As rumored, Activision is expanding its reach in the gaming industry with the purchase of Major League Gaming (MLG). The stated goal is to create the “ESPN of esports” and follows on the heels of the Call of Duty, Destiny, and Skylanders publisher launching its own eSports division plus a television and film studio.
Activision announced the purchase on Monday following rumors over the New Year’s holiday. The transaction went through just before midnight on January 1 for $46 million, according to a Fortune report.
While the acquisition may leave some scratching their heads, it immediately gives Activision the live-streaming technology and broadcasting infrastructure needed to host and promote eSports events. Major League Gaming has seen its influence and popularity wane in recent years, but it is still a prominent fixture in the North American professional gaming community and a recognized name globally.
Activision’s new esports division is headed by former CEO of EPSN and NFL Network, Steve Bornstein. Meanwhile, former MLG co-founder and President Mike Sepso serves as the Senior Vice President chair. The entire MLG organization will join Activision Blizzard, according to Venturebeat, and there is currently no word on a reorganization or layoffs. The existing MLG Pro Circuit will continue to operate along with the MLG.tv online broadcasting network and Gamebattles tournament system.
MLG was found in 2002 by Sundance Giovanni and Sespo. It regularly holds official video game tournaments throughout the United States and Canada for titles such as Call of Duty and Counter-Strike: Global Offensive.
Meanwhile, Activision Blizzard owns a number of competitive games including Hearthstone, StarCraft, Heroes of the Storm, and the upcoming Overwatch in addition to the aforementioned Call of Duty. The annual BlizzCon convention has held major tournaments for all of the titles under Blizzard’s umbrella, but the purchase of MLG allows for the expansion and coverage beyond just the annual championship events.
The current worldwide market for eSports totals $748 million in revenues, according to SuperData Research estimates. It is on track to reach an estimated $1.9 billion by 2018. Activision states that esports has over 100 million unique viewers today and is projected to grow to over 300 million viewers by 2017.
“Following several other acquisitions and announcements from Activision, it is clear that the firm is evolving into a media conglomerate rather than a company that simply develops and publishes video games,” SuperData Research market research analyst Joost van Dreunen said. “This is a consistent trend we have also observed elsewhere in the industry, with firms like Electronic Arts, Ubisoft and Take-Two Interactive, as the potential of ad-based revenue has come into focus.”
“Our acquisition of Major League Gaming’s business furthers our plans to create the ESPN of esports. MLG’s ability to create premium content and its proven broadcast technology platform – including its live streaming capabilities – strengthens our strategic position in competitive gaming. MLG has an incredibly strong and seasoned team and a thriving community. Together, we will create new ways to celebrate players and their unique skills, dedication and commitment to gaming. We are excited to add Sundance and the entire MLG esports team to our competitive gaming initiatives.”
Sundance DiGiovanni, Chief Executive Officer and MLG Co-founder, said, “Our mission for over 12 years has been to promote and expand the growth of competitive gaming worldwide, and today the industry is at a key inflection point as its popularity soars and rivals that of many traditional professional sports. This acquisition and Activision Blizzard’s commitment to competitive gaming will expand the opportunities for gamers to be recognized and celebrated for their competitive excellence.”
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[Image via MLG]