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    <journal-meta />
    <article-meta>
      <title-group>
        <article-title>Tobias M. Scholza, Lisa Völkela, Carolin Uebacha and Volker Steina</article-title>
      </title-group>
      <contrib-group>
        <aff id="aff0">
          <label>0</label>
          <institution>Chair for Human Resource Management and Organizational Behavior, University of Siegen</institution>
          ,
          <country country="DE">Germany</country>
        </aff>
      </contrib-group>
      <abstract>
        <p>Esports has gained much attention in recent years, especially traditional sports clubs see esports as a way to diversify their product or brand. This is since many traditional sports are going gray, and they are often failing to attract a young audience. Furthermore, they need to catch-up concerning digitization and internationalization. These aspects are ingrained in the DNA of esports. Therefore, until the end of 2019, over 400 professional sports clubs entered esports. Though, there is no single strategy to enter the eSports ecosystem observable. Consequently, the goal of this paper is to systemize the way sports teams are acting in esports. Based on that analysis, three cases will be presented to show the potential struggle in joining esports and why sports need to establish a strategy for entering esports. Finally, several implications for sports teams will be presented to minimize the risk of entering the esports ecosystem. Sports teams, participation, systematization, strategic management, brand diversification</p>
      </abstract>
    </article-meta>
  </front>
  <body>
    <sec id="sec-1">
      <title>In recent years esports has grown</title>
      <p>
        exponentially [
        <xref ref-type="bibr" rid="ref44 ref52">44, 52</xref>
        ] and attracted interest
from various non-endemic actors. Besides
companies like Amazon buying the live
streaming platform Twitch and media
companies like MTG acquiring ESL and
Dreamhack, there is a surge of sports
organizations joining esports. Esports has been
evolving for a long time, mostly in isolation.
But this has changed significantly in the last
years. At the end of 2019, more than 400 sports
teams worldwide have communicated that
esports is part of their sports organization. The
strategies vary from teams like FC Schalke 04
having a League of Legends (LoL) Team on the
highest level to Eintracht Frankfurt fostering
esports on a more grassroots and local level.
      </p>
      <p>
        In August 2020, the Rhein-Neckar Löwen
announced their ERN ROAR team and made a
call for local League of Legends players [
        <xref ref-type="bibr" rid="ref40">40</xref>
        ].
At the same time, VfB Stuttgart closed their
esports team due to economic struggles from
the Covid-19 crisis [
        <xref ref-type="bibr" rid="ref49">49</xref>
        ]. Those two examples
reveal the difficulty in creating a successful
esports team. Covid-19 reinforced the current
sports business model s risk and amplified how
frail it is [
        <xref ref-type="bibr" rid="ref12">12</xref>
        ]. Consequently, there is a certain
allure to venture into esports, especially, as it
seems resistant to this crisis [
        <xref ref-type="bibr" rid="ref41">41</xref>
        ], at least, more
resistant than traditional sports. Furthermore,
traditional sports are going gray, and many
sports struggle to reach the young generation
[
        <xref ref-type="bibr" rid="ref27">27</xref>
        ]. From a business perspective, it makes
strategic sense to invest in esports.
      </p>
      <p>Still, the case of VfB Stuttgart reveals that
esports is a complex and volatile ecosystem.
There is no concise or unified strategy to
succeed in esports and sports are, in a certain
sense, deadlocked due to their long history.
Even though sports teams have many tools to
be successful in esports, many organizations
venture without a strategy into esports.
Researching the existing sports organizations
should be helpful to understand the
sportification of esports. It is essential to
highlight that this is a global competition and
sports teams compete with other sports teams,
existing esports teams, and various investors
and businesses. The market is far from divided
up and, consequently, highly competitive.</p>
      <p>
        In this paper, the goal is to give some form
of systematization for sports teams joining
esports until the end of 2019. Based on the types
of sports teams in esports from Scholz [
        <xref ref-type="bibr" rid="ref44">44</xref>
        ], the
authors did a systematic search for those sports
teams and categorized them. These results yield
an overview of the current stage and serve as
the basis for three cases of interesting sports
teams joining the esports ecosystem. Finally,
implications will be discussed on how to
adequately venture into esports and highlight
the importance of strategic management. Being
a successful sports team does not translate into
definite success in esports.
      </p>
      <p>
        There is a longstanding and highly debated
discourse if esports is a sport (e.g. [
        <xref ref-type="bibr" rid="ref11 ref15 ref20 ref21 ref22 ref23 ref24 ref35 ref42 ref56 ref8">8, 11, 15,
20, 21, 22, 23, 24, 56, 35, 42</xref>
        ]). There is an
observable link to sports based on the
competitiveness and how the tournaments are
designed [
        <xref ref-type="bibr" rid="ref1 ref17">1, 17</xref>
        ]. Even though there might be
sufficient parallels to call esports a sport, many
sports associations like the International
Olympic Committee are cautious and try to
dictate the rules for the inclusion of esports in
the sports world [
        <xref ref-type="bibr" rid="ref4">4</xref>
        ]. For esports, being a sport
may lead to a wide-spread legitimation and
legal certainty. For traditional sports, it might
lead to a loss in their current power situation
[
        <xref ref-type="bibr" rid="ref44">44</xref>
        ].
      </p>
      <p>
        It is essential to highlight that esports may
not fit into the category of traditional sports, as
think that a new phenomenon like esports
can be described in terms of the old is to
[51, p. 3]. Esports
emerged out of a digital phenomenon and is
intertwined with globalization. The core of
esports is the idea that everybody can play with
everybody around the world. Traditional sports,
however, is, at its core, about the physical and
local interaction. This core difference
influenced the evolution of esports
fundamentally: Esports is born digital and born
global [
        <xref ref-type="bibr" rid="ref44">44</xref>
        ]. Therefore, we are using the
cultural phenomenon with resemblance rooted
in sports, media, entertainment, and culture, but
emerged in a digitized environment. Thereby,
evolved beyond the constraints of traditional
sport [
        <xref ref-type="bibr" rid="ref45">45</xref>
        ]
      </p>
      <p>
        Despite the ongoing discourse on sports and
esports, it is undeniable that there is a surge of
interest in esports from sports organizations and
that various sports businesses have invested
heavily in esports in the last couple of years.
Although many sports teams are adding esports
on a local level due to their societal tasks for the
community, many sports businesses see esports
as another market with growth potential.
Consequently, there is a strong business interest
in venturing into esports. This development can
be observed with the strategic partnership
between FC Barcelona and Tencent [
        <xref ref-type="bibr" rid="ref19">19</xref>
        ].
      </p>
      <p>
        In addition to searching for new growth
possibilities, many traditional sports struggle to
connect with a young audience. A study by
Lombardo and Broughton [
        <xref ref-type="bibr" rid="ref27">27</xref>
        ] stated that the
average age is gradually increasing. For
example, an NFL fan increased
from 46 years in 2006 to 50 years in 2016.
Every other big sport has fans averaging
beyond 40 years, with the MLB at 57 years. On
the other side, the average esports fan is at 29
years [
        <xref ref-type="bibr" rid="ref50">50</xref>
        ]. Although data collection in esports
is still not that reliable as sports data, the
difference is striking. The underlying
assumption is that esports might revitalize
traditional sports and introduce esports fans to
traditional sports. It is important to highlight
that the potential of such synergy effects needs
to be addressed in the esports business
development strategy. However, there are
various strategic approaches observable within
sports teams entering esports. Scholz derived
the following seven types for sports teams
investing in esports.
      </p>
      <p>1.
digital version of the core business.
2. Esports teams for a variety of games.
3. Esports teams for a variety of games in
a different country.
4. Joint ventures with an existing esports
team and creating a new brand.
5. Temporarily withdrawing from
esports.
6. Creating a dedicated league.
7. [44, p.
7879]</p>
    </sec>
    <sec id="sec-2">
      <title>Type 1 describes the strategy of teams to</title>
      <p>
        identify esports players playing their sport
virtually. These players represent the team and
often wear the official jerseys. Type 2 teams are
playing different esports titles besides their
sports. The most prominent example is FC
Schalke 04, having a successful League of
Legends team and football esports players.
Interestingly, they keep the brand to create
synergies between the football division and the
esports division [
        <xref ref-type="bibr" rid="ref9">9</xref>
        ]. Type 3 is a rarity but a
strategy to access new markets. One case is
Olympique Lyon signing a Chinese esports
team as part of its internationalization strategy.
move by Lyon and a logical attempt at growing
its brand overseas and reaching a whole new fan
[
        <xref ref-type="bibr" rid="ref6">6</xref>
        ]. Type 4 is about keeping the brands
separated but utilizing potential synergy
effects. One example of that is the
CounterStrike team North from FC Copenhagen. Type
5 needs to be mentioned as there are various
cases in which a sports team is withdrawing
from esports, which can be temporary. Type 6
is currently the most common form in which a
league is created mimicking the traditional
sports counterpart. This is often spearheaded by
the league operator. For example, the Virtual
Bundesliga in Germany consists entirely of
teams from the 1st and 2nd Bundesliga. Type 7
has gained more attention recently as many
esports leagues, like League of Legends and
Overwatch, adopt the franchise model. In
Overwatch, for example, the Comcast Group
owning the Philadelphia Flyers acquired the
Philadelphia Fusion. In League of Legends,
Golden State Warriors invested in the Golden
Guardians.
      </p>
      <p>In recent years another type emerged (type
8). A growing number of individual sports
players and individual investors affiliated with
esports invest in esports teams (e. g. Stephen
Curry investing in TSM) or even create their
own team (e. g. the footballer Christian Fuchs).
This trend gained momentum only recently in
2019. Still, several big names like Lionel
Messi, Michael Jordan, and others use their
fortune to diversify their portfolio into esports.
As anybody can invest in esports and many
professional sports players play video games,
this type will grow exponentially in the coming
years.</p>
      <p>
        The process of finding sports teams that
entered esports was done exploratory, as there
is no concise list for such teams. Many lists are
vastly incomplete, which can be seen in the case
of SSV Lehnitz, which is not listed in any of the
existing reports. The data was collected
between 2017 and 2019, and we used news sites
like Dexerto, Dot Esports, ESPN, Esports
Insider, and The Esports Observer.
Furthermore, we utilized the snowball method
[
        <xref ref-type="bibr" rid="ref3">3</xref>
        ] to search for further sports teams using
search engines, social media, and traditional
sports news outlets. As esports is still emerging
and there are no centralized institutions like
sports associations that may collect such data,
we utilized the snowball method to follow up
on news snippets and posts. We
crossreferenced this with other data sources to
confirm the information. Based on this
information, we searched for the original news
to verify the news. Finally, we cross-checked it
with the list of Code Red Esports that emerged
in 2019 and validated some of the entries.
Consequently, the list may be incomplete as the
search process is limited, and language barriers
might lead to teams missing. That said, it might
be the case that there is a vast amount of sports
teams in countries like China. Mostly as esports
data from China should be utilized with caution
[
        <xref ref-type="bibr" rid="ref10">10</xref>
        ]. Still, the data-set is, at the moment of
publication, the most exhaustive data-set
available.
      </p>
      <p>
        In the search process, we identified 418
sports teams and individual sports investors that
have entered esports in some form until the end
of 2019. It became evident that some teams
could be part of various types as the
systematization of Scholz [
        <xref ref-type="bibr" rid="ref44">44</xref>
        ] is no longer
precise enough due to the evolution of esports.
Esports is highly volatile, and this volatility is
even further increased by the hefty influx of
various sports teams. The sportification of
esports may stir up new evolutions and,
subsequently, new types, like type 8 we
introduced in this paper.
      </p>
    </sec>
    <sec id="sec-3">
      <title>As shown in Table 1, most teams are in type</title>
      <p>
        1 (101 teams) and type 6 (189 teams). These
types are an extension of the sports that teams
play to the esports simulation of that specific
sport. Most of these teams are from football.
However, there is one distinct difference
between those types. In countries like
Germany, the initiative for expanding to esports
is driven by individual teams. Consequently,
several top teams, like Borussia Dortmund, are
still missing in the Virtual Bundesliga. That
team saw esports not as part of their strategy for
a long time and even stated in 2016 that
Borussia Dortmund will not enter esports as it
may weaken their brand strategy [
        <xref ref-type="bibr" rid="ref5">5</xref>
        ]. However,
they added a FIFA player and entered esports in
2020 [
        <xref ref-type="bibr" rid="ref33">33</xref>
        ]. In countries like Japan, the initiative
is driven by the national sports association,
subsequently stating that every team in the first
and second division of the J.League will have
to participate [
        <xref ref-type="bibr" rid="ref25">25</xref>
        ]. Therefore, this type inflates
the number of teams involved in esports.
Nonetheless, the brand is represented in esports
and impacts the strategy of the respective sports
teams.
      </p>
      <p>More interesting from a brand perspective
and the strategic diversification of traditional
sports teams are the types 2 (50 Teams) and 7
(25 Teams). Especially with the introduction of
the Overwatch League and the success of
League of Legends, many sports teams saw an
opportunity to invest in esports and achieve
diversification of their portfolio. This situation
intensified with the recent move towards
franchising in esports. Sports groups from the
U.S. saw the parallels to leagues like the NFL
and NBA, leading to many of those teams
investing in the Overwatch League and the
League of Legends Championship Series. For
example, Kroenke Sports and Entertainment
owns Arsenal London, Colorado Avalanche,
Colorado Rapid, Denver Nuggets, and Los
Angeles Rams. They acquired the Los Angeles
Gladiators in Overwatch. There are observable
strategic and administrative synergies like the
Dallas Cowboys, who own Complexity and
support them in terms of training facilities. It
remains unclear how much sports teams can
utilize the synergy effects if the teams have
different names and brands. Or is the bet to have
an alternative for the time if traditional sports
stay gray?</p>
      <p>Type 3 (2 teams) is still an odd strategy for
many teams. However, there are two teams
(Olympique Lyon and Paris Saint Germain)
focusing on that strategy. Interestingly both
teams are from France, and, in the case of Paris
Saint Germain, they are extremely successful.
Concerning type 4, this has become less
popular in recent years as many sports teams are
nowadays trying to create their department for
esports in their organization. But, there may be
ir
name to esports teams or individual players that
are managed by another organization.</p>
      <p>Teams withdrawing from esports (type 5) is
something that has happened occasionally but
may increase in the near future. Cases like VfB
Stuttgart show the struggle to adapt to esports
and the necessity of a strategy. As many sports
teams realize, it requires a significant
investment to be on the top-level in relevant
esports titles like Counter-Strike. In other titles
like League of Legends that are franchise
leagues, the slots are limited. Consequently, the
cost-benefit-analysis might not be beneficial for
several esports programs from traditional sports
teams, especially as it is still questionable if the
proposed synergies from esports to sports loom
the way it was envisioned.</p>
      <p>
        In our research, this became evident with
type 8 in which individual players and
individual investors who are affiliated with
esports are investing in esports and utilizing
their money to become shareholders of
traditional esports teams like Ea
Johnson investing in aXiomatic, which owns
Team Liquid or create their own team like
David Beckham with Guild Esports [
        <xref ref-type="bibr" rid="ref47">47</xref>
        ].
      </p>
      <p>As mentioned earlier, the recent influx of
sports teams entering esports started in 2015.
SSV Lehnitz was an extreme outlier with their
experiment in esports from 2003 until 2006.
Interestingly, in 2014 the American Football
player Roger Saffold acquired a Call of Duty
squad and became the first individual investor
from sports, and predates the interest of sports
teams in esports. However, the numbers
indicate that the peak was reached in 2018 and
2019 was already a bit slower, which is
illustrated in Figure 1. That may be because
sports teams do not see the immediate success
of having an esports team and the increase of
investment necessary to achieve high-level
success. However, in 2019 and 2020, we see
that sports teams no longer focus on the highest
level but try to complement their regional
impact, e.g., Eintracht Frankfurt with a local
League of Legends team and the collaboration
of FC St. Pauli with the team MTW Gaming in
League of Legends. Both teams try to succeed
nationally in competing in the Prime League.</p>
    </sec>
    <sec id="sec-4">
      <title>Concerning the origin of those sports teams,</title>
      <p>the U.S. is currently the biggest region for
traditional sports teams in esports, with 70
teams. This has recently increased with the
investment of various individual sports players.
Following up, there is Japan, but that is due to
the push of J.League that already contributes for
40 teams in that number. Germany is in third
place with 44 teams, however, mostly with
football teams. In the following, there is
England, Netherlands, France, Norway, and
Belgium. There is a strong European focus.
However, that may be due to the research focus
on Western media as China is only listed with
two sports teams. But it is interesting to observe
that many countries are following specific sport
cultural values. The U.S.A. focuses on
franchise leagues and teams part of such
leagues, Germany with a more individualistic
bottom-up approach, and Japan with a
collectivist top-down approach.</p>
    </sec>
    <sec id="sec-5">
      <title>Many articles stated that sports teams started</title>
      <p>
        to move into esports in 2015, and the first big
mover was Besiktas Istanbul (e.g. [
        <xref ref-type="bibr" rid="ref32 ref57">32, 57</xref>
        ]).
Besiktas Istanbul is often considered as the first
sports team in esports on a professional level.
However, the first sports team in esports was a
German organization called SSV Lehnitz in
2003. Although Lehnitz might not be a big
sports name like Besiktas Istanbul or Paris Saint
Germain that joined esports early on [
        <xref ref-type="bibr" rid="ref36">36</xref>
        ], SSV
Lehnitz was a powerhouse in Counter-Strike
from 2003 until 2006 with playing at the World
Cyber Games in 2003 in Korea and at the CPL
Brazil in 2005. Furthermore, the team always
had an international focus with players from
Austria and Sweden as well as a multi-gaming
strategy with teams in Counter-Strike, Warcraft
3, and Battlefield.
      </p>
      <p>
        It is important to highlight that sports teams
still struggle with Counter-Strike as part of their
organization. Therefore, it is to emphasize that
in 2003
Counterinto their organization to make their brand
internationally known, reach a young audience,
attract new sponsors, and improve their image
as well as the image of esports [
        <xref ref-type="bibr" rid="ref54">54</xref>
        ]. This
organization was already pioneering the
sportsesports discussion before any other sports team
even considered it. SSV Lehnitz exited esports
in 2006 [
        <xref ref-type="bibr" rid="ref44">44</xref>
        ] due to the following reasons
summarized by the board member Norbert
contracts with players, since we are a non-profit
organization. Also, we have to heed the many
obligations of the German legal framework,
[
        <xref ref-type="bibr" rid="ref18">18</xref>
        ]. Nonetheless, this case highlights that the
reasons for joining esports are today still the
same. In addition, the synergy between esports
and sports becomes apparent as sports
organizations help to legitimate esports, and
many regional newspapers reported positive
about this development. This case also shows
the struggle for any sports team in esports.
Esports is dynamic and highly volatile, SSV
Lehnitz struggled in Counter-Strike to keep
players for an extended period, and the squad
consistently changed [
        <xref ref-type="bibr" rid="ref26">26</xref>
        ]. SSV Lehnitz is the
first and prime example of sports teams joining
the esports world. And it is a striking sign of
historical amnesia [
        <xref ref-type="bibr" rid="ref44">44</xref>
        ], as this case is often
forgotten in the current discourse.
      </p>
    </sec>
    <sec id="sec-6">
      <title>Another pioneer in sports expanding to</title>
      <p>
        esports is FC Schalke 04. This football team
joined esports in 2016. However, not only for
the football simulation as many others, but they
also focused on League of Legends and, even
further, strived to compete on the highest level.
The team even bought a franchise slot for the
League of Legends European Championship,
intending to compete on a global level and
business point of view, if we go to Worlds this
would mean so much to the club. It would be
massive to have a global audience, global
[
        <xref ref-type="bibr" rid="ref9">9</xref>
        ]. In the 2020 summer season, the LoL team
even became an Internet phenomenon as they
qualified for playoffs after a record losing
streak. T
massive gain in interest in Schalke on a national
as well as the international level (e.g. [
        <xref ref-type="bibr" rid="ref14 ref53">14, 53</xref>
        ]).
The LoL team has been able to achieve to push
the brand to new levels and new markets.
      </p>
      <p>
        It is part of Schalke's strategy to bring fans
from sports and esports together, and already in
2017, the LoL team walked on the football pitch
and were presented in front of thousands of fans
[
        <xref ref-type="bibr" rid="ref2">2</xref>
        ]. Furthermore, Schalke sees an intersection
between both fan camps, and the core of the
strategy is creating synergy by utilizing the
existing brand. At the moment, the majority of
sports teams owning a team outside of their
sports simulation counterpart are using
different brands like the Kraft Group that owns
the New England Patriots and the Overwatch
Team Boston Uprising. FC Schalke 04 states
that they want to integrate esports in its entirety
to the Schalke family [
        <xref ref-type="bibr" rid="ref31">31</xref>
        ]. This might be a bet
for the future, but with the exponential growth
of video gaming, the potential of brand synergy
can only grow. Still, it needs to be proven that
esports fans can become sports fans, and sports
fans can become esports fans [
        <xref ref-type="bibr" rid="ref43">43</xref>
        ]. But, FC
Schalke 04, as an early adopter, positioned
themselves with League of Legends that will
lead to sustainable success in the long-run.
      </p>
    </sec>
    <sec id="sec-7">
      <title>Another interesting case is the esports</title>
      <p>
        commitment of Paris Saint Germain and its
drastic strategic changes. Paris Saint Germain
entered esports around the time of FC Schalke
04 in 2016, and it even led to matches between
both teams in League of Legends [
        <xref ref-type="bibr" rid="ref55">55</xref>
        ].
However, as Riot moved towards a franchise
model for the European league, the
management decided to withdraw their team:
wonder about the League of Legends
[
        <xref ref-type="bibr" rid="ref37">37</xref>
        ]. At
that time, there was an ongoing discussion
about the profitability of League of Legends on
the highest level and a debate about the revenue
sharing model offered by Riot Games [
        <xref ref-type="bibr" rid="ref16">16</xref>
        ]. It
seemed that Paris Saint Germain made a
strategic decision due to the deficit
costbenefit-outlook for the team's future, especially
as they did not show the results. Still, Paris
Saint Germain stayed in esports with rosters in
FIFA and Rocket League. With the latter
exiting Rocket League in 2019.
      </p>
      <p>
        Paris Saint Germain may have exited
League of Legends, still, the strategy was to
compete on the highest level. Therefore, they
partnered up with the Chinese esports
organization LGD Gaming in DOTA 2 in 2018.
The organization highlighted in the
announcement that this move is part of their
but also Eastern Europe or North America
w [
        <xref ref-type="bibr" rid="ref38">38</xref>
        ].
They were able to reach the finals of The
International (the biggest Dota 2 tournament of
the year) in the same year. Co-aligning to the
strategy of utilizing esports to move towards the
Asian market, they announced a partnership
with the Hong Kong organization Talon
Esports and re-entered League of Legends in
2020. Furthermore, they highlighted this
cooperation is part of its brand diversification
strategy [
        <xref ref-type="bibr" rid="ref39">39</xref>
        ]. Besides the FIFA players, the
focus of Paris Saint Germain is entirely on the
Asian market, and esports serve a purpose to
expand their brand reach and foster growth.
      </p>
    </sec>
    <sec id="sec-8">
      <title>It becomes evident that there are various</title>
      <p>strategies to enter esports as a sports team.
However, it also comes as some countries are
pushing more aggressively into esports.
Especially the U.S. sports teams see in esports
a chance to diversify and to conquer new
markets. In this paper, we only looked at sports
teams, but there is also a surge in collegiate
esports teams, and many colleges are trying to
establish esports teams in their varsity program.
So the number of sports programs being
involved in esports is higher than reported in
this paper. Furthermore, it seems surprising that
Germany has many sports teams in esports,
even though the legal situation of esports as a
sport is still debated. Nevertheless, the list is
still missing several sports teams as data
collection has only been done until the end of
2019. Additionally, in countries like China,
there will be more than a few sports teams
venturing into esports. Consequently, a
limitation of the paper is that the number of
sports teams will be higher, which should be
subject to further research. Still, this paper
highlights the different strategies and creates an
exhaustive list of sports teams involved in
esports. To our knowledge, this list is currently
the most exhaustive one.</p>
      <p>Interestingly, it becomes apparent in 2020
and the current Covid-19 crisis that sports
teams reevaluate their engagement in esports,
and teams like VfB Stuttgart exited esports
entirely. There might be further changes in the
sports-lead esports teams as in leagues like
Overwatch or Call of Duty, where the concept
of geolocalization is currently not conductible.
Furthermore, teams like the Philadelphia
Fusion are building esports arenas that they
cannot use at the moment. Even though
Overwatch teams are locked-in in the franchise
model, they will not exit the league in the
shortterm but will reevaluate their financial
commitment. It becomes apparent that having
an esports team does not magically lead to
financial gain or attracting young audiences.</p>
      <p>
        In many cases, sports teams still shy away
from committing to esports fully and, by that,
use the existing brands for recognition. A
development that was observable with Clutch
Gaming, owned by Houston Rockets. Clutch
Gaming was sold in 2019 to the Philadelphia
76ers and was renamed Dignitas [
        <xref ref-type="bibr" rid="ref58">58</xref>
        ]. Although
the synergies still do not exist between 76ers
and Dignitas, the brand Dignitas has a name in
esports as it was founded in 2003. Only a few
teams utilize the full synergy potential of their
branding, and for FC Schalke 04, it seems to
work [
        <xref ref-type="bibr" rid="ref43">43</xref>
        ]. Besides this defensive behavior,
there is also inconsistent behavior observable.
Paris Saint Germain started out with acquiring
a League of Legends team and actually had a
match against FC Schalke 04 but exited the
market only to rejoin esports with a joint
venture with the Chinese Dota 2 team LDG
Gaming in 2018 and in 2020, they partnered up
with the Hong Kong League of Legends Team
Talon Esports. PSG is an example of the
inconsistency of various sports teams in
esports.
      </p>
      <p>
        Still, esports could serve many purposes,
especially acting as a future lab for digitizing
their sports business and a testing field for new
ideas. Especially as the esports audience is
younger than the sports audience, this might
yield fruitful and lead to synergies between the
audiences. Esports can help to reverse the going
gray situation of traditional sports.
Furthermore, in theory, the running costs are
relatively low as the sports training facilities
can be used by the esports players as well as the
staff. Beyond that, with the progress in
technology, virtual reality becomes more
common, there might be a future in which any
sports could be played virtually. Building up
competencies for the digitization now will
translate into a competitive advantage if Sports
is moving to Sports 2.0 [
        <xref ref-type="bibr" rid="ref29">29</xref>
        ].
      </p>
      <p>
        Esports will keep on growing. However, it
will also diversify even further. New esports
titles will emerge and others will vanish. With
the current franchising model prevailing in the
big leagues, it will become expensive for sports
teams to join on the top level. Especially for
early adopters like FC Schalke 04, this could
translate into long-term success. But, if leagues
are struggling like the Overwatch League, this
could tarnish the long-term
commitment. If such an expensive franchise
league would fail, this may also lead to an exit
of individual sports businesses in the esports
industry. It becomes evident that esports stay
volatile for sports businesses as there is a high
fluctuation in esports titles. An esports title like
Valorant, officially released on the 2nd of June
2020, is already categorized as a Tier 2 esports
title [
        <xref ref-type="bibr" rid="ref48">48</xref>
        ]. Consequently, picking the right game
and the right franchise is a massive source of
risk. Coming from traditional sports, the
competence of selecting such a game is nothing
that traditional sports businesses possess.
      </p>
      <p>
        Consequently, it will be crucial to find the
right people before venturing into esports [
        <xref ref-type="bibr" rid="ref46">46</xref>
        ].
There is a lot that esports can learn from sports,
be it training, marketing, merchandise, and so
on. But this is not one-directional. Esports has
its rules [
        <xref ref-type="bibr" rid="ref44">44</xref>
        ] and follows a digital mindset.
Understanding this difference and that not
everything that works in sports will work in
esports will be the competitive advantage for
businesses entering the esports ecosystem.
endanger the business [
        <xref ref-type="bibr" rid="ref30">30</xref>
        ]. This lack of
willingness to learn might also rob them of the
innovativeness, the chance to digitize
their business, and to reach a younger audience.
      </p>
    </sec>
    <sec id="sec-9">
      <title>The debate if esports is a sport may never</title>
      <p>end, however, it is not necessary to have a strict
stand on this question. It becomes evident that
esports is interesting for sports teams. Be it the
local sports club serving their community or the
sports business diversifying their portfolio.
Esports are different and this difference can be
utilized for innovations, especially as some
sports reached a dead end. Esports can help
revitalize traditional sports, reach a young
audience, and venture into the digital society.
But it all depends on a precise strategy from the
sports business. VfB Stuttgart may be only the
many jumped on the bandwagon. There are
many synergies for sports teams to have a head
start to other investors, but in the long run, this
can lead to a lock-in if they are doing esports in
their traditional way. It is crucial to consider a
unique strategy for venturing into esports. If
that happens, sports organizations can learn
from it for their business.</p>
    </sec>
    <sec id="sec-10">
      <title>The data-set with the 418 sports teams can</title>
      <p>be found here: http://sports.esportslab.org</p>
    </sec>
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