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Evolution of the NA LCS

Riot·6/1/2017, 12:59:45 PM·1 votes·66,743 views
Evolution of the
NA LCS
June 1, 2017
Introduction
Back in 2016, we talked about our vision for the future of esports (and how we plan to get there). Our end goal is to create a strong and stable system that's profitable for pro players and provides entertainment for fans in the long-term — and today we'll be taking some major steps forward in North America that helps us achieve that.
3 Major Areas of Focus
These changes focus around three major areas:
Changing the structure of the league to encourage long-term investments
Sharing league revenue to provide a better foundation for teams and pros
Giving pros a larger voice and better protections
In this post, we want to lay out some of the reasons we think these upcoming changes are a great step for pro players and for fans in North America. For more details on why, how, and when this is going to roll out, read on.
Changing League Structure
We believe that stability for teams and for pros will help create a league that rewards the highest level of play and is ultimately more entertaining for fans. To get there, we're going to make some central changes. Starting in 2018, teams that participate in the NA LCS will be there as permanent partners of the league. Teams will be selected from an application process (more details on that below) meaning they won't face relegation or have to fight for the right to compete as a new org via a promotion tournament. We see this as a positive step forward for the league for multiple reasons, but mainly because teams will no longer have to juggle uncertainty while planning for their future.
With today's uncertainty of relegation, making long term bets in the NA LCS is extremely risky. Making large investments — like a long-term sponsorship with a team, or building an expensive training facility to better support players — are often hampered by this risk. Removing relegation makes things less uncertain, unlocks long term investments and hopefully makes the league more competitive from the inside out. Here's a deeper dive into how this will work:
Committed, professional ownership groups
We'll be partnering with organizations who have the welfare and support of pro players on their teams as one of their top priorities. Part of our evaluation process will be examining how teams will support their pros, not only in coaching and training, but in career opportunities or higher education once their playing career has ended. We believe that the best results happen when pros work with teams that they’re motivated and proud to support throughout their careers
Competitive landscape, even without relegation
Taking away the threat of relegation may feel like it lowers the stakes for teams competing in the league. Although it makes the NA LCS a less risky prospect for a team, we want to make sure they are still motivated to do their best year-in and year-out. To achieve this, we'll be creating financial incentives for each place in the league — the better you do, the bigger the rewards. We are also implementing a policy in which teams can lose their right to compete in the league if they finish in 9th or 10th place 5 times over an 8-split span.
Rebooted Challenger Series
At its core, Challenger was built towards two goals: helping to develop talent for NA LCS, and enabling strong ownership groups to replace weaker ones at the highest level of play. Although the second goal is no longer a focus, we believe we can do better at meeting the first goal — developing future stars of the NA LCS. We'll be rebooting Challenger as an Academy League, where each NA LCS organization will field a team of developmental players. This will hopefully meet multiple needs for NA LCS teams: deeper rosters to experiment with younger talent, enough spots in the league for all LCS teams to be represented, and more games played to speed the development of their Academy players.
How do teams join the franchise?
Here is the process in how team's will join the NA LCS
Phase 1
Application Submission
Phase 2
Application Review
Phase 3
Partner Announcement
Developing a strong league depends on finding aligned partners who are motivated to help evolve the sport and create teams that pro players are proud to represent. During Phase One, we'll be partnering with expert third parties, asking teams to give us some details about their plans for their NA LCS team and organization. Here are a few representative questions we'll be using as part of the selection process.
Brand Plan
How does the team plan to engage with and acquire fans?
What's their strategy for providing value to fans through merchandise, content and other opportunities?
Why should fans support them?
Owners
Who will be working with pro players?
How much does the team know about league and esports?
What are the goals of the ownership group in buying into the league?
Business Plan
How do they plan to fund the org over the next few years?
What's their strategy for sponsorships — in particular, bringing in new sponsors to the league?
How do they plan to compensate pro players that work for them?
Team Strategy
How do they intend to develop talent in their organization?
What facilities are they planning for pros?
How will they stay competitive, including plans for coaching and support staff?
How will they work with pros transitioning out of full-time player careers?
Sharing League Revenue
In a healthy, long-term league, money generated by the ecosystem should be shared by the people who contribute to it. We also believe that the league is healthiest when teams, players, and Riot are all motivated to create a thriving, entertaining league that's popular with fans. Entering into partnership allows us to create opportunities for teams and pros to share in the upside of the league. To achieve that, we will be sharing league-based revenues (like the media deal announced last year and team-branded digital goods). In the same vein, teams will be required to share a portion of their league-driven revenues as well (including things like sponsorships and merch sales). This aligns the interests of all parties (while still granting considerable opportunity for motivated owners and superstar players to earn outsized revenues), creating a strong and competitive ecosystem.
Only a portion of revenues that a team makes is added to the revenue pool. Teams will retain a large portion of any sponsorship they help to sell, just as they keep a piece of all merch sales, before their sharing contribution is calculated. This is where business-savvy teams can start to earn more than other teams in the field, but it still aligns teams to work together to grow league revenues as a whole. Let's look at the impact of this new economic system:
For Pros
Raised minimum salaries for all NA LCS pro players
Player salaries have risen a lot in the past couple years - and we think that's a great thing. To make sure we're keeping a healthy floor across all pros — whether superstar or just starting out — we'll be increasing the minimum salary in the league to $75k.
Revenue sharing with pros
On top of the minimum salary increase, pro players will have the opportunity to share in the upside of strong league economics. Essentially, player salaries will be guaranteed through their contracts, but the total play population will also be guaranteed to earn at least 35% of league revenues. What this means is that players will earn their full salary throughout the year, and if the players' share of league revenue is greater than their combined salaries for the year, the difference will be distributed to the players directly. If the share is less than the sum of the salaries, players won't have any money recalled — all salaries will be 100% guaranteed.
For Teams
Revenue sharing with teams
Pro teams will also be entitled to a 32.5% share of league revenues. Half of the pool will be distributed equally to each organization, but the other half will be split into allocations based on regular season finish and contribution to viewership/fan engagement. This will give successful orgs an opportunity to earn more as their team performs better in the League. This money will go towards covering overhead costs for teams (academy team, gaming house, support staff, content creation, etc). We believe this new revenue stream will unlock teams to invest far more into making their organizations more competitive.
Current League Revenue Model
League Revenue Pool
League Stipend
Team Sponsors
Team Merchandise
Team-branded
Digital Products
Player Salaries
Coaching
Team Staff
Gaming House
Future League Revenue Model
League Revenue Pool
Media Rights / Distribution
League Sponsors
Team Sponsors
Team Merchandise
Team-branded
Digital Products
Riot Games
Broadcast Production
Live Events
Team
Coaching / Staff
Gaming House
Pro Players
Player Salary
Bonus Upside Compensation
Giving Pros a Larger Voice and Better Protections
A strong and stable league is one where all parties have an active stake in the future. Revenue sharing and more permanent membership in the LCS is a large step in that direction for teams, but this also means that pros should have a greater voice in how the league is run.
To help kickstart this process, we're providing pros the resources to set up a Players' Association. Players will vote on independent reps to be their voice in league decisions and the Association will provide easy access to core resources like skills training, financial planning and legal help.
We'll be funding the launch of the Association, however the representation that the players vote on and elect is responsible solely to them. The goal is that this Association is an independent voice of the players to work with Riot and the teams. It's our hope and expectation that as the association grows, the players assume full financial control over the organization — we believe this is the most effective way to give the process a kick start and provide them with an official voice.
The Player's Association will launch later this year. Kickstarting an association which independently represents pro players is a complex process — legally and organizationally. We'll share more details later this year, but here's the basics of how it'll work:
The Players' Association Process
The PA's complex launch process in a nutshell
Step 1
Vote
A short list of representatives will present to NA LCS Players in June — players vote as a group on who to represent them. Players can also vote to reject all candidates. In this case, we would either provide additional candidates for them to screen or accept representation that they have elected independently.
Step 2
Plan
The newly elected Players' Association representatives will have July through September to get up to speed organizationally and to meet with players.
Step 3
Represent
Fully launched, the Players' Association provides centralized representation for players in tri-party negotiations (Riot-Owners-Players); they also provide access to vetted resources (e.g. legal/financial advice) to help players planning out their careers
When is this all happening?
June 1
July 28
August
November
Application
Period Opens
Application
Period Closes
Update on
Players' Association
Partners Announced
We're excited to usher in a new competitive future for the NA LCS with strong and motivated partners by our side. We believe that these moves to share league revenue, adapt the structure of the league and give pro players a seat at the table when key decisions are made will build a more sustainable, more competitive and ultimately more exciting League for years to come. Let us know your questions, and we'll be back with updates throughout this journey as we move closer to 2018.

59 Comments

Eggoliant6/2/2017, 7:54:48 AM8 votes

Too bad about removing relegation. I see the point about encouraging long-term investment, but from the standpoint of a player and fan, it feels less merit-based and like more of an insiders' game.

FamousTG6/1/2017, 2:22:13 PM8 votes

With an increase in collegiate participation in League and Esports, why not host a draft each year in reverse order of records? This can help ensure the talent is better divided among various franchises so the same team is not continually winning every split or acquiring the latest and greatest talent due to their brand name and the ability to pay players higher wages.Use the Challenger series as a developmental league for these players to practice and better their skills until they're ready to be brought up into the LCS. Again, it doesn't necessarily need to be a collegiate draft, but at least a draft of some sort so that player talent is more evenly divided among LCS Franchises.

Öreo6/1/2017, 1:33:06 PM6 votes

I was always on the fence about the idea of permanent spots within the NA LCS. After reading this and seeing that Riot is working on steps to prevent teams just staying in last place. Big props to right for helping the players kick start a PA. Overall these are steps in the right direction for the longevity of NA LCS. Looking forward to the rest of 2017 season and the new format in 2018. Do we have any word on EU LCS?

Sionnan696/1/2017, 3:51:10 PM6 votes

Does the Paying 10 million for a spot help in you evaluation process?

KAID06/1/2017, 2:44:29 PM5 votes

i don't like the new way to get into the lcs.... do teams even have to play anymore to earn their spot???? or just fill out a application and be in the lcs and prove that they can pay their players and make league more money. this also favors people who already have money rather then starting from the ground up... is there certain times when teams can fill out the application? or can applications only be filled out when a team gets kicked out when they get placed in 9th and 10th place for 5 splits in a row over an 8-split span, also how do you even know if the team that submits the application is even good? you didn't even ask on the application that you had to be a certain division in ranked wtf lol... i hope you guys give out more info because as it stands the new system is really bad and puts new teams at a really big disadvantage.... as a league player who likes to watch the NA LCS i like to watch the challenger series and see new underdog teams try to earn their spot in the NA LCS by competing... not filling out applications.... also the new challenger series means nothing to the viewer its more for pro teams now... why would the common league esports viewer want to watch an Academy League that does not even have rewards such as going into the relegations for a spot into the lcs.

Zilareut6/1/2017, 2:42:02 PM4 votes

I think each LCS team should have 2-3 academy teams, kinda like A, B, and C. I'm not sure how big this academy league will be or how easy non-affiliated LCS teams can enter, but if it's just one academy team per LCS team, it seems limiting to people trying to enter the scene. Then orgs will have more flexibility shuffling players between squads, the good academy players will stand out more, and 1 year 'prove it' contacts will be more applicable to the newcomers. There's no need for an MSI-esque academy level tourney, so the normal 2 splits can be reduced to 1, and just increase the length of the split to accommodate the higher number of teams.

Shirahago6/1/2017, 10:38:42 PM3 votes

First of all I highly appreciate the changes Riot has planned for the future. But perhaps someone could clear up a few points for me:

  1. Once this system kicks in the only ways to drop out of LCS are withdrawal on behalf of the team itself with whatever penalties included or placing in the bottom two ranks five times over eight splits. Let's assume that there is a team that indeed places very low every split. There are two splits a year, so does this mean this hypothetical team is locked into the LCS for at least 2.5 years?
  2. In a similar vein and by extension challenger scene, what about other teams that have a bunch of promising players and may or may not be on the level of lower LCS teams, are they just locked out for extended periods of time?

I am just worried that removing relegation creates a stale environment since you need to try really hard to drop out of LCS by results.

Virtual Prophet6/5/2017, 10:15:43 AM3 votes

this is awful. rip riot, i've had so much respect for you, you were the only company to put the love of a fair and balanced game over profits, you were truly my hero. sadly everything comes to an end i guess, i hope you come back or make another game with those principles of a level-playing field where everyone has the chace to win, not just the guy with the biggest checkbook. riot has finally completely sold-out, no longer can you come up from nothing( silver 2) with 4 of your friends and make your e-sports dreams come true. now you have to be rich and buy a spot. really disgraceful riot and you didn't even do a good job making it look like anything other than that. the emperor is naked

Húrin Thalion6/2/2017, 3:57:04 AM2 votes

I'm quite sad that Riot is removing relegation from the NA LCS. I feel that is a healthly way to bring fresh talent into the league and it keeps things seasons exciting. I love watching the end of season relegation tournaments. It's awesome to see people that have risen up the rankings to play in the LCS. Many people feels that they can get into the LCS via that route. If we remove relegation, this will remove a lot of people's ability to see their path to the LCS. Not seeing a clear path will reduce their motive to get into the LCS and fewer good players will go that route. There will still be plenty of good people playing, but the pool they pick from will be smaller. I love the revenue sharing idea and am not sure about what sounds like a players union, but I'm glad to see there are thoughts for the future.

Tehemai6/1/2017, 11:37:06 PM2 votes

I guess fans of real competition have been relegated. I absolutely will not watch the closed ecosystem competition in 2018.

The Howme6/1/2017, 8:01:07 PM2 votes

I am happy to hear many of these changes happening. Sure, there can be adjustments, but it really sounds like a major improvement.

SciFi Scrivener6/1/2017, 1:39:23 PM2 votes

This is exciting to see. It looks like Riot is modeling the new LCS system after other successful sports, like the NFL. I hope this attracts the best talent in the world to want to play in NA. Look forward to seeing where LoL grows in the future.

ExWhiteWolf6/1/2017, 2:18:04 PM2 votes

I'm fine with everything other than during the video. 0:52 "now that the NA LCS is generating revenue". So they were operating at a loss before that just seems so unlikely to me.

sliceurdead6/2/2017, 4:27:55 AM1 votes

This is a great step for League of Legends and eSports as a whole! The only thing I don't get is that it seems that the application process is a little vague.... Any one know where the application is or if it is available to the public?

ThePandaGod6/2/2017, 5:46:38 AM1 votes

i feel as there is a bunch of empty space, and too much 12 point text. other than that mild inconvenience, the article is good

Steefness6/2/2017, 5:33:55 PM1 votes

All in all, great changes. I like how the structure is starting to resemble the structure of athletic sports, which have hundreds of years (cumulatively) of development behind them leading to what they are now. The Academy series is fantastic. When Baseball created the minor league farm system, the overall quality of the game went up exponentially. The only real problem I see is the revenue sharing. I know its beneficial to do that so the lower level teams have a competitive balance, but as shown in Basketball, it can encourage tanking. If your revenue is guaranteed, what's to stop you from filling your roster with cheap players and laughing all the way to the bank? Just need to keep an eye on that and have penalties if caught doing it. Other wise, keep it up Riot, you're doing great.

JQTvor8/11/2017, 12:58:09 PM1 votes

I see the positive and negative sides of this system. On a positive side we have protections for both the companies investing and the players to help expand the league, the talent of an individual, and financial security of the NALCS. The Negative is we we won't be seeing the C9's of 3 years ago, or the Immortals of last year again, which takes some of the excitement out of the game since those players will have to be farmed to the NALCS teams instead of being recruited by a new organization and placed into a "break-out" team. As for the "closed league," it always has been a closed league. When teams are punished and forced to give up ownership, the sell price is 1 million dollars. That is before player salaries, coaches, houses, analysts, transportation, and anything else a is needed to be competitive. The days of having 5 friends and making the NA LCS died season by the end of Season 1. In the words of Elsa, Let it go.

All in all these changes offer some things that I was hoping to see for a while. A Players Association, Educational help for the players, and a salary that makes working 7 days a week in extreme stress nearly worth it. It would be nice to see 2 leagues that are connected via relegation that are created equal and both get air time, but I don't think the base of LoL is big enough for that and the lesser known teams would have a difficult time fielding fans, so that may be in the hopes for the future, but right now, it is not financially viable.

Spoo6/5/2017, 1:58:18 PM1 votes

Bye bye future cool team names.

If this were implemented in EU a few years back...no more Unicorns of Love. And they're basically like #1/#2 in the fan vote. Despite not always having the best players.

I both like and dislike this. Might give some freedom to 'not so well' off teams to goof off during a spring split and try some interesting picks though, kind of like how we sub out all the stars when a pro team no longer has a chance.

redchewbacca7/7/2017, 11:15:11 PM1 votes

What do you think about having Worlds less often? Like every 3 years or something. I feel like it might hype it up more, as well as make regional success feel more rewarding. Additionally, it could also help regional fan base health. I think fan bases would diversify since each region's fans wouldn't be funneled into the 3 teams that made it to worlds every year. Fun mid season international tourneys would still be fine every year, like MSI, and rift rivals, and IEM, but I feel that Worlds every single year is too often. Maybe that's just me though?

Dark Star Cho6/1/2017, 3:29:35 PM1 votes

Is this going to allow lcs subs to move up and down without contract breaches? If so so much NA talent bound to the bench might see quicker development

Raptearer6/1/2017, 6:56:13 PM1 votes

How do teams apply?

Eleshakai6/1/2017, 7:05:17 PM1 votes

Interesting. Always good to see more stability for pro teams/players.

ramo586/1/2017, 2:15:50 PM1 votes

so there are 10 team spots

hotarse6/2/2017, 1:34:31 AM1 votes

Anyone else find it stupid that some teams are going to get "partnered" while others don't. How objective can you expect a company like Riot Game to be when it comes to significant matters like this. Which teams do they currently have grudges against that they are going to work toward getting relegated and never "partnering" with.