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Comment by mamonster | Hacker News Reader

As someone has followed the industry for quite some time, I would say that the hype isn't really dying down, but rather that teams are finally having to address the elephant in the room: Pro player compensation is completely out of whack with regards to where franchising revenue/merch sales are. Salaries need to come down maybe 50% in the West for the numbers to make sense.

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The flip side is that compensation is not terribly attractive to the players.

I’ve heard that players are dropping out at young ages not because they can’t play anymore but because it is not a good living.

I had a LoL habit for a while. I was definitely a fan of Yiliang Peng but spent a lot more time playing LoL than I did watching the pros. I don’t think I generated much if any revenue for his team. There is not a big money train like there is for the NFL.

The reality is that top players can make more from streaming/content than playing. To take your Doublelift example he has been full time streaming for 2 years but is coming back to LCS this year. He's taking a massive paycut by playing LCS vs. full time streaming/content.

These inflated pro salaries are good for the lower tier players who don't have the entertainer personality

I only follow pubg esports, but I'm just not seeing how a pro player in an expensive country can afford to make a living. The competition is brutal, the hours to be at the top are very high, and unless you're a top streamer the income is very low.

Now this can all be hand waved away with "they're just playing a video game, they're lucky" but I think that misses the point. To be a pro at one game, you have to dedicate everything to that game. Revenue sharing has to go up for longevity of esports.

Isn't the very definition of 'pro' that they get paid to do it? Prize money, sure, but also sponsors.

You can get paid without getting paid well.

Take [1] as a random example - 18th in the pubg global championship, and they've made $53k split between 3 players in 2022.

How many hours of practice do you think they have to put in, to be 18th in the global championship and earn $17.7k per person?

[1] https://liquipedia.net/pubg/BBL_Esports

Aren't they getting a salary for those hours of practice? That's what I mean with pro, as in professional, as in having gaming as their profession.

Honestly, $17.7k for _18th_ place, in PUBG of all games, seems very high to me as a prize. But I am sure they split a lot of that with their organization, coaches and whatever they have, and taxes on top of that.

Even so, people work for minimum wage so it all just, depends.

A lot of the teams aren't organizations, and the ones who are can sometimes get pretty low salaries, from what I understand. With how much movement there is in the leaderboard year to year, the team who came in first in 2020 placed last in 2021.

For how many hours of time played, it's well below minimum wage. And of course it is different, playing a game has plenty of benefits, I'm just thinking about longevity of esports as a whole.

I don't believe that's per person, that's total for the team. So <18k for 4 players and a coach. The tournament went for 20 days, so missing out on any income you could generate from another job during that time, excluding the coach that's 4.5k per tax, on the largest money making opportunity all year.

I don't know anything about e-sports, but I know something about professional sports - and the prize money at the top end is small compared with the endorsements. Tiger Woods only made 10% of his fortune in prize money, for example.

And yet he made $120,895,206 in tournament winnings. It just emphasizes both that the orders of magnitude is nowhere the same in the direct compensation side, and a universe of difference on the sponsorship side.

> and unless you're a top streamer the income is very low.

For rocket league, the content creation scene is much bigger than the pro scene. As a developer once said, is very GIFable. Combined with the flexibility of the game itself, you see nearly endless possibilities for content creation. More than half of the top content creators for this game are "casual" players[1]. Casual is quoted because they're still grand champion level but nowhere near the pro level. There are also pros turned content creators that are familiar with unreal engine and create really cool stuff (eg lethamyr). On the other end of the spectrum is sunless khan who creates video essays about rocket league[2]

[1] https://www.youtube.com/results?search_query=rocket+league&s...

[2] https://www.youtube.com/watch?v=DuV2SGAZaig

Rocket League is very watchable by people unfamiliar with it too. It's just Pong in 3D. It's 3v3, and you can manipulate the paddle in very creative ways, but it's basically just as simple.

I was pretty much done with gaming until I found Rocket League. It's one-of-a-kind in so many ways, I'm not sure it'll ever be outdone. If it can't survive an industry crash, I don't think any eSport game will.

And on other side popular players can possibly make same money as streamers or influencers with less risk and effort.

To me, this is what's changing and it's not just changing esports.

Yeah you see it in the NBA/NFL with a lot of players building their personal brand via Youtube/TikTok/Podcast/etc. It will be interesting to see how this plays out over the next decade. Will businesses keep dumping money into influencer advertising, or will it die down and go back to just the mega stars getting deals.

I know right now even people with 10-20k followers on a platform can still get brand deals because it is a new form of targeting. I think the hard thing to solve for is how do you measure the ROI besides use code "XYZ" for 20% off your first month or whatever.

So the classic sports model?

Step 1. Be good at a sport and become famous Step 2. Convert Fame into money by endorsing products.

In most sports leagues the vast majority of player income is salary from their team. There is something approaching a power law around endorsement money, even in the NBA it’s really only the top 10 earners who make more than 20-30% on their non-basketball revenue streams.

This is true for soccer, but almost all American athletes make the vast majority of their income off team salary.

Not really. Endorsements and Advertising are a good cut of the money but most of the big money in streaming is coming directly from fans, whether through premium subscriptions or donations.

The flip side is that the earning potential of the top players are incredibly lopsided, whether that be the top competing players in terms of winnings, or those most able to be a personality in terms of streaming. It's not clear the teams themselves contribute much to either of those areas - training is most often self directed or with play groups that may not align with teams, and it's not like e.g. soccer where there's big physical infrastructure like stadiums that clearly the players need an organisation to provide. Instead the venues for in-person events are provided by the tournaments, not the teams, and pretty much everything else the players need to earn money is online.

I believe Faker was the first million dollar salary in eSports on 2017, IIRC LoL moved to a franchising system for it's leagues, which brought in a ton of 'naive' capital, the combination caused a gigantic inflation in NA player salaries and a significant one in EU.

This was recognised as a bubble by veterans in the industry and talked about on various talkshows at the time.

I completely agree with your point about salaries and really just want to add that this has been expected for years. ESports is still growing, it's just the rate will seem more sane to those in the know.

That’s essentially the thesis of the article, yes. Hype here refers not to the players or the fans but rather to the business side. Investors are looking for returns and not finding them.

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