TLDR IS AT THE BOTTOM
Its been a tiny while since I stirred the pot with own3d and twitch. I actually didn’t expect things to get as out of control as they did. So I am going to put a little perspective onto why exactly I was annoyed enough to publicly voice my opinion of all the issues.
FXOpen e-Sports does not want to hurt other peoples bottom lines. This isn’t our business, it will never be and I don’t want it to ever be. I want the market to be big enough for us all to dance under the rainbow with sunshine and lollipops.. Kinda.
So for the good of transparency, I will now explain why this effected me so much.
We are now going to take a look at FXOpen Invitational Series business model.
FXOpen e-Sports does not exist for the purpose of cash profit. It exists for the purpose of advertising our company as a brand name to make it so if someone does run into our company for business they will know the name. And it works. We have obtained many a client from the e-sports base and word of mouth of e-Sports.
What we hope to do every time we do something in e-sports is cover our costs. It is important in any business to cover costs. Lack of fill rates, is a big thing and when it happens costs do not get covered. This is when board members (such as my self) reconsider an industry. Because if a fill rate changes it becomes harder to forecast the future. The variance in fill rate was the only real issue since we cover a margin in our forecasts (usually about 30%).
Now its required to know what actually goes into an event in particular our upcoming FXOpen invitational series.
Fortunately for e-Sports, media is not very hard to come by at a cheap price (usually free). The awesome TL and reddit communities allow this to happen if the material is dramatic. But the problem is, if you don’t have drama in your material, you won’t get exposure. So then you have to try to dramatise your non dramatic material. Which I am pretty bad at doing. Commentators are considered media staff under the FXOpen flag, we pay them salaries per event (less than players are earning for what its worth) and they do their job. On top of this we have frequency who earns money for organising the events and doing forum media.
So we have regular updates on TL, Reddit, twitter, facebook, our website, my blog etc every day. Which is pretty time consuming and time = money.
We have something like 50 hours per week of casting time so that we can cast every single game of the Invitational series. According to our work schedule there will be 8 hours per day of casting amongst 4 casters. Its alot of casting. We also then need people to monitor the chat and stream when the live broadcast is going on and that takes alot of time, has a little cost. This time we will be re-broadcasting twice per day also incase other geographical locations missed out. Which then requires further chat/stream monitoring
$5000, yeh ok FXOpen is a big company, but $5000 still means something. And if you can’t cover $5000 why should you try to cover $50 000. Makes sense AMIRITE?
These 3 things are where all the cost goes into, and it doesnt mention hardware as we purchase hardware for the purpose of the entire company not just e-sports. So the expense is in the business operation expenses not the e-sports investment expenses. So lets ignore the 20k+ of equipment we have purchased :)
Now lets go into what it requires to actually break even.
We are considering doing a subscription model for $5 for the entire event + showmatches. With this everyone will go into the draw to win various prizes (TBA) and there will be subscription chat only days when we expect a high rate of required chat moderation (because of fan favourites maybe? depends on how fast chat is moving).
If we do not do a subscription model, we require approximately 7000 concurrent viewers to break even in this event. Thats 7000 over 8 hours every day of the weekend for 4 weeks. Its achievable but it will take alot of effort.
In the slight chance that we go over that amount, the money that is made is re-invested in the next prize for FXOpen Invitational series.
Every dime FXOpen e-Sports has made, in cash. Has been re-invested into either its team or events and will remain to be reinvested. As we are not here for cash just exposure. But at the same time, its always nice when you get the cash you spend back and still get the exposure, whilst supporting a community you love.
At the same time, the model we have chosen is a sustainable one which can promote solid consistent growth rather than sporadic boom/bust growth. If you have something that pays for itself, it will generally last a longer period of time. This is our goal, and this is why things sometimes make me huff and puff.
TL:DR> FXOpen e-Sports is butthurt because fill changes don’t allow us to put the money made from events into the team/future events. FXOpen e-Sports is butthurt because fill changes effect growth of our events in the long term.
FXOpen e-Sports re-invests all its cash earned from e-sports into e-sports and makes a return from exposure
Have fun ladies and gents.