We have spent a lot of time talking about the South African scene needing more cash in order to grow, but we’ve never really explained why. This week we chatted to MSI’s Miles ‘B4d R0b0t’ Regenass about the actual costs involved in running an eSports organisation.
There is a whole lot more to keeping a team above water than many people realise, before we even start talking about player salaries or gaming houses. From travel and accommodation expenses to feeding the players and making sure all their equipment arrives undamaged and on time, it’s not just rocking up at a LAN with a 2L coke and a polony gatsby, and playing some games.
What’s the problem you ask? There are plenty of cheap flight options in South Africa and there’s cheap accommodation if you book well in advance, you say?
Well, while you aren’t wrong, as always things aren’t that simple. Before any LAN event there will be online qualifiers, so teams often don’t know they need to book flights and a place to stay in Cape Town or Johannesburg until a couple of weeks before the event.
If we asked you how much money a local eSports team would need to run at full capacity, not including player salaries, what would you say? Because Miles’ answer was a bit of an eye-opener for us.
“You need more than you think. My honest opinion, before salaries, I think teams should be getting between R50,000 and R100,000 a month to cover their costs. If it was R50,000 a month, they could travel to one event a month and they would have R10,000 for food, drink and stuff. You’d be surprised how quickly you can go through that kind of money with a team of five guys over five days.”
You’re right, we are surprised.
“If you take five guys from the Cape and bring them up to Joburg, on a bad weekend where flights are expensive, that can be R40,000.”
But I mean it’s chilled, MSI Global reported consolidated revenue of $2.7billion in 2014, R50,000 is like $17 at the current exchange rate, right? Wrong.
“Everybody has this belief that MSI has millions and millions of dollars to spend. And while they do in the world, their strategy is very much based on how many sales they generate in the region.
I don’t think sales are big enough in this region for all these different technology brands to support these teams at the level they need to be supported.
We’ve set a yearly budget, which I think we were already over in May.”
It sounds pretty bleak, but fear not, Miles has a plan.
“I think now is the time to start looking for partners that are outside of gaming. Obviously the standard route is, ‘We’re a gaming team, so let’s get sponsored by a peripheral brand, like Roccat or Logitech or SteelSeries.’
Teams need money coming in, and I believe that needs to come from outside of organisations or vendors that produce gaming products. We all want BenQ on our shirts, but BenQ only sell so many monitors in the region. They just don’t have the money. But who possibly does? Volkswagen? Ford? A soft drink company? Monster does really well here. Red Bull does really well here. There’s other energy drink companies.”
There is also a fantastic opportunity to get the global side of brands on board as more and more South African teams start qualifying for trips overseas because they will be gaining exposure on an international scale, but there is definitely a need to get more non-traditional brands on board locally in order to grow the scene enough to earn those trips to Europe.
It’s always easy to blame brands for not putting enough into local eSports – the big, bad money men. It’s obviously their fault. They’re just greedy and could easily afford to sponsor more teams if they wanted to, but they’d prefer another Ferrari instead…
However, let’s break it down by sending an example MGO from Cape Town, let’s call them AWPsie Daisies, up to Johannesburg for a LAN.
“It’s 15 okes, and you’re all in Cape Town. So that’s 15 x R3,500 in flights. That’s the one fee. And then there’s accommodation. Let’s say we put you in a backpackers or a guesthouse at R250 a head x 15. Let’s put that amount of money aside. And then you possibly need some money for food and drink. So let’s put that aside. And then you want hardware. I have gaming notebooks. If I gave you the cheapest one I had at R15,000 x 15. Let’s put that aside. Let’s add all that money up. What you’re actually asking me for to put my name on your shirt is hundreds of thousands of rand.”
R281,250 to be exact. And that’s assuming it’s one night and you don’t want to eat or drink any food, which, to be honest, we’ve all done at a LAN but isn’t preferable behaviour for a team trying to win a tournament and impress a sponsor. When you think about what else brands can do with that kind of money, it almost seems silly any of them sponsor teams at all.
“There’s no logic. And it’s not feasible. And I know it sounds like I’m being really rude and aggressive, but what they want for their team, that isn’t even going to get on a podium, is what I would spend on the whole quarter on print and social media, and online advertising. In three months. And they want it for one weekend.”
Which, and we’re going to pretend this happened by accident, brings us nicely round to exactly why we are so adamant about getting more South Africans to watch local teams and events.
Apart from what the players can do to convince brands to back them (Pro tip: Look out for our article next week), viewership numbers and engagement from fans is one of the only things that will convince companies local eSports are worth sinking their Randelas into.
For years South African gamers have shown how dedicated and hardworking they are, with little to no financial return. Let’s start giving them the support they deserve so that doesn’t have to be the case any longer.