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Activision is going all-in on eSports, and CEO Bobby Kotick sees the money

In today's earnings call, Kotick rhapsodized about the reveue opportunites for the company's eSports business, and shared his vision for the segment as the next big revenue driver for Activision.

Activision is going all-in on eSports.

That is not a new realization -- CEO Bobby Kotick previously compared eSports to professional sports like the NFL, and implied that his company sees similar opportunities for fandom and revenue generation. 

Well, he wasn't teasing. In today's earnings call, Kotick rhapsodized about the reveue opportunites for the company's eSports business, and shared his vision for the segment as the next big revenue driver for Activision.

Saying that "we're barely in the first inning of opportunity for games as organized sport," Kotick pointed out that "eSports viewership is greater than the individual audiences for NHL, Major League Baseball, or the NBA."

His expectations for growth? "In the future, Call of Duty, Hearthstone, and Overwatch could each have audiences in excess of any of the most well known sports leagues."

Moving forward, we should expect Activision's franchises to have eSports potential, it seems.

Noting that "advertising and subscription revenues for eSports events are dwarfed by major league sports," he shared this short anecdote: "My friend Robert Kraft, the owner of the New England Patriots, paid a little less than $180 million for the Patriots in the early 1990s, and he told me it was the best investment he ever made."

The takeaway? "15 to 20 years from now, pro team owners of our major franchises will likely be sharing similar sentiments."

In the future, Kotick expects eSports events to "command their fair share of broadcasting revenues." NFL broadcasting revenues will generate over $7 billion this year.

He later expanded on his thoughts about how eSports might bolster Activision's business.

"I think when you try to get the untapped opportunities, though, that enable you to do a lot of these things, we have this very virtuous cycle: People pay to participate, sponsors are willing to finance events, those events then become the content that's broadcast on our network or on other networks.

"Those events then lead to having the ability to have regional events, national events, intentational events, all of these things have the opportunity for us to expand to have broadcast rights, licensing and merchandising, ticket sales, local sponsorships, national sponsorships -- and these are all things we are very actively engaged in. Not to mention all the opportunities to sell our professional teams for our professional legaues."

The conclusion? Says Kotick, "over the long term we view this as a tremendous opportunity to both celebrate our players and create a lot of value for our shareholders." In his view, Activision Blizzard is "better positioned than any entertainment company to take advantage of the opportunities ahead."

Note "entertainment company." In the past, the game industry so often compared itself to the movie industry. But Kotick sees himself as a competitor of the NFL now -- and likely ESPN.

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