TenCent Makes A Shift in the League

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Riot Game’s most popular property is League of Legends.

Gaming headlines this week are in a little bit of a tizzy. Riot Games, most well known for their ever increasingly popular game, League of Legends, is now owned by a larger company in China named, TenCent.  TenCent is mostly a software company that makes utility smartphone apps like chat programs and taxi hailing services.  The Chinese company has had some experience in developing games, though strictly for the Chinese market.

Although various news agencies are treating this as major news… it really isn’t.  Most of Riot’s stock has been owned by TenCent for several years now, and TenCent has just purchased the rest of the Riot’s remaining stock.  This does give TenCent a majority of ownership of Riot Games, but they weren’t that far off from that goal to begin with.

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The official unofficial sports league of gamers in eSports

TenCent, as a company, has been gaining small portions of valuable stock in quite a few leading game development and software studios such as Epic, which is most well known for their game Unreal Tournament and the game development software engine, Unreal Engine, and Activision Blizzard, known for Call of Duty and World of Warcraft.  Really, all of this isn’t much of a surprise that Riot is now primarily owned by TenCent due to their history of buying stocks in other American game studios.

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How this affects Riot is a little unknown, but chances are, from the player perspective, it really won’t (mainly because as stated above, most of the company’s shares have been owned by TenCent already).

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Digital card games, like Blizzard’s Hearthstone are also seeing large gains in popularity.

Apparently, the biggest change will be to how Riot as a company pays its employees and the benefits that they receive for working at Riot.  Already, the company is ranked 13th in Fortune magazine’s top 100 places to work in 2015 (while Activision Blizzard, the only other game studio that made that list, is ranked 96th), so the changes proposed might make them an even better company to work for, as far as benefits and compensation are concerned..

According to Riot’s blog post:

As a result of our continued growth and changing circumstances, we’re shifting to a new structure to recognize and reward Rioters’ contributions – and that first involves a big change to our existing equity program. As part of this effort, our majority investor, Tencent, recently purchased the remaining equity of Riot Games. This allows us to move away from a Riot equity program towards a cash based incentive program that allows Rioters to share in Riot’s success. This program comes in addition to our highly competitive salaries, open PTO, learning and development programs, 401K match, subsidized medical plans, and kitchens stocked with snax (poro and otherwise) all full-time Rioters get.Riot Games
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Much like Riot’s League of Legends, Valve’s DOTA2 also has massively viewed international championship tournaments.

ESports, in general and as a whole, is rising in popularity and rising exponentially.  Both the number of people playing eSports and those tuning in to watch eSports are growing in swelling numbers.  On live television, broadcasts from League of Legends and the DOTA2 international championship tournaments were even picked up by ESPN (Note: this other article from ESPN also has some data on the size of the eSport realm).

Valve’s Innovation: DOTA2

Though, I want to be clear at this point. When I mention “E-Sports” I’m not talking about gambling and betting games like “Fantasy Football” by companies such as Draft Kings and Fandeul.  “E-Sports” in our definition actually have user input, team work, and active players and are not just “betting on statistics and analysis” (So… unless it has wizards and dragons… I’m not talking about fantasy football when I talk about “e-sports”.  Sorry, bros).

League of Legends World Championship 2015 Finals

 

According to Gamasutra:

A new report by L.A.-based creative agency Sparks & Honey predicts that by 2017, eSports will be attracting more viewers than the most popular sports event in North America, the Super Bowl. That prediction is based on data compiled from ESPN, Riot Games, Valve, Wargaming, Blizzard, Hi-Rez Studios, Newzoo and SuperData showing viewership figures that continue to surge year-over-year.Gamasutra

With the increasing popularity of eSports and the games that facilitate them, a change in practice that hampers the actual gaming experience for the players can end up to be rather volatile.  Also, with the breadth of competitive games on today’s market and a large swarm of companies all vying for player’s attentions, if players no longer like one experience a game is selling, they will migrate to the next game of their fancy.

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This info-graphic from 2013, although outdated, still shows a grand upward swell in eSport popularity

All in all, I don’t really think TenCent will be changing much of the game itself, other than what’s already in Riot’s pipeline.

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