The US Navy has confirmed it is massively shifting its advertising budget away from television towards digital, with esports and YouTube being the main focuses.

Massive shift towards digital & esports

According to a USNI News report, the Navy now intends to allocate 97%, or almost $33 million, of its 2020 advertising budget to online advertising, leaving just 3% for traditional advertising including local radio and billboards. TV advertising will be ditched entirely.

The Navy’s new approach is driven by the need reach people aged between 17 and 28 – an age group that the Navy’s own research has shown exists mostly in the digital arena.

Regarding the dramatic reallocation of resources, Vice Chief of Naval Operations, Adm. Robert Burke, has said:

“One thing we did learn, is paying for a lot of TV ads in the middle of Super Bowl games… [The] target audience is not watching that.”

Further reinforcing the ineffectiveness of TV advertising, the Navy says that, despite reducing the money it spent on television advertising in 2018, it had noticed no adverse effects on recruitment.

For 2020, the Navy will be especially focusing on esports, both for recruitment and morale goals. From February the Navy will begin advertising in esports, while the service also aims to become a major events sponsor and field its own esports team.

Air Force and Army also look to esports

The Navy isn’t alone is recognising the military potential of esports. The US Air Force entered a partnership with ELEAGUE in 2018, which has included collaborating on content production, as well as sponsoring events like the ELEAGUE Counter-Strike: Global Offensive Major in Boston.

Meanwhile, the US Army fields its own esports team which competes in titles including Call of Duty. The branch is also partnered with Complexity, with the organisation’s players attending a bootcamp at the US Army’s Fort Bliss, Texas, in June. US Army personnel also visited the GameStop Performance Center at The Star in Frisco, Texas (read more). US Army Esports also has a partnership with esports tournament organiser Ultimate Gaming Championship (read more).

AYO.NEWS says:

It’s not just the US military that is harnessing esports for recruitment either, in Europe the Danish armed forces have been collaborating with CS:GO teams, including Astralis (read more) – and we’re sure other countries will be launching their own initiatives over the coming year.

Given the subject matter of many esports titles, especially Counter-Strike: Global Offensive and Call of Duty, and the qualities and skills needed to be a great player (quick decision making, staying calm under pressures, good reflexes, honed military equipment identification skills, excellent teamwork and communications abilities etc.), its hardly surprising esports is an ideal military recruitment tool.

Specifically regarding the US Navy’s massive shift in spending, the sheer-scale of the move speaks volumes about just how ineffective traditional media, like TV, now is at connecting with younger generations. Given the size of the US Navy’s budget, its also going to be a major financial boost for some esports organisations and events.

AYO.NEWS says features the opinion of the author and does not necessarily reflect the views of Pentagon Digital Limited.

North American esports organisation Rogue has teamed up with x-kom AGO to launch a team in Ultraliga, the Polish League of Legends league.

The plan is for x-kom AGO to create a marketing presence and training and accommodation base in Warsaw, while ReKTGlobal-owned Rogue will take care of team selection and career development.

The new entity, AGO Rogue, says it will aim to take Rogue Esports Club’s impressive first and second place finishes in the 2019 season, and build on them, while it will also continue to support players from the academy side that gave Rogue a fourth place finish in the 2019 LEC split.

Discussing the news Managing Director and General Counsel at Rogue Europe, Anna Baumann, explained:

“In 2018, we have chosen the Ultraliga as one of the most excellent grounds for talent development in Europe and ever since we have pursued our unique high-performance approach for young League of Legends talent while furthering our clout in the market.

“X-kom AGO has demonstrated that they are a leader in both, the sports aspect and the commercialization of esports club assets. We are excited to continue our success story with joint forces, developing prodigy players for the international Stage while connecting even closer to our fans in Poland with a dedicated marketing approach.”

While President of x-kom AGO, Jakub Szumielewicz, added:

“I feel great pride joining our cooperation with Rogue. Since its beginnings, our organization has been focused on building competence in the fields of competitive knowledge, care for the comprehensive development of players, effectiveness in relations with business partners and consistency in building media.

“Rogue – as an internationally leading esports brand – entrusting us with its players and marketing in Poland shows that our efforts have not gone unnoticed.”

A couple of weeks ago, ReKTGlobal, parent company of esports organisations Rogue and London Royal Ravens, announced Taylor Fritz as its latest celebrity investor (read more).

South Korean private equity firm ATU Partners has launched the ATU Esports Growth Fund, with an initial capacity of 20 billion won (approx. $17.2 million).

ATU also confirmed it has added two companies to its esports fund’s portfolio, in the shape of South Korean esports team DragonX and talent agency AZYT.

Limited partners of the fund, which is said to be the first in the region dedicated to esports, include major corporations like Kakao Games and The E&M, along with institutional investors including Woori Technology Investment and SB Partners.

Chief advisor to the fund is media and esports investment expert Allen DeBevoise, who currently also serves as managing director of Third Wave Digital, a marketing firm.

The fund will be managed by former McKinsey & Company consultant and head of global business at esports broadcaster OGN, and ATU Partners founder and CEO Jamie Jungmoo Park.

Discussing the fund’s launch, Park said:

“The esports industry has been growing rapidly at 30% YoY over the last couple of years. Followed by the investment boom in K-Pop and K-Beauty, we forecast that esports will become the next big investment trend capturing Korea’s strength in the industry.”

Both DragonX and AZYT are positioned to bridge the gap between the Asian and North American esports market, giving an indicator of the focus of the fund.

DragonX currently competes in League of Legends Champions Korea (LCK) – the last remaining major unfranchised LoL league. It has been reported that ATU has plans to expand the organisation into China and the US, and expand into titles like CS:GO and Fortnite, which are currently under-represented in Korean competitive circles.

AZYT is a Los Angeles-based esports talent agency established in June 2018 by two Korean-Americans. So far it has signed more than 70 pro players.

ATU is also said to have plans to launch a second esports growth fund in Q3 2020 – with plans for $50M aimed at digital data and analytics platforms.

AYO.NEWS says:

Esports funds seem to be popping up all over the place recently, but this is said to be the first in the region, and it does have an interesting focus – trying to bridge the Pacific and unite South Korean and North American esports. We wonder who’ll be next to join the ATU portfolio?

AYO.NEWS says features the opinion of the author and does not necessarily reflect the views of Pentagon Digital Limited.

Swedish esports organisation GODSENT have signed a three-year exclusive apparel deal with fashion label Björn Borg.

Apparently the partnership actually began in autumn, and will see Björn Borg’s clothing featured in all GODSENT official match wear and merchandise.

The partnership will see a new collaborative collection, slated for release in autumn 2020, that focuses on the benefits of physical training alongside gaming.

Discussing the partnership, CEO at GODSENT, Ludwig Sandgren, explained:

“Since I started my career as an entrepreneur in esports I have worked to incorporate workout regiments in the life of professionals players, since it to me always have been easy to recognise the obvious benefits of being fit when you try to be the best at anything.

“Therefore, I am extremely proud to be able to bring Björn Borg into our world and collaborate with them to bring higher standards to our organization and to the esports world in general by putting focus on the physical aspect of the professional lifestyle of the esports athlete.”

While CEO at Björn Borg, Henrik Bunge, added:

“I look very much forward to our collaboration with GODSENT. We both share a strong belief that physical training adds far more value than just feeling good. For GODSENT, it has added value in becoming the best in the world within esports.”

AYO.NEWS says:

Though sportwear brands are increasingly active in the esports space, this partnership is notable for its long-term aspect, and seems to be aimed at building a very distinct lifestyle brand, of which esports and gaming is one aspect, but maybe not the dominant one. It will be interesting to see what crystalises from this in autumn next year!

On a decidedly cuter note, in November UK-based esports organisation entered an apparel partnership with iconic Japanese brand Hello Kitty (read more), while Vexed Gaming also expanded its partnership with sportwear brand Kappa (read more).

AYO.NEWS says features the opinion of the author and does not necessarily reflect the views of Pentagon Digital Limited.

Immortals Gaming Club’s LCS franchise, Immortals, has announced partnerships with GameStop and Ironclad Performance Wear, and an “intimate season kickoff party.”

Immortals will be launching the season that sees it return to the North American league, and the partnerships, with a special event on 13^th January 2020 at Button Mash – a vintage arcade bar in the Echo Park neighbourhood of Los Angeles.

The organisation says its partnership with GameStop will be geared towards the amateur community and allow League of Legends fans to participate in exclusive content and special access activations.

Immortals’ partnership with Ironclad will feature a ‘handy’ collaboration to be revealed at their first event in January – namely, a gaming glove designed and tested in collaboration with Immortals Gaming Club teams. Apparently, a prototype glove will be available to try at the Button Mash event.

Discussing the partnership, and new gaming globe, President of Ironclad Performance Wear, Jun Xu, said:

“Ironclad gloves are built on innovation, authenticity and quality. Through our partnership with IGC, we worked with professional gamers, embracing those key elements to create a totally new glove category.

“These are exciting times for us to finally bring this glove to market after extensive product development and field testing which took us through uncharted territory. Our hope is that these gloves will allow players to push the envelope of their gameplay performance and endurance, by reducing sweat and fatigue to create a better gaming experience.”

AYO.NEWS says:

Well, if we were in LA we’d definitely be swinging by Button Mash (tickets are only $7 and available here)!

The GameStop partnership sounds run-of-the-mill, but the Ironclad partnership is interesting, as it marks a whole new world for the company, which normally creates gloves for manual and skilled tradespeople, DIY enthusiasts and construction workers. They obviously have the tech know-how when it comes to making gloves, but will they be able to successfully market to the gaming crowd?’

AYO.NEWS says features the opinion of the author and does not necessarily reflect the views of Pentagon Digital Limited.

Social media behemoth Facebook has acquired Spain-based cloud gaming startup PlayGiga for a reported €70 million (US$78m).

The PlayGiga team have posted a statement on their website hinting at Facebook’s plans for the company, saying: “We are continuing our work in cloud gaming, now with a new mission.”

Is Facebook looking to take its experience with Instant Games, which launched in 2016 and gave users the ability to play HTML5 games without downloads, and take things to the next level with a real, high-quality cloud gaming service? It certainly looks that way…

Prior to the acquisition Madrid-based PlayGiga had been offering its services across Italy, Spain, Argentina and Chile. According to Variety, the company had also been planning to launch in the Middle East region, and had been exploring opportunities in Sweden, Austria, the Netherlands and Guatemala.

AYO.NEWS says:

The cloud gaming market looks set to explode in 2020, with Google having just launched its Stadia service, Microsoft previewing its xCloud service ahead of a 2020 launch, and Sony having dropped the subscription price of its PlayStation Now service to just $9.99 per month.

AYO.NEWS says features the opinion of the author and does not necessarily reflect the views of Pentagon Digital Limited.