Facebook Embraces Esports in Its Video Strategy Shift
May 18 2017 - 5:59AM
Dow Jones News
By Sarah E. Needleman and Deepa Seetharaman
Facebook Inc. is paying professional videogame teams and others
in the esports industry to post videos on the social network, part
of a shift in strategy to deliver more-polished programming to the
company's nearly two billion monthly users.
Earlier this year, Facebook signed contracts with five teams to
publish live and on-demand video of players practicing or competing
at esports. In addition, Facebook on Thursday is expected to
announce a deal with ESL, a global organizer of esports contests,
to broadcast matches, player interviews and more.
Under the deals, esports partners must produce a minimum number
of hours of video for the social network, and in most cases the
partners are allowed to simultaneously publish to rival platforms
such as Amazon.com Inc.'s Twitch. Financial terms weren't
disclosed.
Facebook's interest in beefing up TV-like programming from
science, lifestyle and other genres comes as many publishers are
seeing lackluster viewership for their live videos on the platform.
Facebook is also grappling with how to censor violent moments and
other dark content streamed live to the site.
People scrolling through Facebook's news feed are more likely to
watch polished videos with audio turned on, making them potentially
lucrative vehicles for ads, analysts say. Such content will
increasingly appear in news feeds over off-the-cuff live videos
from users, as Facebook wants to be seen as a hub for longform
video.
In retooling its video strategy, Facebook revised some of its
live-streaming contracts with publishers to emphasize on-demand
video, according to people familiar with the matter. Recode earlier
reported on Facebook revising its video contracts.
Facebook also is investing in more gaming and traditional sports
content. Esports marries both, and fits Facebook's strategy to
focus on lower-profile sports that still have dedicated
followings.
The genre has a built-in fan base of millions who watch videos
mainly on Twitch and Alphabet Inc.'s YouTube. In 2016, people
watched 9.6 billion hours of live-streamed esports and other
videogame content on those platforms, according to SuperData
Research. The industry tracker projects that number to climb to
11.4 billion hours this year.
Team Dignitas, an esports squad majority owned by the National
Basketball Association's Philadelphia 76ers, joined Facebook's paid
content program last month after an exclusive contract it had with
Twitch ended. Echo Fox, an esports team co-founded nearly two years
ago by former basketball star Rick Fox, also recently signed a deal
with Facebook, which gave the team advice on how to reach viewers
and generate ad revenue.
Amy Carrera, a 40-year-old marketing professional in Kingman,
Ariz., tunes in to Twitch because she can easily find her favorite
games played live. Facebook might be more attractive to her, she
said, if it had a dedicated section for game streams.
Facebook is hoping more esports videos will help it develop such
an ecosystem. The company plans to apply what it learns from its
initial esports partners to develop new features for game
broadcasters, said Leo Olebe, Facebook's director of global games
partnerships.
Write to Sarah E. Needleman at sarah.needleman@wsj.com and Deepa
Seetharaman at Deepa.Seetharaman@wsj.com
(END) Dow Jones Newswires
May 18, 2017 05:44 ET (09:44 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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