Turner Sports Sees a Major Opportunity in eSports

By David Kretzmann Markets Fool.com

With viewership rapidly expanding into the hundreds of millions, eSports enjoyed some time in the spotlight at CES 2017 last week. Supernova analyst David Kretzmann was at the trade show in Las Vegas, and he spent some time getting the latest news for this growing industry from the VP and General Manager for eSports at Turner Sports.

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Tune in to learn about how the media companies are approaching the eSports opportunity and what investors should watch in the coming years.

A full transcript follows the video.

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David Kretzmann:David Kretzmann, here, with Motley Fool Supernova. I'm pleased to be joined by Christina Alejandre, vice president of eSports at Turner Sports. Christina, thanks so much for joining us. Let's first start with Turner Sports and how you all are approaching the eSports market. Can you expand on how Turner Sports is approaching eSports?

Christina Alejandre:Turner Sports is approaching eSports as they would approach any other sport under their umbrella. So if you look at the different verticals that we represent (which are NBA, NCAA, and PGA), they treat eLeague and eSports with the same care and attention as they treat any other sport.

Kretzmann:What would you say is the biggest misconception people have about eSports?

Alejandre:I think people still believe that it's a bunch of kids playing in their mom's basement. They're playing for fun. It doesn't take any skill. It's a bunch of kids who might just be really dedicated at playing video games. And what they're not realizing is this is a full-time job for these players. They're sitting, and they're living in game houses, and they're practicing 40, 50, or 60 hours a week. They're watching game tape, if you will, of their competitors. They're thinking about different strategies. And it is a serious sport that takes a lot of skill.

Kretzmann:When you're developing relationships with game producers like Activision Blizzard or Electronic Arts, what does that look like from Turner Sports' perspective?

Alejandre:For us, especially because we have a year under our belt, we go to them and we show them what we've created. If you look at our broadcasts that we've created for TBS on Friday nights, we do very compelling story lines. Our level of production is, again, the same level of production that you would see for NBA, NCAA. Our tournament operations -- the way we treat players, and teams, and pick our talent -- every aspect is treated as the best in class, and it shows in our final product.

So when we're talking to different publishers, we show that we will take their game and give it the care and attention that it deserves. This isn't just some kind of niche product that's out there that's kind of second best. We really treat it with the respect that it deserves. And that's something that I think publishers really respond to, because this is their game, and this is their baby, and this is the thing that they've invested millions and millions of dollars in. They want to know that when you're taking on their product as a tournament or as some type of competitive event that you're going to treat their child well, too. We've shown that we're able to do that.

Kretzmann:You mentioned that Turner Sports approaches eSports like any other sport. What would you say is one of the primary differences between eSports and traditional sports as far as how that plays out from a broadcasting perspective?

Alejandre:You know, there's a lot more technical things that go into eSports. You have builds and games, and it has to connect to the internet, and there are so many kinds of different unknowns. If there's a malfunction in basketball, it's probably because the basketball is flat, so you just get another basketball. Or somebody gets injured, or something like that. But there are no real technical issues in traditional stick and ball sports as you would find in eSports.

Sometimes during our broadcasts, somebody will disconnect from a server, so you have to take a break and go figure out what's wrong. I think that's one of the primary differences.

Kretzmann:And what would you say are some of the main games that resonate most with audiences?

Alejandre:So there's the core eSports audience, and whatever game it is it resonates with them. But as far as extending outside of the core and trying to hit the mainstream, it's the games that are more palatable or more understandable. The reason why we went with Counter-Strike for our first game is because it's pretty easy at its core level to understand Counter-Strike. It's pretty easy to say 5-v-5, first team that annihilates the other team wins.

We're always looking to improve. Evolve. Innovate. We innovate, and we change things sometimes episode to episode of our seasons, or even hour to hour. We're also looking at other games. Counter-Strike will always be a core part of our DNA, and we'll always be doing stuff within Counter-Strike, but there are other games in eSports. We want to be a premier eSports tournament operator, and in order to do that we can't just focus on one game.

There's a huge amount of growth. There are a lot of different eSports out there, so it's just finding the one that's right for us and moving on in that fashion.

Kretzmann:And at The Motley Fool, we're all about investors helping investors, so looking out over the long-term, what are some metrics or trends within eSports that investors should be paying close attention to over the next three, five-plus years?

Alejandre:I think looking into non-endemic sponsorship into the space is something that they should be paying attention to. You're seeing a lot of non-endemics kind of getting into the space now. I don't think the community really embraces that. But the types of non-endemic sponsors getting into the space -- I think you'll see that that will help everyone in the ecosystem grow eSports.

Kretzmann:Great. Well, we'll leave it at that. Thank you so much, Christina, for taking the time. Fool on!

David Kretzmann owns shares of Activision Blizzard and Electronic Arts. The Motley Fool owns shares of and recommends Activision Blizzard. The Motley Fool recommends Electronic Arts. The Motley Fool has a disclosure policy.