Cynopsis Esports 2/22/24: Embracer CEO causes uproar; Team owner sues Call of Duty League; Super Bowl ads shift away from gaming

Medias First Morning Read
Thursday February 22, 2024

Good morning! It’s Thursday and this is your early morning Esports and Gaming brief.
Gaming conglomerate Embracer Group’s restructuring is in “the final stretch,” but the company’s messaging could use some major work moving forward after CEO Lars Wingefors said its No. 1 value is to “maximize shareholder value in any given situation” amid laying off nearly 1,400 workers.

The statement comes from the Swedish company’s Q3 financial report (Embracer’s third quarter ended Dec. 31, 2023), with Wingefors noting the company’s commitment to reducing its net debt – a commitment that has led to the cancellation of at least 29 titles from its suite of studios since the June 2023 announcement of its restructuring. The layoffs account for 8% of Embracer’s workforce, but Wingefors’ comments are a prime example of how to make a bad situation worse, even when surrounded by competitors like Microsoft making the same type of moves (more on that later).

Despite record revenues and ever-growing audiences, the esports and gaming industries remain in a transition period that is focused on right-sizing companies and regulating spending that was, at best, overly ambitious. It’s a difficult reality that cuts, and some sizable ones, will continue through 2024. The important thing to remember, and the thing Wingefors seemingly forgot, is that the shareholders matter – but the people making your product matter more, especially in the public eye. Have empathy, do your best to do right by your people, and remember that how you communicate what you do is just about as important as the choice itself.

COMPETITION AND GAMING NEWS

Activision Blizzard is being sued by OpTic Gaming CEO Hector “H3CZ” Rodriguez and former Call of Duty League pro Seth “Scump” Abner for “Activision’s unlawful 100% monopoly over … professional Call of Duty leagues and tournaments,” according to a mid-February filing. The lawsuit, which is seeking $680 million in damages, is centered on Activision Blizzard’s policies for the Call of Duty League, the franchised esports circuit for Call of Duty esports. The lawsuit is the latest example of teams souring on the franchised league model, which has been framed as anti-competitive and a net loss for competitors across multiple esports even prior to this lawsuit.

Helldivers 2 is the latest unexpected viral gaming sensation, with the co-op third-person shooter taking the No. 1 spot on Steam’s concurrent player list on Tuesday over mainstays Counter-Strike 2 and Dota 2. Helldivers, which exploded in popularity at launch behind a unique gameplay loop, stellar graphics and mechanics, and a $40 price tag, has been suffering from its success: Developer Arrowhead Game Studios has struggled to keep up with server demand, resulting in a need to cap total player populations while building out new server space. The PlayStation and PC exclusive seems to have staying power, too, with glowing reviews across the board and a growing player base since its Feb. 8 launch.

Is Xbox ditching the console wars? Not really, but sort of: Microsoft is planning to bring some formerly exclusive titles to platforms including the PlayStation 5 and Nintendo Switch, opening the door for a shift in what drives Microsoft’s games business. Cloud gaming has been at the center of that conversation in recent years, and subscriber services like Xbox Game Pass, which provides a suite of games for a monthly fee, could go platform-agnostic should Microsoft decide to step away from a hardware battle it’s been a distant third in for around a decade. That said, physical consoles, discs, and peripherals aren’t going away any time soon, Microsoft Gaming CEO Phil Spencer told Stephen Totilo, even with most of the gaming audience shifting to all-digital ownership.

Elden Ring’s Shadow of the Erdtree expansion was revealed Wednesday as FromSoftware’s multi-time Game of the Year honoree gets its first DLC since launching in February 2022. FromSoftware, which revealed the expansion in February 2023, released a three-minute trailer early Wednesday that drew millions of eyeballs and set the tone for the next step for a franchise that has increasingly shaped the way modern games are designed.

SPONSORSHIP & ACTIVATION

Game studio Frost Giant is looking to potential players for funding to help market its first-ever release. Frost Giant, which was founded in 2020 by former Blizzard Entertainment developers Tim Morten and Tim Campbell behind around $5 million in funding, launched a crowdfunding campaign that offers company equity in exchange for funds to support marketing of Stormgate, Frost Giant’s premiere title. Frost Giant is framing the move as a way to build direct community support and avoid bloating Stormgate’s budget with costly marketing stunts, particularly at a time when game companies worldwide are reeling from such decisions.

Streamer QTCinderella’s Streamer Awards activation drew nearly 650,000 peak viewers earlier this month, a 40% increase year-over-year for the content creator’s Oscar-style awards show. QTCinderella, who built the program independently this year after working with gaming entertainment organization Misfits on the show in 2023, brought in around 400 co-streaming channels over the course of her 10-hour program, which became the No. 2 Twitch broadcast of 2024.

From a partnership with Lexus to its crowning its first million-dollar earner, the Madden Championship Series had an Ultimate Madden Bowl to remember over Super Bowl weekend. Alongside a virtual naming rights deal that saw Lexus take ownership of the digital playing field for Madden Bowl, the event put on a red carpet that brought in stars from across the entertainment and sports industries, and got a great storyline from the competition to go with the fanfare. Henry “Henry” Leverette, at 20 years old, became the first Madden pro to cross the $1 million earnings threshold in the esport with his championship win over Wesley “Wesley” Gittens in the final.

2024 Top Women in Esports & Gaming

Queens of the Console: It’s Time to Unveil the Reigning Women in Esports!

Level up with legends of the esports & gaming industry and join us as we shine a spotlight on the brilliant minds, fierce competitors, and industry trailblazers. From pixel pioneers to esports queens, their stories redefine the narrative. Are you ready to redefine yours?

JOIN THE MOVEMENT

YOUGOV LIVING DATA INSIGHTS
Explaining the generational device divide

Smartphones are equally popular among both groups (49% of adults vs. 50% of teens). Teens show a higher preference for laptops/desktops (43% vs. 30% in adults), Nintendo Switch (34% vs. 17% in adults), Xbox One (24% vs. 13% in adults), and VR headsets (17% vs. 5% in adults). Conversely, adults are more inclined towards the Sony PlayStation 5 (11% vs 17% in adults). This suggests a generational shift in gaming platforms, with teens favoring more versatile or newer-generation devices.

The full results of the poll can be found here.

STREAM HATCHET INSIGHTS
Download our 2023 Video Game and Live Streaming Trends Report for free

Stream Hatchet’s latest report shines as a beacon for the live-streaming, gaming, and esports industries, offering unparalleled analytics to navigate the evolving digital landscape.

– 2023 saw a remarkable stabilization in live-streaming viewership, echoing the peaks of 2020 with 38.3 billion hours watched, signaling a mature yet vibrant market.
– The year marked a significant shift, with Kick and AfreecaTV surpassing Facebook in streaming dominance, illustrating the fluidity of platform popularity.
– Esports viewership grew by 9%, while co-streaming emerged as a significant trend, contributing to 29% of total watched hours, underscoring changing viewer habits.
– Non-gaming streams gain momentum, reflecting a shift towards more varied content offerings, with platforms like Kick leading the charge in content diversification.

The report offers critical insights, serving as a strategic guide for stakeholders in the streaming ecosystem, emphasizing the importance of leveraging analytics for informed decision-making.

Download the report for free here

SUPER BOWL SHUFFLE

Super Bowl LVIII featured plenty of celebrity appearances, from TikTok stars to hot shows. We also saw a cameo from one of gaming’s biggest faces, with the aforementioned Scump appearing in a Mountain Dew commercial featuring actress Aubrey Plaza.

Mountain Dew, a product of PepsiCo, has long been active in the esports and gaming space and set itself apart with the move: As many advertisers surprisingly turned away from gaming creators that are Gen Z’s primary form of entertainment in favor of short-term TikTok trends, Mountain Dew stuck by one of its mainstays to promote the launch of its Baja Blast flavor going nationwide.

The shift in Super Bowl ad talent is an interesting one, and perhaps an overcorrection by traditional brands trying to keep up with the latest trends rather than understanding their audience’s actual preferences. We’ve cited this stat before, but around 90% of Gen Z identify as gamers; neglecting that trend in favor of what’s hot on social media this month is indicative of how out-of-touch top brass are with younger fans’ interests and the persistent marketing beats that will appeal to them.

INDUSTRY

The Federal Trade Commission is reexamining Microsoft’s deal with Activision Blizzard following the company’s decision to lay off 1,900 workers. The FTC, which conducted but lost a heated battle against the companies’ merger in 2023, took the matter to the courts again in early February, saying Microsoft made material changes to Activision Blizzard’s staff after saying the company would be largely independent after the merger. This, the FTC claimed, amounts to Microsoft going back on promises it made before the court, despite Microsoft’s broader gaming division also being impacted by the cuts.

Is Borderlands the next major game-to-big-screen franchise? Film director Eli Roth and Gearbox Entertainment founder Randy Pitchford seem to think so, and with a cast including Cate Blanchett, Jack Black, Kevin Hart, Jamie Lee Curtis and more, it’s easy to see why. Much like the Borderlands franchise itself, the goal of the film is fun for fun’s sake, amid a backdrop of some blood and guts, Roth and Pitchford explained in an interview with IGN ahead of the movie’s first trailer. The movie, set to release Aug. 9, is non-canonical in order to allow it to bring in the biggest names from the franchise without toying with the game’s chronology – good news for a game that doesn’t fit in any one box. “At a certain point you just have to pick, these are our characters, this is the story we’re going with, and let’s just make the best one possible,” Roth told IGN.

More than 500 games hit $3 million in gross revenue on Steam last year alone, the video game platform announced Monday, the highest-ever number of $3 million earners on publisher Valve’s storefront. It’s also more than twice the total that hit that threshold in 2018, according to Steam, and the variety of titles that got there speaks to the diverse interests of the gaming community and the global nature of the fanbase. “Every month we publicly track the top 20 new releases by revenue, and the top five most-played new release free-to-play titles,” Steam said in its report. “In 2023, more than a quarter of those new releases were from studios releasing a game on Steam for the very first time, and those new studios hailed from more than two dozen different countries.”

2024 Tempest Awards

Who will stand tall among the giants of last year’s winners’ circle?

In 2023, we celebrated 22 of the industry’s most outstanding campaigns, five watch list honorees, and three luminaries.

Want to take home a trophy in 2024? Entries open May 1, 2024.

WATCH THE TEASER

TRIVIA
What is the name of January’s viral video game that has reportedly lost about 67% of its player base since peaking at more than 2 million players on Steam and 3 million on Xbox? (Email [email protected] with your answer, and be sure to include your name, company and city).

Answer to Our Last Trivia Question
As of Jan. 26, how many points did Iowa women’s basketball star Caitlin Clark need to get to become the all-time leading scorer in NCAA women’s hoops history? Answer: One hundred and seventy seven. Congrats to Clark for passing the mark last week! Kudos: Creed Heilskov | ImOn Communications, Cedar Rapids, Iowa; Michael Goodman | Radio One Atlanta, Atlanta; Tom Moore | Kalt Productions, Los Angeles; David Westberg | SAG•AFTRA Federal Credit Union, Burbank, California

Cynopsis Team

Robbie Caploe
VP/Group Publisher
[email protected]

Lynn Leahey
Editorial Director
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Kerry Smith
Division President
Access Intelligence

Albert Nassour
Executive Director of Sales
917-545-3129
[email protected]

Stephanie Cronk
Senior Marketing Director
[email protected]

 

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DIRECTOR, CUSTONER ACQUISITION

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INTERSECTION
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MEDIA COORDIATOR DIRECT RESPONSE >>
OPPORTUNITY MEDIA/NY(REMOTE/HYBRID):
Seeking an energetic achiever with excellent written & organizational skills for role to assist in growing revenue for dynamic Direct Response Team: required: BA Degree, Bilingual (English/Spanish) Wide Orbit Exp a +. Full info HERE

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Grow in billings, income, and experience on a team that continues to lead our industry. Take your career to the next level with a company that is transforming cities and delivering on our promises to our clients and to our long-standing Municipal and Transit Authority partners. Full info HERE

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EXECUTIVE PRODUCER OF NEWS/ENTERTAINMENT
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Assist in migrating development infrastructure, such as Perforce, to Linux on AWS, work on automation for non-game services such as the build system and improve overall company infrastructure.
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https://www.arena.net/en/careers

Lead, mentor, and nurture the growth of the Global Marketing team via discussions, brainstorming sessions, creative briefs, and marketing planning efforts on a global scale.
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https://nzxt.com/careers

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https://www.netgear.com/about/careers/

Utilize Linux to support hosting game services and the game server; including automation for scaling and wielding Docker for packaging and deployment.
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https://us.ncsoft.com/en-us/careers

Work with design team to create playable spaces conducive to AI interaction and revise and tune characters based on design goals and playtest feedback.
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Be sole point of contact for establishing business relationships with third party and cloud hosting providers, customer support, quality assurance, NOC and localization.
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https://www.turtlerockstudios.com/careers

Scale our Data Center and hardware infrastructure at a time of incredible growth for our business.
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https://corp.roblox.com/careers/

Work with multiple engineering teams like rendering, physics, and networking to create industry-leading quality assurance and test coverage for the Roblox engine.
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https://corp.roblox.com/careers/

Serves as an expert in strategic talent programs, continuing to identify ways to optimize employee performance, enhance employee engagement, and align talent initiatives with business priorities.
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https://www.nintendo.com/corp/jobs.jsp#

Develop, maintain, architect, and design embedded networking software and research complex subjects and provide expert guidance.
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https://www.nintendo.com/corp/jobs.jsp#

Create photo-real particle systems for game environments and scripted moments, as well as destructible assets, and coinciding particle systems.
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https://careers.activision.com

Design and develop highly scalable, highly available and highly reliable Ads & Monetization platform that handles billions of requests per day.
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