Shall eSports need a certification to avoid challenges?

The growth of the eSports market opens questions on how to ensure their proper performance

A certification for eSports tournaments could be the next step in a market whose regulatory regime is exponentially resembling the highly regulated gambling sector.

The growth of the eSports market

The eSports market is facing rapid growth with a value that will surpass $ 1 billion in 2019, as outlined in the chart below.

Sponsorship will be the primary revenue stream together with media rights, with only 3% of revenues coming from game publisher fees.

However, as it happens with sports, the trust of the audience in the proper performance of eSports events is crucial for the growth of the market.

We already discussed the concept of “eDoping” and how it might impair the appropriate performance of eSports tournaments. This practice is not the classic doping to strengthen physical performances such as the level of concentration. But it refers to the fixing of machines used for tournaments, i.e. the manipulation of either software or hardware to give the player a specific advantage within the game.

Is the certification of eSports games the next stage?

The certification of games has been for several years a regulatory requirement for gambling games. Regulators can impose them since operators (and in some countries suppliers) need to hold a license which leads to the applicability of a complex regime and obligations.

No similar regime applies to eSports, and such liberalization might be among the factors that enabled its fast growth. However, in countries like Italy, an appraisal confirming the inability for the organizers to alter or manipulate the proper operation of the game can already be required in some cases. The requirement applies if the mechanic of the eSports tournament is structured so that it is subject to prize promotion rules. And in such circumstances, the appraisal shall be filed with the public notary certifying the proper award of the prizes.

The certification of games as a regulatory obligation would add a layer of compliance to eSports tournaments. This requirement might limit, for instance, the cross border organization of such events and would lead to an increase in costs. But it might be also the result of mere self-regulation that can be more industry-oriented and quickly change with the evolution of the market. And only at a later stage, such a certification can become a regulatory requirement.

This scenario is what occurred, for instance, with the age rating of video games and might work for the eSports industry.

What are the benefits of certification for eSports organizers?

Apart from the potential regulatory obligations, a certification of the video games used as part of eSports tournaments could considerably help organizers to sell their product to sponsors and investors.

Indeed, such certification might also cover the security measures adopted to avoid cyber attacks altering the proper operation of the tournament. The certification would limit the risk of challenges not only by players but also by whoever invested in the event and might deem its outcome illegally manipulated.

What is your view? On the topic above, you may find interesting the article The concept of eDoping in eSports.

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Giulio Coraggio

I am the head of the Italian Technology sector and the global head of the IoT and Gaming and Gambling groups at the world-leading law firm DLA Piper. IoT and artificial intelligence influencer and FinTech and blockchain expert, finding solutions to what's next for our clients' success.

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