ASSOCIATION

OF SUMMER OLYMPIC
INTERNATIONAL FEDERATIONS

IF GAMING AND
ESPORTS STRATEGY
SEPTEMBER 2021
 IF GAMING AND ESPORTS STRATEGY

Contents
1 Foreword 04

2 Gaming and esports: a friend or a foe? 08

3 Introduction to gaming and esports 12

4 IFs’ strategic positioning options 18

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 IF GAMING AND ESPORTS STRATEGY

Esports Report – Foreword

The Association of Summer Olympic International the status of the IFs’ engagement with the esports been engaged by ASOIF to schedule a follow-up
Federations (ASOIF) positions itself as a provider of industry, analysed the major determinants for IFs bespoke session with each member IF to discuss
added value to its members, the summer Olympic to adopt esports as a key part of their digitization individual strategic positioning options for them.
International Federations (IFs), and for the Sport strategy and studied the feasibility of potential
and Olympic Movement as a whole. business models. According to Newzoo, a leading On behalf of ASOIF and its members I give special
global provider of gaming and esports market data, thanks to the IOC for its cooperation and to all the
When the IFs pool their collective expertise and the global gaming & esports revenue would amass contributors to this report who freely gave their time
experience across many specialist areas they more than one billion USD in revenue for 2021 with and shared their experience and knowledge during
provide an unmatchable resource and one role of additional growth in media rights and the their interviews and to the IFs who contributed
ASOIF is to provide access to this resource, often livestreaming market. With an increasing number during the various workshops. Thanks also go to
facilitated through our eight consultative and of IFs engaging with gaming & esports, it has the PwC Sports Business Advisory team for their
advisory groups. In the case of this report sincere become important to develop a cohesive work in delivering the project working closely with
thanks are due to the Commercial Advisory Group, understanding of different strategies among IFs. members of the ASOIF staff who provided
chaired by Antony Scanlon, IGF Executive Director, supporting research and helped process and
ably supported by members Christian Volk, FIFA For the above reasons, we commissioned the consolidate the mass of information that was
Director eFootball & Gaming, Frank Leenders, FIBA current research project from PwC to aggregate collected in constructing this report.
General Director (Media & Marketing), Michael the perspectives of key players in the gaming &

1
Schmidt, WBSC Executive Director, Thierry Weil, FIH esports industry, including gaming publishers,
CEO and Thomas Lund, BWF Secretary General. esports competition organisers and IFs which were
already active in the esports ecosphere. This report
ASOIF´s Future of Global Sport Report, published in aims to deliver a clear understanding of the gaming
2019, concluded that in a fast-evolving world, sport and esports market landscape, to support IFs in
is increasingly subjected to technological, socio- devising a structured approach on how to address
economic and geo-political developments that all strategic questions and most importantly, to outline
sports governing bodies must anticipate and be strategic positioning options to help IFs define a
prepared to respond to. This report was reviewed way forward. The research has provided extensive
at the start of the Covid-19 pandemic in 2020 and information for our various internal groups and
the subsequent report, published internally to our resulted in some recommendations for our IFs.
members, highlighted the acceleration of many
trends which were already in play, including the ASOIF and PwC conducted two series of
growth of gaming and esports. workshops in February and June 2021 with
participants from 20 IFs. In addition, a number of

Foreword That acceleration combined with the emergence of

new esports bodies and rights holders meant that
the IFs could not ignore the potential impact on their
interviews was conducted with gaming publishers,
esports competition organisers and IFs which were
already actively engaging with esports. Following Francesco Ricci Bitti
sports. ASOIF research conducted in 2019 examined the publication of the report, the PwC team has President

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IF GAMING AND ESPORTS STRATEGY IF GAMING AND ESPORTS STRATEGY

List of Contributors
◥ Sean Parry, Commercial Strategy Director, ◥ Gustavo Arellano, Head of Commercial
Zwift Development, FIBA

◥ Jie Yun, Head of Brand, Tencent Esports ◥ Christian Volk, Director eFootball & Gaming, FIFA

◥ Miaobo Gong, Senior Brand Manager, ◥ Kelly Fairweather, Chief Operating Officer, ITF
Tencent Esports
◥ Horst Lichtner, General Secretary, IIHF
◥ Roger Lodewick, Chief Executive Officer,
Dreamhack ◥ Michael Rogers, Innovation Manager, UCI

◥ Philippe Guigné, Founder, Virtual Regatta ◥ Scott Over, Commercial Director, World Sailing

◥ Kerry Hopkins, Senior Vice President, EA ◥ Shinji Namekawa, Head of Global Business
Development, Konami Digital Entertainment
◥ Dylan Budd, Head of Legal, EA

◥ Stephane Schwander, Head of Digital, FEI

◥ Matt Smith, Executive Director, World Rowing

◥ Michael Schmidt, Executive Director, WBSC

◥ Yusuke Nagai, Head of Commercial and

Partnership, WBSC

◥ Valerio Cianfoni, Executive Assistant to the

President, WBSC

◥ Frank Leenders, General Director (Media &

Marketing), FIBA

◥ Nicolas Chapart, Head of Digital, FIBA

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 IF GAMING AND ESPORTS STRATEGY

Growing popularity Market outlook

Global gaming market,

of gaming and esports revenues in USDbn (2021-2024)

+5%

168.9 177.2
160.6
Over the last years, there has been a growing enthusiasm around gaming and 152.1
+5%
esports with both sectors becoming increasingly commercialised…
168.9 177.2
152.1 160.6

Headlines 2021 2022 2023 2024

Global esports 2022

2021 market,
+12% 2023 2024

Video games are a bigger industry than movies and

revenues in USDbn (2021-2024)
2.2
1.8 2.0

North American sports combined, thanks to the pandemic

1.6
+12%
2.2
1.8 2.0
1.6
2021 2022 2023 2024

Three Billion Players by 2023: Engagement and Revenues

2
Continue to Thrive Across the Global Games Market 2021 2022 2023 2024

Video games Comment

are becoming League of Legends is growing.
Traditional sports better watch out.
◥ Gaming and esports are increasingly becoming
spectator sports critical sectors within entertainment and media

◥ The global gaming market size is worth ca.

Esports pull in more viewers as USD 152 bn with Asia Pacific contributing ca.
Key to coronavirus halts live sport ma
Gaming is the
50% to the total revenues in 2021
tch es
Audiences
Unlocking New ◥ Esports generates significantly less revenues than
gaming; China and the US are the leading markets

Gaming and esports:

and have a combined market share of 56%
an Olympic Sport
Esports Take Step Closer to Becoming ◥ COVID-19 has accelerated growth

a friend or a foe?
of gaming/esports

◥ Given the close interlinkage of gaming and

esports, both segments mutually benefit from
Source: PwC Entertainment and Media Outlook each other’s growth

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IF GAMING AND ESPORTS STRATEGY IF GAMING AND ESPORTS STRATEGY

Opportunities in gaming Strategic challenges

and/or esports and risks
The active involvement in the gaming and/or esports segment provides important In addition, IFs must tackle various other strategic challenges when considering an
opportunities that need serious consideration by each IF engagement in the gaming and/or esports segment

Gaming and esports attract young audiences Esports has been developed Gaming and esports are expected
across genders and territories, hence, using the same fundamentals to grow significantly over the
playing an active role in the ecosystem for as traditional sport, consequently coming years, hence offering
the virtual version of the sport will help it could be considered as a new opportunities to leverage
to connect with younger audiences, genuine competitive discipline IF’s Intellectual Property, events
extend fan bases and strengthen with different requirements, and access to fans to drive
relevance of the sport rules and formats commercial revenues

Revenue Risk of financial The ecosystem The acceptance The IF must invest The gaming
potential for and reputational requires flexibility of the community financial and product requires
sports-related damages and agility is unpredictable human resources regular updates
gaming/esports
likely limited

The sports genre The IF may face Given the market As the game It requires To keep the
has low share of reputational and/or dynamics, the IF development is a dedicated community engaged,
the gaming and financial damages and its partners hit-or-miss industry, resources to it is crucial to launch
esports market, in case of must act with there is no guarantee activate the gaming new features
hence, the revenue data breaches, agility and adapt that a game will be and/or esports and enhance the
potential might integrity issues or to changing accepted and played segment and to gameplay on
Engagement with new audiences Creation of additional business vertical Generation of new revenue streams be limited ethical concerns behaviours quickly by gamers build an community a regular basis

Each IF must carefully firstly understand and evaluate what are the opportunities (or opportunity costs) for engaging (or not) with gaming and/or esports Each IF must assess both opportunities and risks thoroughly as there might be reasonable arguments not to engage with gaming and/or esports

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 IF GAMING AND ESPORTS STRATEGY

Definition of gaming and esports

The core element of both gaming and esports is a game title that provides the gamer with an engaging
experience and may convert into a successful esports title over time

1 2 3
Game title
The game (software) provides the foundation
for both gaming and competitive gaming (esports)

Gaming

3
Gaming refers to playing mobile, PC or console
games in a single or multiplayer game mode for leisure
or entertainment purposes

Esports
Esports refers to organised gaming competitions
(online or in-person) at a professional level and includes
both one-off events and season-long league structures

Introduction to
gaming and esports Within gaming and esports today the game is the central element around which communities are built.
Once a strong gamer base has been developed, competitive gaming can be established through organised competitions
Source: PwC Entertainment and Media Outlook

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IF GAMING AND ESPORTS STRATEGY IF GAMING AND ESPORTS STRATEGY

Gaming genres Sports genre game segmentation

Games can be classified into various gaming genres based on the gameplay, the most popular game genres are battle arena, shooter and strategy The sports genre gaming segment can be clustered into four types that differ in terms of gameplay authenticity and hardware requirements for the gamer

Gameplay revolves around storytelling, Gameplay is about movement and traversal

Adventure which is an integral part of the game and
usually has a distinct ending.
Platformer as involves the player jumping from platform
to platform and avoiding obstacles. Segments of sports-related gaming
Comment
Titles are defined by their simple The player solves a series of increasingly Mobile PC & console Sport equipment ◥ Hybrid
Arcade mechanics and short, repeatable play
sessions. Scoring is integral to the gameplay.
Puzzle difficult puzzles or riddles which have a
fixed, linear solution. games enable the gamer to
have an gamified experience
Arcade games target while exercising physically
The player controls a character with A significant share of the gameplay in mobile gamers, however,
Battle Arena set abilities, usually as part of a team. Racing racing titles is centered around racing Simulation Hybrid
The bulk of the gameplay is defeating enemies. with vehicles or animals. selected titles are accessible ◥ Simulation
via PC & console. Also, few games aim for a authentic
simulation/fantasy titles representation of the real

Gameplay authenticity
Players compete with others to become the Player takes on the role of a character(s) to offer a mobile-based version world and are played mainly
Battle Royale last one standing. Players can gather weapons,
armor, and other loot to gain power.
Role Playing have its own unique fantasy, specialization,
strengths, and shortcomings. on PC or console

In shooters, the aim of the game is ◥ Fantasy

Gameplay is about defeating a continuous games include fictional
to defeat enemies by shooting them.
Brawler stream of opponents. The aim is to progress
through rooms, waves of enemies, or scenarios.
Shooter The weapons of choice in most shooters characters and are played
are firearms or artillery. Arcade Fantasy mainly on PC or console
Titles mostly involve the player investing money Simulation games simulate specific
◥ Arcade
Casino or items (virtual or real), hoping to win back Simulation activities, situations, or social
games are low-complexity
more money/items via a random outcome. interactions in a recognizable manner.
games that are played mainly
on mobile or browser
Gameplay is about using collectible objects The core gameplay elements of sports
Deck Building (e.g. cards) in a deck. Players make decisions Sports games are based on or inspired by
based on available objects during the game. real-world sports.

Strategy games see the player making Physical activity level

Games are centered around direct combat with
strategic or tactical decisions, typically
Fighting another combatant which happens in small Strategy involving resource management (from a
arenas, often by means of hand-to-hand combat. Note: Fantasy includes fictitious gameplay and characters, but it is not related to fan activation games such as Fantasy Football Manager
top-down perspective).

Vehicular-combat games mainly involve

Gameplay in music titles is mainly
Music centered around music and rhythm Vehicular Combat the player controlling and engaging in
combat with armed vehicles (e.g. tanks,
as well as dancing. planes, ships, etc.) There are game categories that differ in terms of complexity of the gameplay, hardware requirements and physical involvement
Source: Newzoo

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IF GAMING AND ESPORTS STRATEGY

Esports segmentation
The esports competition structure operates from grassroots to elite,
with competitions varying in formats (e.g. virtual, physical) and locations (e.g. online, in person)

Segments of sports-related esports

On-site
Like in traditional
sports, only very
few gamers Amateur event/ Professional
become elite
festival event
players making
a living from
Elite

Competition environment
esports
The vast players
majority of
gamers play
competitively
for fun without
notable Online
success Semi-professional
gamers
Community Performance
activation focus

Grassroots
gamers

Degree of professionalism

Depending on the competition structure, events may target elite players only.
Also, technology enables participants to compete fully virtually with each other There are different game categories that differ in terms of complexity of the game play, hardware requirements and physical involvement

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 IF GAMING AND ESPORTS STRATEGY

Strategy development process

Comment

The development of a robust gaming and/or esports strategy is an iterative process and requires ◥ Developing an effective
agility as the market environment evolves quickly strategy is not linear:
it requires hypotheses
and multiple iterations,
revisiting earlier
assumptions once new
Elaboration Strategic Feasibility What's insights and information
of the positioning assessment next? are available
strategic vision option design
◥ IFs should first develop
a vision for their role in
gaming/esports

◥ IFs should then agree

on a desired strategic
positioning, followed
by a feasibility round

4
based on internal
and external factors

◥ If there is no
What is the long-term What are strategic What are the What long-term agreement on
opportunity and vision? options for IFs to IF-internal and roadmap to follow? feasibility, the
And which type of successfully position external dynamics What to do in short vision and strategic
gameplay is the in the gaming/ impacting strategic term to engage in positioning need
most promising? esports segment? decision making? gaming/esports? revisiting in a new
iteration round

◥ Investment
requirements
and partnership

IFs’ strategic
models, as well as
business cases are
to be looked at only
The development of a strategic positioning follows an iterative process

positioning options
when vision,
positioning and
feasibility are clear
Source: PwC Entertainment and Media Outlook

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IF GAMING AND ESPORTS STRATEGY IF GAMING AND ESPORTS STRATEGY

IFs’ vision for gaming and/or esports Types of gamification

There are various reasons to engage with gaming and/or esports: IFs should be clear on what objectives they pursue and understand related questions In principle, there are two ways to leverage gaming: either traditional sports are replicated virtually, or technology is used to gamify real-world sport activities

Non-physical gamification Physical/virtual extension gamification

Maintain relevance amongst younger generations
Comment
Based on The gameplay
◥ Gaming and esports can traditional of the traditional
contribute to the IFs’ sports, a virtual sports incl. its
overarching objective gameplay with physical aspects
to build and secure some degree remains the
long-term relevance of similarity to key part. Smart
Define standards Engage through gaming Innovate physical real-world sport and connected
in an evolving ecosystem and/or esports content sport experiences ◥ However, each IF may is developed equipment enable
have a different viewpoint and launched new (gamified)
on the strategic relevance for mobile, formats and
of gaming/esports PC or console communities
The IF could play an active role The IF could leverage gaming The IF could leverage Traditional sports Traditional sports
in defining global standards and/or esports content to drive technologies to make physical ◥ IFs could put their focus on
and determining rules for a active engagement and (virtual) experiences more attractive clarifying the governance
virtual or gamified version of interaction with younger and adapted to changing role, driving community
traditional sport demographics consumer behaviours engagement or innovating
physical sport experiences
• What do stakeholders want • What gameplay (e.g. arcade) to • What are the fans’ and players’
and expect from the IF? focus on? What about new vs. preferences in the future? ◥ The IF may decide to
existing game title? incorporate multiple
• What is the stakeholder • How will people like to strategic objectives
ecosystem in 20+ years? • On what channel is the content engage with the sport into its vision statement
distributed — own or operated? 20+ years from now?
• Who will ensure integrity of Is it part of a D2C-strategy? ◥ As there are various ways to
competitions, if not the IF? • What technologies to use implement the vision, some
• How do gaming and/or esports and/or any platforms/ initial questions are outlined
• Which developers/publishers fit into the broader digital communities to build upon? to drive internal discussions
could be interested in content strategy? Game title Gamified features
partnerships? • Should the innovation ◥ Ideally, all IFs develop a
• What access to data can the be competition- or viewpoint on initial questions
IF get? What is the CRM/data participation-focused? to define concrete measures
targeting strategy? in the following steps Focus on the virtual gameplay with some link to traditional sports, Focus on the physical activity while integrating augmented/digital
however, the gaming activity includes little to no physical activities features and ability to compete with others through a platform

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Gameplay design options Potential strategic positioning options

Therefore, depending on the degree of similarity to traditional sports, Once the IF has elaborated its broader strategy and objectives, it is important to
there are various types of gamification an IF may consider moving forward identify what strategic positioning (or combination thereof) is most suitable

Physical
Physical/virtual Non-physical /virtual
extension No gamification extension
Non-physical gamification gamification gamification gamification
Comment

Arcade Fantasy Simulation Hybrid ◥ Each positioning represents

a distinct way by which
an IF can generate value
IP exploiter in the gaming and/or
esports market

Engagement driver ◥ Positionings are not

mutually exclusive
and can be combined,
Game developer albeit one positioning
Gaming
should typically be the
dominant one
Arcade game Fantasy game Simulation game Hybrid game Traditional sports Platform developer
◥ Positionings do not
represent a finalised
Arcade games are Fantasy games include Simulation games Hybrid games enable strategy, but should
low-complexity games fictional characters and aim for an authentic the gamer to have an IP exploiter rather help kick-start
that are played mainly are played mainly on representation of the real gamified experience a discussion on the
on mobile or browser PC or console world and are played while exercising various options and
mainly on PC or console physically Engagement driver define sharper objectives
and concrete actions

Governance services ◥ To be successful

Degree of similarity to traditional sports executing the positioning
each IF needs to ponder
Esports Competition promoter if it possesses the
required assets
and capabilities
Depending on the type of gamification, there are multiple options to gamify IF's sports and to design an engaging gameplay
Platform developer

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Strategic positioning options Factors for feasibility

Each strategic positioning represents a distinct value proposition and requires Hence, IF-internal and external factors need reviewing to assess feasibility of any
different assets and capabilities to succeed; ideally, the IF can leverage existing ones strategy that has been shortlisted as part of the previous phase

Category Strategic positioning Description

The IF licenses relevant IP to 3 rd parties (e.g. publisher) for exploitation in the gaming sector.
IP exploiter The IP is incorporated into a gameplay developed by a 3rd party. Internal factors impacting the strategic positioning External factors impacting the strategic positioning

The IF collaborates with 3rd parties to produce (and enable user-generated) gaming
Engagement driver content which is leveraged to engage fans and gamers/athletes via owned channels. Strength of IP Market size
Gaming
Which own (or syndicated) compelling IP can the What is the estimated addressable market size
The IF creates its own game with the options ranging from developing a less complex arcade game towards a
Game developer IF successfully leverage in gaming and esports? in gaming and esports as of today and in ten
hybrid game. Ultimately, the IF aims for greater engagement amongst fans and gamers/athletes through gaming.
years' time?

The IF provides a platform connecting various stakeholders around the gamified

Platform developer version of the sport to build up direct relationships with fans and gamers/athletes.
Access to fans Dominance of existing competitors

What access does the IF have to the global How tough is competition in the marketplace
The IF licenses relevant IP related to its events to 3rd parties for exploitation in the esports
IP exploiter sector. The IP is incorporated into esports competitions organised by a 3rd party.
sports community? considering the dominance of any existing players?

The IF collaborates with 3rd parties to produce (and enable user-generated) esports content
Engagement driver distributed on owned channels and to directly engage with the esports community.
Value added services Investment requirement

Esports The IF offers governance services to event promoters sanctioning on/offline esports How can the IF add value to the ecosystem by What is the need for investment incl. potential
Governance services competitions which are played on either non-physical or virtual extension games. leveraging existing assets and demonstrating funding to establish IF with a clear value
capabilities? proposition?

The IF oversees the esports by hosting own events and sanctioning a

Competition promoter tournament across one or multiple game titles.

Assessment of internal assets and capabilities that can Market assessment to understand the implications of a
The IF provides a virtual competition platform enabling gamers/athletes to join
Platform developer organised tournaments for non-physical or virtual-extended gameplays.
be leveraged to execute on a strategic positioning developed strategy

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IF GAMING AND ESPORTS STRATEGY

What’s next? (illustrative)

Given the complexity of developing a long-term vision, IFs may consider a first-step
approach to gain experience in gaming/esports without larger investments

Partnering Searching Sourcing Learning

◥ Discuss partnership options ◥ Search for developers ◥ Go to the market and initiate ◥ Launch an RFI process to get
with an established game interested in launching a an open-source development innovative ideas and assess
This report is
publisher (mobile) sport title competition business opportunities
produced for
non-commercial
◥ Identify opportunities where ◥ Leverage existing assets/IP to ◥ Identify promising gameplay ◥ Disclose clear strategic purposes and all
the IF can add tangible value contribute to the partnership designs conceptualised by objectives that are of relevance graphics and images
to the publisher developers for the IF are for illustrative
◥ Access IF’s network and purposes only.
◥ Use the gaming/esports channels to promote the game ◥ Provide assets/IP developers ◥ Develop strategic options once
segment as a testing field can incorporate into the market feedback is clear Photos:
for new ideas gameplay
World Rowing
World Sailing
World Baseball
Softball Confederation
ESL
Getty Images

Moving forward, IFs can explore different alternatives on how to play an active role in the gaming and/or esports segment despite Design:
being at an early development stage
Touchline
(www.touchline.com)

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Association of Summer Olympic International Federations

Maison du Sport International
Av. de Rhodanie 54, 1007 Lausanne - Switzerland
Tel.: +41 21 601 48 88 Fax: +41 21 601 48 89
Email: [email protected] www.asoif.com