Introduction to Esports Player Contracts - a blog series

Written By Johnny Troset Andersen

It’s not every day that an esports organisation (org) makes your fourteen-year-old son a lucrative offer of a three-year long contract, with a monthly, stable salary. But it happened to me when my son, Martin “MrSavage” Foss Andersen, placed second in the European Fortnite Winter Royale 2018 Qualifiers.

More than nine million players (!) participated in the Winter Royale tournament across Europe and North America with a prize pool of $500k (USD) for Europe alone ($75k to the winner). Due to his age, however, Martin couldn’t advance beyond the qualifiers.

Nevertheless, his achievement sparked interest among many esports orgs across Europe and North America, and contract offers came pouring in. Even though the financial offers were tempting, many of the contract terms were potentially exploitative.

Suspect contract terms

Here are some examples of the suspect contract terms Martin was offered:

  • To stream gameplay online for 120 hours per month (entirely overlooking his full-time schooling obligations).

  • To give away a two-digit percentage of his YouTube advertising revenue to the org, extending four years (!) beyond the three-year contract period.

  • To participate in promotional activities decided exclusively by the org - if he failed to attend events, he would be liable to pay damages and the org would have the right to terminate his contract.

  • To allow the org to exclusively handle all independent sponsorships (blocking him from having his own agent representative to secure his interests).

  • To allow the org the right to terminate the contract without cause, at any time (an option only available to the org).

  • To use a streaming service decided by the org (without being able to influence the decision, risking losing his followers if forced to stop using his preferred service - Twitch).

A young kid, like my son, dazzled by the opportunity of finally ‘going pro’, could easily have been taken advantage of without the proper knowledge.

Esports is a huge industry

He is likely not the only one – just look at the numbers:

  • In 2022, the estimated number of esports viewers worldwide was 530 million and 640 million viewers by 2025, of which about 50% are considered enthusiasts, according to Statista.

  • The number of active professional esports players worldwide was at least 13,000 in 2021, also according to Statista. This number may seem low, but the world’s largest sport – football – has just 10 times more professional players, according to FIFA.

Wild West negotiations

Washington Post points out the unregulated problem of the esports player contract in an article from March 2022:

“Even as the esports industry pushes into the mainstream and blossoms into a billion-dollar enterprise, replete with organized leagues and big-name sponsors, many esports player contracts are negotiated in a manner resembling the Wild West.”

Share experience to help young players, their parents and others

In a series of blog posts, I will share some of the experience I have gained by working with my son. My goal is to make it easier for young players, but also their parents and any other supporting party to navigate this ragged contractual landscape. Given that my son plays Fortnite, the posts will be aimed at Fortnite esports, but should be valuable for players of other games as well.

What to expect from this blog posts series

A contract document is not simply a piece of paper, but the end of weeks of discussions that requires a thorough understanding of the industry, the roles, the value a partnership creates and how to share that value between the parties.

This blog series will therefore start out with the fundamentals: How esports orgs operate, how they make money, negotiations, org to player services (and vice versa) and the most important legal aspects.

Later articles will cover the detailed structure of contract documents with a walkthrough of sections, paragraphs and detailed legal and formal aspects, mixed with practical advice from personal experience.

Summary

  • Esports is a huge industry with Fortnite being among the most popular games with large prize pools.

  • The number of esports viewers worldwide across all games is more than 500 million.

  • Contracts can contain suspect terms.

  • Young players dazzled by the opportunity of ‘going pro’ can be taken advantage of.

  • My goal is to make it easier for young players and parents alike to navigate this ragged contractual landscape.

  • The first articles in this blog post series will describe the fundamentals before moving on to contract document structure and content.

Next post

In my next post, I will describe esports orgs and how they operate. If you leave your email address below, I’ll send it to you.

Questions or comments?

Check here for ways to connect with me.

Please note that the examples of suspect contract terms in this article are not representative of all esports orgs. After his breakthrough my son ended up signing with NRG Esports in early 2019 who were professional throughout, offering fair and balanced terms.

Same goes for 100 Thieves, which signed Martin in February 2020. Matthew "Nadeshot" Haag, John Robinson, Jacob Toft-Andersen and rest of the org were professional all the way.

Resources

Johnny Troset Andersen https://deeperdown.com
Previous

Interview with Andy Miller - CEO of NRG Esports
Next

Interview with Erik “Bloodx” Guttormsen - The world’s best Fortnite coach