Is the cinema industry capturing the esports flag, or is it struggling to find the health boosts needed to survive? Melissa Cogavin plugs in and sees where this sector can lead exhibitors.
MAYBE YOU’RE OLD ENOUGH to remember Sony’s launch of the original PlayStation in 1994? If so, you’re arguably too old to be fully aware of the gaming revolution taking place right now. First, a few numbers. The number of online gamers globally is predicted to rise to 2.7bn by 2021, up from 1.8bn in 2014. The average gamer spends 90 minutes online a day. The global value of the industry in 2018 was $135bn, compared to global box office last year which was $41.7bn. The gaming industry is worth more than the music and movie industries combined. Cinema esports events are a novel sideline and an exciting development worthy of investment, but they are far from the gaming industry’s core business. Gaming forms a tiny fraction of the box office share of your average multiplex; some are dabbling, others are committed, but it’s still early days and light-years from the cinema industry’s core business. There are tiny percentages from both sides making progress. It is limited but the potential is huge and the buzz palpable.
Esports in cinemas surfaces on industry panels occasionally and while the speakers wax lyrical about potential it is obvious to all that we haven’t even got close to achieving that. Gaming and esports are increasingly becoming a serious consideration for circuits, though; IMAX recently announced a partnership with Vindex, distributing exclusive esports events across its theaters worldwide; progress is slow but internationally circuits everywhere are taking the plunge to some degree.
Just another form of event cinema, right?
There are technical, commercial and cultural challenges to esports and gaming in cinemas, and viewed through the broader prism of event cinema itself, the sector is reminiscent of music events in cinemas six to eight years ago. It is clear from speaking to all parties across the supply chain from amateur/pro gamers, sponsors, distributors, production companies and exhibitors that all are excited by the possibilities.
Jonathan Woodhouse, former national sales manager for events at Cineworld and himself a committed gamer thinks esports in cinemas will be a big revenue stream within 15 years. “If it’s commercialised sufficiently it could surpass studio product,” he added which, given the numbers, is possible. “Retail spend alone makes it worth investment by exhibitors.”
Let’s get some preconceptions out of the way. First, esports isn’t gaming. Fans in this area will roll their eyes, but to the uninitiated they may appear to be the same. Alban Dechelotte, head of sponsorship and business development at Riot Games — the owner of League of Legends — patiently explained to me that gaming is the business of playing games while esports is concerned with watching others do so. The opportunities are large but if they are to be exploited, cinemas have to be clear what they are trying to achieve in their estates.
Second, the generation gap. It’s not just about what the kids are into; gamers are not an anti-social, nerdy demographic you never come into contact with. They’re very social, they just don’t socialise the way their parents do. Gamers are already your core audience; they are already coming to your cinema. They are likely — but not exclusively — male, aged between 15-30. They are used to consuming media in ways utterly different from anyone aged over 40. Their preferred medium is online. TV guides and terrestrial television are meaningless to them. Their social outlets are Snapchat, Caffeine and Twitch, not Facebook. Gaming is much more aligned with the millennial mindset than feature films (attention span, agility, tech savvy, multi-tasking), but they’re also a generation used to not paying for content, something we will touch on later.
Gaming is a community, much like a Facebook feed. Georgie, a 22-year-old amateur gamer told me that her social life is tied up with watching other pro gamers at her friends’ houses compete for big prize money; they will all gather together and watch the tournament on TV via Twitch. Those with social anxiety find hiding behind an online avatar a huge release and it gives them an outlet and inspires confidence. Craig, a semi-pro gamer explained to me that gaming, in his view, is the only form of media where the gamer himself is actively playing a part in his own entertainment. All other content renders the viewer exactly that — a spectator. “Where else can you find that kind of fulfillment?” he sighed.
Surprisingly considering the younger demographic, the male-heavy ratio in esports has resulted in some ugly treatment of women; Georgie told me she is reluctant to use a microphone in first person shooter (FPS) online games like Battlefield as she has been on the receiving end of considerable abuse as a lone female in a game featuring multiple male players worldwide. “There’s a rating system now like Uber so it’s better than it was five years ago, but it’s still there,” she explained. Jonathan told me that the esports tournament auditorium therefore must be a safe environment where people can meet in person, perhaps for the first time, and above all have fun. With that in mind what are the challenges? More joined-up, long term thinking, managed expectations, investment in people and cinemas’ estates, likewise a deep understanding of the gaming culture at the executive end of exhibition. Like all event cinema content, cultivating esports is a long game and it’ll take time to find your audience.
Cinemas have a number of options available: to screen esports tournaments taking place live elsewhere in the world, to stage esports tournaments themselves or expand their offering and offer gaming areas in their lobbies with banks of consoles and screens. Or all three.
On the surface the conventional cinema auditorium, with its big screen and surround sound seems tailor-made for an esports tournament screened live — a League of Legends Summer Finals for example, but the reality is that these tournaments are lengthy — 4-5 hours at least — and the crowd are sociable. For that amount of time, they expect to move around a lot. They expect the lights to be low, not dark. This is a sociable atmosphere where people are meeting friends, and using their phones is a prerequisite, obviously. Consoles at the front feature actual gamers at work — the audience will want to see what’s going on. Cinemas have to be prepared to lose at least two standard shows to accommodate one tournament, possibly at an unsocial hour, and with free entry. Superficially this sounds a terrible deal. Conventional cinemas are okay for now, but to make the jump to the next level, investment in remodelling sites is increasingly going to be a consideration.
Show your workings…
It wasn’t easy getting UK exhibitors to talk about their experiences, which is revealing in itself and a reminder that we are still in the sector’s relative infancy; people are happier sharing good news in general. In Canada, Wim Stocks, CEO at Worldgaming and Collegiate StarLeague, a division of Cineplex has overseen a substantial refit of cinemas and with huge enthusiasm told me, “When you sit in a theatre, it’s designed for you to sit there and look straight ahead, there is no ability to get up and move around and that’s a big part of any esports event. They are 6-8 hours in one day and taking place over several days — quarter, semi, finals over two days.” Wim said. “You can’t sit there for two whole days like that.”
StarLeague is investing heavily in remodelling certain Cineplex auditoria, taking out seats for these events. “We have tried all sorts of configurations,” Wim explained. Jonathan Woodhouse believes adaptable seating is an inevitable part of the evolution of the cinema as a multi-purpose venue — and why not? In Turkey, one chain has embraced both gaming and esports, combining them in a series of lavish venues — banks of flatscreens and gaming suites as well as a refurbished cinema for esports tournaments — across the country. Adnan Akdemir, CEO at FDR Oyun Cumhuriyeti showcased his operation at the ECM conference in Istanbul in November with impressive early results. “We opened our first site six months ago in Istanbul and occupancy is around 20%. Our second at the Metropol mall is 25% and our latest, in Adana, opened last month with a whopping 50% occupancy at a 14-hour operational cycle.”
Mariam El Bacha, CEO of Cinepax in Pakistan explained the decision to move into esports; in an early experiment featuring competing teams playing in one of her lobbies, streamed live to a packed auditorium next door, Mariam was struck by the engagement of the all-male audience aged 15-24. The cinema was full. “They were shouting at the screen,” she laughed. “That decided it There is a market in Pakistan.” As a result, this year Cinepax will screen exclusive esports championships in an initial four of its nine cities this year, bringing teams from the UK to compete. They have launched a unique training initiative giving gamers the opportunity to improve techniques and compete live with their heroes. “It gives something back to customers, and gives gamers invaluable exposure,” she told me. It’s also the first time a cinema has actively addressed social engagement and is a major PR coup for Cinepax.
No-one said it would be simple
It isn’t easy for exhibitors. They are constantly being told to invest and upgrade, running to stand still. Studio product is their core. Esports take place at odd times of the day and night, conflicting with peak times. It’s not regular business. Esports companies still think about cinema in terms of revenue rather than as part of their marketing spend, a shift the music industry made a few years ago which helped its growth exponentially.
Certainly there are changes to be made if exhibitors are to profit long-term from gaming and esports, but in all likelihood these changes will pay off; this time the multiplex will benefit more than the indie — up until now the traditional home for event cinema. Jonathan Woodhouse was firm on this: “Invest in passionate gamers who understand the culture and medium as staff. A dedicated gaming events manager would be ideal. Invest in dedicated wifi. Invest maybe in your seating. Take the long view. Recognise the generation gap and the mindset of millennials. Find partners to make your events sustainable. Learn from gamers. It’s a mindset — gaming is storytelling.”
At Riot Games, Alban summed it up. “We’re privileged. We aren’t growing as fast as we expected, but we are thankful, not frustrated. We have trusted networks, good relationships with exhibitors and several great events each year. We are educating and being educated by our fans. But if you’re going to make a go of this, exhibitors need to think about scheduling esports as a priority, not as a back-up.”
With platforms such as Caffeine and Twitch offering free access to esport tournaments, the challenge for cinemas is how to monetise events. Cinepax CEO Mariam el Bacha explained that the appeal of cinema advertising pales in comparison to exposure sponsors get from partnering with esports producers who advertise during tournaments in cinemas. Such willing partners solve the ticketing issue, covering the costs of the tournaments. Wim Stocks added that it’s all about who you want to reach. “For Generation Z/Millenials, if you’re a brand looking to reach this audience then it’s through esports, via influencers.”
If the average concessions spend in a cinema visit is $10, as Oliver Delaney, European channel director at Coca-Cola informed me, multiply that over a 4-5 hour period. With a sponsor on board, free entry ceases to be an issue. Further to an association with Riot Games and League of Legends, Coca-Cola signed a deal last year with Activision Blizzard Esports Leagues to become the official partner of Overwatch League, such is the level of their commitment to esports in cinemas. Robert Borchard-Young co-founder of BY Experience, pioneers of event cinema and distributor of the Met Opera, trialled some early esports events in cinemas in 2015. The results were mixed. “The exhibitor community, to their credit, embraced the concept and those who were not 100% convinced trusted that we were trialling something new — and tried the initiative based on trust. We were open that this was a new concept and we were hopeful, but unsure of the commercial potential.”
To get around the issue of Twitch and Caffeine, he explained: “We invested in behind-the-scenes content so that cinema attendees saw bonus content not available elsewhere.” Making it worth leaving the house is key; the addition of exclusive content is a great PR tool and word-of-mouth recommendations can’t be overestimated. Simon Smith-Wright, founder of Advncr, a creative production agency with clients including Xbox, Red Bull and EA Games as well as key influencers agrees. “The moment has to be spectacular. But it’s about the shared experience. That can’t be replicated in your living room.”
This is perhaps why Alban is reluctant to scale up League of Legends to anything more than a Summer Final, “We’re not ready to do weekly shows,” he said. ”With finals, it’s an event. Football tournaments in some territories work in cinemas — but not weekly. It’s the same for esports.”
The technical considerations
Cinemas are used to their estates being used as multi-purpose venues, but the issue of wifi is a recurring theme. King Kima Perez, creative director at Hammers Esports, made his case very clear. “Give the gamers separate wifi access. Give them continuous bandwidth for the rooms where we are hosting these events. The worst part about trying to play a game is to experience lag, or internet drop off. That’s a gamer’s no. 1 irritation and losing the signal for a split-second could be the difference between winning and losing.”
Jonathan Woodhouse explained further. “A split-second lag wouldn’t be noticeable to an amateur gamer but with professionals participating, any kind of lag is 100% noticeable.” The irritation is akin to watching the winning goal in a cup final when the screen goes black, and everyone’s phones around you starts buzzing with the news that you missed. In addition to better wifi access, other solutions include networked cinemas so tournaments can take place between sites. For more on the technology, see p.30.