Esports Salon Ep 8: LCS Franchising Era (feat. Reginald, ocelote and HotshotGG)

okay welcome to episode 8 of eSports salon and this is going to be a special reunion episode for people who are good in season one of legal ages no just kidding obviously it's about the eSports industry so we're going to go around the overlay so I can introduce all the people here so in my left in the overlay is former mid laner of Team solomid TSM and the second-best Cassiopeia player in the conversations at the moment but still number 2 pretty good its Reginald obviously frontiers I'm Phil owner of the team and had a very successful legal edges team they've won many titles they've been in every LCS final haven't had a team in csgo we don't talk about that anymore though and they also actually did have an overwatch team but again we don't talk about anymore oh and discussed no need to talk about that purely about League of Legends Reginald you I'll keep moving on the overlay so in the bottom right corner we've got the best top laner in the conversation although there was another person in the conversation who tried to do that one time but that one even worse for him don't worry hotshot like I remember when he actually tried to swap with Kevin and it didn't work out well places even came to an MLG ultimate right I think was a MLG he came to it didn't work out well anyway so it's hotshot GG owner of CLG who has both a league of Legends team not quite as good now but they were good about a year ago and has a csgo team who actually were better than expected recently so he's not bad he's branching out this point right he's gradually working as when two other games you know but the last guest is his name is now Carlos are like he's the only one who's abandoned the alias you know I'm he spent his whole career just non-stop spamming the word also a lot months you know that also up world and mousepads up enough for some weird reason it's just Carlos are the most generic sound in Spanish name you can ever have but Carlos are older of g2 and used to be called gamers – but you did a good job disassociate myself what do you have all these photo data but that wasn't that wasn't the best piece I think was a good idea to rebrand like forget g2 g2 eSports not gamers – and at the moment is killing it in all the games you know who's in the MSI final and legal legends he's won all the EU LCS is t much he just won a huge tournament in csgo so currently you can just do it all so the topic of this discussion is that we no longer have to discuss like will there ever be franchising in League of Legends you know what would happen if there is now franchising the na LCS will have franchising although I noticed they purposely changed the wording so it's something like it's like permanent partners whatever that means and you you've to buy in for a certain amount the figure we saw was 10 million dollars and the NA LCS that is franchised in the comics see I think I said starting in 2018 so obviously two of the three people in this conversation it's assumed will be part of this franchising in el na LCS so actually I want to start off and I just want to ask also on because also as far as we know EU LCS is not whether we'll be franchising so I just want to know this does also plan to be part of the franchising would would you think about for example having a team in in a league if you could have a franchise spot what do you think about this whole topic yeah I mean the possibility is there the reason is because I consider g2 notice an european organization but it's a kind of western world organization and our kind of reach within the u.s. is growing and growing so and i see within the long term there will be much more present and expanding to the US more often right so it is a possibility for us and it wouldn't be something you know that would i wouldn't i wouldn't need to change anything from the company from a structure standpoint or anything of that nature so it will be a fairly easy move now it is a matter of does it make sense from a business standpoint in comparison with whatever you is working on and and that's that's essentially the question that we're asking ourselves right now and and as we get information and information and digest it we gotta take a decision very soon right what do you guys think of that the guys men either because of that's an aspect no-one's really thought of you know everyone assumes right NLCS it's just all the teams in na LCS now but presumably by the way it was worded with the whole permanent partner thing in the million dollars at Sarah I assume like yeah there'll be some teams will get in but some moment so if someone like GC wanted to be involved and they were going to move to na what would you think of that George you want to take this question first yeah sure so I think it would be a significant brand hit if someone like Ocelot who's literally right now considered the kings of Europe to like head over to North America so you kind of have to like assess that that loss of value so I don't see any of the big teams moving over I'd guess like a lot of these smaller teams like misfits would want to come over to North America especially misfits who's based in Miami will they get in who knows right the application isn't as strong coming from a bottom half LCS team so we are they are they bottom half I thought their top four are at the fourth like TL of Europe are they okay their sixth I think okay yeah so I mean I think that it is a little confusing um in terms of just like how g2 is it identified right cuz if you look at it you know they have three Europeans and I think two foreign players is that right and so if they were to switch over it would be a pretty big roster change for g2 so that would be kind of weird because a lot of their players are really popular and they're identified as like the kings of Europe as hotshot mentioned I think from a competitive aspect though if ever I was purely just looking for a someone that can build a competitive team then also would be you know really big top candidate because he had he's had a track record of building a winning team especially here I mean Vince Peters a time aside recently but I think uh when we talk about permanent partnerships there there's a lot more that goes into it than just like the competitive nature um there is you know like multiple categories that you have to yet the work on for example and so I I did think that he would be like uh he I don't think it's a plication would be weaker than anyone else of mine I'm not even sure which teams are going to make it at this point so if that was that would be something something interesting to talk about so yeah that's that's a great topic because obviously when it was announced okay I know it was though adversity to quit who they had to do that interview with Travis they had like noah from immortals who was the other one was originally it was heroes the u2 is the owners right and then they had some guys from right there sit so they did that as if to imply like you know these guys probably would be part the league but no one knows beyond that who would be in the league who even can for example raise ten million dollars you know so I have a question here which is as far as I know no one in this chart has big outside investment into their org and that's been one of the topics of conversation the last few years so could everyone in this shot even get ten million dollars and get into this permanent partnership in LCS absolutely yes I think I'm hotter person sure the answer is yes I don't know about the rest but I mean I would I would argue that for for your Chen and Andy the same thing but at least for g2 we didn't raise purposely because we wanted to we understood that everyone was raising and then there was a lot of those a lot of demand but it was sort of offering as well right and I understood that if everyone raises at some point there will be not enough proper companies proper franchises actually I'm willing to raise again and therefore they will be scarcity in the market which is exactly what's happening right now and then we have all of a sudden a bidding process everyone wants to partake in in a top organization in this case such as g-tube and and it's just we can get much better elevations and much better terms in general so even this was a conscious move and I don't believe that any top five top six eSports Club overweight or on the Western market let's say it has any issues whatsoever kind of raising this kind of money okay yeah so I mean to answer your previous question thorn the reason why no and I were on that show is because Travis kind of reached out to us on spin it's ok you guys want to be a part of the show you guys would be like two good people to be on it because Noah likes talked law and for me I mean you know with how visible I am in the legal and justice system and it's okay so I literally like confirmed like at 10:00 p.m. the day before it wasn't like it wasn't right requested I think it was Travis requested so I really don't think that show you know I don't I don't think that indicates that we're going to be a part of the permanent partnerships another question about the finances to be honest with you I think any eSports organization in the LCS anyone in the EU LCS any eSports organization that applies can easily get access to ten million dollars because we could do is you could you know look for investors there's there's a lot looking at the spacer now I think the key the key of getting in is that other three things you have to be really good at right like Brett's looking at owners that can you know help generate more revenue for the league so make sure that the ecosystem is really strong to make sure that the league's really competitive and so I do you think that existing teams have a huge advantage here um but like I'd really don't think the finances it's got to be like a big topic okay so I obviously you can't talk about the specifics of the deal and so in that sense I guess you can't give me an exact answer in an abstract sense if someone's a casual fun and they hear it costs 10 billion dollars for a spot but a lot of people are just gonna think how could it be worth that so what can anyone tell me how could it be worth 10 million dollars to to be a better partner but I mean if you look at it right um right now on the ecosystem sponsorships are always growing if you look at um if you look at how teens monetized right now for how much reach we have we actually sell at a much slower rate than what you know traditional sports seems still not per user right so I think that once we once we get better at monetizing an audience that that 10 million dollar figure suddenly doesn't sound nearly as scary as before um and so I think it's I think one of those cases where expectation is for us to constantly improve that running our business to the point where that I figure is something that you know is this not a big deal yeah and right now meteorites aren't really generating much revenue and so with like you know a league you have an easier time going to a party and then kind of like the NBA has their leak wide deal at the national deal it just brings in a ton of revenue that can also generate a huge chunk of money for the league okay so if you remember that was an issue that came up I think it was last year right when you did not let her to write about the idea that you wanted to have franchising and more opportunities to earn revenue what limited you before franchising came along from making more money or getting more money into the doors in League of Legends like what were the limitations before um so to answer question right arm I think that letters I sent shared opinions of this multiple people over array I wanted to touch on problems that smaller teams had and I wanted to touch on problems that bigger teams head so I to answer your question well I felt strongly most about was your ability to get relegated so first one like TSM that's been in the league for the last seven seasons or you know nine splits or whatever eight it it was really depressing to me because every single split felt like a really big struggle even though we had huge success and we went to the finals every split I always treated every split as if it was our first foot because relegate relegations essentially meant the death of your organization when when you want to build a successful organization you have to have the right infrastructure you have to have staff you have so on you know get food for the players yet that yep they're like like there's all this infrastructure cost at the higher sales people you have to hire account managers you haven't to hire someone to do accounting finances etc and you have all these people that need to rely on you and then you also have players that rely on you too and when you get relegated essentially what would happen is that a lot of your machines would go away relegation would mean like the death of your organization and so I felt like a lot of teams contributed you know years and years and years of building up the league but for someone like TSM we could still go away within a matter of six nine months and that was something that was always really stressful and uncomfortable for me so you know I wanted to make a heavy push for permanent partnerships because I really felt like that was about what that would be better for the ecosystem not only from like a a stance of mitigating risk but also if we do go to permanent partnerships we'll be able to sign longer-term sponsor deal with longer-term meteorite deals which in return will drive more revenue and be shared with the players so um it would bring stability to our staff it would you know increase revenue of our players it would honestly make the ecosystem better so that's also coming from Reginald who's historically the most successful in terms of maintaining his position in the league and imagine what that thought process like he's already thinking about oh god I got a I got to worry about relegation people lower on the list like we even came close ourselves I think that that is part of the reason why the ecosystem just went out of control in terms of financial perspective is because people are constantly worrying about oh god if I if I get relegated then I lose everything and so it puts people in a specific mindset and I don't think that's good for the ecosystem and I don't think that's good for the fans either yeah I mean people get relegated into you all the time is it a problem na you as well so there's different points I think I think philosophically you may agree with more franchising or more kind of this European soccer system instead but I feel like the key point here is that there's only there are many variables in place okay but there's there's only ten teams okay and out of those ten teams actually three teams scroll down right oh I think yeah two or three teams cougar down that's that's the 30% of the league would literally be in you know nowhere nowhere close in the next three months that's definitely too much in my OMI is to some degree I do like the competition attached to having some kind of relegation for those teams that are tanking but I agree with that when there's literally 20 teams in the league and two of them may go down I win 10% when during the bottom 10% of a really big pool is because we read backup okay however there are however there are other variables in place okay which is the first of all in football in soccer which is the example we use there are 22 players per team right and you only play with 11 well in league of legends the system does not justify the expense of a team like ours which are the ones that are doing probably the best or some of the ones that are doing probably the best it doesn't justify us to get good enough SAP apps that would be able to be used in case our top player dies right imagine okay so seriously they were not able to play okay our in our cells okay our top player gets hit by a bus again and imagine you rely on that guy then you go down into second division in the challenges series and what what the you can do nothing that's it that's the biggest problem here because the whole infrastructure and this is not anyone's fault it's just the game is what it is right it does not allow for good subs to be part of a team and that and that leads to this problem and then it no now to finish this point and I do think that in another franchise system where people can go down let's take 10% ok can go down and it's if you still manage to kind of reward the teams that are stay in the league enough in other words if the if in a null relegation sorry in a relegation environment the teams that stay in the league are rewarded rewarded better than the teams that are in the franchise system then it would make sense because it's more risk more you know it's just fair is balanced however that is not the case and for that reason it would it would not make sense to have a system that is franchised on one region and a system that is not franchise on the other when the salaries are going to be pretty much equal when a lot of variables are going to be pretty similar that creates an imbalance and furthermore it will make the players the best players from that one region that can get relegated to want to go to the region that cannot get relegated for obvious reasons what do you think then virtual I mean do you think if you isn't franchise the NA is do you think like as also lots agenda well we just have to start players from EU make their way to LA I mean I think it I think that right it has a different approach to Europe so I can't really answer that in terms of like a confidentiality standpoint but overall I think that there there's going to be its strengths and weaknesses rate in terms of just how we monetize I'm fine to be honest with you I'm not exactly in tune with the complete details on how everything will work it so I just can't yeah I just cancer that but from what Carlos was saying before I think that there are ways to make it so arm to make it so it's it's successful even with relegation rate so a good example is a good example is EU LCS right relegations exist but there are financial incentives to stay in the league or there are still financial incentives where there's the ecosystem below you will see us where it makes sense in your organization so exist and run the same even when being relegated then uh III agree with that sentiment um but I'm not exactly sure how it's gonna play out during recruitment and until we get there I mean for the sake of clarity I didn't mean that your LCS was gonna be anything because I really don't know or that na else isn't you know it's a matter of philosophical is a philosophical question right okay so I have a question so the NAO is there since you guys haven't taken in the investment so far and there have been teams in the league who've had a lot more investment than you and even had salaries that were ridiculous you know was there not an element of that that you liked like did you not like the fact that it's essentially kind of like it didn't really encourage people to put ridiculous money in because they could end up like energy they could you get relegated you know they could spend all that money in the league in that scenario where there's just a franchising system what if that guy comes along with all that money and he invests it all they doesn't get relegated now isn't the pressure on you to pay your players the salary that he places superstar player well in a franchise system we would have like economic levers right you to stop people from doing that so something like a salary cap like in the NBA at the NHL or something like that well Ike I don't again I can't say anything about what Riots doing or if I will do a salary cap or they won't but there's there's a lot of different levers that can be pulled in that circumstance similar to that here I mean honestly though there's been yeah if you look at the teams of generate that's been like eight times more than the teams here or there's in make cases where teams are teams that have came into the LCS that has been like overnight like over one annual year the sellers tripled because of you know like tournament investment teams coming in to the ecosystem and they're spending at the point where on you can't really monetize to that point um they still didn't have competitive success rate so I don't know the legends it's it's it's more than just doing dollars at the problem it's really about building a culture of succeeding and you know really fixing your issues I I don't think I had that dug it wrong the team came in it's been like 20 times more than us and they take like all of this talent for their subs and their starters and our starters were worse than their subs that I could see a world where we would get it on don't get me wrong but um that would really what to do you'd have to see like Bill Gates Steve Ballmer like some just not just like one billionaire later most ability just cut in just like I'm gonna take everyone that then I it would be difficult but I still think that we would win for a couple seasons first before before it's extremely challenging but I mean that's the reason why I bring that up is essentially what I'm kind of saying is that unless unless as George just as an abstract point that was for example you know something like a salary cap some way of limiting is that you couldn't just invest in limited money as much as everyone might think who's an owner who didn't take investment oh this is fix is the problem of the guy who comes in spends all the money it doesn't it just makes it bigger like if anything if that guy could convince someone in a relegation system to give him a million dollars he might get some idiot to give him 30 million and now we might just buy every player for two million dollar salary you know a year like long as there's like limitation fact that you could do it right because the problem is in a franchise system presumably you guys want to make a profit you actually wanna make money off legal edges and not just invest for ten years down the line but it does all always be idiots who can get money you know who don't care about that now is that not an issue I think that I mean what we're looking for stability um they're like one things that people don't count for it is there there's asset values even if we're losing money it's fine as long as it doesn't go down I more or less but I mean it like the George wins right it is a sense of us working it was all the time so I think I think we can still win and you know that becomes a huge issue for the league then I think that the address is I believe it's one of those cases where one dude just picks up like 50 starter players and honestly a lot of the players that are the very best and what they do right now in the league a lot of them can actually just quit become streamers full-time but they're they're willing to make lust to basically play and start or it's at like one team could really only have five starters I really don't even if you if you even if you hand-picked the five best players in any else history I still don't think that they have like a higher than like 60% chance of winning the LCS consistently like to be honest with you okay what about since we don't know the teams that will get in at the moment people think that relegation doesn't matter because they think that you're just waiting until the franchise system starts and then the teams will be announced and so at the moment most people looked at it from the other way they look at like oh is it worth it for the Challenger teams right now you know but I want to ask this on paper someone like Team Liquid should be a shoo-in to get in and they've already got the investment I've already got a long history in the game they've got a good owner they've got all these factors but if they get relegated could've happened last split if double of some play for them if they get relegated does that matter with the team of that still get into the franchise system what are your thoughts I think they I think they would it I mean it just comes with a higher price rate because well runs doing is it's pretty cool so the teams that don't get picked even though they have an existing star right now they're still watching out for those existing teams so yeah then you'd like by yet to buy this there's thought-out right and so I think it just comes with a shaky huge tree but like if you look at team with track record I mean they've been in the season as long as someone like us like you know nine spots now take forth a lot which is pretty good they've been bleak for everyone just seemed weird that didn't exist we were gonna say I'm biased because he's my friend but you know the truth is you know I would want to see someone like CLG go away though where he'd rivals or like if GT was part of na LCS you know Carlos and I go way back and he's shown like extreme competitive success I wouldn't want to see him going on there I think CL is like if I had a guest like they they fit the picture they'd do something about the competitive competitive ministry now Russia sure of its short term or long term but they're pretty bad right now yeah I mean they were they were consistent for so long consistently taking forth for such a loss of my bad yeah well that is yeah exactly pretty good and and I think Steve did a good job at though did a good job with his brand and marketing his brand and actually selling on his brand he did a really good job in that part and so he goes through a period where all the talents locked up the contracts you know he has two imports on his team can't get more and he's in a really really tough position and this is just kind of like the mechanism of relegation who's causing so many problems and that in that way it just I really feel for Steven I'm not as close to to him as Reggie yeah it just sucks what do you paddle so long like is it like for example even though original said that in theory he was just on my interview because he was just asked last minute and he decided to go on you know people assume that all the big names will be in like even if he says oh no one knows that my mortals will be I mean I'll tell you right now I'll bet any amount of money they obviously will be like that's exactly the sort of person you would expect to be in theory has the track record will it be all real names giving us a lot I don't know exactly what are the variables right would look look at in order to get the team some word but if I had to make I mean red this is pretty good at their job and I think that they understand that where their audience is is we can be endemic companies so to say we think the companies that have grown with the industry and have grown these fan bases and have you know of course you can maybe bring LA Lakers about the Saturn or whatever but at the end of the day will not really create or generate the impact you intend to generate with this franchise probably not because one is because it may be you know the first two months is going to be a great LA Lakers are here and blah blah but at the other day and and you know you may have some basketball fans have always been part of the Lakers and whatnot but people that grew with eSports are not necessarily traditional sports fans so none of not all of them will relate me myself I have grown loving soccer football yet I still had SK gaming when I was in no one you know SK gaming was the team I was looking up to and I was the idol of spawn the black the black player from Sweden played csgo for ASCII gaming and I was and I was telling myself one day I would play in sk-gaming you know I would I was not telling myself even when I was playing football you know it wasn't even like I wasn't such a farm boy a puto and that's because I feel like millennium post Millennials they're following sports for the most part our fans of eSports teams and it's much more valuable for a company like Riot to have a kind of diehard fans from CLG TSM g2 you know that they're you know those diehard fans have been during the wins and the losses in the content pieces that they create in every story line you know and and and and kind of feel in sync with that story I don't believe that a traditional sports team can come in with a completely different storyline and background and kind of get the spotlight I don't think that's a good long-term approach and now with that said I really don't know what is what they're looking at and in terms of going to these variables this is what I would do myself okay yeah I mean I think that any single LCS team although any LCS teams NDL teams EU LCS teams have a solid shot I'm actually getting in to the franchise it's they just really have to look at their weaknesses and find partners that will complement their weaknesses right so like your weakness that you think would keep someone out um I mean not being able personally knowing like yeah okay so like um I mean I I think a big weakness that would keep someone out it's really like their ability to grow their fan base and and their brand there are a lot of like na LCS rate um there was there was a time period where Rai expanded from eight to ten teams and I really felt like for the last couple years two to three teams in the LCS I've just been completely like garbage like they didn't really put that much effort into creating content building a fan base they just invested LCL see us because there's a hot thing and they knew that that was going to be valuable I think that uh that's like a huge weakness in order for the league to be successful you kind of you're going to want the rear should be high you're going to want to cure your brand um I'm a good example is like if you look at they want and they really capitalize on it and they they develop really strong fan base for them right I would like to see that out of a lot of other teams I think that that's like a key component is from the military if you have years you're not gonna be able to get sponsors you're not going to do anything I want to see teams that have a really strong track record of building brands and so um if your your weakness is building a brand but you're you can build a competitive team then you're going to find some top like top level dude that can help you build a strong brand within this ecosystem whether they had success building the Trump brand in other games or they had strong success of building a huge brand outside of eSports I think that that would be key component you know I think like honestly the 10 million number that's being during REMS seems big but they're they're enough investors right now that you can find to do that and I you know it's like you know Whalen mentioned on on the show with Travis that rides ultimate goal to have the most competitively possible so if you're a shitty team that said you know you're in the your your the bottom two for the last three years you're barely making it in but you're still avoiding relegations um maybe you hire like a huge coaching example Korea Europe wherever does you look worldwide to hire the best competitive team so I think that there's like a lot of things that people can work on but if they go all-in and do it I think they could you know there's like so many ways you can approach it like if I was a smaller team struggling for cash maybe I just do a joint venture with a major investor and spend resources to strengthen all my other categories so I I actually don't think that European teams are that able to kind of raise money I think that I would say and maybe I'm being even too optimistic only three clubs in Europe India NLCS Europe can actually raise that kind of money so to some degree I am under Dame this is my perception under the perception that this ten million number does not have a base from a business standpoint so much but it's more of a filter you know it's more of a filter to see if you can actually even do the business together I mean you can get the money then the first test it's kind of past right then you can get into whatever brand you know whatever you want to talk about but raising ten million you know from North America is actually that's what I said before you know the top six teams worldwide within the Western market I feel have a really easy time kind of raising that money because also you know there's other games involved and well you name it but the did you know the bottom I mean not even the bottom like they did the rest xx the rest 14 teams you know from the LCS I think I'm going to have a much harder time because money doesn't doesn't grow from from trees you know my money in it and yeah you may find a sugar daddy which with some of the some of the some of they or some things have found sugar that is and this connects to just previous to your previous point about about kind of the salaries raising but typically those sugar daddies you know egos hand by the competitive failures in combination with the amount of money they spend on the team it typically go hand by hand with the fight their sugar daddies and they have no idea what they're doing you know so so yeah I think the ten million is definitely like a filter so to say and we in regards to to what reginal said about kind of LCS teams especially the bottom three you know that don't create any content like I hate it man I hate it because I am sorry I hate it because they are making my business worse and I'm very much a valiant with these things and I'm extremely pragmatic and extremely kind of emotional as with these things okay and I think these people are the parasites that are kind of shocking from their bottle hahaha I'm serious I am I feel serious this is clubs that don't generate any content there the parasites of LCS people watch them because because people want to watch my team because I create content you know they're completely irrelevant and they're the main reason the main reason actually we couldn't monetize any better in just just you know years back and that does the truth because I didn't say if I play a tournament I'm the winner of a tournament that has 20,000 viewers ain't good for you right what can i generate with that but if I win a tournament that is watched by 300,000 viewers concurrent consistently because the rest of the teams are creating content is just fun production quality is nice and you have storylines and drama then if I can I can sell my you know I you know I I just like that I prefer I mean you just say the in ear opening intro business it is really really bad sometimes because not even three teams like six teams don't create any kind of content and what can you do can you say is you should generate more content you can tell them how to how to how to do stuff right those are the very basics if they don't even understand the basics of how to build their brand with power well yeah that's that's a problem with the system like the fact that matter is everybody's main focus is avoiding relegation that's that's the that's the number one thing you build your business around and if the property was different maybe we would think about it like how do we build this as an entertainment platform how do we get the most viewers but like people aren't thinking that way because the system has been set up like that so that's why I'm so like happy that we're at least changing things up and moving to a different format because I think we can get to places we can get to a place where we focus on in my opinion things are more important like you know how to build fan bases that are long and lasting how to really give to the fans make sure that everybody is having fun and to you know make sure that we raise all the teams together so that the storylines are strong I personally think that if everybody levels up you know it's better than having one team when all the time you know I want to see you know the standings go up and down I want to see it like different positions so I think that's a good point yeah like when you win some time you know I'm serious like sometimes within Europe you know we did you know as it's been pretty one-sided in Europe lately and I actually don't like that I really don't like that I went to every single Final and I was just there knowing that we would win and that's really bad thing to have right and imagine if you're a hater I mean I'm I'm the owner of g2 imagine if I'm a hater like would you even watch the game you don't even watch you know you don't want to watch the game right so so everything connects to drama and unpredictability and I know that we will win against I was about to say a name but that's I'm polite so I'm not going to say a name everyone but yeah but I mean I was gonna say you know one of the lower teams in the in the last season and it was a harder percent victory right yeah one thing I do want to say though on the church on Carlos is earlier point was that I even though you see 10 million as a barrier I see it as something that to really Frankie and I I really feel like anyone can get it because if you make you if you make it if you make your investment contingent on getting into the ALCS franchise right we're just basically telling your investor hears that hey if I get in then you then you're going to give me this capital and if they go about it that way then you get any investor because they're they're more than twenty or thirty investors willing to try to pay you know ten again to the franchise so if you just talk to this investor to say okay I want to submit an application you're going to be my you're gonna be my capital if I get in you're going to provide this campus Yeah right but that connects to my point which is that but by what you're saying except actually there's not a single team that has the cash in in the bank okay unless they just raise recently which means that everyone plays they're the same rules right which means that everyone yourself included TSM the biggest League of Legends brand can actually or are you are going to do that essentially so if you are going to do that and mister no one random team number three is going to do that at the end of the day everything is going to come down to the brown power everything is going to come down to the variables that you already know in which case then there's no team from outside the environment that you already know that can get in because you are playing on the same variables well I mean III think I think for TSM we have a huge advantage because of our success in the psychological system I mean just me straight for with you I think that we've done a really good job with that but I think you know a lot of the teams in the LCS are actually weak really weak about it and and if they don't see it as a weakness and if they don't see that they need to change a lot of things up and you can offer a better solution then of course you're going to get in right just say like you hire someone to do some why do you it's already shown that you guys can create a lot of content and you guys have had success with that now imagine if you get to own that even better are you not only have a proven track record we you're getting things on even better how is someone going to justify a weaker brand versus it like a weaker brand getting in you know like um yeah it's hard to say but uh it's really it's not about just doing it and making a brand it's about like doing it better than like people applying okay even if you said that everyone in your opinion could get the sponsorship you like the investment because like as you say you could literally make it where you know you – you have to give me the ten million if we don't get in even so like he's like we've already mentioned some brands are already in else yes I'm actually very good and some of those teams haven't been around very long and don't absolve seem to really know what they're doing so do you think there will be fewer outside brands come in I mean everyone's heard for years and years the ones that we've mentioned our LA Lakers not Cuba and the guys who own the Patriots everyone said that these people at least had interests you know which is before a lot of them thought they couldn't justify the investment because of the relegation model you know presumably some of these people will come in and just make a team they won't just partner with like teammate or whether the you know someone that no one cares about don't actually try and make you know their own their own squad what do you think about don't always think it's quote before buying this look then no no one's gonna make a squad period I could curse but the issue is that like if you're a billionaire and yet endless amounts of money and you want to own a team they want to own a team and go there and watch and support their team they're not going to want to operate and run their team right okay and so they're gonna have to hire an eSports operator to run their team anyways so if I was a billionaire I wouldn't just say I'm gonna make one squad that's way too much work for the amount of satisfaction that I'm going to get even if I think it's a good investment oftentimes they would just find someone they did think that has like a crazy or a huge track record to run it for them yeah we just rather buy CLG don't you yeah I want to buy you a period that's it that's that's that's in our circumstance everybody in this meeting I would say that's true but you know for some of the little a let's just throw it you were a pro team at exact resulted just threw it through I was talking about it Phoenix one okay or even fly quest right both some are applicable okay if the LA Lakers come in and they're like here's my business plan I'm going to start up a team you know these are the eSports people I'm going to hire and and this is like the storylines I'm going to create and if P ones just like well I'm p1 and that's their application you know I see in a circumstance like that right my favor non endemic theme I think that there's a circumstance that because I'd be surprised if every single team in the LCS currently just got in AI but that's because these teams you mentioned haven't done a great job branding essentially that's not that's a big big big problem right because I mean if you ask me you know a Mark Cuban is going to come is gonna buy a team is going to hire the best possible talent and I can tell you right now it doesn't matter how much money he uses for this I can tell you I we're running circles around the team I will make sure I'm serious I would make sure that my team goodness girls run it down oh there you go and I didn't call him on it very often so talk I love competition you know I I love I would love that but truthfully eSport is a much deeper environment that one people were people you know especially the new eSports people try to make it be right like we grew I've been here for almost 12 years and many of you as well right I've seen my tournaments were watched by 37 people so I've seen everything grow from zero to hero and and I can I I knew you know the trend how is it going and what's next potentially so I I mean these people may come yes and maybe we'll make it harder to some degree especially coming when it comes in to finances right it kind of the money they can put in but at end of the day you know I know how to build teams I know how to build content that isn't entertaining for four days ports in a community which is much different than the content you actually see in the NBA or whatever is a completely different kind of thing and I know how to monetize within my industry you see a lot of actual companies that are non endemic and agencies are endemic that are unable to monetize within eSport because you monetize much differently you do be online sponsorship deals a lot of deliverables you know it's a completely different culture so I am telling you right now that if they come from outside and hire the people the kind of people that I hire I know I will run my company better than Mark Cuban or whoever comes here because I've been living this in America unless they're going to cover the hot iron off logic that's what a good idea I mean I watch the carrier they can't afford me oh my god yeah but III link the the categories in the chat will rights looking for a so the categories brand plan owners business plan team strategy and this is all public right so those are the four categories that they're looking for and of of the four categories I think three categories is in a lot of the organization's control where it doesn't necessarily take that much capital right so a good example is brand plan you like you only really have to spend so much money on like content in bread lines it's not a high cost business plan you know like what's your strategy like team strategy that's a competitive performance set of things there's really only one category which is owners and like probably about finances capital calling cetera whatever it is that's really about money so um I don't know I think there's a lot of room for people if I was p1 I guess like what if you want to get a hot record you brought p1 up like out of these four get it one of the weekend he's saying that we get all them they did really well on slit so no no I I think they did well I'm just saying that for a new team that has it doesn't have legacy it hasn't really built up that much of a brand or a fan base there could be an outside you know team or sports team that's like hey look at this proposal this is what I'm going to do this is the things I'm going to provide and it could easily outweigh you know the time that like Westar p1 has been in the LCS in terms of the value they created because I really build it up and tend me so I'm going to you can use a realistic example and I want to counter your argument okay a realistic example let's say I think who would you think between flag West and p1 is weaker in terms of a brand right now okay fine I think that it will take you long for me to get my pointer color right let me go highlight a point just see the Lakers are super interested in LCS and they submit their own application right and they're better at every single category from a brand plan a business plan and an ownership group than p1 but p1 has been in the league for two seasons now from a ninth place team they went to third the split what place did you take George let's split six okay so you took six right so p1 is stronger in the team strategy team strategy category but they're weaker in those other three categories which is the business plan the brand plan donors because their ownership group is strong they have like the extra min a paramount but it's not nearly as strong as the Lakers group their brand plan is because their fan base is really low and their business plan is in trunk of them any sponsors okay so if I was p1 else we can do through categories but I'll strum it in one so I would be looking for is okay well they're they're stronger than those three other categories so I'm going to go and partner up with the New York Knicks which are strong in those three categories I beat out the Lakers in the competitive category so therefore my application is better or I can go to the Clippers in Dec okay you can own 51% of our organization let me be an operator I need you for these direct three categories I want to be remain p1 you have a higher equity share than me but I have complete control over the roster and our direction of the company but you're going to help me with this application you're gonna have to get in and this is going to be a really valuable investment for me now how is like the Lakers going to be p1 in the application if they found a traditional sports teams as just as get as them but they have a huge advantage in the competitive side I mean this making like a lot of assumptions but yeah in that in that circumstance if they got the Knicks and you know p1 joins forces with the Knicks I just I think that there is a lot of variables but like it's a situation with there's so many things that you don't know that can happen that like when the time comes right we'll look at it from like a five to seven year perspective what p1 has done in like two splits I don't think when they're thinking about like Oh house is going to be in five to ten years they're going to be they're going to way that really happily I think you're missing the point man but the point is that p1 has the ability to go out and find a partner that that will make their application stronger than only a traditional sports team rate because a lot of people use examples of the NBA this traditional sports teams going to make an application they're going to get in I think they're at a disadvantage because there's only so many slots right just say there's only five or six or ten spots available and there are more sports teams that want to get into intent that means a year of now you have the advantage on those other guys the second thing also is these sports teams that want to get it they're going to have to want to hire an operator in partner up someone anyways they're not going to go in and then be at a huge disadvantage they're not going to compete against TT that thinks that they could run circles around everyone and come in at disadvantage they're going to want to hire someone that will understand the ecosystem um at the highest level right and III but by your opinion basically discrediting everything you do an idea and Carlos does by just saying oh they're thinking long term so they should just go through sports scene you're basically discrediting your value as a no no no no Ziya what I'm trying to say is like when it comes to an application right it all comes down to the final details of it so for instance if you know the Lakers comes comes out it's like okay we're going to build 20 e sports stadiums across the country and like P one doesn't prep as well and they're like okay we'll get you know someone that's less interested in eSports they still have an NBA team but you know they're not as committed well then maybe maybe bribe would pay for the Lakers well so so I think it really comes down to the details and but I do see the value and that they provide and I do recognize the value that we provide like we wouldn't be sitting here right now this day if we didn't provide that value correction it sorry all right let me make a point buck is this it's like me okay Jesus and there's like this there's actually something that we do mention which is that typically within the NBA or NFL or whatever these franchises these brands are not able to have the same brand used for other competitions correct sure yeah which in soccer is not the case because there's no franchise okay so soccer teams are essentially and maybe another league that I'm missing essentially the only teams that can actually make their own teams like PSG does for example shopkins in other games because they're our own franchise you know and for that reason then it automatically discredits what LA Lakers did in the past because they can't even use it right whatever social media whatever fan engagement what they can't use it so what they can do and is something that we didn't talk about is the connection by a brand that has some eSports history that potentially is not in the LCS today that's I think the only way in without having to buy hotshot Gigi's team okay give me an example give me a team well they buy my la crema and a Laker spice Alliance I mean I mean that would be the worst I ever seen for eg is like the worst brought by ever but imagine they do that right first if drugs yes I don't know in LCS let's imagine they buy EG okay the brand and then they go they go and apply for the LCS then they have a better kind of background and stands for that one a proposal right because they have a brand that has some some work fans and you know they have a history about that right so many be more appealing I mean I would have to argue that I don't I I don't agree regs a lot of those fans are fans of those brands for specifically other reasons if you look at like if you look at the Alliance right there they're completely known for data and more recently their their fans and engagement has dropped since they've won like the International few years ago right and they haven't really done anything sense of note and so I think that like it's in a sense to George's argument it's not about what you're just now it's about what you can do the future moving forward to and I think it's a combination of both I don't I don't disagree that it does increase their chances slightly but I don't think that that would be like a huge factor like because the line is not like they're just not nearly as relevant you know but yeah yeah by I understand your point though what do you think George in terms of going with an endemic partnership and the pointy nose yes sorry I understand he means that it we know partnering up with any takers even though any Lakers cannot have their brand used in this game and that that how do you think kind of they help out to your to your to make a cape country yeah yeah I mean I think it does help a significant amount it's probably better than creating a new brand from scratch I would always I would always say like well you have to keep the people on board to like those people have extreme amount of experience that have led to the creation of that brand so if you've removed them then you just take the brand itself it won't be as good oh you're actually imagining the application process I don't know exactly how kind of you know they did the timeline I mean I think I do know the top line but I can't talk about that line in regard to the timeline and there's a chance that the timeline in order to kind of apply and kind of get further into the process happens even before the contracts of the most relevant talent and run out so at the end of the day if you want to make a case where you plan on having your own team with a new lineup and blah blah that's gonna be extremely hard because there's car city of talent there's not enough talent open and you have to essentially wait until until you know November so say so that is kind of a security on your end I think yeah this mean right that's true yeah but the favor okay so I got when you say that this ten million okay is if tilter it's filtering nothing based on what they're saying or so what they claim every single team basically NRG echo fox any of these garbage teams that were else yes they can also get sponsorship and then cool their all and else yes so why don't you donated it all it's everything it's all about you sir it doesn't matter it doesn't matter may as long as they don't want echo fox ok energies back in they've got the 10 million in their pocket what is filtering well there he had a translator for one whether they got relegated so a big difference is that a the teams that you see here and post probably plus cloud nine plus fanatic and plasting liquid and plastic models and those are the only teams that if a franchise system would not exist yeah they would be able to raise this money and this is something that right knows and acknowledges and this holds value because it's not the same to apply for a slot when you don't have access to the money until you get a you get accepted in which then you are in the same level as everyone else as being in a position of power such as we are where we can raise our money even before we are or even if we are not accepted right because our it is a powerful we have not all DX in the same basket and we're kind of right ok I get that part right yes those teams are obvious as to why you'd invite them but you have to fill out the rest of the league and beyond that everyone has weaknesses right so what are you really filtering with the ten million well you you just filter right I mean not every person can actually raise two million something like they just keep telling you that they can they're telling you everyone else's shouldn't get the 10 million royalty energy is a new york rocks and they're all gonna begin you know this people are speaking from la la is the hype city you know they you know that's it you know they they hype everything up everyone is raising at 100 million valuation then at the end of the day you look at the reality and we raised that money let's see let's look at the terms who really raised another thing everything falls into you know everything crumbles you know everything everyone talks so much and a deal of the day the truth is you know twenty percent of what you hear so i don't believe that everyone can raise that kind of money easily i do think that there will be enough people able to raise their money yes to fill out the league but if you tell me right now that the europe LCS teams let's imagine or new LCS going the same route I'll tell you already I can tell you rate seven out of ten teams will not be able to raise the running I will need to help them out and I will get a fee so let's use let's use na LCS as example rename one team and then in the na LCS I can raise that money they want him that cannot raise their money all of them have already raised yeah they do a 1v1 actually p1 could be potentially right potentially career I want it overnight they get revenge I organized this they wake up Livio it's really two different market but is this 10 million 10 to 13 million away what is that like that's a lot of money yeah I mean I'm okay that's a lot of money don't get me wrong I just think it's doable you know I I think running five miles is extremely hard for me but it's doable okay maybe okay let's actually go back maybe raising that money at whatever terms it's actually pretty easy to do but raising money are terms that you as a team owner can justify just waiting out how nice is to be North American LCS against actually not owning your team anymore and beam diluted to death for the years to come then maybe yeah maybe you're you're you're not thinking about the right way if you raise money and you own less of something or you have zero of nothing okay was there anything you have a rank in the League of Legends basket then that that then you're nothing right sure order that's not true though because the thing is that if you if you don't want your brand so if you don't want that investor to touch your other games or your other investments then you just do a joint an adventure for only the NA LCS right like you can you can structure your company I got much lower valuations and worse terms on your end you can't do that yeah but yeah but then yep you're not putting up the money so you should be willing to have less power if you want to take more risk then you could take more risk but you're really kind of less power originals in TSM no I want absolute power maybe I'll just pay for myself alright okay don't on 10k 10 mil in the bank up here yeah you'll sugar-daddy off sugar daddy okay yes original just cleaning the streets trying to finance the finances lotsa mcelroy looking for dimes I try also cheese very good technology I'm actually you know I don't despair my like that so I wouldn't give you a tip time oh my god you're so cheap Julia so you guys obviously can't talk about the specifics right of what riot said they're going to do what they promised but if slots are going to be ten million dollars and presumably one would assume that that means riot will have broadcast rights they will sell and they will bring in sponsors and this is how it will justify at least in a few years to be worth ten million dollars doesn't that mean LCS can't be like it is now has to get way bigger or all the fun stuff in some way be monetized pretty soon right it has to be like in the next couple of years for it to be worth it surely I think I think people that buy into a franchise system have a longer view than wanted what happens in one to two years okay but regardless I think that eSports is in a position where realistically we're going to push to to try to get meteorites fairly fairly soon and try to do collect negotiation in terms of like sponsor deals and stuff like that uh yeah III think eSports again as as Reggie said earlier is really under monetized right now and I think just this whole group of people that are coming together to make something happen is just gonna it's going to make things a lot better in all regards finances viewership fandom content I just personally think it's going to be awesome so yeah I mean I mean for me I like the two things I'm really most interested about three Ana's with you is what teams are going to do with their brands and how effective they're going to use our Academy team I'm in the past for us I know I thought done a good job of it and George's didn't good job for TSM we haven't we haven't really put together again and that's something I want to take really seriously you know from an infrastructure standpoint maybe even having a gaming house for an extra team or our Academy team can even script with our main team and AH or all these prices for the same areas or if the Academy team can pick up you know certain details of our main team practice but there's a lot we can do I really think if we do it the right way and we use our Academy the right way we can push and need competitive performances from there I know like over there I'll fly only there's only like really truly competitive with two other teams and other Seventeen's or but he's able to do so much with so little so for us right with ten teams ten Academy teams we might be able to be GT next time hopefully that happens that's right okay okay we're gonna beat the midsummer you said Roger I've even got a world soon right you go they claim is to make the most competitive league right so in theory in a franchise system you don't actually have to care if the other team is competitive like actually reginal they don't have to be TSN if they theme that does really good branding and they get a lot of viewers that helps you in the league that they've done their job right so what if someone just takes all their money and they say right I just want have the most popular team so I'm making you know like Delta Fox that's my lineup in LCS you know I've got the ten million is Muslim Apple the most popular like streamers personalities will play you know we might not win probably wouldn't but we'll be super popular how will the league be more competitive than the relegation approach yeah so let me answer that question because you're asking me um so for the most part I think it's going to be more competitive because the way we ride structuring it teams that plays higher get you know they get paid more essentially uh that was announced publicly and so the finance of financial incentives of placing higher and doing better is extremely important right and if you're required to have Academy team anyways why would you why would you not right if like if winning and succeeding financially in this league means placing higher and having the strongest competitive performance possible then every team would do that right because they're going to be motivated by the finances and success of that and so they're they're going to destroy have fun at the bottom and be a stream team then they're gonna get relegated eventually or they're just not going to have sponsors because sponsors are now kinda want to sponsor them but history has shown that teams that win consistently get sponsors on an individual basis teams that are that considerably lose never get sponsored because sponsors don't want to tie their brand with a losing team and so just the way this thing has been designed it's truly about winning which is awesome for me because we went a lot in na LCS is actually exciting for me from the competitive standpoint because we won we pushed even harder to like all that said being pushed is extremely important not only for us right but if if CLG is push of club bands push and Dignitas and everyone's pushed harder that means that we're going to see better international results in the long run and it's really sad because I made this claim about winning worlds from all time and we we've been far from it and so I think I really think like having canopy teams is a step in the right direction now to your point with the echo fox thing the the permanent partnerships hasn't started yet but I really like that that's something that is cool it's going to be fun and it's going to be exciting because all the streamers are going to be playing in Challenger I really think it's kind of like a slap to the face from I'm a permanent from a permanent partnership standpoint because they're not really putting in Academy team that they're taking seriously on top of that to you when they're streaming their scrims it's really honestly just a waste of time because then I'd be using their standard players so I think it's like one of those promotional things maybe they sold it to Facebook or like they're monetizing it but like it that that specific act isn't really about like making the league as competitive as possible so maybe right I likes it but I really don't think that it would be on brand with the competitive thing that is being pushed so Duncan you said that Ryan's goal is to have the most competitive league possible reginal just told me big in the episode I'm also I think I think Ryan's goal is to ensure that they create the best so it always comes down to this like I remember in the last eSports salon episode Noah was basically for the case of just being like you know I want to eight audiences I want to make sure the fans are engaged I want to and then on the other two on the other side of the table Jack was like I want the most competitively you know I want I don't care who's playing at the games just as long as all the best players and I think for riots riots the goal in all this is to find a balance in that it's to ensure that we keep people out of the constant relegation mindset but also have a little bit of pressure so I would argue that it's not the most competitive league possible that it and Derek Travis's inner yeah but what they say and what they want like well no no like look at it from like rise perspective and at least making everything as valuable as it can be right having having the most competitive ecosystem would be like you know five team five teams relegated every season like okay I think they're just trying to make a sustainable ecosystem that gets the moat what they think the most amount of viewership in the long term so that it constantly makes League of Legends successful and calmly adds to legal questions so I think it's more of a buzzword thing to say that like we're going to make the most competitive league possible because we're pretty far from a gladiatorial arena what I don't what was beyond I made the truth is George right like with anything you can you always use extreme examples and to get away with it right but you're also not thinking of the macro picture of things you're thinking on a really micro level if relegations existed for five spots right just just use example that means that teams would not be as well financed that means they wouldn't be able to pick up basket of players and players won't be able to play and put in the amount of effort that they put in because they want to be paid as much so for a league to be successful and more competitive the league also needs to be really well financed and also monetized well because um people will put more effort in if the finances financial incentives are there right like with anything one motivator for people a lot of people is money and if players are paid you know just say hi example million dollars per year each they would put 31 to put more of their life on hold to put in more effort to playing all day because if they weren't as competitively successful that means they wouldn't get that type of pay where they can live for the rest of the life often two or three years work um so I think a lot of those things going hand-in-hand and I think that yells what to contribute that a fact a factor of the league monetizing wealth to competitive performance yeah I wasn't speaking in terms of like statistics I was just getting like kind of like an example um but yeah no I totally agree with you I think that like you know having all ten teams fight for relegations or whatever like is just uh there's a point where I think rotten rice hitting it is they're making the lead competitive while ensuring that there's the most value in an ecosystem and you know future for the game so yeah this shows about me George are you any Jesus look yes LCS a better investment than overwatch League hahahaha I don't want to get in there or Ellen okay I say I'll do it okay okay listen I just say the truth but I'm not dumb enough to go there come on haha okay you doesn't trust himself okay I don't know okay no I know I would say the truth and I don't know if I wanna go there okay no it's just it doesn't make any sense very compared I don't wanna think it's two different games two different games two different topics different topics oh it's just money so utterly wrong turtle or twenty million that's helping you get oh actually I did it on public no mine oh good okay no no I uh I also but yeah no thank you take authority thank you okay only by the question pass pass check okay I'll take a bath – so when they when they make the franchise system and they bring it in they put all this stuff in place NLCS already has a lot of imports anyway like some people would say it's almost hit like the maximum you can get as it is because a lot of like even good Koreans now will go over there you know would that would that go even further would we get even more important and like you know basically anyone who wins will do whatever suddenly there right now and else yes the next split would it be like that you think now I mean honestly one of the biggest issues with any LCS is I mean I've stressed about this a ton and I would say that Carlson Gorge probably see my perspective is really having that Academy team there and it's not just an Academy team of crappy players it's Academy team of players that can constantly push your players forward where they can help improve our starter starters at the game I really think that that's an absolutely necessary we want to be able to have a LCS or na LCS compete at the highest you know point and might do really well Worlds I know that GT found some success I am assigned a six-second but it would be a different story when there's three Korean teams there and three Chinese teams there and it's as well it's a lot more trials and tribulations at Worlds and for for us for us I want to see na LCS team the LCS team in the finals of worlds right and for us to make that happen we're going to have to have better consistent practice and we can really use a lot with the ketamine team I don't think consignee important creams over is really the right move either due to the the rules of you know minimum three for your country I really think it's important to find a way to develop our talent to make players better faster because right now a lot of the players are promoted through silico and Challenger and we all know the competitive League of Legends is really not about individual play it's really about team play and how you move around the map as five and all the things you learn in so q is just a basis like of mechanics that you need at the highest level I don't know Venga we have a smart Indian I think has a lot to do with the playerbase I think that I mean it's it's in a I don't know the exact numbers but I would I would argue yes from my educated opinion that Europe has higher player base by default than North America has when it comes into p22 to PC games in this case the semantics of Legends right I would again this is just assumptions I will just say for example 60 maybe 2% Europe and for the Western market and the rest not America and I would say the reason for this is North America is very very kind of console friendly where the drop is not that much yeah so at the end of the day comes down to look at the look at the color of the routines right kind of dreams in the North America they're always winning and why is that because the culture is there's just more players in console players how many other days is very mathematic right and in one of the reasons why it's harder to find talent in North America is because Europe has a bigger player base that's one of the reasons and so I think at the end of the day they the average success of a region has a lot to do with the number of players from that region and I don't think the competitive success is the only metric we should be looking at because in my eyes you know when I when I guess expense especially in Spanish interviews and they bombard me with this with this talking question pisses me off is eSports a sport you know I don't care yes I just don't care this is like a branch of the entertainment industry so to say so in that why North American teams which are within you know the PC environment the PC market North American teams with typic which typically are worse than the other regions still generate some of the biggest revenue because they know how to hype stuff up they know they know about branding and about content creation there's no how to how to have a product you know well well you know you have Europe which has always been you know yeah I mean it's it is culture this is culture we know how to create good products typically but we lack the kind of hype you know knowing how to hype a product or a brand right which North America definitely has it so and then the fact that they can monetize better leave them to be able to acquire better talent you know the very best player he maybe not in his prime which he will hit proudly in Korea but then he will be born out you know very negative I mean who has a bigger player based Europe or Korea that's a good question I can't answer I don't know I'm pretty sure your Europe as a whole a bigger brand firebase I will check this out I really don't know about South Korea actually don't they didn't they until you know obviously until they open up the Chinese servers you can play in the play against each other and so on so I mean I'm not sure okay I've no idea so I just think that the player base plays a big role you know and if you look at different titles across these ports you can see that happening how we're different rising design is just people playing a game is this likely that you will find the star that beats everyone right just mathematic how would franchising change the West's chances to win worlds I gradual you said that you've been tirana with Wolves all these times young come close so far so what's going to change if you have ten million dollars in franchising how's that gonna help you win wolves well that that amount can get a riot right so to be honest with you I think it increases our odds now if you have a very if you have a low odds rate and increase Michael percentage it's definitely higher right now I do think it would increase our chances actually substantially because what we plan to do is we plan to take our Academy team extremely seriously and so it will increase our chances significantly now not this season but we're gonna during the offseason we're going to look to heavily invest into building a canopy team out arm and because of franchising were able to do that right it didn't necessarily make sense in the future I really wanted to the best performance possible but I was limited in resources now I can justify making bigger bets and longer-term investments in in our in our own competitive performance right like when I say I want to win worlds I'm not to be I'm not willing to can actually go and tie Carlos to shoes on a daily basis to make the extra $10 you know but for me like because of franchising and because relegation is being removed I can justifiably actually the best Mike as much as I can into my team without being afraid that you know I'm losing everything over a period of three to six months rate and I think you know Georgia fields in wave is franchise or if we were to French as we build same way and a lot of team that yeah so probably feel the same way too they can justify making bigger bets into building more content begin justify investing more to staff etc a lot of the previous teams they didn't invest all they could was because they're also operating on wagers razor-thin budgets too and so even though like I give a lot of bottom teams a lot of for not creating content there is a pretty big amount of cost to it comparative to the ten million it's not that much but before it is a lot you know I'm sure also there's a lot of money trading on all accounting he does and I carry the camera around myself there's no money yeah yeah so I think of economic stability allows us like I might not look at it as the same way Reggie would in terms of like you know the Academy team is going to be the specific thing I actually don't know what the specific thing is that we're going to work on to to beat Korea you know I surely there's a lot more that we can twelve into in terms of like sports psychology and eSports psychology and how to become better players and we could bolster our spikes scratch our strategy development teams like there's so many there's so many different things that the increased revenue and the increased value that the franchise system will provide to allow for those things I mean I think that you're right in the sense of you know a better business having a better business and a kind of more safe future will allow you to invest more aggressively but I think that there's a factor we should factor in the human nature to which is that it needs a classic topic about a convenience is a philosophical matter but if you can't go down in the league right it will decent advise you potentially will decent device you to to kind of you know keep having a super competitive team and maybe across the next ten years maybe the last five you look at the comparative success of North America elite emerging up whatever franchise system that is maybe an assumption maybe the fact that no team can go down will kill that kind of hanger right of being a really really good team because I think updating their business are profitable and and the the whole league is you know very fun to watch and whatnot maybe the focus lies elsewhere maybe content creation brand building who knows I don't know again it is just a assuming it's an exercise right it's kind of like the example I gave Reggie which is basically okay he wants he says he wants to lead to be more competitive you know even for himself you know to push TSM and Sarah but if the Bolton place team in LCS was Delta Fox right now and they're just meaning everywhere and streaming and they're really popular though and they're killing it you know to make it loads of sponsor money and the make it that makes the league less competitive for him well I mean you know so if there are the 10th team right clams they that means yeah but if they stay at the temp spot for four slits or 5/8 but though just came out again okay and though they'll be forced to sell okay what's your thoughts on that part then because obviously like that's listed there which is interesting but presumably it will happen eventually to someone someone will or place 10 for whatever it is you know haven't we have many things wrong and get kicked out or potentially kicked out what do you think of that detail of the of the structure I don't happen I think that I'd you've said that deal would have to suck or dude they would have that terrible ownership I mean it they could have been really unlucky to rate like if you think about it we see I didn't really think about it too much because I never placed down there's nothing me close you know George do you have more to it you've been in real additions Wow didn't want it was only one oh man and I can no matter and punch you in the face but uh I'm sure Carlos I don't think about relegation that much not right now you never know man I mean diet I'm not I'll just play remember I subbed and I still we still want six out of seven games I think okay I remember and I know you will come up with my own ultimate but I remember those blue cards even I had nine hours some of it some of the worst League of Legends as witnessed it no I'm hoping get you boot Carter beat CLG that's why it's like you going to joke but your heart is eyebrows even with the blue car huh shut the IBGE brother Luca Raja come on I'll be back on top stay quiet sorry I got lost in the was the original question yeah why were we before run off topic guys it was about the I was about the guy a relegation spot yeah yeah essentially you still kinda get you can just be kicked out of the league I am keep finishing last place and what do you think of that I think that'll probably never activate for any team that gets in the league it's going to be really hard to like there's I don't want to bring dis confidence into the into that part but I'll just be honest like all that has to happen is hey maybe like and I'm sure that there's going to be all the protections in place so this doesn't happen but like mister seventh place team is like best friends with mister play tenth place team they do a transaction and like okay he's out of that position for like one one split right and then I don't go that although what do you mean doesn't make sense because if you do that it gets competitive integrity chip anywhere yeah you know but but I'm saying like there's so many ways that there's only one circumstance so somehow it would just never happen even if it seemed really balls that bonds yeah I think like politics there's politics involved I think that when it came time they would spend absurd amounts of money to make sure happens unless there's a economic lover's if there are economic levers and they can't do that and maybe that actually happen yes actually is narrating to the prospect take a think about it if the seventh place team gave a free win to the 10th of I've seen I mean the seven placing is giving the money because your your incentivize the every place that you take higher you get paid born right okay and it's going to be major because it's going to be based on percentages of meteorites and everything so to say like one percent of a three billion dollar deal in the NBA is absurd amount of money you never know dude when it comes to politics we know we don't know yeah okay you don't know what you don't know George has gotten to do that so Ocelot is that you have a really good team that's not in legal agents like your future is not just legal I just made does it if this league is going to go and be franchise people to put all this money and people are going to be watching League of Legends in massive numbers in 2027 what do you think can you repeat the question I don't get it and you maybe the question will be watching League of now with people in massive numbers in 2027 I mean I think you know the and the there's some myths is like a mythology that a eSports games are bound to die but if you look closely you know you look at how daughter got born then kind of League of Legends got born corner strike it's been there forever and yes there have been some some examples like Starcraft right but there's actually a good chance that a game like League of Legends can last for a very very long time forever essentially the the beauty of games and service which essentially I don't know if rate right games was the first one but definitely were one of the first ones that created these games as a service in kind of the business in which the game doesn't cost any money and therefore they are there for the developers are motivated so in order to monetize excite exactly to increase to improve the game if you look at the first league of Legends it was much different than now I was far too different and worse right so I think that League of Legends and all these games counter-strike etc are bound to grow over time in a way that adapts to the people's needs which is something that soccer and any traditional sport can't really do because it's not something digital that's the beauty of eSports you can create something that is impossible to be in real life and and I feel like that beauty it that allows the game to grow and kind of grow grow grow into whatever culture are the people the community demand in that moment is gonna likely make League of Legends lasts for a very very long time potentially forever and they can always pivot okay this is not working definitely so we can people don't do this other thing instead I think that it came to a point where I feel like Riot Games is extremely talented when it comes into building a game that people like that's why so many people played for a very very long time and I think they've passed the point the threshold of in which they may fear losing that game just because they know how to adapt to make people like it again and of course at the same time I'm assuming that Riot Games is working on different games simultaneously in order to be part of different segments different I don't know you name it any kind of game right and and and of course other games will come into the mix but I think they will come naturally with the growth of the eSports audience I think that maybe League of Legends all of a sudden has a smaller market share because another game appears and that game is very liked by everyone but a bigger players will keep in there you know we'll be in a rock keep growing quickly growing and we'll keep being relevant for a long time I think yeah even if you look at csgo there's its ups and downs I mean don't you know best about this how long has it been around for almost the competitive scene like what like what were your thoughts on it right it was a lot it's like 2001 was when counter-strike itself really got going you know like as an eSports game and then obviously add like a dip wet it comes to I get injures in csgo came out but it was roughly continuous for about yet well more viewers and now like 17 years in theory so ever I could do League of Legends The Rocketeer League of Legends 2 and so on and do what they did there it could very well ask for you know of decades right okay so I have one question okay now this isn't a secret way to double back on the overwatch League question but it's this okay if in the future there are things like overwatch sleek so obviously in overwatch it would be over thing but let's say in CS we have a franchise League and another game dota whatever another game we don't even know yet exists if these leagues all exist and they have a franchise model and this broadcast rights and people investing all this money won't there eventually be no more multi game teams when people have to kind of be all-in on legal edges or overwatch or whatever I'm actually a hundred percent sure that because this is actually a free market right and I'm sorry if you guys good what I want to answer go ahead but I think I have a good answer for this because this is a free market right so everyone can go ahead hotshot can just get bored I know he likes games can get bored and create a game right everyone can create a game and because of that reason well you see that everyone is going towards the same system franchise system then the best way for you to become successful with your game is to be different right so there will be games in different systems across across kind of different regions that will be able to justify things like g2 to being kind of you know all over the place and kind of putting all the eggs in different baskets you look at look at bottle for example I mean valve is known for for not being very communicative and you can say that's a bad thing but is it a bad thing at the other day they do whatever they feel is right they led most tournament organizers to run their own tournaments they you know this is a very is an open market right and the opportunities of that open market are vastly different that the opportunities in League of Legends you have other kinds of talks right the salaries are very very different especially when you compare in region so you know I think that it's very enriching for the industry that is different systems in place and I think that a maybe the system is franchised baby the system will be a combination of maybe the system is completely free for all and I think that there will always be one of each okay yeah I mean for us I can speak to this the way I see TSM is where we're likely are probably never going to take part in the exclusive ecosystem where if if there was a case of PSS brand name being fully tied down to just one specific game I really see that as a debt to our is Asian and that this wouldn't be even if they're the biggest game at that time I still want to do it because um for free sports I see it as something that I wanted spend a lifetime in or at least a lot of time in now maybe I won't be here at 30 or 40 years but I know for the next 10 15 years I'll be here for sure and that's what I want to dedicate like a lot of my adult life to and so if we were to you know be exclusive to any specific IP then that one that wouldn't even go for me even if it was the best financial decision okay what it reginald in if you LC is being in every LCS final and in general it's done very well there was a period where TSM probably add the most money now sure with all the investors now probably not the case but what if everything works with the franchise system you know everyone gets the backing to get into the league the league does make really good revenue everyone shares it every team is making really great money oh we're imagine like the best-case scenario here you know the league's doing really great couldn't there be a world where we find out that Reginald wasn't actually the best owner it turns out those other guys just didn't have the resources you had advantages in certain areas or you had things that helped you from the past are you fine with making money but not being the number one team anymore you're just a franchise what's your question how are you yeah would you find one that won't as long as you make money now I mean for me I think when I entered eSports I already owned media property before then where I was making a really good amount of money and when I did start TSM it to be honest with you for the first three or four years it really wasn't about making money at all oh and I I mean would I be fine with it like but from a personal standpoint absolutely not I would do whatever I can to try to be as competitive as possible with the resources that I have for sure it wouldn't be a case of me just sitting there and enjoying like a monthly cheque that's not what I'm about I can sir to how other people feel but for for me when we even start doing poorly at all really hands on I go there on a daily basis to make sure that my team steps up arm yeah competive performance is important to me I mean I could see a possibility of that but what what that means is I just need a better mind game about what's happening yeah they're in there in George you haven't signed like a bjergsen in the last few seasons right you've kept mainly the same players a lot of people speculate that's because you don't have three million dollars invested from some big team you know and you don't have the much money to pay the best bigger salary in the league would it even things up for you uh-oh ever wait we started bearson as a rookie I'm Seldon a bjergsen so he can't sign again sir and he can't get some day he can't get flame or whatever you know he's burning people the assumption is he doesn't want to pay the salaries of these players right well my buddy was throwing everyone in Europe already narrative and color so there's a lot of assumptions okay it's most likely for bjergsen specifically if if I couldn't afford him then I'm sure that there would be someone else there that would cut it for him that's not why okay you know bjergsen does isn't on another team but there is a chance that the new system comes out and they do something like a draft and that could shake up the ecosystem a significant amount at least in the short term and then it will have the would you like what I mean obviously that's one of the things they do in all those NHL and be honest that's one of the ways that it isn't always the same team on top the same team the Bolton right it's a way to shake it up you the bottom teams get a chance to get potentially the next cubes right I'm up for in my philosophy has always been like try to make this the scales as even as possible and then have people fight with those fair like a fairy no system so like this if we have salary caps if we have graphs I'm actually all for that because I think that it just puts everybody on the same level and it's hard for me to say that because I really like my players and I really like the ecosystem to a certain degree because I've growing up in and I'd played in it but in like in my heart I really think that anything that brings the scales closer for everybody is a better it is something I want to be a part of those you can't compete dude no no I I'm joking I would get really like I think this split will do extremely well and even even even having that and say say we wind naca we win any this year in the win worlds I'll still have the exact same opinion um just as a competitor just as a competitor I really like like the idea of everything being very reggie you don't want a draft in salary caps right um are you talking about like a draft for all new talent by the way yeah what about I think is the new plans come in the league I'm awesome indifferent to be honest with you I really put as much thought to so don't have a really strong opinion because I'm not familiar with how jazz board for example but it really honestly um just like with the bare knowledge I have I think it would give us a competitive advantage because we've been able to build stronger Kings and other people I would not necessarily paying like up certain months money rate like I remember like when we sent bjergsen he was in relegation with NI pea rate we had the option to sign like the best mid laner you at the time and we chose to go with a rookie player when we sent amazing he's in relegations at that time and I was our best competitive performance to date was amazing and Pearson at that time when we hadn't spent scaring he got relegated with SK who else to be signed we tied wildturtle he was uh he was also not in LCS and we sent double of shield she just kicked him off so well and we said Bob frost he was a challenger player so a lot of players that we signed wasn't necessarily known we just signed them because we felt like they're a good culture fit okay so I honestly don't think signing the biggest checks like the guys are some of the biggest checks are now that na LCS are actually at the very bottom so but the irony with tradition okay yeah do you want you want things to be more fair and I don't have the same chance and then just just down at the skill of how you make your team I'm I'm pretty indifferent in the sense of if I will play with whatever they give me you know if we am in a league where where me doing sales better will reward me with better players I will take it and I will win and if I am in a league that where I need to have a better eye for who is the better player and kind of look at you know psychology and blah blah blah in order to make a winning team then I will take it to and I will turn to my best efforts well to win right and instead my sales efforts will translate into profits for me into money for myself so it's just two different environments and I'm okay we both yeah I think I think everybody here is extremely competitive in the sense that like we we would always try to be number one and we would force ourselves to do everything we can I think that in an ecosystem where franchising does happen though people like Carlos and Andy actually take a significant hit because the economics Patel it's actually we don't know the variables right so if there's salary caps then maybe we don't it they don't take so much of a hit but maybe rise like okay we decide to release everybody's contract and then we completely draft from the from the from the start you know like holy have o it out yeah I don't even go on then what are you say okay so are you like what show would you like uh yes no could better players are starting Walter I'm with him look yeah no that's that's not it um would I would I think I actually okay so wow that would be brutal for me dude oh my god you're scaring me well that's the thing like you have to think about now you have ten owners that all want to be on the fair and riot is like if riot thinks see right this is like a weird relationship because then then it it depends on how the deal structured if riot has the power then who knows what they'll do if the teams have the power to make the decisions in terms of like this ecosystem well maybe Reggie since he's sitting at the top the other nine owners will just be like hey you know what it looks like accumulating all the talent in in concession like that that's kind of effed up like we don't actually have a chance because the better planners just keep going to better players you know so you know so unlike Reggie does bjergsen who you could argue is like a generational talent it's completely insane you know it goes to a different team it could be a pretty big blow to TSM but everything speculative like we don't know what could happen everything could just exist as it is now but I do believe in like Carlos and Reggie no matter what the circumstances are to always like fight for number one and and they're very talented at what they do so okay but it would definitely be a short-term hit if some if a mechanism like that just popped up okay right is there any final topic we need to bring up here and we can wrap it up but does anyone need to at the end of the interview say anything there's a final statement or some message you want to give to everyone okay how about this yeah sure Terry you all own teams and might may or may not be part of the franchising system what would you say each of you to the fan base your team's Reginald what would you say to the TSM fans who who may be their scared maybe they're like what hot shot was talking about maybe all the drafting all the players maybe Oakes is going to be on fly quest like you what would you say to the the funds of TSM regarding the franchising era that we're going into bureaus are coming out for us okay evolve I don't up or troll application and I put as all my effort and time and resources we should be in LCS unless I do something extremely dumb so hopefully my fan base feels more comfortable about it and honestly uh thanks for this interview it's really fun actually talking to Carlos hardly ever get to catch up with him or even talking to George you're not bit fun with them a lot and thanks to embarrassing this is really fun sorry anyone else will not anything hotshot yeah I've been working very very hard in the past while to ensure CLG as a brand succeeds and like our number one focus is to win and it will always be to win it's always been that from day one and so not being an LCS what is not winning for me so I really want to be in LCS and I know we'll get there so you guys have to worry about anything okay Carlos I honest formerly known as Ocelot you get the last word mate that's all you ever wanted right so come on good yeah I mean for me this is one through it which is M actually this is coming out pretty good actually this is a good so I asked myself and this is actually true I asked myself all the time what will I do when I am a billionaire because I will be a billionaire and I am right and I keep going yeah what will you do what's wrong why would I do if it was sorry when I will be a billionaire yes and and then III tell me okay well you know invest here invest there have some fun okay I'll probably want to own a team right I want to own a team of something that I like what I like the most is eSports right so I went out when I'm in sports team and I'm like wait a minute I already own any sports team right so it's a little bit of a conundrum I don't know if you can call it like that right the reason I do this is because I enjoy winning so much I enjoy winning when I get sponsored that was supposed to go to TSM as an example right to TSM and I get that a sponsor myself for g2 and I'm like yeah yeah addition you know it's horrible he won't okay maybe happen already who knows okay going out wrong yeah but that's the point I love competition I love to see my players I love to see okay I spend a lot of time with that player and and that team is winning because of Feynman and I just see I love this competition you know it's harmless it's like a gladiator arena but no one times you know and this is lovely and so this competition it makes me so hungry and so so ambitious you know for victories that it doesn't matter what happens whether I'm going to it you know is going to be playing a new LCS or Utica analysis who knows a Mark Cuban comes the other guy comes I don't care I I will find a way I will find a way to make the team winner a winner and will find a way to have a shot at winning worlds it's my dream it really is my dream and I put a personal note even right is it very hard to attain absolutely right but what I can tell you for sure is that the amount of work I'm putting into this and I will keep putting into this in order to make that happen not only in big of legends but in every single game that matters in my eyes is going to be there from me and from everyone for you to at all times so fans new fans old fans haters that are going to be advanced one day or haters that I'm never going to be friends just know that it's crumbs you're lost how do you not know where you are it's touring channel

47 thoughts on “Esports Salon Ep 8: LCS Franchising Era (feat. Reginald, ocelote and HotshotGG)

  1. Riot's goal isn't to have the most competitive league possible (BO1, No Sound Booth, Region Locking). All they care about is their money.

  2. With everything has been said about franchising, going forward to make the teams in the NA LCS getting stronger and be able to beat the Koreans and Chinese, the matter isn't related to what franchising is all about. I understand Riot wants the NA LCS to generate revenue similar to the NBA, NFL and the MLB, but the teams of these traditional sport leagues aren't competing in the international level. We don't see the Golden State Warrior, after winning the NBA 2017 season, playing against other champions from other countries for a higher caliber title than the NBA champion.

    But that is not the case with European football, whether in the BPL/EPL, Spanish League, Serie A or the Bundesliga where relegation system is exist and at the end of every season, top 3 teams from each league will compete in a higher football competition than their domestic league called the UEFA Champions League. And ultimately the winner of the UEFA Championship League will be crowned as the king of Europe and get to represent the EU region in yearly held FIFA Club World Cup.

    So I still don't get it how franchising will create a better competitive environment than what we currently have in the NA LCS. In my opinion, relegation really brings the best out of everyone. Everyone needs to have the mindset that if we don't do well, we will be relegated. I understand the point that Reginald and HotshotGG were trying to make, but I think feeling the pressure at the start of each split towards the end is the nature of the league. If there's no pressure, people will eventually become lazy because they know they're not going anywhere and money will keep going in no matter what. They won't strive to become a champion or even to qualify for World because they know that being 4th or 5th place is good enough as long as they don't end at the bottom in every split.

    I think, Riot's intention to transform the league is purely based on making profits and to attract big names from the traditional sports league. As far as we know, League Of Legends is already big and Riot is already worth billions over the years. They can sell the broadcasting right to anyone with the current league format. As for the growth of organizations and esport teams, they can take European football clubs as an example. Every team in the English Premier League is exposed to relegation even for MUFC when they lost Sir Alex Ferguson. But that's what drives team to do well and to plan a better strategy to deal with the difficulties that they have every season. So is this system going to help the NA team beat the Koreans and the Chinese? Time will tell but I highly doubt it, and in my opinion it will make things even worse competitively. But I'm happy to be proven wrong because I really want a western team to win the World or at least be in the Grand Final. Because that is what the Korean and Chinese players are all about, being constantly pushed and pressured to be better.

  3. "Mark Cuban can't offer me, man." – Ocelote

    Oh shit, Mark Cuban will come for you and offer an amount of money that you've seen before.

  4. In hindsight these speculations about gets the spots are funny. Little did they know. Even IMT is out.

  5. Gotta love how all these esports team owners are so successful that they are sponsoring melee players. That's how you know you made it

  6. Found the 2 best moments

    16:14 Ocelote on the issue with not having subs.

    1:36:18 Reginald on how he won't get hurt by a draft system because he always signs cheap players.

    That last one really cracked me up.

  7. thats such an awesome and in depth discussion…. and all you commenttrolls care about are the fucking webcams….

  8. Incredibly interesting and great show. I was really bummed that nobody was willing to compare professional League to Overwatch from a business standpoint. I have my own opinions but I would really love to hear what these intelligent, successful, knowledgeable insiders think about it.

  9. When carlos says "This teams are parasites of the LCS" he's actually right, i only watch EU because of Fnatic and H2K and NA for TSM and Echo Fox, but LCS is like "half is because of TSM and the other half is for Johnny gaming" so it's kinda shitty in that regard.

  10. Classic NA trying to put the cart before the horse…

    Money in all leagues is not what comes first, the success always comes first and the money follows.

    Andy said at one point to george (near 1:05:00) that 5 relegations would make the teams less funded so the players would try less and the teams would be worse.

    Did reginald not try when he was not being paid? Were SKT being paid lots in season 3 when they came from nothing?

    Involving Ocelot, would he make the french superteam if they were unproven? he took a risk BECAUSE they had proven themselves and had potential to do it again, the NA owners have not shown a basis that they can get that potential and reach it again.

    All the NA infrastructure just want to buy success. monitary and performance.

  11. I still dont get this franshising of a league. Where is the fun when u can get relagated, makes the whole league boring. But I´m from europe, maybe I just dont get it^^

  12. Coming to to Thoorin's channel after a long time where is Alpha Draft? Premier betting site for esports opps i mean Fantasy Esports.

  13. Ocelote really underestimates Mark Cuban and how he treats his teams/investments. You have to remember, this is a guy who thought about investing in League of legends in the past. He didn't just read about it. He didn't just talk to people. He came and watched the events himself. He has huge dedication to his investments, and he would choose the best possible people he could to run his org.

    I agree with Regi in the fact that old teams can partner with sports teams increasing their value, but there is a huge difference between a partner who is investing in your team, and someone who is going all in on the industry. Also not all sports teams are created equal. Some of them have much better business practice than others, and those are the ones who would want their own team.

  14. Interviews like this are the reason I love Thorin. These are all pretty complacent dudes, and he is trying to spark them into getting passionate int heir responses. He doesn't play it safe like a Travis Gafford, he wants to cut to the core with these guys.

  15. eu has slighlty more players then korea but Alot of Asian countries play on Korea so player base is even bigger on that server

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