Gen.G CEO Arnold Hur spoke on the dire financial straights most LCK, and League of Legends franchise, organizations are in on an episode of The Monte & Wolf Show.
It is no secret that esports leagues and organizations across the globe are struggling to make ends meet. The LCK, in an effort to stop bleeding cash and introduce some level of financial stability to the league, introduced Sporting Financial Regulations. The SFR is essentially a salary regulation system, or player salary cap, specific to the Korean League of Legends league designed to create a floor and ceiling of spending for organizations among other things.
Gen.G’s CEO, Arnold Hur, spoke about the SFR regulations, what it brings to the table and the financial situation around League of Legends competitions in an episode of The Monte & Wolf Show.
On the podcast, Hur specifically highlighted how much money organizations are losing by being in these leagues.
As a part of the many measures to ensure the #LCK maintains sustainable growth, Sporting Financial Regulations (SFR) will be introduced starting in the 2023 offseason.The SFR seeks to allow the sustainable growth of teams, players and the league by regulating each team’s salary… pic.twitter.com/QCS5T1Ys8B
— LCK (@LCK) July 19, 2023
“The player payroll is multiple times the revenue that’s actually brought into the league,” Hur said about the LCK.
He later claimed that most organizations are still losing about $3 million a year in the League of Legends ecosystem.
“Right now, you’ll make more money being an intern at Riot than you would owning a second-place team in LCK, or in the world,” Hur said.
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Gen.G CEO speaks on LCK financial struggles
The CEO also said many organizations in the franchise league system are looking to sell their teams. The LEC and LCS saw some organizations sell their spots in the league in 2023. CLG was absorbed by NRG Esports, while Rogue and Misfits Gaming were replaced by Team Heretics and KOI.
Hur also went into specifics on how the SFR will help organizations and make the league and its franchise look for better monetization options and sustainability. He claimed that under the current LCK system, organizations are incentivized to not spend money on their rosters.
“You’ll make more money running a team with zero sponsors and minimum players than you would having a championship team right now,” Hur said, “That doesn’t make any sense.”
Hur and the two podcast hosts also discussed other solutions for the financial situation of League of Legends esports. The three discussed implementing a digital revenue stream for organizations through the game, similar to Riot Games’ other esport Valorant. Another topic discussed was creating an APAC super league similar to Valorant’s VCT Pacific league, which would bring the top teams from across Asia into one competition.
One throughline from the entire conversation was changes to the current system across the board for the LCK. Hur and the hosts discussed, and disagreed, about what or why things should change, but they all agreed that things cannot stay the same for the league, and the esport, to be successful.
“We need to try things that not everybody will agree with… I would like a league that tries more things, and even fails, instead of right now. I think they are very careful and they have fantastic growth being careful but for us to hit that next stage of growth we need to be taking more risks, sometimes even bad ones,” Hur said.