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Column: The next major sport? Josh Kroenke confident esports can build big, global audiences

L.A. Gladiators fans cheer during an Overwatch League match against the L.A. Valiant on Saturday.
L.A. Gladiators fans cheer during an Overwatch League match against the L.A. Valiant on Saturday. The Gladiators are a subsidiary of Kroenke Sports & Entertainment, the same company that owns the Los Angeles Rams.
(Robert Paul)

While the Rams were playing the Denver Broncos in a preseason game at the Coliseum on Saturday night, less than three miles down Figueroa at L.A. Live, the Gladiators and Valiant, Los Angeles’ two Overwatch League teams, were going back and forth in the “Battle for L.A.”

Tracking the action early Sunday morning in England was Josh Kroenke, who along with his father, Stan, own Kroenke Sports & Entertainment. The company’s subsidiaries include the Rams and Gladiators in Los Angeles, as well as the Denver Nuggets, Colorado Avalanche, Colorado Rapids and international soccer powerhouse Arsenal in London.

As the Arsenal director, Josh was at Anfield to watch Liverpool defeat Arsenal, 3-1, but the results from Los Angeles were more to his liking as the Rams and Gladiators came away with victories. It may seem odd to include the results of an esports team with NFL and Premier League franchises worth about $3 billion each but the Kroenkes don’t see it that way.

Josh Kroenke claps before a match between Arsenal FC and Burnley FC at Emirates Stadium in London on Aug. 17.
Josh Kroenke attends a match between Arsenal FC and Burnley FC at Emirates Stadium in London on Aug. 17.
(Arsenal FC via Getty Images)
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Three years ago Activision Blizzard CEO Bobby Kotick met with Stan and Josh Kroenke as well as with Robert and Jonathan Kraft, who own the New England Patriots and New England Revolution as well as the Boston Uprising of the Overwatch League. Kotick explained his vision for the Overwatch League, a professional esports league for the popular first-person shooter video game, and how he wanted to put teams in home markets with established owners and make it like a traditional professional sports league. The idea attracted Stan, 72, almost as much as it did Josh, 39.

“While I am closer to the general age of the demographic, my father and Bobby Kotick have been friends for a very long time so he understands gaming much better than people might expect,” Josh Kroenke said. “When you start talking about a global esports audience that could reach almost 600 million people next year, he was quickly able to get his head around the industry because the numbers speak for themselves. Boiled all the way down, the esports industry is simply fans wanting to see the best in the world perform something that they themselves enjoy doing, which is the same concept as any of our teams in traditional sports.”

L.A.’s newest rivalry took a big step towards joining their more established brethren when the Gladiators and Valiant squared off in the “Battle for L.A.”

Kotick recalls addressing a room a few years ago that included NFL commissioner Roger Goodell, William Morris Endeavor CEO Ari Emanuel, Alex Rodriguez and other powerful figures in traditional sports about esports and watching their eyes glaze over as he explained its popularity.

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“They were asking me where’s the sports part?” Kotick said. “So I asked Alex to stand up and I said there are about 1,200 Major League Baseball players and maybe 10 are as distinguished as this guy. Now look at me. There are a billion of me. They want the same sense of belonging and the same sense of purpose and the same sense of meaning. They want their hopes and dreams to be possible and achievable. Those billion people aren’t going to get that from traditional sports, but they are going to get it from video games and that’s the difference between esports and traditional sports.”

Denver Nuggets president Josh Kroenke stands on the court next to his father, Stan, and NBA fan Jimmy Goldstein
Denver Nuggets president Josh Kroenke, left, stands next to his father and team owner Stan Kroenke, center, and NBA super fan Jimmy Goldstein before a playoff game against the Portland Trail Blazers in May.
(Getty Images)

The message hit home with the Kroenkes and Krafts in 2016 when they were guests of Kotick at BlizzCon, an annual gaming convention held by Blizzard Entertainment in Anaheim to promote its major franchises such as Overwatch. Both bought slots in the Overwatch League for $20 million each when the league launched with 12 teams last year. Eight more teams were added this year with slots going for $35 million. The league plans to expand to 28 teams in the future and the hope is franchise fees will reach $60 million.

“I think whenever you experience something like BlizzCon you immediately understand the power of the gaming community and its reach,” Josh Kroenke said. “Bobby had a grand vision of what they were planning, and to see and experience the people there supporting the different games and their characters just re-validated the gaming ecosystem as a whole. Plus, we thought that the city-based format of the Overwatch League created a compelling revenue model for everyone involved — the league, team owners, players, and sponsors.”

“We think that between the new stadium, the performance venue, and potentially even partnering with The Forum next door, the possibilities around the district are endless for hosting amateur and professional esports events.”
Josh Kroenke

The Kroenkes recently doubled down on their investment into esports by also buying a franchise in the Call of Duty League, which is launching next year, for $25 million. Much like “Overwatch,” “Call of Duty” is a popular first-person shooter video game franchise published by Activision.

The Kroenkes’ Overwatch League and Call of Duty League teams will play in the 6,000-seat performance venue that is being built under the same canopy that will cover the 70,000-seat football stadium that will serve as the home of the Rams and Chargers in Inglewood. While the original idea for the performance venue was to hold concerts and movie premieres, the Kroenkes are focused on making it a premiere esports venue as well.

‘We think that few traditional sports can match gaming’s reach,” Josh Kroenke said. “The ‘Call of Duty’ franchise has been a best-selling game 10 years in a row, and I have friends who absolutely love playing the game, so I know its popularity is unquestionable. Its fans are some of the most passionate around, and as an esport it’s going to be fun to continue to evolve with them alongside the launch of the new league in 2020.”

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There are moments when the multibillion dollar world of esports seeps into the consciousness of traditional sports fans and executives. Last month, 16-year old Kyle “Bugha” Giersdorf won the $3 million grand prize at the Fortnite World Cup in New York and last weekend at The International, a tournament for “Dota 2,” a multiplayer online battle arena video game, a prize pool of $34 million was awarded in Shanghai, making it the largest single esports tournament ever.

After finishing second in the Fortnite World Cup, L.A. native Harrison “Psalm” Chang is looking at life a little differently now that he’s a millionaire.

The Kroenkes would like to produce another one of those moments by hosting the League of Legends World Championship at the Los Angeles Stadium at Hollywood Park in the near future. If that sounds crazy, consider that the 2017 League of Legends World Championship was held at the 80,000-seat Beijing National Stadium, which was used during the 2008 Summer Olympics.

“The Hollywood Park project speaks for itself, and integrating esports into it has been a fun conversation,” Josh Kroenke said. “Esports events are playing a significant role in the current dialogue. We think that between the new stadium, the performance venue, and potentially even partnering with the Forum next door, the possibilities around the district are endless for hosting amateur and professional esports events.”


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