Esports: Emerging Programs Report

Published: January 16, 2020

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Table of Contents

Introduction ................................................................................................................................................................... 3

Section 1: academic programming and the esports market ......................................................................................... 4

Industry structure ...................................................................................................................................................... 4

Business models ........................................................................................................................................................ 4

Labour market size .................................................................................................................................................... 5

Academic programming by region............................................................................................................................. 8

Programming considerations ..................................................................................................................................... 8

Conclusions .............................................................................................................................................................. 11

Section 2: starting an esports varsity team ................................................................................................................. 12

Addendums.................................................................................................................................................................. 13

A: Durham College ................................................................................................................................................... 13

B: Lambton College .................................................................................................................................................. 13

C: St. Clair College .................................................................................................................................................... 13

D: Sports Management Worldwide ......................................................................................................................... 13

E: Coursera ............................................................................................................................................................... 14

F: Ohio State University ........................................................................................................................................... 14

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Introduction Esports is a new industry creating many varied opportunities for post-secondary institutions. Esports is a form of

sport competition using video games.1 Like traditional sports, esports players compete either individually or on

teams, and spectators watch competitions either physically in arenas/stadiums, or via broadcast. Broadcasts are

usually online.

Like traditional sports, esports viewers are not always players. For example, 26% of the League of Legends (a

popular esports video game) audience are players only, 42% play and watch, and 26% only watch.2 The industry is

large and growing – for perspective, the 2018 League of Legends final was played in front of 50,000 fans at the

Beijing National Stadium and drew 99.6 million unique viewers.3

The esports industry is hiring graduates from a variety of esports-specific courses and programs, ranging from

computer science, business, information technology, health, education/coaching, psychology, and more. These

training opportunities vary significantly by geography and industry, but most regions will, at a minimum, have job

openings within esports coaching and marketing.

Post-secondary institutions can introduce esports varsity teams, which would compete in national and

international leagues. Creating these teams can help to attract new students and increase student engagement.

Opportunities for new academic programming are not as obvious.

The esports market is changing quickly, as will the role post-secondary institutions will play within this market.

While there are currently over 175 varsity esports teams competing in North America, institutions appear

cautiously optimistic with academic programming. Hedhome has found fewer than 20 institutions in North

America that have offered or announced esports-specific courses or programs.

Based on this data, it appears that most post-secondary institutions enter the esports realm by first introducing a

varsity team, and then academic programs. While some institutions in Canada started by offering one foundational

esports course, other institutions have entered the esports market with a full program.

There are three main questions that institutions should ask themselves when considering esports programming, as

outlined below:

• Does your local market have significant game development, broadcasting, and/or esport advertising

companies to support esport-specific software engineering, broadcasting and marketing graduates?

• Are the local professional sports franchise owners (i.e. NHL), post-secondary institutions and high schools

planning to introduce esports teams to support esport-specific coaching and marketing graduates?

• Can you introduce a distinctive computer science program to attract students from outside your local

market?

If your institution can answer yes to any of the above questions, there is a potential opportunity to introduce an

esports academic course or program within your institution.

1 https://en.wikipedia.org/wiki/Esports, citing Hamari, Juho; Sjöblom, Max (2016). "What is eSports and why do people watch it?". Internet Research. 27 (2): 211–232 2 https://esportsobserver.com/newzoo-report-august/ 3 https://dotesports.com/league-of-legends/news/league-of-legends-vs-superbowl-viewer-numbers. .3 For

comparison, the 2018 Super Bowl drew 113M viewers. Note however that peak concurrent viewership for League

of Legends was < 4M. (https://escharts.com/tournaments/lol/2019-world-championship),3 indicating viewers were

not watching the entire broadcast.

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Section 1: academic programming and the esports market Industry structure

The professional esports industry is immature and not yet profitable.4 However, the industry is quickly evolving to

reflect the business models of existing, profitable professional leagues, such as the NFL, NBA, MLB and NHL.

Industry participants in esports reflect traditional sports:

• Players: players are paid professionals with salaries, benefits, retirement plans and are often part of

players associations.

• Franchises/teams: franchises recruit players and coaches, host practices and compete at events.

Franchises are often owned by the same people or organizations that also own traditional sports

franchises in the NFL, NHL, MLB and NBA. Franchises often own esports franchises, presumably because

they’re familiar with the business models and revenue streams. Varsity and amateur teams are becoming

more popular at the post-secondary and high school levels.

• Leagues: like traditional sports, professional leagues are typically made up of dedicated franchises. Unlike

traditional sports where leagues are non-profit associations owned and controlled by the for-profit

franchises, esports leagues are generally majority owned by the video game publishers who sell franchises

within their leagues.5 Franchises fees can sell for $50-80M USD.

• Organizers: organizers host events either in stadiums or online, with stadium events typically broadcast to

wider viewing audiences. As the industry matures and competitions follow more predictable schedules,

organizers may integrate with either leagues or franchises.

• Broadcasters: this includes traditional sports broadcasters and non-traditional online broadcasters

(sometimes called channels), such as Amazon Twitch or Google Stadia.

• Sponsors and advertisers: companies are promoting their products to esports viewers through ads and

sponsorships.

Business models

Venture capital and private equity investments into esports

increased from $490M in 2017 to $4.5B in 2018. This is a

year-over-year growth rate of 837%.6 Like traditional sports,

the four key revenue sources in esports include:

• Media rights

• Live event ticket sales

• Merchandise

• Advertising and sponsorships (advertising and

sponsorships make up 69% of revenue)

Game development/publishing can be considered a fifth

revenue source, but this is likely better thought of as part of

the gaming video content industry.7

4 https://www.riftherald.com/2016/9/13/12865772/lol-esports-profit-money-riot 5 https://www.forbes.com/sites/darrenheitner/2017/09/20/full-12-franchises-announced-for-initial-overwatch-league-season/#6d42861e2c65 6 https://www.businessinsider.com/the-esports-ecosystem-2019-11 7 https://investmentbank.com/esports-gaming-video-content/

Figure 1: Esports Revenue Streams (Newzoo.com)

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Labour market size

Hedhome estimated the size of the esports labour market by adding the workforce size to the number of job

postings. We estimated the workforce size by counting the number of employees with the term “esports” in their

resume on LinkedIn and determined the job postings from online sources.8

The charts below show the respective labour market estimates for the US (Figure 2) and Canadian (Figure 3)

markets. As would be expected, the US market is approximately ten times the size of the Canadian market. The

vast majority of esports jobs in North America are with game publishers, broadcasters and advertising companies

who hire staff with software engineering, marketing and design skills.

Figure 2: US job postings and workforce estimate

Figure 3: Canadian job postings and workforce estimate

Drilling into the Canadian market data at a municipal level, the esports workforce is concentrated in Montreal,

Toronto and Vancouver. The cumulative labour market in these cities accounts for over 90% of the total Canadian

esports labour market.

8 https://www.glassdoor.ca/Job/canada-esports-jobs-SRCH_IL.0,6_IN3_KO7,14.htm, and https://hitmarkerjobs.com/

Montreal has a higher

concentration of broadcasting

and game publishers seeking

software engineers, art and

design skills.

Vancouver has a higher

concentration of game publishers,

as well as the Vancouver Titans

esports franchise, which drives

demand for design and software

engineering skills.

Figure 5: Vancouver esports job demographics

Figure 4: Montreal esports job demographics

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Toronto has a higher concentration of

advertising/promotion companies and

MLSE (Maple Leaf Sports & Entertainment)

that require marketing and software

engineering skills.

The remainder of the Canadian market

has an estimated 200 esports workers

with no job postings (as of December

2019), Approximately 50% of those

positions are in Alberta.

Figure 6: Toronto esports job demographics

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Academic programming by region

Despite the concentrated labour markets in Vancouver, Montreal and Toronto, the Canadian esports market is still

developing. Therefore, it’s premature to conclude that academic esports programs will only succeed in these cities.

In the US, the esports market is more mature, providing potential insights into the connection between existing

academic programs and the labour market. Figure 8 compares the estimated labour market with the locations of

post-secondary institutions that offer esports program. The darker blue states have a larger workforce, and the

size of the red bubble represents the number of courses.

Several markets have an imbalance of labour market size and course supply, including:

• California, Texas, Georgia, Illinois, Colorado, Nevada, North Carolina, Washington and New York State

have higher concentrations of esports staff and job postings, but very few esports-specific courses.

• Idaho and Utah have a disproportionately high number of courses relative to the size of the labour

market, and these programs are both heavily focused on software engineering.

Programming considerations

As the esports market expands and grows, post-secondary institutions can meet demands for skilled graduates by

offering relevant and comprehensive programming. Esports involves a wide range of competencies, ranging from

the expected skills in film and video production to the less predictable but necessary areas of law, branding and

data analytics. Hedhome has categorized 167 esports courses into the hierarchical categories below.9

9 Your microsite includes a list of programs and courses within each category.

Figure 9: esports varsity teams

Figure 8: Labour market demand (blue) and esports course supply (red)

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Category 1 Category 2 Category 3

Arts and Performing Arts Film/Video Film/Video Commercialization

Film/Video Production

Business Business Administration

Business Communication Personal Business Skills

Business Ethics

Business Law

Business Project Management

Finance

Fundraising

General Business

Human Resources

Leadership

Marketing Advertising and Promotions

Branding

Digital Marketing

Event Planning

Product Management

Social Media

Operations

Strategy

Technology Management

Computer Science Programming Game Design

Machine Learning

System Design

Data Analytics and Intelligence Business Analytics

Education Education Research

Health Mental Health Mindfulness

Nutrition

Recreation Therapy

Sports Medicine

Humanities Psychology

Information Technology Computer Systems Computer Security

General IT

Network Systems

Leisure, Recreation, Personal Development

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The chart below outlines the most common and relevant keywords that appear within the over 1,000 current

esport job descriptions.

Keywords Keyword count in esport job descriptions

Marketing 795

Content 743

Analytics 739

Video 590

Event management 579

Strategy 291

Social Media 280

Law 227

Human Resources / Recruit 205

Sponsorship 155

Product management 138

Project management 128

Entrepreneurship 89

Ecosystem 87

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Conclusions

Based on Hedhome’s research, we have four main observations regarding esports academic programming:

1. Employers hiring software engineers are not yet demanding that graduates have esports-specific

programs, or they aren’t hiring from local institutions. California, Texas, and North Carolina have higher

software engineer demand, yet they offer very few esports courses. Conversely, many courses offered in

esports are in geographic areas without a large labour market, which suggests students either intend to

work virtually or relocate after graduation. For example, Boise State University promotes to prospective

students where graduates gain employment, yet virtually none of the companies shown are in Idaho. The

University of Utah has a significant computer science programs10 apparently designed to attract students

from across the US.

2. Markets strong in broadcasting, game publishing or advertising/promotions are more likely to have a

successful esports program. Hedhome interviewed institutions that offered esports courses in the areas

of broadcasting, game publishing or advertising/promotions. Each institution indicated that a local market

that is strong in these competencies is more likely to support a successful esports program – institutions

indicated that their programs are often wait-listed, and employers are hiring graduates immediately upon

graduation.

3. It’s too early to know if professional, varsity and high school esports teams represent significant

opportunities for academic programming. Several sports franchise owners in the NHL, NFL, NBA, and

MLB have begun acquiring professional esports franchises. At the collegiate level, there are already an

estimated 270 varsity-level esports teams in the United States, with several also appearing in Canada. An

estimated 10 post-secondary institutions in Ontario plan to announce esports teams by September 2020.

The high-school team market is also growing, as many schools have introduced officially recognized clubs

and teams. These esports teams may represent a significant training opportunity, as they need to hire

coaches, arena operators, athletic trainers, healthcare professionals, and legal professionals. This is in

addition to the significant opportunities in the areas of marketing, human resources, operations, IT and

more. As an example, there are currently 20 open coaching job postings for these teams in the United

States. However, whether there are adequate esports specific-skills required for these areas is difficult to

predict with confidence.

4. Many institutions have an introductory or foundation level esports course, but only this course. This

suggests that several schools are starting with an introductory class, potentially to test local market

demand.

10 See your microsite for a complete list of courses.

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Section 2: starting an esports varsity team

If your institution is thinking of starting a varsity esports team, there are several considerations when assessing the

viability of such a team, including:

Team checklist item Comments

Research the market Determine the teams and leagues in your surrounding community to understand the leagues you will participate in and who your future competition will be.

Ensure there are plenty of tournaments available

Start with the most popular games/leagues in your area to ensure you have a viable community of competitors without having to travel.

Secure funding Funding models for esports teams are like other varsity teams. Consider the following expenses:

- Team: may include coaching salaries, tournament entry fees, jerseys, team events and marketing

- Facilities space (see below)

- Hardware, software and support. See Addendum F for the Ohio State University estimated start-up costs for its advanced esports arena.

Hire a coach Hire an experienced coach and a team manager

Secure a facility The space used by your varsity team will often also be used as a classroom, in the same way a gymnasium or pool is multi-use. If different, a space for dedicated to your varsity team can be as small a room with computers. A facility with teaching capabilities is typically larger and includes a shared screen and seating. It is common to utilize an existing classroom as a combined varsity team and teaching space.

Host tryouts Recruit your best players. Be aware that upcoming teams will attempt to poach players from existing teams. For a small team, recruit the same number of players as it takes to play that game plus two substitute players. Assign a team captain.

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Addendums The following is a list of notable esports programs in North America.

A: Durham College

Esport Business Management Graduate Certificate

• 2 semesters

• $2,999 (plus $1,337 ancillary costs) for a total of $4,336

• In-class

B: Lambton College

Esports Entrepreneurship & Administration

• 2-year Esports Entrepreneurship & Administration diploma

• $8,000 over 2 years

• In-class

C: St. Clair College

Esports Administration and Entrepreneurship

• 2 year Esports Administration and Entrepreneurship Diploma

• Price not available

• In-class

D: Sports Management Worldwide

Sportsmanagementworldwide.com

• 8 week program online11

• $1,450 USD

• Online

• Outline:

- Week 1: Business Competences - esports Landscape

- Week 2: Esports Event Management, League Operations & Fan Engagement

- Week 3: Coaching Studies

- Week 4: Esports Psychology

- Week 5: Esports Team Management

- Week 6: Content Creation/Video Production

- Week 7: Esports Sponsorship

- Week 8: Esports Broadcasting/Streaming

11 https://www.sportsmanagementworldwide.com/courses/business-esports

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E: Coursera

Esports Specialization (University of California, Irvine)

• 8 weeks (4 hours/week)

• $0

• Online

• Outline:

- Game developers and esports organizations

- Esports teams and professional players

- Collegiate esports and career planning

- Esports management capstone

F: Ohio State University12

Proposal for Bachelor of Science in Esports and Game Studies (EGS)

• 4-year bachelor’s degree

• $10,726 per student per year

• In-class

Three tracks:

- Track 1: Esports and Game Creation

- Track 2: Esports Management

- Track 3: Application of Games in Medicine and Health

Rationale highlights:

- A Newzoo report suggested esports industry revenues to be $1.65B by 2021

- Internal support within the university, including the development of an esports arena on campus

- Relationship with MLG (Major League Gaming), Columbus and Multivarious Games (game developer) also

in Columbus.

Enrolment forecast:

Ohio State University modeled its bachelor’s degree program after the University of Utah, Master of Entertainment

Arts and Engineering and a dual MBA/MEAE degree.

Utah had:

- 40 enrolments in year 1

- 60 enrolments in year 2

- 80 enrolments in year 3

12 Proposal for Bachelor of Science in Esports and Game Studies (EGS)

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Ohio state enrolment targets (see section V on page 37-39)

- Ohio state enrolment forecasts are largely generated from looking at the number of internal graduates

from other programs that may take the EGS program

- Ohio state forecasts are looking to the national esports market (page 39).

Targeted careers:

- Game creation track: Game program, video game engineers, game designer, game writer, software

developer

- Management track: event manager, esports coach, esports manager, marketing, sales

- Health track: health coaching, health support for esports teams.

Investment (page 52):

The Ohio State University esports arena is a brand new, large, state-of-the-art facility. The costs below reflect this

and should not be considered as a minimum starting point for an esports program.

Learn more about the Ohio State arena here: https://esports.osu.edu/student-experience/the-arena/