By Michael Arin. Full Text.
This Note examines the growing concern over publisher-controlled leagues in the esports industry. Upon recognizing the value of organized, competitive playing of video games—esports—beyond mere marketing for the underlying game, publishers began to create leagues of teams to play each other. These league operators used traditional sports as a model. However, this “sportsification” of video games brought the possibility of anticompetitive conduct recognized as such by traditional sports antitrust history. This Note begins by first drawing a distinction between esports and sports: the publisher owns the game as opposed to the sports league who does not. Copyright protections afforded to these publishers strengthen downstream control of the use of the intellectual property, and copyright does not have clear limitations on such use. Next, this Note shows how sports antitrust clearly defines anticompetitive conduct by league operators—such as restrictions on players, territorial allocation, pooled rights agreements, and refusals to deal with competing leagues—but often justifies the practice under a rule of reason analysis. In the end, this Note finds a paradox between legitimate exercises of copyright law and unreasonable restraints on sports competition. This paradox leaves the esports industry—and particularly independent league or tournament operators—reliant on the fragile framework of league operator self-regulation. This Note proposes “Spotifyication” as a solution: an opt-in compulsory licensing system whereby independent tournament operators automatically acquire a tournament license in return for a royalty based on in-person and online attendance. This solution finds a proper balance between publisher interests and industry stability that other solutions like regulatory oversight, modification to copyright, or reliance on antitrust lack.