|KSV eSports CEO Kevin Chou speaks during an interview at its headquarters in Seoul. Courtesy of KSV eSports|
KSV CEO seeks to bring global perspective to Korean esports scene
By Kang Seung-woo
Gone are the days when eSports, better known as professional video gaming, were regarded as just a hobby reserved for kids.
eSports are currently enjoying massive popularity and booming revenue, indicating they are emerging as a new national pastime over traditional sports such as baseball, basketball, football and American football.
In fact, a number of U.S. pro sports team owners have joined a new league for the shooting video game "Overwatch" with its inaugural season beginning Jan. 10.
Kevin Chou, the CEO and co-founder of KSV eSports, is one of those who believe the entertainment landscape has changed drastically over the past few years and the industry still has plenty of room to grow.
"Sports are ultimately a media business. All sports owners are thinking about how many people are viewing this sport, and that's generally tied to how overall media deals are being done," Chou said in a recent interview with The Korea Times in Seoul.
"When people look at the size of eSports in terms of viewership, it's phenomenal and higher than baseball already. It'll probably overtake the NBA and the NFL very soon."
According to him, the NFL is starting to decline in overall ratings for the first time, while the MLB has seen ratings decline for 20 years already.
Chou said eSports have proven that they have as much potential as traditional sports in attracting audiences to big stadiums.
More than 40,000 fans visited the final of the "League of Legends" (LoL) World Championship at the Bird's Nest Olympic Stadium in Beijing last month, with more than 60 million watching it online. In the 2014 event, just as many eSports fans packed the Seoul World Cup Stadium. "LoL" is a decade-old multiplayer role-playing game.
"We thought only traditional sports could create this amount. The growth of eSports and people going to real-live events had got noticed by all of the traditional sports owners," Chou said.
"Traditional sports owners are thinking more broadly about business, considering what to invest in. The most interesting is eSports. 2017 will be known for traditional sports owners jumping into eSports."
He added: "eSports will definitely continue to grow and we're in the beginning phase."
According to industry tracker Newzoo, eSports revenues will grow to $700 million (754 billion won) in 2017, up 41.3 percent from last year, and the sector is forecast to reach $1.5 billion by 2020.
"eSports viewership has grown drastically over the years thanks to the growth of online streaming and dedicated gaming channels such as Twich.tv," multinational accounting firm PwC said in a recent report.
KSV owns top-tier eSports teams across four major games
Earlier this year, Chou, who previously co-founded Kabam, a global mobile game firm, established KSV (Korea plus Silicon Valley) amid the meteoric rise in worldwide popularity and has since made a massive investment to expand its presence in the eSports industry.
Despite its "short" history, KSV now owns four major eSports teams across games such as "Heroes of the Storm" and "PlayerUnknown's Battlegrounds" as well as "Overwatch" and "LoL." All of them are based in Korea.
In particular, the company was thrust into the limelight Nov. 30 after acquiring Samsung Galaxy (SSG), the winning team of this year's LoL championship.
"I know it's surprising for a company like KSV to make big moves like acquiring SSG," Chou said.
"We're here to really invest in eSports and bring a global aspect to esports."
For the Overwatch League that will operate in a city-based format like traditional sports, KSV also spent an estimated $20 million for the Seoul-based franchise, or the Seoul Dynasty.
Chou said digital and social media are the most important channel for KSV to run his eSports teams successfully.
"Most sports businesses have media revenue from TV and broadcasts, but in the eSports business, the media revenue is a very digital-oriented business," he said.
"Google, Facebook, Netflix and Amazon are all becoming very aggressive in terms of pursuing eSports content. As we come to the table, we're focused on putting together media deals in the U.S. and having our teams and players still playing in Korea be broadcast on the global basis."
Along with the business standpoint, the CEO is focused on growing the fan base and in that respect, the New York Yankees are the best role model.
"We think about the Yankees, an iconic baseball team that has global fan base," he said, adding that the 27-time World Series champions have 8.5 million followers on Facebook, and 3.5 million followers on Twitter.
"We think that's a good goal for us in the short term, in terms of how do we get to that number of fans that follow us across new media platforms developing in this decade."
The Chinese-American chose Korea over China for the esports business -- although the latter is the largest market for the industry -- thanks to a deep pool of players and coaches as well as business-friendly environment.
However, Chou advises the Korean eSports industry to think about its international strategy.
"The market in Korea is vibrant and exciting, but Korea is still a small media market. The business model for sports is clearly going to be a media business, and it will need a very large media market," he said.
"It's important that Korean eSports teams figure out ways to also have operations in China and the U.S. Those two markets are so much bigger in terms of the media and there are very large companies that are focused on eSports that want to do partnerships with Korean teams."