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The two main platforms for esports distribution are still YouTube and Twitch. They’re free to access with good social media integration and have been great for linking like-minded enthusiasts. But despite the numbers, its still quite early in the development of esports, and monetisation outside of those main social media platforms is a challenge people are still working through. Currently, there is a fair amount of positioning between the different operators and associations, but how to get revenue out of esports seems unclear. The most obvious ways to generate revenue from esports include AVOD (video on demand driven by advertising) or a paid- for model. An early partner of Brightcove offered an esports service which charged users based on the quality of their stream, offering a free service and, for those who wanted HD or 4K, a premium version. HOW TO GET REVENUE OUT OF ESPORTS SEEMS UNCLEAR LEVERAGING TRADITION The formation of esports sporting associations is another area with potential, where stars and teams with money- making potential can be developed. We could start seeing those associations developing their own independent platforms, which might be able to develop closer relationships with players and audiences, diminishing the value of social platforms like Twitch and YouTube. Traditional broadcasters have been making some inroads as well. These operators have a lot of experience monetising large scale sporting events, and that traditional route could end up, ironically, becoming a consistent revenue generator. Esports might emulate the early days of televised cricket, where Kerry Packer and Rupert Murdoch tuned the game for monetisation. Packer invented the one-day series, because he realised that a five-day series was a challenge to make money out of in broadcast. Will we see the same thing in esports where media companies take stakes in a game and then tune the format to be able to monetise it effectively? There’s no doubt that in the long term, esports is a big opportunity, but it is early days. The sector still needs to mature.
THE PROMISE OF AI Artificial intelligence however – specifically machine learning – is going to have a much bigger impact, much more quickly, across all areas of the industry. The full scale of that impact is to some extent still speculative, which makes it all the more exciting. Machine learning will have fundamental benefits in almost every industry that has some digital connection, but the video industry has a particularly advantage in leveraging those benefits. The element that increases the likelihood of AI having real utility is data - without it, AI and machine learning are not that useful. One of the beauties of video is that it’s a massive producer of data. Every single frame of video that’s produced or watched gives you data. The type of content, the amount of content, the amount of time spent viewing it – all of it is
grist for the AI mill. What is exciting for video platforms is that they are hubs for data. The nature of what we do is to consolidate big chunks of information, both in terms of what gets pushed to the platform and gets published and then what gets viewed. At Brightcove, our initial usage of AI has been to improve video quality. We use the data we’ve collected and our video encoding data to optimise the quality of the viewing experience. In the long term, we anticipate a myriad of benefits from the technology that we can pass on to customers. ERA OF BENEFITS Advertising will be enhanced by AI too, with machine learning being used to predict what ad will result in the best engagement and result for each individual viewer.
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