESPORTS companies have been farces based on non-payment and then a quick declaration of bankruptcy.
It's easy to get some initial investments, take a loss, and then hope that the numbers stack up to make it sustainable.
MLG trimmed all their fat, cut all their extra production, fired all the writers, and started charging PPV on the stream. If that doesn't ring bells in your ears then I don't know what will. I don't think this is a case of a greed, I think it's a desire to actually tun a profit.
It's not going to work, because ESPORTS is never going to be as big as MLG needs it to be. MLG's business is not sustainable, and anyone who invests in it would be better off putting their money in a furnace.
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On February 15 2012 05:52 Chill wrote:Show nested quote +On February 15 2012 05:38 Quenchiest wrote:On February 15 2012 05:34 cz wrote:On February 15 2012 05:33 legaton wrote:On February 15 2012 05:04 iky43210 wrote:On February 15 2012 04:19 legaton wrote:
Well, i guess we are just hearing the bubble pop
Today's business model is just not sustainable. Costs in the e-sports industry and specially in SC2 are extremely high. To run a LAN, you must face a huge investment for the location of the hall (several thousands dollars, if not more, for an MLG sized event). But SC2 LAN are specially expensive because you truly have a globalized game, so someone (either the teams or the event organizers) has to pay a small fortune on plane tickets. You also need a lot of fairly new computers as you could run into graphic lag if you use PC with bad graphic cards, and you need a top of the notch internet connection as you depend on it to play the game.
On the other hand, revenues are scarce. For a long time, the only sources of revenue were the entry fees of viewers (non existent on a closed door event as this one) and the ad revenue. Problem is the ad revenue is way smaller most people believe it is. Most events end up with red numbers, and huge event organizers are losing money. MLG only survives thanks to the gullibility of some venture capitalists that poured millions on a "booming" industry, but you can't ride for free forever. It is fair for them to try to cut their losses.
Sadly, MLG is fucked over. The ppp system works for sports events because they have a total monopoly on some sports. In boxing or in the UFC, you either pay or you don't see anything. In Starcraft, a 1000 euros monthly cup as the MSI/Millenium tournament has a roster as good as MLG. This business model is bound to fail too.
Bye bye SC2, it was nice knowing you. people ought to not use the word bubble when they have no idea what they're talking about. Also you provide alot of speculation with no citation whatsoever. MLG has been running for 10+ years, I doubt their previous ad-based model was constantly putting them in the red. Companies don't operate, even expand, on the basis of being red for so many years. So much for your speculations This isn't a case of "cutting your loses", its about attempting to use a new business model to achieve more profit. Simple as that. Nobody is dumb enough to "cut your loses" by paying tens of thousands of dollars ahead of time to fly everyone around the globe to NY, in addition to hire a huge list of expensive casters. Its an experimentation at the new model I'm going to show you something, it is called a SEC form: http://www.sec.gov/Archives/edgar/data/1371551/000137155111000001/xslFormDX01/primary_doc.xmlYou will see it was filled by MLG and they are selling debt + options on their business. They sold 3,1 millions. They have done this several times on the last years: You just need to search the SEC archives. http://www.sec.gov/cgi-bin/browse-edgar?company=Major League Gaming Inc.&match=&CIK=&filenum=&State=&Country=&SIC=&owner=exclude&Find=Find Companies&action=getcompanyThe MLG costs a lot of money. It's a super expensive operation and they've been fairly successful at securing venture capital, but it seems they are burning money to exist. Everybody here is so delusional about the financial state of the "e-sports" scene. Not all of us. The e-sports audience is one of the most difficult audiences to monetize. It's full of people who are used to pirating / not paying for things and/or don't have credit cards / don't have much money. Really tough. It's not even so much that. It's that when you charge above and beyond what others are charging (or not charging) for similar events you're not going to get a lot of bites. I don't doubt there's some people that don't get it, but I'd say the majority probably realize this is an expensive business to run. That said, you can't just start gouging people because you need money and expect them to pay up. But everyone is losing money. The lesson here is that ESPORTS just isn't profitable. You either give it away undervalued like everyone else, or charge what it costs and get labeled "gouging". Lose/Lose.
If 20 bucks for a weekend event is what it's ultimately going to cost then I'm afraid this business just isn't going to last very long unless someone can come up with a sustainable model.
With the abundance of tournaments and free viewing it's going to be hard to convince anyone to drop 20 dollars on a weekend event.
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On February 15 2012 05:55 00Visor wrote:Show nested quote +On February 15 2012 05:34 Chill wrote:On February 15 2012 05:25 m4inbrain wrote:On February 15 2012 05:22 Chill wrote:On February 15 2012 05:19 Chicane wrote:On February 15 2012 05:02 T.O.P. wrote:On February 15 2012 03:50 Kuni wrote:
Are none of the other good tournaments (Dreamhack, IPL etc) making any money? Because if it is only MLG, then there is something wrong that won't be fixed by PPV.
Viewers will drop significantly with PPV. I wonder if less exposure is a good thing. Doubt it. All the big tournaments lose money. Actually all the big tournaments profit. Link to their balance sheets please. Isnt the fact that theyre still around "evidence" enough? Do you really think a tournament will survive if they lose money for 10 years straight? Do you actually think an organisation would even consider to rescue a "business" which paints red numbers for 10 years? Well. I actually do believe that they are in the blacks, without seeing their balance sheets. Again, the fact that theyre still here is proof enough. Edit: although it was a joke, i stick to my opinion. A tournament that would make consistenly a - at the end of the year wouldnt be around for so long. Look at history. The majority of major ESPORTS companies have been farces based on non-payment and then a quick declaration of bankruptcy. It's easy to get some initial investments, take a loss, and then hope that the numbers stack up to make it sustainable. MLG trimmed all their fat, cut all their extra production, fired all the writers, and started charging PPV on the stream. If that doesn't ring bells in your ears then I don't know what will. I don't think this is a case of a greed, I think it's a desire to actually tun a profit. SC2 pro scene is one and a half years old and still growing very good. It is not a big cash cow yet. We need more viewers and a PPV stream won't get us this. And isn't MLG flying 32(!) Players to New York to have tournament with no audience? Thats way more expensive than everything they cut.
Hah, exactly what I was thinking.. Seems rather unnecessary, unneeded extravagance.
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EPT
