LPL Moves Towards "Solo Broadcasting" Can the value of esports copyright be revalued?

The LPL kicked off as scheduled, but this time it was a little different.

On January 10, the 2022 LPL Spring Tournament began as scheduled, this time different from the past, in April last year, Huya, which won the LPL 5-year copyright for 2.013 billion yuan, only distributed the rights to Station B and Penguin Esports.

Considering the user volume of B station and penguin e-sports in hardcore events, the differences between the two and Huya, and some interests that have to be considered behind it (S race of B station, Tencent attributes of Penguin?), in a sense, LPL copyright has opened the era of solo broadcasting.

Solo broadcasting means that Huya recognizes the value of the LPL copyright fee of about 400 million yuan per year, which is a new record for the copyright fee of the single-year esports competition as we know it so far. It is also an important step taken by the LPL and the beginning of the revaluation of copyright in esports.

Free copyright

Many people have heard such a story, in 1989, then the president of the NBA, David Stern, waited for an hour at the CCTV gate to meet Li Zhuang, who was then the editor-in-chief's office to buy the program.

At that time, Stern was trying his best to promote the NBA this tournament, and China is a market he attaches great importance to, in order to push open the door of the Chinese market, in the initial cooperation agreement with CCTV, the NBA this event has no copyright gold, completely free to CCTV, just get some advertising share.

And today, in 2019, Tencent and the NBA Alliance renewed an agreement, and the copyright price of $1.5 billion for 5 years was 3 times the price of the previous one. In addition, the NBA also sold another copyright to Migu Video in 2021, $200 million for 4 years.

That is to say, the NBA's copyright is now Chinese mainland, and the annual revenue can reach 350 million US dollars, which is not counting the short video copyright for platforms such as Weibo.

From promoting the event for free to selling at least $350 million a year, 30 years has proved that the NBA has improved from the user dimension to the influence dimension in China.

Esports events are also going down this path.

In the earliest days, the main purpose of the launch of e-sports events was to promote, promote games, and promote hardware, so e-sports events also did not have copyright in the early days, and even if there were, they were minimal.

For example, WCG, an early iconic event, was dominated by Samsung's display division, which was established as a brand promotion campaign by Samsung's display division.

For example, Tencent's earliest first-party event "Crossfire" of the Hundred Cities League, in early 2009, the "Hundred Cities League" officially launched, the event lasted 6 months, covering more than 150 cities in 23 provinces across the country, with the main line of "advancing to the WCG Finals", a total of 12 places in 7 major divisions were set up to qualify to the WCG Finals, with a total of more than 15,000 teams and a total of more than 150,000 participants.

Afterwards, the official definition of this event was "to create the largest, most popular and most participatory large-scale event promotion activities in China and even in the world!"

Esports events are the window of brand promotion, which is the main value of esports events.

In an article in our interview with Feng Xiao, head of Tengjing Sports' new tour e-sports, Feng Xiao also mentioned, "When I was doing LPL at the earliest, my title was the brand manager of League of Legends, and the earliest e-sports was done as our entire brand and marketing means. ”

As a means of brand promotion, then what it pursues is bound to be a greater amount of exposure, and the fundamental appeal of selling copyright and exposure is obviously contrary. Only free can more platforms participate in it, so that more users can learn about the game by watching the event.

Now, LPL's annual copyright fees sold for $400 million.

The release of the value of esports

From free to now 400 million yuan a year in live broadcast copyright fees, this is the release of the value of the LPL, but also the release of the e-sports industry from the promotion window to the independent commercial value.

How exactly does the e-sports industry release its own business value step by step.

Feng Xiao said that during the S6 and S7 periods, the ecology of the e-sports industry, whether it is users or attention, has slowly begun to become an independent ecology and industry no less than the game itself.

We have counted some of the data from S3-S6 under the official release:

S3: The cumulative number of viewing hours is 70 million, and the number of independent viewers in the final final is 32 million, and the peak of the highest simultaneous viewing is 8.7 million.

S4: The cumulative number of viewing hours is 179 million, and the number of independent viewers of the final final is 27 million, and the highest simultaneous viewing peak is 11.2 million.

S5: The cumulative number of viewing hours is 360 million, and the number of independent viewers in the final is 36 million, and the highest simultaneous viewing peak is 14 million.

S6: The cumulative number of viewing hours is 370 million, and the number of independent viewers in the final is 46 million, and the highest simultaneous viewing peak is 14.7 million.

S7: The cumulative number of viewing hours is 1.2 billion, and the number of independent viewers of the final final is 57.6 million, and the highest simultaneous viewing peak is not disclosed. (SKT's semi-final against RNG set a record of 80 million unique viewers).)

It can be clearly seen that with S Sai as the data background, the real qualitative change in data is in S7, whether it is the number of independent viewing users or the cumulative viewing time, a huge change has occurred.

How does this happen?

S5, S6 China clubs two consecutive years of heavy setbacks have caused more attention?

From the 2011 national service public test to 2017, 6 years, students entered the society, and playing games began to gradually become watching games.

Or, after several years of accumulation, including star players, one by one, it has driven the attention of the event?

And the effect of S Race's first entry into China?

......

There are many reasons, but two points that have to be mentioned are that the policy has begun to support the development of the e-sports industry, and the second is that the e-sports industry has become more and more perfect and has brought about a more mature business ecology.

In terms of policy, at the end of 2017, Shanghai issued the "50 Articles of Cultural Creativity", which for the first time proposed to build Shanghai into a "global e-sports capital", which mentioned encouraging investment in the construction of e-sports venues, cultivating local events, introducing international events, and creating a complete ecosystem.

Since Shanghai, many places have introduced relevant e-sports industry support policies, Hainan's Hailiutiao, Suzhou's "Implementation Opinions on Promoting the Healthy Development of Suzhou's E-sports Industry" and so on.

The support of the policy has put a booster on the development of the e-sports industry, and S10 was successfully held in Shanghai in 2020, when various sports events around the world were suspended due to the epidemic.

In addition to the support of the policy, talk about the improvement of industrial development.

On April 30, 2017, the LPL began to unite, canceling relegation and creating home and away games.

At the LPL Spring Tournament and the second anniversary of the establishment of Tengjing Sports in early 2021, the game value theory asked Jin Yibo, co-CEO of Tengjing Sports, a question, "If you give an evaluation of these two years, which thing do you think is the most successful?"

Jin Yibo's answer was, "I think the most successful thing we've had over the years is the promotion of alliances." ”

Behind the alliance is a whole about the creation of the e-sports system, from the improvement of the youth training system, to the entry of capital, to the construction of the production and broadcast center, and so on. Driven by these columns, the LPL, an e-sports event, has accelerated its approach to traditional sporting events.

After the alliance, the LPL can be regarded as the real impact and traffic began to be realized, that is, the commercial value of e-sports began to be released one by one.

Among them, we also found an interesting data comparison.

In 2016, LPL sponsors: Sprite, Lenovo, AutoFull, Intel, Philips, Logitech.

2018, LPL sponsors: Mercedes-Benz, Doritos, War horse, Intel, L'Oréal Men, HP, Direx.

In 2022, LPL sponsors: Mercedes-Benz, NIKE, JD.com, Moslian, Mobil Auto Lubricants, Lenovo Savior, Wahaha, TCL, Warhorse, KFC, TT Voice, OnePlus Mobile, Liepin, AutoFull.

In October 2016, on the occasion of the S6 competition, League of Legends held a 2017 e-sports business promotion conference, at which the commercialization plan of the China region was announced, including the LPL, LSPL, Demacia Cup and the copyright of the anniversary celebration, with an all-inclusive bid reserve price of 15 million yuan and a secret bid method.

At the end of 2019, Penguin E-sports announced that it had won the S file rights of the 2020 LPL event for 60 million yuan, while Huya won the A file, and the rumored price was 40 million yuan.

In April 2021, foreign media The Esports Observer reported that Huya signed an LPL copyright broadcast agreement with Tengjing Sports for $310 million, which granted Huya Live broadcasting as the exclusive broadcasting platform of the LPL League, including the video-on-demand and distribution rights of the LPL, LDL League and LPL All-Star Game.

When it was first established, Tengjing Sports had clearly put forward three development goals, that is, the total revenue of the league reached 1 billion yuan, and the league's viewing time reached 4 billion hours, making LPL one of the most valuable sports IP in China.

According to Jin Yibo, co-CEO of Tengjing Sports, at the press conference of the second anniversary, Tengjing Sports, which was established for two years, has basically achieved these three goals, that is, the total revenue has reached 1 billion yuan.

Can I revalue copyright?

The surge in copyright fees and the surge in commercial sponsorship are the monetization of LPL traffic, and the LPL exclusive broadcast opened by Huya is a value recognition for the LPL.

For Huya, Huya's strong field has always been in the mobile e-sports end, in pc e-sports, Huya is lagging behind competitors, from this point of view, you can understand Huya's desire for exclusive LPL.

However, before that, Tengjing Sports may think that the LPL brand is not mature enough and needs more platform promotion, so it has always been subcontracted and sold to several platforms to broadcast together.

But now, Tengjing Sports may think that the LPL has passed the stage of needing multiple platforms to jointly boost traffic, a single platform can also bring traffic and monetization, and the event brand can be independent.

This, like the NBA, from the early need for CCTV to promote, to now sell exclusive rights to Tencent at a high price (Migu's copyright is another form).

Or look at the Premier League next door, the copyright of the Premier League at the beginning is also scattered, from five-star sports, Guangdong sports, these TV ends, to PPTV, Sina Sports and other network ends, it needs multi-platform promotion of this event.

But in recent years, premier league copyrights have been exclusive sales, from PPTV to Tencent Sports to iQiyi Sports, all that has been obtained are exclusive rights (Migu got the distribution of iQIYI).

From the perspective of the development of the Premier League and the NBA in China in recent years, it is no longer a window for events to rely on the platform, but a platform to rely on events, and Sina Sports, which lost the Premier League and the NBA, has long been in a slump, and PPTV has long proved that copyright is its fundamental in the cycle of loss, acquisition and loss.

Users will follow the game, not follow the platform, which has been proven in the Premier League and the NBA, and now whether the LPL can prove that today's esports events can also play such a role, let's wait and see.

And once the esports event can do the same, then the value of the entire esports event will be completely re-evaluated.

Take a look at the data:

According to the NBA's official data, in the 2018-2019 season, 490 million fans watched live NBA game broadcasts and video programs through the Tencent platform, which is nearly 3 times that of the 2014-15 season; More than 21 million fans watched the live broadcast of game 6 of the 2018-19 NBA Finals.

In 2018, the LPL region had 15 billion live viewers of professional events, 2.5 billion hours of live viewing time, an average of about 25 million independent spectators per day, and an average of more than 7 million viewers per minute in the summer finals.

Of course, many of the NBA's wonderful games are paid (members) to watch, but even so, we also think that the value of the LPL is still undervalued, of course, provided that it needs to prove that it can really bring about a large-scale user migration, such as the Premier League and the NBA.

Whatever the outcome, now that the LPL has taken this step, it has already taken this step the moment it agreed to sell the copyright exclusively to Huya, and whether the copyright of the esports event can be revalued depends on the LPL's test.