Saudi Arabia is currently making a big splash in eSports, the oil millions are sitting loosely. Whether there is serious interest or eSportswashing behind it is hotly debated. What does the German eSports Federation think about this development? eSport spoke to Vice President Christopher Flato about this.
Saudi Arabia’s ambitions in eSports seem great. Even bigger are the sums that the desert state is putting up for it. An “eSports City” in Riyadh, for example, is expected to cost up to 500 million US dollars. 1.5 billion US dollars were due for the ESL and FACEIT. According to the Financial Times, Saudi Arabia has invested more than 8 billion US dollars in shares in gaming companies since the beginning of 2022.
Officially, these measures are part of the “Saudi Vision 2030”, an initiative with which the country wants to become less dependent on its fossil resources. Time and again, however, there is harsh criticism, talk of a “sell-out”, moral dilemmas come into focus and, of course, the buzzword eSportswashing is not far away. So how to deal with the sums from the Middle East? That’s exactly what eSport asked Christopher Flato, who has been vice-president of the eSport-Bund Deutschland (ESBD) since 2020.
“Of course, you can’t look into people’s heads,” he says with regard to the eSportswashing accusations. Therefore, a final judgement cannot be made yet. “Only time will tell what the exact intentions are, just like with any other investment.” However, Flato is positive about the approaches: “So far, we have to say quite clearly that we have not observed any negative changes in German eSports since the Saudis entered the market.”
But not only that. On the contrary, the ESBD vice president even reports positive effects and has a very concrete example of this: GGFORALL, a CS:GO series exclusively for women. “ESL launched the initiative at the end of 2021, before the takeover by Savvy Gaming Group. Nowadays, the event is considered the biggest women’s league ESL has ever had.” Growth that may have also been reaffirmed by funding from Saudi Arabia.
Saudi funds economically vital in “eSports winter”?
Growth is an important keyword anyway, as the eSports industry continues to be in trouble as a result of the difficult global economic conditions. Flato describes the situation as an “eSports winter” in reference to a report by the Deutsche Presse-Agentur and therefore also refers to the economic relevance of new funds. “In the current economic situation, many companies are facing great challenges. Especially in eSports, because marketing budgets and sponsorship money, which continue to make up a large part of eSports, are the first branch to be sawn.”
Therefore, “investments of this size, which are longer-term and really meant to build something over time” are currently “very important” for the eSports market – and in demand accordingly: “They are welcome in the scene, you can say that in general.”
Does Saudi funding count towards this kind of long-term, targeted support? “If you look at the developments through the Saudi investments, you see that they also want to make a difference,” Flato finds, elaborating, “It’s not just about putting money somewhere and putting your logo on it.” Rather, there are “actors who really want to promote these areas”.
An intention that seems credible to the ESBD vice-president against the background of Saudi Arabia’s general economic orientation: “These are also economic interests. Saudi Arabia is currently developing very strongly and is opening up in many areas, especially in the direction of digitalisation, artificial intelligence and eSports as well as gaming.
Flato reiterates desire for dialogue
The situation is different when it comes to human rights, which, from a Western perspective, continue to be severely restricted for some marginalised groups. A problem that is of course also known to the eSports Federation Germany, as Flato already told us in his assessment of the FIFAe Finals in Riyadh. In the course of this event, he expressed his desire to build bridges with eSports – which he also affirms in a larger context. The economic connection in eSports could contribute to this, he said. “There is a cultural exchange, an international exchange, and it stimulates discussion. That is immensely important.”
The truth, however, is that the ESBD’s intervention measures are limited. “We have about 90 to 100 members in the form of voluntary clubs, professional teams or tournament organisers. Some of these members are companies of an international nature and accordingly have investors, sponsors and partners from the most diverse areas,” the vice-president describes the status quo and makes clear: “The organisational level is a matter for the members.”
At the same time, Flato also emphasises that “as an association, we always look very closely at where the scene is going, which players are active and what effects this will have on the national as well as international market in the long term”. If there are “negative effects” on German eSports as a result of the Saudi entry, they will therefore make a statement accordingly. A caveat under which the eSports Federation Germany welcomes the investment from the Middle East for the time being.
