Esports — The Wild West

One of the hardest parts of making money for yourself is the ability to sit on your hands. We are in a business where we don’t have to produce every day, just when it counts. I know some old timers who maybe worked one or two days a month. They would make their strike and move on. Better yet, they would hit then sit. Forever projecting patience above all else. That is a story for another day, for in my quest to find patience and sit on my hands a little more. I decided to buy and download an old video game I played growing up. Counter Strike. The game is developed by Valve Inc. and distributed on their Steam platform. The main reason why I ended up playing that as opposed to going out to buy a PlayStation or something, is it was 2 am. The financial futures markets were a dead zone and my usual late night crutch that is Tennis, was local in the states so all the matches were wrapped up by 11 pm. On my binge for instant gratification I paid the $14.99 and hit play on my computer. I had no idea what I just signed up for.

First, the backstory on Valve, Steam and Counter Strike. Valve Corporation was founded in 1996 by two former Microsoft employees, Gabe Newell and Mike Harrington. They are a $2.5 billion dollar software company that offers videos games on their various platforms. Some of the companies more famous and widely played titles include, the Half-Life series and Counter Strike. Steam is Valve’s gaming community platform which powers the company’s games. On the Steam platform, users are able to Buy, Sell, and Trade ‘skins’. Skins are items that can be used in the game you’re playing. In the case of Counter Strike: Global Offensive (CS: GO) which is by far, Valves most popular game. The word ‘Skins’ refers to guns, knives and stickers. CS: GO, is a first person role playing shooter that pits a team of Terrorists against Counter Terrorists. There are many aspects to how the game is played but the one surrounding the whirlwind of the underage gambling accusations back in July 2016. Involves competitive matches against teams.

In short, CS: GO is 5 v 5, best of 30. Each round is two minutes in length. Teams switch sides at halftime (15 games). A team wins a round when any of the opposing side is fully eliminated .The bomb is either exploded or defused, or time in the round runs out, whichever first. First team to win 16 rounds, wins the match. In E-Sports, they play multiple matches, equal to a series in Baseball or Basketball. In game, a player earns money for kills, assists and bomb relations. This money is used to buy guns in the game. This is where the ‘Skins’ on Steam show up.

Counter Strike boasts a 10 million user base with around 500,000 monthly active users (MAU). Boast might be the wrong word to use here, League of Legends reportedly has 90 million MAU’s but here is the difference in what makes the Counter Strike: Global

Offensive army of users more impressive. They have their own economy and the game lends itself perfectly to perplex the masses who follow it. If money hangs around curiosity trying to find an edge, some form of gambling is bound to take place. CS: GO is the equivalent to Call of Duty, but with skill factored in. The guns have kickback and spray patterns. The players make noise when they walk and the screen is disrupted when being hit. The game incorporates strategy and communication. It is team oriented and performance driven. I played Counter Strike in 2004 when it first came out. I dropped it after a year, life kind of crowded it out. When I came back to it nearly 12 years later I couldn’t believe what I found. Honestly, I was surprised a computer game that old still had a following.

I grew up wagering on stuff. If you’re reading this, I feel you may have too. About 100 of us got busted in Middle School for rolling dice. Half the 7th grade male population got caught playing Cee-Lo on school grounds. Two kids were spotted exchanging money with dice on them by the Principal. And well, it doesn’t take much for a little kid to rat out 1 out of 100. Soon, everyone snitched on one another and we all had to write an essay entitled “Why I Should Never Gamble.” There were so many of us that were involved, they couldn’t do much. 100 kids got detention and had to write a 500 word essay on gambling. If I knew my career choice back then, I would have crafted my school a better article. The chronicles of my middle school dice rolling days are only relevant here because as I’m sitting online, getting shot at by 14 year olds sporting $200 virtual M4 rifles they won playing a video game. I’m reminded, I grew no different than they. Instead of shooting dice, these kids are tapping a mouse. In my opinion, the curiosity to take risk for monetary reward is part of growing up. Kids have been “gambling” since children were born. That is why, when U.S. District Judge John C Coughenour granted the motion for Dismissal this week in Federal court against Defendant Valve Corporation and Valves Co-Defendants, CS: GO gambling website owners. I ruled it a giant win against the mindset of anti-gambling practices within the United States. The Plaintiffs in the case, alleged Valve and the other parties violated the R.I.C.O act. Racketeer Influenced and Corrupt Organizations Act, which is commonly levied against unauthorized gambling establishments.

Valve is paving the way for creating a thriving video game monetization platform. The ‘Skins’ that fell under scrutiny are simply artistically modified versions of the current games arsenal. Different variations of different guns fluctuate in rarity and popularity. Knives are the rarest and can fetch prize tags as high as $1,000 on the ‘open market’. The open market in this case is the Steam Community where players can congregate and barter. This form of ‘Trading’ fluctuates the value of certain guns. “Skins’ are packaged in ‘cases’ which require ‘keys’ to unlock. ‘Skins’ and ‘Cases’ are generated in CS:GO, after a completed game, by Valve. The more you play, the higher the

frequency of case drops you receive. Keys are bought from Valve for $2.50 a piece to unlock the ‘cases’ they ‘reward’ you with after completing playing hours. Much like how online poker sites and casinos give you reward cards for staying and playing.

All Valve is doing is creating virtual art in video game form. The more creative the ‘skin’, meaning color scheme, gun type (Pistol, SMG, Rifle), and attention grabbing detail, the “rarer” it is. All rare means in this situation is the lack of frequency they appear in game. Valve controls the demand of certain items so when they surface, players rush to attach a value to the current supply. Players of CS: GO either pay good money for these ‘skins’ in the marketplace. Good money meaning $15 to $500. Or they “play” for them. A player, usually a teenager, packages enough of their ‘skins’ to equal the value of the one they want. Much like trading a Lenny Dykstra Topp’s rookie card for a Mike Schmidt. Just like Baseball cards of the 80’s and Beanie Babies of the 90’s, CS: GO ‘skins’ will end up the worthless. At least I can still hold my Beanie Babies and look at my worthless Chad Curtis cards, what can be said for the 15 year old spending his communion money on fake guns on the internet? The only thing Valve is truly guilty of is ripping off little kids by selling them fictions stuff. Good luck if you’re Counter Strike account is worth “$6,000” and you want to convert those ‘Skins’ to hard earned cash.

This process is called “Cashing Out.” Most of these “Cash Out “sites are run by degenerates who scam people more than they actually pay them. seems to be the most legit of the bunch. A few sites used to let you convert ‘Skins’ into Bitcoin or trade them to wager on Soccer, but those were some of the shadiest rackets going and were immediately shut down once Valve sent a Cease & Desist letter to every site tied to the unlawful gambling complaint.

It seems to me, E-Sports is the modern day Wild West of the gambling world. While I have no plans to wager on an E-Sports match anytime soon. Bookmaking powerhouse Don Best has offered lines on E-Sport leagues and carries E-Sport action. The fact that it’s becoming mainstream is a 21st century revelation that seems unstoppable in the not too distant future. The growth in the industry is staggering. With almost 30 million “fans” split between North America and Europe. The business that is E-Sports is expanding 21% year over year. Twitch, a video streaming site with over 55 million viewers and TBS, the nationally recognized cable network who owns Conan O’Brien, will be broadcasting the next Counter Strike Tournament when it stops by Atlanta in January.

Do you realize how hard it is to find a Hockey game broadcasted on a national cable channel? Some of these Counter Strike teams are becoming household names as well. If you have a child from middle school on up. Names like “Natus Vincere” and

“Luminosity” are replacing “Lakers” and “Yankees.” Kids today know more about Kenny S, who is the Michael Jordan of Counter Strike apparently, than the actual Michael Jordan. When somebody blows an enemy up with a grenade in CS: GO. They yell “Kobe” but yet they don’t even know who Kobe is. Except for “that old guy who retired from Basketball.”

Last Sunday night, after I watched the Steelers abuse the Chiefs. I was in the mood to get shot at and trolled heavily by 16 year old video game enthusiasts. Thank god I’m a grown man and I don’t find owning a virtual neon blue AK-47 a priority in life because I suck at Counter Strike. I use it more as a real life distraction than for a real life aspiration. When I play competitive matches I’m always dead last and I’m constantly getting told how immensely stupid I am. Clearly, there is some pent up teenage angst at play, this particular Sunday was no different. But when a few of them finally had a moment to calm down and breathe. I asked my team of 5, “You watch any of the games today?” Referring to the full slate of NFL games that categorized the day. After a minute of silence, one responded, “I saw the Madden E-Sports contest today.”

Author: Chris Gosling

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