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Message: Gamers Fight for Rights as Billion-Dollar Esports Market Matures

By Eben Novy-Williams

While there’s disagreement over how big a problem this is, there’s consensus that esports organizations have too much power.

“Orgs have strong counsel with 30-page agreements that have all sorts of terms in them, and often on the other side you’ve got a teenager, or early 20s, who’s probably never read a contract before,” said Gordon, whose firm represents both players and organizations. “It’s really weighted against the player.”

As some esports leagues push to make themselves more and more like traditional sports leagues, the industry may need to decide whether its players will get the benefits of traditional sports stars (unions, collective bargaining and rigid salary structures) or whether it will mirror more the music and entertainment world, where young creators often sign away a large bulk of their rights and income on their way up.

Finding Agents

One major concern in esports: Teams often serve as management for their players. Trink said that earlier this year, while FaZe Clan was trying to reach a new agreement with Tenney, it began encouraging those on its roster to find outside representation. He said it’s better for the players and better for the organization to help avoid situations like the one they’re in now.

That’s part of what Trink called the new-era contract. In addition to helping gamers find agents or managers, the team is rethinking revenue splits. Instead of teams getting 80% of brand deals that it brings to a player, Trink said the team now takes 20%. (The $60,000 that FaZe claims to have made from Tenney came from 20% cuts off two different brand deals.)

FaZe Clan is also getting more granular on revenue details. Instead of simply taking a cut of Twitch revenue, FaZe Clan is separating out different streams. It no longer takes a percentage of donations or subscriptions that its gamers earn from Twitch, which for top streamers can be tens of thousands of dollars each month.

“We feel that is too personal and that we shouldn’t take that money,” Trink said.

Proving Themselves

Only so much change can come from the teams themselves. In the future, gamers may need fully independent unions, similar to those in the NFL or NBA, and a collectively bargained salary structure.

But as in pro sports, up-and-coming gamers will have to demonstrate that they deserve lucrative contracts, said Bryce Blum, founding partner at ESG Law.

“An unproven player in esports, like the majority of rookies in traditional sports, isn’t worth a massive deal,” he said. “They need to get their foot in door and prove their worth on the first contract in order to improve their value in the marketplace.”

Source: https://www.bloomberg.com/news/articles/2019-05-29/gamers-fight-for-rights-as-billion-dollar-esports-market-matures

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