AGORACOM Small-cap Investor Relations Blog

HIVE Berlin: Jens Hilgers, Peter Warman Discuss Trends in Esports

• Warman spoke about gatekeeping in the industry and the challenges of breaking in, and estimated that between himself and Hilgers, they have collectively taken more than 1,000 calls over the years from people who want to get into esports

By: Andrew Hayward

At the HIVE esports business conference in Berlin this week, influential minds from across the industry gathered to discuss the future of esports. Before the wide-ranging panels began, Jens Hilgers and Peter Warman took the stage to explore some of the trends they’ve seen and expect to see in the future.

Both are long-standing fixtures of the esports industry. Hilgers has spent more than two decades in esports, co-founding Turtle Entertainment  and ESL  in 2000 and serving as its CEO until 2010, when he transitioned to the role of chairman of the board until 2015. He has also co-founded G2 Esports  and tools maker DOJO Madness , and is a founding partner in BITKRAFT Esports Ventures . Warman, meanwhile, is the CEO and founder of gaming and esports analytics firm Newzoo , which was established in 2007.

“Every single time that something like that has happened in history, it was the most important and most exciting times for me.”

Warman spoke about gatekeeping in the industry and the challenges of breaking in, and estimated that between himself and Hilgers, they have collectively taken more than 1,000 calls over the years from people who want to get into esports—whether it’s startups, brands, media, or financial services. Carefully explaining the industry to people who are outside of it is critical, although both said that detailing the subject to government representatives is a less enjoyable situation.

“You sometimes have to explain what the hell is going on,” said Warman. Added Hilgers: “I try to avoid those meetings… those are the most frustrating ones.”

Many more people in recent years have seen the boom around esports, said Warman, between the excitement building around the industry and the money flowing into it. But newcomers who think that esports is a completely new thing need to be educated that it’s actually a long-running, gradually-maturing industry, he said.

“We have to explain to people: this esports thing—it’s been around for a long time,” said Warman. “It’s not this ‘hockey stick’ expectation, new industry thing, but a very healthy and growing business.”

Amidst all of the excitement and investment around the space, however, Warman and Hilgers both said that people in the space need to manage expectations for incoming stakeholders, in part to help avoid the possibility of a bubble. Warman added that part of managing expectations is making it clear that the rise of esports is not a standalone thing—that the underlying growth is tied into the popularity gaming and other industries and technologies. It’s also a matter of new generations growing up with gaming, esports, and digital devices.

“You sometimes have to explain what the hell is going on.”

“What I’ve been observing for the last 23 years in my career,” said Hilgers, “is that when we see the growth year-over-year in esports, it’s mostly driven by digital natives growing up with video games and the paradigm of esports.”

Looking back on his career to date, Hilgers pointed to key games that have defined or redefined genres and helped boost esports at that time. He noted the impact of Counter-Strike , World of Warcraft , and League of Legends  in the past, and more recently Fortnite , as each raised the bar for its respective genre and the level of competition and interest around it. If that kind of trend continues, then Hilgers said that we could see another paradigm-shifting competitive game in two to four years’ time that might draw even larger numbers of players and viewers.

“Every single time that something like that has happened in history, it was the most important and most exciting times for me,” said Hilgers, “because these new, genre-defining games truly elevated competitive multiplayer gaming and esports.”

Related Article: ESL’s David Hiltscher on Helping Fans ‘Commit With Their Wallets’ to Teams

Warman pointed to the exponential growth of both gaming and esports over the years compared to other types of popular media. He said that the wider gaming industry’s evolving focus on engaging fans, making them happy, and providing them free tools before expecting any kind of payment is helping to drive that. That’s seen both with free-to-play games and freely-streamed esports tournaments and related content.

“What makes us very special in games is we put time first before money,” he said. “That’s the secret sauce of our business.”

“I think there’s going to be a generation of games going forward that actually will start the design process by reflecting these assumptions in the right way.”

But there’s a fine line to walk, he continued, as some people have more time than money, while others have plenty of money and are willing to spend it within games. Creators in both the game development and esports sides of the games industry need to balance the accessibility on one end with premium features and services on the other. “We are entertaining people who don’t want to spend money or don’t have money, but have a lot of time,” said Warman. “And people that have a shitload of money, and they will all spend it in our game. One single environment has to serve both. Think about it: that’s very, very hard.”

Hilgers spoke about the impact of Fortnite and how its success has come in part from breaking the mold of the battle royale genre. It’s a competitive game, yes, but the colorful experience is also more accessible and targeted at a less die-hard audience. Games like Apex Legends, Call of Duty , and Overwatch  have more of a hardcore fan base, he said, while some Fortnite players simply want to play casually and hang out with friends in the game. It has wide-ranging appeal.

When it comes to the next wave of esports games, however, he said that developers need to consider the viewing experience as much as the gameplay and moment-to-moment action. “Having a game that is equally great to spectate and to watch as it is to play the game will ultimately make for the best esports games,” said Hilgers. He doesn’t believe that most games in the market now were built with that kind of mentality, but that developers are learning lessons from today’s games and their challenges, and that the next generation of esports-ready titles will be better poised to deliver on both fronts.

“I think there’s going to be a generation of games going forward that actually will start the design process by reflecting these assumptions in the right way,” he said, “and that will lead to a greater entertainment offering and elevate esports.”

Source: https://esportsobserver.com/hive-berlin-hilgers-warman/