Speaker 1: Pushkin from Pushkin Industries. This is Deep Background, the show
Speaker 1: where we explore the stories behind the stories in the news.
Speaker 1: I'm Noah Feldman Dan Deep Background. Something a little bit different.
Speaker 1: I have been watching very closely the debates about the
Speaker 1: future of virtual reality and augmented reality. Since the beginning
Speaker 1: of COVID, all of us have had to explore making
Speaker 1: human connections, having conversations, learning and engaging with others from
Speaker 1: our desks, staring at our screens in ways we did
Speaker 1: not do previously. That entire process has led me to
Speaker 1: think increasingly about what kinds of human engagement can happen
Speaker 1: in virtual space. One direction this might take us, and
Speaker 1: I hope to discuss this in a future episode, is
Speaker 1: the question of virtual reality, augmented reality, and the new
Speaker 1: modes and platforms of engagement that will take place in
Speaker 1: our lives. Another is to think about activities that increasingly
Speaker 1: take place not only in the real world but also
Speaker 1: almost exclusively online. Gaming is one such activity. We hear
Speaker 1: a lot about the gamification of trading, a topic that
Speaker 1: we've done an episode on, and about the gamification of
Speaker 1: a wider range of human interactive activities, including coding. But
Speaker 1: what about the gamification of gaming itself. What I'm referring
Speaker 1: to is the esports industry, in which it turns out
Speaker 1: millions and millions of people watch others playing games, either
Speaker 1: at an extraordinarily high competitive level for rewards and for money,
Speaker 1: or alternatively in an entertainment mode, as gamers who are
Speaker 1: particularly clever or sophisticated or knowledge of stream their own
Speaker 1: games for the edification and entertainment of their fans. This
Speaker 1: is an emergent industry whose participants tend to be young,
Speaker 1: and so perhaps it's not surprising that leading figures in
Speaker 1: this industry are young themselves. Case in point, our guests
Speaker 1: today Nicole La Pointe Jamison, who's the CEO of a
Speaker 1: North American esports organization called Evil Geniuses or EG, which
Speaker 1: is one of the oldest and most recognizable brands in
Speaker 1: professional gaming, or so I'm told, going back all the
Speaker 1: way to nineteen ninety nine. Nicole, for her part, barely
Speaker 1: goes back to nineteen ninety nine herself. She was born
Speaker 1: in nineteen ninety four, which makes her an unusual person
Speaker 1: to be running a large and growing organization as a CEO.
Speaker 1: To top it all off, she's a woman at an
Speaker 1: African American in an industry that tends to be stereotyped
Speaker 1: as one for men, primarily for white and perhaps for
Speaker 1: Asian men. As you're about to hear, Nicole is an
Speaker 1: extraordinary person, and she sat down with me to explain
Speaker 1: her industry and what she does in it. Nicole, thank
Speaker 1: you so much for joining me. This is one of
Speaker 1: those episodes on Deep Background where instead of talking about
Speaker 1: some well fummed area where I and the listeners all
Speaker 1: think we're big experts, were instead exploring a whole field
Speaker 1: of human endeavor that is not actually all that new,
Speaker 1: but is new to many of us as observers, and
Speaker 1: that's esports as an industry and as a concept. So
Speaker 1: I wonder if you would start by just assuming that
Speaker 1: we don't understand exactly what esports are, we don't understand
Speaker 1: why it is that other people would want to watch
Speaker 1: people playing video games, and begin by just explaining to
Speaker 1: us what this industry is and why we should start
Speaker 1: caring about it. Of course, and first of all, Noah,
Speaker 1: thank you for having me. Always glad to bring others
Speaker 1: on board to the surprisingly vast and deep world of esports. So,
Speaker 1: if you're coming from zero esports is competitive gaming where
Speaker 1: we bridge industries that resemble a lot of traditional sports
Speaker 1: but also resemble modern day entertainment. And so the best
Speaker 1: way to think about my universe I run an esports
Speaker 1: organization called Evil Geniuses, is think of us like the
Speaker 1: University of Michigan, like UM's athletics department, where they have
Speaker 1: basketball and football and soccer that have distinct players on
Speaker 1: distinct schedules, and a very robust back office that bridges
Speaker 1: athletics to sponsorships, to brand, to health and wellness, all
Speaker 1: to support the different players in their seasons. But instead
Speaker 1: of University of Michigan, I am Evil Geniuses, and I
Speaker 1: have Counterstrike and DODA and League of Legends, distinct player
Speaker 1: athletes with distinct schedules, and all of the same back
Speaker 1: office needs to support and make sure we are competitively viable,
Speaker 1: financially viable, and culturally viable. And it is often surprising
Speaker 1: people to hear the level of play for these athletes.
Speaker 1: Isn't someone that could just mosey on and say, oh,
Speaker 1: you know, I'm pretty good at Mario Kart, Let me
Speaker 1: show up one day and be a esports pro. These
Speaker 1: are athletes that have typically been playing at the best
Speaker 1: level that exists in the world from a long time,
Speaker 1: at a young age, and when they come into an
Speaker 1: esports organization, it looks like traditional sports. You have training time,
Speaker 1: you have physical fitness health wellness time, you have scrimming
Speaker 1: and review, and the infrastructure around these athletes and players
Speaker 1: is robust and deep, and we heavily invest in these games.
Speaker 1: And so a lot of this mirrors traditional sports. Where
Speaker 1: I think the analogy falls off, and I don't have
Speaker 1: a really good way to paint that picture yet, is
Speaker 1: we also have what I mentioned earlier, this entertainment side,
Speaker 1: where unlike traditional sports where fans tend to be geo
Speaker 1: affiliated or inherited, we are digital and global. Our players
Speaker 1: come from all over the world. We're not locked into
Speaker 1: a region. I'm not even though we're Seattle based, I
Speaker 1: am not the Seattle something. The Seattle eg our fans
Speaker 1: are truly global. So many questions immediately come into my mind.
Speaker 1: Let's start with what maybe is a silly question, which
Speaker 1: is there's a movement from we all play sports outdoors
Speaker 1: to we watch sports on television. And you know, a
Speaker 1: whole generation, an older generation even than mine, was skeptical
Speaker 1: of that saying why don't you go out and play
Speaker 1: the sport? Why do you want to sit at home
Speaker 1: and watch the sport? And now that objection seems hopelessly
Speaker 1: dated because of course as possible to do both, and
Speaker 1: televised sports became a vast multi billion, maybe even trillion
Speaker 1: dollar industry over the course of fifty years. Are there
Speaker 1: similar objections? There must be similar objections to esports saying
Speaker 1: that somehow, why are you watching people do something that
Speaker 1: they're in fact doing technologically? And is the answer just
Speaker 1: sort of grow up? You know, Like that's the same
Speaker 1: objection that people made to watching basketball on television and
Speaker 1: didn't make any sense really, and it makes even less
Speaker 1: sense in this context. I actually think the analogy transfers
Speaker 1: really well. Like the beauty of esports, both the athletes
Speaker 1: and the fan is that we're young, digital and very diverse,
Speaker 1: but the altitude of play and competence at the pro level,
Speaker 1: because then these are oftentimes six figure to seven figure
Speaker 1: based salaries of athletes. These aren't the run of a
Speaker 1: mill picked up off a street corner players. They are
Speaker 1: the top thirty in the world. So similarly to why
Speaker 1: you want to watch NBA, the depth of prestige and
Speaker 1: ability to perform in some of these games is unparalleled,
Speaker 1: and so that's exciting to watch. The esports athletes also
Speaker 1: play for the same reasons. They just do it so well.
Speaker 1: The answer is, they just do it so well, and
Speaker 1: the specific skills that they have are some combination of
Speaker 1: hand eye coordination, conceptual ability, strategic ability. It's a full
Speaker 1: range of skills. Presumably yes, probabilistic thinking, quick communication, similar
Speaker 1: to an options trader or a sports athlete. Right, let's
Speaker 1: talk for a second about this non locality that you mentioned.
Speaker 1: So one of the fascinating things about sports, both at
Speaker 1: the university level but also at the professional level, is
Speaker 1: that over time it came to be one of the
Speaker 1: leading factors in a lot of countries in unifying people
Speaker 1: within a geographic area. Right. Originally, the reason you had
Speaker 1: local teams is that people had strong local identities, and
Speaker 1: people who were starting teams wanted to make money, and
Speaker 1: they said, well, if we identified the team with a
Speaker 1: place or with a university, then there will be attachment
Speaker 1: to it. But then things flipped and as our identities
Speaker 1: as members of a neighborhood or a region weakened, the
Speaker 1: sports teams became the glue that held us together. In
Speaker 1: that sense, what your industry is is about cosmopolitanism in
Speaker 1: the deepest sense, right. It's about a world where we
Speaker 1: no longer think, oh, I'm from New England, so I'm
Speaker 1: a member of Red Sox Nation by default, or you know,
Speaker 1: I have to be a Patriots fan and there's nothing
Speaker 1: I can do about that because I was born that way.
Speaker 1: It's like my religion in your world. I can pick
Speaker 1: and choose my affiliations no matter where they are in
Speaker 1: the world. So how do people choose whom they're going
Speaker 1: to root for and root against? I love this question
Speaker 1: because it's surprisingly contentious in the space, especially when talking
Speaker 1: to people that come from traditional sports into the esports area.
Speaker 1: Is the lack of geo affiliation is puzzling, but I
Speaker 1: find it exciting for us because we have a bigger
Speaker 1: pie to play from. And that's again where the entertainment
Speaker 1: sprinkle comes in. More like WWE than even you know,
Speaker 1: the Lakers or the Yankees. The brand identity of the
Speaker 1: organization matters, and how an organization presents itself beyond just
Speaker 1: what games they compete in, because not every sport team
Speaker 1: or organization plays the same games, So there's some fan
Speaker 1: stratification by what game are they in. If you're a
Speaker 1: Rocket League fan, you tend to not be a fan
Speaker 1: of League of Legends per se. And then it's how
Speaker 1: does the org represent themselves and some of that, just
Speaker 1: like in traditional sports, is a win loss ratio. People
Speaker 1: like to follow the winners or they like to follow
Speaker 1: the underdogs, So there's that bimodal distribution. But then how
Speaker 1: do we and how do organizations represent themselves in the
Speaker 1: culture and engage with fans in unique ways. That's the
Speaker 1: big why for creating a compelling esports organization with a
Speaker 1: distinct set of fandom. One of the things that stunned
Speaker 1: me and preparing for our conversation was just the size
Speaker 1: of the industry. If someone had asked me to guess,
Speaker 1: I would have been off by orders of magnitude. Yes,
Speaker 1: it is a huge industry, whatever way you slice the pie.
Speaker 1: If it's active viewers on different distribution platforms, because you
Speaker 1: can watch esports in a variety of ways, especially if
Speaker 1: you have an Internet connection. If you count gamers as
Speaker 1: part of the esports industry, people who game, there's more
Speaker 1: of those than people who don't game, especially under the
Speaker 1: age of thirty, and if you consider the global reach,
Speaker 1: especially in the APAC region, the millions of concurrent viewers
Speaker 1: you could have at a time in a day is
Speaker 1: unparalleled to many other traditional sports. We can sometimes reach
Speaker 1: on our peak seasons on social media more viewers in
Speaker 1: a day than certain hockey teams get in a season.
Speaker 1: And though the fandom the eyeballs are large, what I
Speaker 1: find more as a businessperson compelling and exciting is the
Speaker 1: dollars are starting to pace and grow to reflect a
Speaker 1: lot of the magnitude of sponsorship and spend in traditional sports.
Speaker 1: In the esports space, as people start to understand the
Speaker 1: true volume of fans that are hard to advertise, too
Speaker 1: hard to reach organically in other ways, and where they
Speaker 1: are and who they watch. Finding brands, finding distribution platforms,
Speaker 1: and even finding linear distribution platforms like TV try to
Speaker 1: reach and understand how can they have E sports showcased
Speaker 1: is unbelievable, and so I believe there's a new Zoo
Speaker 1: study out that shows E sports industries valued a little
Speaker 1: less than a billion targeted for next year in terms
Speaker 1: of spend and revenue in the space. So it's it's
Speaker 1: exciting how quickly. It's growing. From even five ten years ago,
Speaker 1: it was relatively grassroots and not well established or defined.
Speaker 1: We'll be right back Nicole. Your Wikipedia entry, assuming that
Speaker 1: it's accurate, has you as twenty seven years old. Is
Speaker 1: that true? First of all, it is true. So how
Speaker 1: does a twenty seven year old end up as CEO
Speaker 1: of a major company in this developing space? A lot
Speaker 1: of stumbling up. It can't have been that much. There's
Speaker 1: that's not enough time. So I have a very nonlinear
Speaker 1: path into esports, and I would say my age is
Speaker 1: maybe surprising for the space, but not completely unprecedented, as
Speaker 1: historically leaders and esports either were in esports veterans for
Speaker 1: a while, who typically were players and kind of worked
Speaker 1: their way up, or traditional sports executives who were plopped in.
Speaker 1: That's changed a bit. Prior to this, I actually worked
Speaker 1: for an investment firm in Chicago. I focused on distressed
Speaker 1: asset turnarounds, which is maybe not a great signal for
Speaker 1: those that are more financially savvy understanding my entry into esports,
Speaker 1: but EG came to me actually as an investment opportunity.
Speaker 1: I was all jazzed for a board seat, but at
Speaker 1: the time the company resembled a distressed asset or a
Speaker 1: true startup. That being said that, what was interesting about
Speaker 1: EG is, despite me coming in a little less than
Speaker 1: three years ago, it had been a brand that it
Speaker 1: is actually one of the oldest esports organizations in the world.
Speaker 1: And that's not super interest in general, but I would
Speaker 1: say it's quite insightful for EG and that to exist
Speaker 1: from nineteen ninety nine as a then niche gaming club
Speaker 1: and survive and bring in sponsorships and keep your brand
Speaker 1: and build and grow and build that long term fandom
Speaker 1: and survive tech changes, game changes, and still say culturally
Speaker 1: relevant was exciting. So from an investment conversion into operating position,
Speaker 1: it wasn't that different from things I had done before,
Speaker 1: but definitely the coolest operating company I've been able to
Speaker 1: get my hands on in my history of ensure tech
Speaker 1: and SaaS businesses and hardware technology. But I've always loved
Speaker 1: gaming from a personal passion point, so I understood the space.
Speaker 1: I was familiar with the space, and I was excited
Speaker 1: to help carve out what ought to be in esports
Speaker 1: as I wasn't seeing voices or perspectives like mine and
Speaker 1: our firm represented in this space. So I'm wondering whether
Speaker 1: the sort of stereotypical picture of the industry, which may
Speaker 1: not be accurate as heavily male, heavily white, and Asian,
Speaker 1: as an African American woman, is that a plus for
Speaker 1: you that you come in and say, hey, I have
Speaker 1: a different perspective, or is it altogether irrelevant in an
Speaker 1: enterprise that ultimately is about avatars on screens much more
Speaker 1: than it's about who you are on the other side
Speaker 1: of the console. It was a bit of an interesting
Speaker 1: challenge more from a personal perspective, as I think you
Speaker 1: were quite polite with it. Gaming has stereotypes of who
Speaker 1: is a gamer and what do they act like that
Speaker 1: are not good? Are not positive? Rife with toxicity and
Speaker 1: juvenile behavior, to call it nicely, and coming into a
Speaker 1: space where I was different industry background, different in how
Speaker 1: I appeared. I was a newcomer into a relatively gate
Speaker 1: kept community of who's any esports and who's not, had
Speaker 1: personal and professional challenges. But I think that actually has
Speaker 1: becomes war cry and how we have been able to
Speaker 1: thrive in the past two years and differentiate our brand
Speaker 1: and I can't underline that it can't undermine really that
Speaker 1: it was easy, because it wasn't. It's truly carving a
Speaker 1: path that hadn't been carved. And the anonymity of the
Speaker 1: Internet can be difficult to navigate as people love to
Speaker 1: use that to their advantage to be toxic. But like
Speaker 1: tends to attract like, and I've been able to I'm
Speaker 1: lucky that I've had mentorship and leadership, a strong advisory board,
Speaker 1: and friends in the space that are excited and compelled
Speaker 1: by why and what we do to make sure the
Speaker 1: space is safer. So, Nicole, when you talk about toxicity,
Speaker 1: is toxicity an existential threat to the esports industry or
Speaker 1: to the gaming industry? And alternatively, is the perception of
Speaker 1: toxicity also a kind of existential threats separate from the
Speaker 1: underlying reality. Oh I love that you've broken it up
Speaker 1: into two. So for the former, there is a threat
Speaker 1: of toxicity because just like how people tend to make
Speaker 1: bad decisions in group think, people tend to make bad
Speaker 1: decisions under the cover of anonymity. And we actually we
Speaker 1: did a study on this. We partnered with you gov,
Speaker 1: a data and survey company, and looked to understand toxic
Speaker 1: behaviors and we found that a lot in gaming, whether
Speaker 1: it's through harassment or rude language, etc. Is learned doesn't
Speaker 1: appear until later in life. But if you know, if
Speaker 1: parents don't understand what their kids are doing, if there's
Speaker 1: no checks and balances either by the game in the
Speaker 1: system itself, that perpetuates and becomes an acceptable standard, which
Speaker 1: really isn't acceptable. You can't act like you might in
Speaker 1: a Call of duty game in the workplace or in
Speaker 1: a group project in college. And that needs to be addressed.
Speaker 1: And there's a lot of moving pieces in terms of
Speaker 1: who is the address of this problem. Is it parents,
Speaker 1: is it developers, is it the content creators? But it's
Speaker 1: something that creates tangible and what we found in our
Speaker 1: study is we actually it does create tangible negative results
Speaker 1: and that people either don't want to, for example, have
Speaker 1: their mic on in game and talk, which impedes communication
Speaker 1: for certain games and impedes results, which for me from
Speaker 1: a team side, impedes potential future talent from developing and
Speaker 1: coming into the pipeline. So we care about this because
Speaker 1: it has long term material impacts into who is represented
Speaker 1: in the space, especially if toxicity is aimed at certain
Speaker 1: groups or demographics of people. The perception of toxicity. However,
Speaker 1: is also damaging because in a lot of spaces this
Speaker 1: has gotten much better. I would say gaming is probably
Speaker 1: more inclusive now than it even was five years ago.
Speaker 1: Is people are becoming aware and understand that what is
Speaker 1: culturally accepted as shifting, but the negative, sometimes misunderstanding of
Speaker 1: what the gaming industry represents hurts us from becoming mainstream,
Speaker 1: financially viable and supported. If someone is like, oh, gaming's bad,
Speaker 1: I'm not even going to listen to what these people
Speaker 1: have to say. That closes off the potential for both
Speaker 1: us to develop and grow, but that person from developing
Speaker 1: and growing, and whether that person is potential parent of
Speaker 1: a talent that we'd want to recruit, a sponsorship partner,
Speaker 1: a university that is trying to understand if esports curriculum
Speaker 1: should be supported, and so breaking down both the perception
Speaker 1: and the reality is something that we try to take
Speaker 1: a decent stab at as it relates to our wheelhouse
Speaker 1: and our expertise, but is a multifaceted problem that I'm
Speaker 1: hopeful more and more people as we continue to talk about,
Speaker 1: address and try to tackle and solve in their own way,
Speaker 1: because what we have found is again the learned behavior
Speaker 1: not inherent. I've been very influenced by writing by a
Speaker 1: scholar at Dartmouth called Will Chang, who's actually in the
Speaker 1: music department. Believe it or not, but he wrote a
Speaker 1: book called sound Play, one of his great books, which
Speaker 1: is specifically about the use of sound in major online
Speaker 1: gaming platforms and experiences. And as part of that account,
Speaker 1: he also talks about the whole range of behaviors, whether
Speaker 1: they're supportive or abusive, that come an association with difference
Speaker 1: with gender, with sexuality, with disability status in the online space.
Speaker 1: And one of the things that emerges from his work,
Speaker 1: and I'm oversimplifying it a little bit just for our purposes,
Speaker 1: is that there's both a lot of the toxicity you're
Speaker 1: talking about and a lot of tools for capturing and
Speaker 1: pushing back at that toxicity and reshaping and reforming it.
Speaker 1: And I wonder, when you think about that from the
Speaker 1: standpoint of esports teams and franchises, what are the strategies
Speaker 1: that are available to you to say, we're going to
Speaker 1: make sure that our organized and our teams are contributing
Speaker 1: in the positive way to this stuff rather than to
Speaker 1: the negative. How do you make those two things work together.
Speaker 1: It's been interesting for us as I've been a pretty
Speaker 1: big stickler, and so I can give good examples of
Speaker 1: how One of the problems we faced is finding good
Speaker 1: talent that want to come into esports because I need
Speaker 1: a head of finance. It's really hard to convince the
Speaker 1: forty five year old controller at EUY to come on
Speaker 1: over to an esports organization that I've never heard of
Speaker 1: the space. They don't really understand it. And when you
Speaker 1: google gaming and esports, not wonderful things came up about
Speaker 1: the stability, the perception inclusion, and so we've been tackling
Speaker 1: this through a couple of different ways, some of that
Speaker 1: are less sexy than others, but maybe forever all the
Speaker 1: listeners rolling their eyes. But the first thing we pushed
Speaker 1: was really a suite of back office benefits and support
Speaker 1: that emulate what you would find at a lot of
Speaker 1: our local peers in Seattle. Benefits, maternity leave, paternity leave,
Speaker 1: full suite of healthcare, a lot of the mental wellness
Speaker 1: and physical wellness support first of its kind in esports.
Speaker 1: And people were surprised, why are you spending on this
Speaker 1: esports as sexy? There's so much young people that want
Speaker 1: to come in. But if I can't attract the full
Speaker 1: multigenerational audience of experience workers, I've already failed in inclusivity
Speaker 1: and that hurts our bottom line results. So there's a
Speaker 1: lot of programming we put there to ensure we were
Speaker 1: getting a wide net of talent. On the competitive side, though,
Speaker 1: the esports space has been plagued despite being digitally native,
Speaker 1: plagued by lack of good data use in scouting. It's
Speaker 1: a lot of who you know who the coach knows,
Speaker 1: which becomes an incestuous, self fulfilling pool of the same
Speaker 1: fifty people are becoming pro players, which is crazy because
Speaker 1: we have such opportunity for talent elsewhere, and so we
Speaker 1: are claimed to fame, especially in one of our games,
Speaker 1: League of Legends, was we've been using data and analytics
Speaker 1: to scout and recruit unknown quantities unknown talent and bring
Speaker 1: in and develop up over time talent that we wouldn't
Speaker 1: have found otherwise because they weren't already in network. That
Speaker 1: also led that same method led to us being able
Speaker 1: to start one of the only mixed gender rosters in esports.
Speaker 1: So between the back office infrastructure, the empirical methods for
Speaker 1: scouting and then of course showcasing where we have wins.
Speaker 1: In the education space, we do a lot of K
Speaker 1: through twelve programming, do a lot of university partnership around curriculum,
Speaker 1: anti toxicity, anti bullying, how to create a good personal
Speaker 1: brand for yourself on social media. If the gaming or
Speaker 1: entertainment space is important, that investment of time and labor,
Speaker 1: which is authentic to ourselves but also helps us build
Speaker 1: long term returns in people that think positively about what
Speaker 1: we've done in the space, is critically important. So it's interesting.
Speaker 1: One weird nuance with esports that is cult is unlike
Speaker 1: an NBA team, like you know the game you're going
Speaker 1: to play, the game is there forever, like basketball is
Speaker 1: probably not going to go anywhere, and you kind of
Speaker 1: know the rules aren't going to all of a sudden change.
Speaker 1: We in esports are beholden to a series of developers.
Speaker 1: Riot does not act like Valve, does not act like Epic,
Speaker 1: and they can do whatever they kind of want. Some
Speaker 1: of that gives us perks. We own more ip We
Speaker 1: own more rights than traditional sports teams might own of
Speaker 1: their athletes or their gameplay. On the flip side, eg
Speaker 1: used to be one of the best teams in the
Speaker 1: world at a game called Halo. Halo is no longer
Speaker 1: a competitive game that exists. So we have to be
Speaker 1: careful and always thoughtful of what games do we invest
Speaker 1: in because it's expensive to run an esports organization, and
Speaker 1: but also be good at the predictive nature of what
Speaker 1: games will resonate with certain audiences, certain fans, certain sponsor needs.
Speaker 1: And that's an art of esports leadership. That was probably
Speaker 1: my biggest learning curve as there's no playbook for that,
Speaker 1: and that's the how you pick your winning jockey, and
Speaker 1: esports leadership is finding good leaders who are really attuned
Speaker 1: to the developers and changes of fan interest in games.
Speaker 1: And so why that's relevant to your question is those
Speaker 1: factors of what game do we invest in? And why
Speaker 1: the in game avatars and what they represent is actually
Speaker 1: a meaningful metric in understanding do people play a game?
Speaker 1: And I don't want to use names so I don't
Speaker 1: want to get angry phone calls later. But there's this
Speaker 1: one game it's very popular right now. It's a first
Speaker 1: person shooter game. It's having a hard time proliferating certain
Speaker 1: region in Asia that is known for being very popular
Speaker 1: in gaming, and it's a huge region from a financial standpoint,
Speaker 1: huge region culturally, and there's a lot of theses as
Speaker 1: of why, but when we use in some of our
Speaker 1: derived stats around, we call it the matrix, like how
Speaker 1: we evaluate game titles to be in competitively, when we
Speaker 1: look at style of game, like first person shooters do
Speaker 1: well in certain regions and they don't, that impacts our
Speaker 1: decision as well as when a game has characters that
Speaker 1: look like people of that region, conversion tends to be higher,
Speaker 1: and we noticed this region didn't have any characters that
Speaker 1: looked like them. It's kind of why Overwatch was so popular.
Speaker 1: It's one of the first games that had a variety
Speaker 1: of characters and personas of different body weights, different skin colors,
Speaker 1: different nationalities that really brought in new fandoms and audiences
Speaker 1: that weren't there before, Versus a game that trying to
Speaker 1: not be offensive, but like Counterstrike where it's just terrorists
Speaker 1: versus counter terrorists, army looking white dude versus terrorist. You know,
Speaker 1: that doesn't attract certain people, and so it's actually really
Speaker 1: important and something that we think about deeply in terms
Speaker 1: of what games do we enter into. Because there are
Speaker 1: some games if you look at how they're structured, how
Speaker 1: the avatars are represented. Are you a human or are
Speaker 1: you a car or are you an animal? That really
Speaker 1: can dictate what fans are attracted and where viewers come from,
Speaker 1: as well as what sponsors feel comfortable sponsoring that title.
Speaker 1: But it's critically important for us to be aware of
Speaker 1: to understand where we invest our time and money and focus.
Speaker 1: It's really fascinating to imagine. It's as though James Naismith,
Speaker 1: you know, the guy who invented basketball, owned the NBA,
Speaker 1: the NCAA, Basketball, International Basketball, and every basketball league in
Speaker 1: the world, and could just say I'm changing basketball now.
Speaker 1: I mean, so you know, they're obviously there are evolutions
Speaker 1: within those games. The game looks really different than it
Speaker 1: did when Nasmith created or when my great grandfather, who
Speaker 1: was about five foot four was the semi professional basketball
Speaker 1: player for the South Philadelphia Hebrew Association team, and you know,
Speaker 1: he would talk to us when we were kids about
Speaker 1: what basketball was like in those days, and it was
Speaker 1: you know, it was even then hard to conceive how
Speaker 1: he could have been one of the handful of best
Speaker 1: basketball players on the East Coast. So things evolve, but
Speaker 1: they evolve more slowly and in a more decentralized way.
Speaker 1: I think to some degree here, as you were saying
Speaker 1: the games are wholly owned, what is to stop the
Speaker 1: developers from trying to own the universe of esports entirely?
Speaker 1: From saying, you know, like, we want to create our
Speaker 1: own teams and franchises and have those operate within our universes.
Speaker 1: In other words, from a sort of business organization standpoint,
Speaker 1: why is it efficient for something like EG to have
Speaker 1: to field teams across a range of different platforms or
Speaker 1: games rather than having everything consolidated in the platform owners Well,
Speaker 1: this answer will vary by region because how this is
Speaker 1: reflected in China is very different than how it's reflected
Speaker 1: in the US. As you probably could guess, there's more
Speaker 1: end to end ownership in especially the APAC region than
Speaker 1: you'd find here. But I don't even claim to be
Speaker 1: an expert in APAC region, so I can speak to
Speaker 1: North America. Part of it is the beautiful limitations of capitalism, right.
Speaker 1: Making a game is very high level of effort, like
Speaker 1: company initiative, huge vast upfront in investment exactly, and it's
Speaker 1: rife with problems, rife with human component risk. It's just
Speaker 1: it's an incredible undertaking. Adding a league that is hard
Speaker 1: to do. I know, I just pose a logistics problem.
Speaker 1: A developer could do that, but I don't know if
Speaker 1: it's always financially viable to own all components at the
Speaker 1: scale or without heavy future planning. That being said, there
Speaker 1: are certain developers that are a higher touch, especially in
Speaker 1: the franchise leagues. The leagues that we have to pay
Speaker 1: to be a part of, and the incentive to us
Speaker 1: is league guaranteed revenue. But we have provisions and controls
Speaker 1: and rules that we must abide by versus some developers
Speaker 1: that are very hands off LEAs a fair but there
Speaker 1: aren't many rights of provisions protecting us besides the logistics
Speaker 1: and the time. So what might happen in ten years
Speaker 1: could be different than what's happening today, But current state
Speaker 1: gamed we're probably protected just by the fact that game
Speaker 1: development is such a big undertaking to support as an individual.
Speaker 1: It probably doesn't make as much sense or is the
Speaker 1: smartest vertical integration to jump from game development all the
Speaker 1: way to esports team big picture question assume that esports
Speaker 1: sort of continue on this trajectory towards greater and greater growth.
Speaker 1: How will they How will esports as an industry change
Speaker 1: the way we broadly think about sports and its relationship
Speaker 1: to human experience. I mean, what do you see as
Speaker 1: the biggest impacts. You've already mentioned the geographically localized versus
Speaker 1: the non There's the on screen versus off screen. There's
Speaker 1: the do you attend matches in a big urban you
Speaker 1: know dome or do you do it at home? There's
Speaker 1: probably television versus streaming. I mean, there are a range
Speaker 1: of different ways that you're involved in something that's going
Speaker 1: to disrupt a very big industry with a lot of
Speaker 1: capital in it and a lot of power and a
Speaker 1: lot of social importance. So when you think about the
Speaker 1: bigger social impact that growth in esports is likely to have,
Speaker 1: how do you imagine that that going well? I could
Speaker 1: share a hope around and what we try to help
Speaker 1: bridge the big gap we have, especially if you continue
Speaker 1: to like in the strictional sports. So we haven't figured
Speaker 1: out partially due to the maturity and age of our
Speaker 1: space as well as the accessibility to understanding, we haven't
Speaker 1: figured out the multigenerational or inherited audience type pathway, you know,
Speaker 1: traditional sports. You know, if your dad's a Patriots fan,
Speaker 1: you're probably going to have to watch some Patriots at
Speaker 1: some point in your life. I mean, I was just
Speaker 1: at a family funeral of my great uncle who died
Speaker 1: at ninety two, who was a lifelong fan of the
Speaker 1: Washington sports team. He was sixty plus year season ticket
Speaker 1: holder and the Washington football team, and that was a
Speaker 1: central theme of the funeral because he was a central
Speaker 1: theme of his life, and it was a way that
Speaker 1: he bridged family connections and generations, and it was central.
Speaker 1: So it really was generationally exactly the way that you're describing.
Speaker 1: And we haven't seen that play out yet because I
Speaker 1: would say probably the first generation of die hard esports
Speaker 1: as we know today fans are the older millennials at
Speaker 1: this at this stage, um, but seeing how we bridge
Speaker 1: esports to a younger audience continue to be multigenerational be
Speaker 1: important because and I don't want to sound pessimistic, but
Speaker 1: why I love having these conversations is it is hard
Speaker 1: to convince. You know, even my parents. If you ask
Speaker 1: my parents, would what does your daughter do? She's like, ah,
Speaker 1: she works in tech. Like they don't really understand what
Speaker 1: I do. And I don't know if they sat. They're
Speaker 1: proud of me, but they don't really get it. I
Speaker 1: don't think they know how I get a paycheck. But um,
Speaker 1: it's harder to bridge those that older audience, and I
Speaker 1: hope younger audiences are able to carry some of that
Speaker 1: heavy lifting to help this continue to be multigenerational, to
Speaker 1: be sticky, fascinating. So transgenerational connection would be a desirable
Speaker 1: thing for sure, And if it did, it might supplement
Speaker 1: or even displace some of the other kinds of identity
Speaker 1: based features of sports, and that might have some impact
Speaker 1: on the way we identify around place, around country. You know,
Speaker 1: in the Olympics, we're always thinking about country identity, right,
Speaker 1: and yet that's a very seems like a very dated
Speaker 1: way to think about. You know, athletes at the greatest
Speaker 1: level internationally, right, I mean, on some level, who really
Speaker 1: cares what countries they represent? And when they play in
Speaker 1: professional leagues, they come from all over the world typically
Speaker 1: to wherever they go, and that's pretty cosmopolitan. What you're
Speaker 1: working in, what your industry represents is an even further
Speaker 1: globalization or cosmopolitanization of sport. But I also wonder if
Speaker 1: there might be some loss of some of the familial
Speaker 1: or identity based features that are more generationally bound. It's
Speaker 1: a tough thought to ponder because part of what I
Speaker 1: see esports as is quite beautiful. That you can be
Speaker 1: someone who loves you sports and find community with people
Speaker 1: countries and time zones far away you don't even speak
Speaker 1: the same language of you. But I'm hopeful for this
Speaker 1: because I think it is a natural progression of the
Speaker 1: attitudes and behaviors of our youngest generation right now, how
Speaker 1: they engage in the digital world and how they consume content.
Speaker 1: It is much less where am I physically allocated to
Speaker 1: who has values, beliefs, and ideas like me in a
Speaker 1: broader scale. So I'm optimistic, a little bit biased, but optimistic. Nicole.
Speaker 1: Thank you for educating me and our listeners. And I'm
Speaker 1: very confident that we're going to be hearing a lot
Speaker 1: from you in the future, whether it's in this space
Speaker 1: or other spaces that you find yourself in. And I
Speaker 1: really want to extend my appreciation to you for spending
Speaker 1: some time with me. Thank you, Thank you so much. Noah,
Speaker 1: We'll be right back. What I learned from Nicole is
Speaker 1: genuinely fascinating, with serious implications for society, for our future,
Speaker 1: and for how we interact with each other in the
Speaker 1: spaces of entertainment and sports in the world. Listening to Nicole,
Speaker 1: I felt like a whole world was opening up to me.
Speaker 1: And it's a world in which I think certain elements
Speaker 1: are familiar, but others actually seem to be extraordinarily different.
Speaker 1: I confess that for me, and I'm someone who loves
Speaker 1: to watch sports, the idea of watching somebody play a
Speaker 1: video game is still new and novel. Listening to Nicole,
Speaker 1: I was able to see that the mere excellence of
Speaker 1: the people performing it is actually reminiscent of the joy
Speaker 1: that we take in watching people perform any activity to
Speaker 1: an excellent degree, and we all experienced that during the Olympics,
Speaker 1: when we watch some sports that we don't ordinarily watch
Speaker 1: and are nevertheless gripped to see it done the highest
Speaker 1: possible level. Furthermore, as Nicole pointed out, there's an entertainment component,
Speaker 1: especially with regard to streaming, that is actually more laid
Speaker 1: back and fun than a lot of the watching of
Speaker 1: sports that we do, because we're not just observing competition,
Speaker 1: we're also observing fun being had, and that invites us
Speaker 1: as viewers to tap into that experience of fun much
Speaker 1: more so than we do when we watch professional athletes,
Speaker 1: who to a certain degree are having fun, but to
Speaker 1: a much greater degree are all business. Another takeaway that
Speaker 1: really struck me was the idea that in the world
Speaker 1: of esports, where you're from has nothing to do with
Speaker 1: what teams you root for. I don't think it's possible
Speaker 1: to overstate how transformative and effect expanded esports would therefore
Speaker 1: have on cultures in North America, in Europe, and elsewhere
Speaker 1: around the world where local and national identities are bound
Speaker 1: up in sports teams, whether those sports teams are university based,
Speaker 1: regionally based, city based, or even now nationally based. In
Speaker 1: our world of fading national and local identity associations, sports
Speaker 1: have become important glue for holding us together. On the
Speaker 1: other hand, sports also have the capacity, via those local identities,
Speaker 1: to bring out the worst in US and to make
Speaker 1: us polarized and regionalized. In contrast, esports both hold out
Speaker 1: the hope of true cosmopothanism, where you could root for
Speaker 1: anyone from anywhere, and also of potentially weakening some of
Speaker 1: the local ties that are in fact of some value
Speaker 1: to us. In living in civic communities. Last, but not least,
Speaker 1: I walked away from this conversation with Nicole with a
Speaker 1: sense of being extraordinarily impressed to hear a young person
Speaker 1: so dynamically committed to the growth of an industry so
Speaker 1: deeply steeped in its details. And based on this conversation,
Speaker 1: I'm pretty confident that we should be all watching her
Speaker 1: career going forward alongside career of evil geniuses. Until the
Speaker 1: next time I speak to you. Breathe deep, think deep thoughts,
Speaker 1: and have a little fun, maybe watching esports. If you're
Speaker 1: a regular listener, you know I love communicating with you
Speaker 1: here on Deep Background. I also really want that communication
Speaker 1: to run both ways. I want to know what you
Speaker 1: think are the most important stories of the moment, and
Speaker 1: what kinds of guests you think you would be useful
Speaker 1: to hear from. More So, I'm opening a new channel
Speaker 1: of communication. To access it, just go to my website
Speaker 1: Noa Dashfelman dot com. You can sign up from my
Speaker 1: newsletter and you can tell me exactly what's on your mind,
Speaker 1: something that would be really valuable to me and I
Speaker 1: hope to you too. Deep Background is brought to you
Speaker 1: by Pushkin Industries. Our producer is mo La Board, our
Speaker 1: engineer is Benaliday, and our showrunner is Sophie Crane mckibbon.
Speaker 1: Editorial support from no Osband. Theme music by Luis Guerra
Speaker 1: at Pushkin. Thanks to Mia Lobell, Julia Barton, Lydia Jean Cott,
Speaker 1: Heather Faine, Carl mcgliori, Maggie Taylor, Eric Sandler, and Jacob Weisberg.
Speaker 1: You can find me on Twitter at Noah R. Feldman.
Speaker 1: I also write a column for Bloomberg Opinion, which you
Speaker 1: can find at Bloomberg dot com slash Feldman. To discover
Speaker 1: Bloomberg's original slate of podcasts, go to Bloomberg dot com
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Speaker 1: please write a review or tell a friend. This is
Speaker 1: deep background