The shock merger of ESL and FACEIT, funded by the Savvy Gaming Group, a subsidiary of the Saudi government’s Public Investment Fund, has caused a firestorm across the industry. The nasty ethics of the situation will no doubt permeate the scene for a long time to come, but anyone hoping that Valve will pull the plug on all this by cutting ties with ESL is overwhelmingly naïve. Neither the company’s business practices nor its esports track record suggests that they’ll do such a thing.
Benevolent or absent? The Valve esports conundrum
Valve always seemed to occupy a unique space regarding their esports products. Unlike Riot or Blizzard, they often just hand the reins off to third-party tournament organizers, allowing for a wide range of broadcast tones and event types to emerge.
This made the CS esports scene, and to a smaller extent, professional Dota, very special and different from the aggressively streamlined and super-marketing-focused offerings brought on by other publishers. In turn, the tournament organizers had an easier time leaning into the interests of the esports demographic and could offer some spicier stuff over the super-sanitized saccharine broadcasts of an Overwatch League or a Valorant event.
This natural evolution and competition made CS esports so great over the pre-pandemic years, and it was precisely the ecosystem that could allow a company like BLAST to emerge, make a million mistakes, then refine the formula and emerge as one of the best TOs out there.
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It is also, however, the place where tournament organizers could regularly overreach, with Valve only stepping in at the precipice of disaster. Consider the conflict of interest with MIBR and Yeah Gaming, the StarLadder DMCA controversy, the clusterfuck that was the PGL production: these events, much like their insistence on neutering coaches in the professional game, show that Valve still have a very old-school approach to esports, seeing it as a minuscule marketing arm with little reason to try and make it into its own sustainable product.
This calculation certainly makes sense when you’ve got Steam to fall back on. To get the real idea of how little all this matters to the bigwigs in Bellevue, just consider what happened with the recent Dota Major. Canceled out of nowhere and brought back after public backlash, perhaps the real takeaway is this passive-aggressive throwaway line revealed by EG manager Peter Anders from a meeting at TI10:
“Valve sees TI as a passion project. They don’t gain much revenue from TI compared to the time out in, and when teams go straight to public platforms to complain about issues, it makes Valve less motivated to keep running TI.”
No doubt the same goes for any other esports properties. It’s a pointless afterthought. The quoted $1.5 billion paid for ESL and FACEIT? A third of Valve’s revenue from Steam in 2017, according to estimates.
So don’t expect them to save us from sportswashing. Did you see what they’ve been up to in China?
Sportswashing 101
It might be worth explaining why all this matters. If you spent more time with video games than reading about international politics (which is a perfectly justifiable decision), it’s the way shunned regimes try to launder image through PR by hosting popular sporting events or buying teams. Throwing money at the problem, the human rights way. Think the Qatar World Cup, the Sochi Winter Olympics, the Beijing Summer Olympics, Blast Pro Series Bahrain, or the Abu Dhabi Grand Prix.
Or, apparently, nearly the entire slate of competitive CS:GO matches from now on.
CS esports has shifted overnight into a territory somewhere between yucky and unethical, and it’s up to each of us to determine whether this is something we want to be a part of. There is no right or wrong answer to this question: however, one needs to be clear-eyed about just how seismic this shift is. It isn’t like the NEOM sponsorship deal, not something you can rage away: it’s a done deal, a completed business transaction.
The merger will likely see a division of labor between ESL and FACEIT, with the former focusing on its ever-growing slate of top-tier events and the latter prioritizing FPL-esque pipelines for new talent and smaller competitions.
Rumors suggest BLAST will be the next domino to fall, which would mark the formation of a near-complete monopoly on the third-party CS:GO circuit. This is where the big idea comes in, namely that Valve can capsize this whole affair by rescinding any partnerships and deals with this new business entity, leaving them stranded as far as two of the biggest esports titles are concerned.
As seen above, there’s little to suggest Valve would make such a move. We’ve basically got confirmation of this, too: just take this quote from HLTV’s recent interview with Carmac then:
“In these conversations Valve typically give me the impression that we’re free to do whatever we want or what we think is best for our business so long as it doesn’t clash with the interests of the average Counter-Strike player or fan. They have given us no indication that would happen in regards to our announcement.”
Those expecting new third-party tournament organizers to come in also seem to lack perspective about the lay of the land these days. With the Louvre Agreement in place and BLAST having its own arrangement with the top orgs in the scene, how will anyone convince the best of the best to stick around on a regular basis for their tournaments? We’ve seen how viewing metrics crater when the teams involved are not up to par: remember Flashpoint? Have you seen the stats for WePlay’s Academy League?
Besides, look at who decides to stick around: ELEAGUE (meaning Turner) and MLG left, but there’s still a smattering of StarLadder and PGL to mess up the occasional Major.
So this is our scene now. Take it or leave it. The walls are closing in.
