MTS goes into e-sports – Vedomosti

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The mobile operator MTS acquired the e-sports club Gambit Esports, two employees of the Russian e-sports companies told Vedomosti and confirmed both sides of the deal.

MTS bought the owner of the club – the Cypriot company Praliss Enterprises, says Dmitry Solodovnikov, a spokesman for MTS. According to the Cyprus registry, the sole owner of Praliss Enterprises on January 15 is Allegretto Holdings SARL from Luxembourg. This company is controlled by MTS, it follows from the data of the Luxembourg register. The previous owner of Praliss is Panamanian Gambit EC SA

MTS bought all the assets of Praliss Enterprises from one individual, says Solodovnikov, but declines to name him. Gambit Esports CEO Konstantin Pikiner declined to comment further.

Gambit Esports has 16 players in four disciplines: Counter-Strike Global Offensive, League of Legends, Dota 2 and FIFA, according to the team’s website.

MTS wants to develop on the Internet and make products outside the traditional telecommunications market, explains Solodovnikov. The operator is interested in a young and potentially solvent audience of cybersportsmen. MTS plans to use the marketing opportunities of teams and tournaments with their participation, create products for esports fans, promote the MTS brand through the advertising opportunities of Gambit Esports and offer sponsorship contracts to third-party companies, Solodovnikov said. The operator also expects to receive a portion of the team’s income.

The annual revenue of eSports teams is in the millions of dollars, explains Roman Dvoryankin, CEO of the eSports organization Virtus.pro. Most of this money is just prize money, 80-90% of which is received by the players themselves. Therefore, the main funds that are invested in the development of the team make up the income from sponsorship contracts, Dvoryankin points out.

The partners did not disclose the amount of the deal. Gambit Esports’ prize money exceeds $ 1 million, and in 2017 it could earn up to $ 1.5 million, estimates a source close to the team. According to Dvoryankin’s assumptions, the amount could have amounted to several tens of millions of rubles. Roman Chernyavsky, Editor-in-Chief of the Game Show TV e-sports broadcasts channel, estimates the deal at several million dollars: Gambit Esports has many players who participate in several e-sports disciplines, and the deal will include all the rights and contracts of the players, which constitute the main value of this asset. According to him, it is difficult to more accurately assess the amount of the transaction because the market is young and not always transparent. It would be cheaper for MTS to include a sponsorship contract with the team, but buying it will make it easier for the operator to promote its brand through the company, says Chernyavsky. In connection with the rapid growth in the popularity of eSports, more and more companies are betting not on short sponsorship contracts, but on long-term investments, explains Solodovnikov.

Although the purchase is very far from the traditional telecom market, it will come in handy for the operator – especially if esports justifies the advances given to it, experts interviewed by Vedomosti agree. It is unlikely that the profit from e-sports will be noticeable against the background of the operator’s main business, says Sergey Libin, an analyst at Raiffeisenbank. But he does not rule out that esports will grow into big business. So Libin proposes to regard such a deal as a venture investment. And operators need such diversification, since it is important for them to go beyond the traditional telecommunications market for voice and data transmission, which will stagnate, Libin agrees.

Over several decades, thanks to growing investments, e-sports will reach the scale of traditional sports and then become a profitable long-term investment, Konstantin Ankilov, General Director of TMT Consulting, is sure. Now investments in e-sports will really help MTS with the involvement of progressive youth, he continues: for the effective promotion of MTS, a cyber player can, for example, become a brand ambassador or an operator will launch special rates for gamers – all this will increase the loyalty of the existing customer base and, possibly, an influx of subscribers. …

The television audience for many sports is shrinking, while e-sports is becoming more and more popular among young people, says Denis Kuskov, CEO of Telecom Daily. Competitions in e-sports are already broadcasted by the TV channel “Match! The game, ”he recalls.

Big business has long been interested in esports. And in 2015, Alisher Usmanov’s USM Holdings invested over $ 100 million in the e-sports organization Virtus.pro, and his partner Yuri Milner invested $ 26 million in Super Evil Megacorp. This company created Vainglory, a platform for esports competitions from around the world.

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