CS:GO Insights: An Exclusive Interview with Olswang.com’s Alasdair Lamb
If you’re not a part of the online generation then you might not know what eSports are, but the chances are that you’ll have heard the term. A contraction of the words “electronic sports,” eSports have become a global phenomenon over the last decade and, more importantly, changed the face of gaming.
Back in the seventies and eighties, computer games were simple affairs with simple objectives. For anyone lucky enough to have a home console, personal glory was the goal. For those using their pocket money to play Pac-Man in a local arcade, achieving a score good enough for the leaderboard was the dream.
However, beyond the playing practices of the masses, an early version of eSports was already starting to take shape. Thanks to the advent of the local area networks (LAN), gaming geeks at institutions like Stanford University were able to host multiplayer tournaments. In fact, in 1972 Stanford’s top Spacewar players were given a chance to compete for a year’s subscription to Rolling Stone magazine.
The Internet Brings eSports to Life
From these humble beginnings, video game tournaments began to proliferate, and as technology improved, participation levels gradually increased. Indeed, by the time the nineties rolled around and the Internet kicked into life, competitive gaming soon became a cross-country affair. With players able to access cross-platform open source software and test their skills against remote players, major brands started to take notice.
In 1990, Nintendo hosted a World Championships series across the US and from this base the industry started to grow. Today, eSports is the term used to describe any competition that’s facilitated by computers. Although the genre can encompass a broad range of human/computer activities, the main events people think of when they hear the term eSports are professional level competitions in the following gaming styles: fighting, multiplayer online battle arena (MOBA), first-person shooters (FPS) and real-time strategy.
The Advent of CS:GO and eSports Betting
One of the most popular games comes from the first-person shooter genre and is known as Counter-Strike: Global Offensive. Developed by Hidden Path Entertainment in association with Valve, CS:GO is a cross-platform game where players have to complete a series of objectives and defeat an opposing team.
Being the fourth incarnation of the Counter-Strike series, CS: GO is now well established and that’s made it popular with players, spectators, and more recently, bettors. As an industry, eSports is currently worth more than $325 million and by the close of 2016, it’s estimated the market will have grown by 43%. In fact, by 2019, researchers at Newzoo predict eSports will be worth $1.1 billion.
This surge in value has made eSports an area of interest for betting operators, and today, punters now have the ability to speculate on the top players and major event just as they would in traditional sports.
Naturally, as the industry grows, issues regarding regulation, protection and expansion have come to the fore. Now a mix of financial potential, possible litigation and everything else in between, eSports betting is more interesting than ever which is why Casino.org spoke to Alasdair Lamb from Olswang.com about these issues and more in an exclusive interview.
Can you give a short rundown of the CS:GO skins betting?
In June and July of this year, two class actions were filed in the US against Valve, the developer of distribution platform and online marketplace Steam and the popular game Counter Strike: Global Offensive (or CS:GO). Both alleged that Valve was complicit in the operation and promotion of illegal gambling through enabling millions of Americans to link their individual Steam accounts to third-party websites where they could participate in skins betting in respect of CS:GO. Valve subsequently issued cease and desist orders to all skin betting sites found to be using the Steam trading system. ‘Skins betting’ consists of wagering covers or ‘skins’ for weapons (which can then be used in play) on eSports events as well as using these as casino chips in casino type games. In the case of Valve, it was claimed that, as such skins are available for purchase for real money on the Steam marketplace, and can be traded and used as collateral for bets placed on third party websites, ‘skins betting’ constitutes gambling. Therefore, by enabling players to link their accounts to third party websites offering such services, Valve was complicit in this.
With the recent CS:GO scandal, do you think Valve should be questioned as to why the industry wasn’t regulated in the first place?
It is yet to be seen what regulatory action (if any) will be taken against Valve. Ultimately it is not just Valve that is at fault – the third party websites may yet still face action. The industry as a whole also needs to be accountable for the lack of consistent governance seen to date. Unlicensed gambling in the eSports world is not limited to CS:GO – it can be seen across various games and involves a range of different parties, all of which play a role.
What changes have been made now so that the betting scene is safer for minors?
It is not so much that ‘changes’ have been made, but more that attention is now being paid to eSports gambling by regulators that will help to protect minors.
By way of example, the Gambling Commission of Great Britain – in the wake of the Valve case and the increasing popularity of gambling in this sector – published a discussion paper setting out its view on eSports gambling generally and the extent to which it falls within its remit. Whilst eSports have been on the Commission’s radar for some time, this is the first instance of it providing solid guidance on the topic. It is apparent that the Commission is starting to scrutinize the industry for instances of unregulated gambling. One of the licensing objectives of the Commission is the protection of children and therefore, with greater regulation, there should be in theory greater protection for minors.
By way of summary, in the discussion paper the Commission confirms the following:
- In relation to skins betting, a gambling license will be required where an operator offers facilities to gamble skins which have a monetary value, if they are traded or tradable and therefore constitute a form of virtual currency.
- Betting on the outcome of eSports events will be regulated in the same manner as traditional sports betting.
- There is a risk that offering ‘match up’ style games – where two players go head to head and bet on who will win – could necessitate a gambling intermediary licence where an operator introduces participants who bet against each other in this way (as they are providing a service designed to facilitate the making or accepting of bets between others).
- Where a player plays a game for a prize they may be using facilities for gambling where the game in question involves an element of chance – this departs from the previous assumption that computer games are always games of skill, and hence not ‘gaming’ in the gambling sense.
Not sure if you’ve seen this article but what do you think of it? Do you feel the threat is exaggerated?
Integrity is crucial to the importance of all sports, including eSports, and crime is a major threat to this. Esports has had numerous issues in this area since its popularity boomed. There have been doping scandals – in July 2015, Kory “Semphis” Friesen (a star player of CS:GO) publicly admitted that his former team Cloud9 had used Adderall during a professional tournament for instance. Match fixing has also been evident, as highlighted in the article you provide. Whilst eSports has certainly grown, it is still somewhat of a fledgling sport when you compare it to others. Whilst traditional sports may be able to weather scandals, as illustrated by the likes of football, eSports is more vulnerable due to its relative youth. I don’t think, therefore, that the risk is really exaggerated here – if viewers believe that matches are fixed or that competitors have an unfair advantage, the sports credibility will be damaged and its popularity may be at risk of decline. As fans are central to eSports success, any threat to its popularity must be taken seriously.
What do you think will happen to the game itself? Will it stay popular?
Whilst skins betting is certainly popular, games such as CS:GO have a host of fans who are dedicated to the game itself, without any interest in the gambling side. Whilst some fans may move to other games initially if gambling on CS:GO is restricted, regulation on eSports gambling will be industry-wide. It won’t matter that you are gambling on CS:GO or League of Legends, what matters is that you are ‘gambling’. As a result, it is unlikely that CS:GO will suffer more than any other game from a regulatory point of view. From a PR perspective, however, the Valve cases are the most high-profile to date. As a result, even though similar unregulated behavior exists in respect of other games, the standing of CS:GO in public would have taken a hit by the scandal.
Do you think there’s a way CS:GO skin betting can continue and become a regular part of sports betting? How?
There is no technical reason (in Great Britain at least) why CS:GO skins betting couldn’t become a legitimate form of gambling. As made clear by the Gambling Commission, however, in order to continue lawfully, the necessary gambling licenses will need to be acquired by the relevant parties. Due to the regulation and cost implications that come with this, it is yet to be seen if those in the sector will be willing to do so. If not, they will have two choices: either stop what they are doing altogether, or break the law by committing an offense under the Gambling Act 2015. The latter is likely to ultimately end with the same result as the former, as the Commission has shown that it is zeroing in on this area and anyone attempting to circumvent its remit is likely to soon face action.
Do you think in-play spending money etc and ratings on games will become stricter because of this?
If gambling is to be embedded into a game – and regulated – then yes, age restrictions/ratings are likely to follow accordingly. In-game spending generally isn’t likely to be affected due to the commercial necessity of it continuing for so many games. However, in-game spending on items that are tradeable may be looked at more closely by games developers. As made clear by the example of skins betting, there is a risk here that a form of gambling may develop using such items. Again, due to the financial implications of restricting the purchase of such items, it is unlikely that developers would limit such in-game spending. They may, however, attempt to distance themselves from any third parties offering such gambling services or, as seen in the case of Valve, take action against them.
Where do you think the future of eSports gambling lies?
Esports gambling still has a bright future, despite the Valve case and lack of regulation to date. Many of the main operators now offer markets on eSports events and as the popularity of eSports continues to boom, the popularity of these services is likely to also. The potential success of the less traditional forms of gambling that we have seen – such as skins betting and ‘match ups’ – is not so clear. Whereas sports betting is tried and tested, and therefore it is not a giant leap to suggest that betting on eSports events could succeed, what these operators are offering is new and untested. This is not to mean, of course, that it cannot flourish, but the chances of operators falling foul of regulators and games developers is heightened.
Thankyou to Alasdair Lamb from Olswang.com for taking part in this interview.