Exclusive: Esports Stadium Arlington goes all-in on events, explores naming rights deals
On May 25, Esports Stadium Arlington operator Envy Gaming announced that it would be moving away from the public-facing retail operations related to its gaming center as it shifts its focus to hosting and producing more national and international esports events.
The gaming center, which was focused on LAN competitions, gaming parties, and other public-focused, local retail activities, has been mostly dormant since Envy Gaming took over the operations of the venue from Esports Venues LLC–a group led by Texas Rangers co-owner Neil Leibman and other investors–in January of this year. The facility itself, developed by Populous, is owned by the city of Arlington, Texas. In addition to holding the operating lease for ESA, Envy is using the venue as the official home of its various teams–Optic Gaming, OpTic Texas, Team Envy, Dallas Fuel, and teams in Valorant, Halo, Rocket League, etc.
Envy Gaming Chief Operating Officer and President Geoff Moore told me in an exclusive interview Friday that this is part of a larger plan to focus on esports events and activities that bring people into the city from all over the country–and in some cases–from around the world.
“We want to have a venue that attracts the events that fans go to. That's why we want to have the Dota 2 North American championship, Overwatch League North American tournaments, Call of Duty, Major tournaments... those sorts of things,” Moore said. “We can do that because we have the operation of the venue, the full-time staff to handle production, ticket sales, marketing, whatever. And then we have teams in several of those leagues–and even if we don't have a team in the league, we're trying to do deals.”
Those other deals might include working with publishers to create custom events that promote new games (or newer versions of existing games), working with scholastic/collegiate national events operators such as the High School Esports League (HSEL), and other esports competitions.
The gaming center (or “gaming gallery” as Moore called it during our conversation) will now be used for sponsor activations and large-scale LAN/BYOC events. The first of these activations will take place when Dallas Fuel hosts the OWL Kickoff Clash June 2-8, with eight of the top North American teams competing using Overwatch 2. Ticket holders will be able to use one of the numerous gaming stations at ESA to play the beta of Overwatch 2 during the event.
ESA will also be hosting the PGL Dota Major Arlington from Aug. 4-14–an important stop in North America for the Dota 2 competitive circuit–and the first international Dota 2 event since 2016 in the U.S.
Challenges of Operating a Gaming Center
Speaking more broadly on the topic of gaming centers, Moore points out that the local LAN gaming/retail gaming center market has become increasingly competitive in recent years as the local school district (the Dallas Independent School District) and nearby colleges now have their own gaming centers/esports labs to attract the younger, local audience. In addition, Vindex-owned Belong Gaming Arenas recently opened up a gaming center north of Arlington in Grapevine–about 15 or so miles from ESA.
Further, Moore points out that ESA’s location in Arlington does not provide the kind of local foot traffic needed to generate a decent amount of revenue from a LAN gaming center, and the way the venue is set up, there’s no way to separate retail customers who only want to use the gaming center from those paying for tickets when a major event is going on in the venue. Ultimately, Moore says that retail is just not a space that Envy wants to compete in.
“We don't want to play in that business because that scale is too big for us and we can't afford to do that,” he said. He added that ESA has been referring people looking to put on local activities such as small LAN tournaments and birthday parties to Belong in Grapevine. The company also hopes to support local collegiate initiatives and their own home-grown facilities in the future.
The original goal of the venue was to draw tourism into the city and stimulate the local economy, bringing visitors in to stay in its hotels, shop at its retail stores, and eat at its local restaurants. But the pandemic slowed any possible growth for ESA over the last two years, and the team managing the venue at the time did its best to book local events to keep generating some revenue. Unfortunately, the only major event of note that took place at ESA in 2020 and 2021 was The Esports Awards.
Before Envy took over the lease, it sat down with the city to understand what it wanted out of this partnership; ultimately, Arlington wants to spur the local economy by bringing in people from outside the region, expanding on the visits it gets for regional sports teams (Texas Rangers, Dallas Cowboys) and nearby amusements (Six Flags, Wet & Wild). Like any other municipality investing tax dollars into esports, Arlington wants the kind of results that Raleigh, North Carolina, enjoyed in 2019 when it hosted the Rainbow Six Raleigh Major, which generated approximately $1.45M USD in “economic impact.”
While Envy inked a deal with the city of Arlington to use ESA as a home venue for its Call of Duty League, Overwatch League, Halo Championship Series, and Apex Legends Global Series teams, the end goal is a regular schedule of esports events and competitions at the venue to generate revenue and spur the local economy; that is why this seemingly minor announcement about ditching retail efforts (which likely includes vendors operating inside ESA) is an important first sign that this is a serious change in focus for the venue.
No New Layoffs at ESA
Moore tells us that this change in focus has not resulted in any new layoffs as the company let a majority of the remaining staff go when it took over earlier in the year. He also pointed out that Envy has brought some former staff back, such as Kimberly Yee, who left ESA at the end of 2020 to join Nerd Street Gamers briefly before moving on to Complexity Gaming as a contractor for more than a year and a half– she rejoined Envy/ESA in May as community manager. Corey Dunn, who also left ESA at the end of 2020 to join Envy as an executive producer is also an integral part of the ESA operations team now. Finally, Jarious Holliday returned to the ESA fold in April of this year as technology manager. Holliday worked at ESA for two years as a broadcast manager–he left the company in early 2021 to work at Nerd Street Gamer for a little over a year before rejoining Envy/ESA in April for this new role.
Moore says that ESA currently has seven full-time employees helping to build out events and administering the daily operations of the venue.
While no new layoffs have hit ESA, he did acknowledge that Envy recently had layoffs “a few weeks ago” on the west coast–as it shifted its production needs from there to Texas.
Naming Rights Exploration
When asked about the possibility of a naming rights deal for ESA, Moore told us that Envy is already actively exploring options and working with an undisclosed third party. Still, he also noted that the company is taking its time to establish itself as a regular stop for some of the biggest esports competitions in the world–whether it competes in those leagues or not. In addition, a naming rights deal would be beneficial to the city of Arlington because it gets between 40-50% of the revenue generated from it.
“What I would say about naming rights is that it is a process that we have already started and our goal is to present ESA's future value in the best way possible because that's what's going to make it attractive to the right partner,” Moore said. “So part of it is that we're spending a lot of our time building up our event schedule (because it's important to us on a variety of levels), but also to find the right brand partner at the right value. We also have to be able to demonstrate that schedule of events and usage because that also is what creates the broadcast, the media value, and the foot traffic, a lot of the value that they're going to receive. So while we've started the process, I would say a deal in the second half of this year or 2023 is what I would expect from a deal announcement timeline. I think that range of time makes sense.”
The Esports Awards
Finally, when asked about The Esports Awards leaving Arlington in 2022 for Las Vegas, Moore said that he only had second-hand knowledge of the situation–The Esports Awards had a three-year deal with ESA that ended in 2021.
“We weren't operating it [ESA] when they were there, so we didn't have the conversations directly,” Moore told us. “My understanding is they wanted to take it to Las Vegas because they wanted to ramp up the prestige of it. I don't know that personally, but that's what has been relayed to me by people who know more about it than I do.”
The Esports Awards CEO Mike Ashford tells us that with the ESA deal expiring in 2021, the company decided to sign a new two-year deal with Resorts World Las Vegas.
“We remain huge fans of the Esports Stadium in Arlington and are very excited to see the incredible team at Envy operate the facility,” Ashford told us. “The Esports Awards have operated on a three-year cycle since inception and with our contract up in 2021, the opportunity to explore new options was the chance for a fresh start.”
Ashford added that the key reason for signing with Resorts World was that the opportunity to “harness a mainstream property of the size and scale of Resorts World” was a deal that it “could not turn down.”
The 2022 Esports Awards will be held at the Resorts World Theatre in Las Vegas on Dec. 13.
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