The Los Angeles video game industry is going live.
In the last two years, home-grown Activision Blizzard Inc., Riot Games Inc. and NantG Mobile have established arenas for broadcasting live gaming competitions, known as e-sports.
South Korea-based OGN and Pearl Abyss Corp. have also set up local e-sports venues while USC and UCLA are considering building scaled-down e-sports competition spaces for their newly established teams. And Santa Monica-based Super League Gaming Inc., an online platform that connects gamers and aids tournament organization, went public on Nasdaq earlier this year.
“There’s been a trend that’s gone from development of games to the gameplay space (and then) to live competitions, and that’s all happening in L.A.,” said Brian Mirakian, senior principal at Kansas City, Mo.-based sporting and e-sports venue design firm Populous Inc.
The arenas add a new revenue stream for the video game studios as the popularity of watching expert gamers compete is growing worldwide.
In 2018, e-sports globally generated more than $54.7 million in ticket revenues from roughly 737 e-sports events, according to industry tracker Newzoo. The group estimated $96 million was spent on tickets and merchandise at e-sports events during 2018, up 16 percent from the prior year.
But the L.A. market offers some particular advantages for live video game businesses, aside from being close to home for some big-name studios.
For one, it’s an ideal testing ground, said Chris Rico, director of innovation for the Los Angeles County Economic Development Corp. “Because of (L.A.’s) ethnic diversity, we are this cultural nexus where if you want to experiment, there’s no better marketplace than here,” Rico said.
Mirakian added that location is also a key factor since many top players travel to the live events from Asia and other parts of the world, he said. “Ease of flights to (Los Angeles International Airport) and out is good, a lot of critical infrastructure is already in place, which is why L.A. is naturally becoming a first choice,” for e-sports arena development, Mirakian said.
“The Staples Center of e-sports”
Live video game competitions have been around since the 1980s when Atari Interactive Inc. hosted one of the first events. In the late 1990s, online e-sports gained popularity in internet cafes, with some of the earliest competitions starting in South Korea. The country established the Korean E-sports Association in 2000 to regulate and promote competitions.
Since then, the worldwide industry has exploded.
Santa Monica-based Activision Blizzard entered the sector in 2015 with the creation of its e-sports division and the “Call of Duty” World League, where top players compete for multimillion-dollar prize pools.
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