By Paresh Dave / Los Angeles Times/TNS
LOS ANGELES—More than 100 million people play “League of Legends” each month, making it the world’s top personal computer game.
But the milestone, which was reached sometime in the last year and announced earlier this month, does little to settle questions about developer Riot Games’s growth pace and when it might finally launch a second game.
The Los Angeles company continues to scuttle ideas for a next act and is struggling to propagate an against-the-grain culture across a growing work force. Credited for turning video games into an almost-mainstream sport in recent years through its hit “League of Legends,” Riot also is considering transforming its role at the center of e-sports—a position it has described as “awkward.”
Cofounders Brandon Beck and Marc Merrill must wrestle with these issues as they lead their company into another decade. As part of 10th anniversary celebrations this month, they spoke to the Los Angeles Times at their office, looking back and forward.
“‘League of Legends’ for so many people has become a shared language and passion and that to us is really motivating,” said Merrill, Riot’s president. “The next 10 years, we want to do more of the same, make other interesting games and continue to grow and invest in ‘League.’”
No rush
MERRILL and Riot CEO Beck refused to characterize the company’s increase to 103 million players last month, from the previously released figure of 67 million nearly three years ago, saying it was up to others to judge whether that’s satisfactory growth.
They also declined to comment on sales and profits. Outside estimates have the company easily seeing $1 billion in revenue, mostly from selling cosmetic upgrades to virtual characters in “League of Legends.”
Now fully owned by the Chinese gaming giant Tencent, Riot has both the independence and financial flexibility to chart its own course. Riot wants to end up with “a few games” over the next decade, Beck said. But there’s no rush.
Regardless of what lies ahead, Riot will remembered for unusual strategies and for taking e-sports from “a cult segment to a huge stature,” said Lisa Cosmas Hanson, managing partner of gaming industry consultancy Niko Partners.
Financiers, including National Basketball Association stars and media moguls, are spending millions of dollars to field top-tier “League of Legends” teams and thrust them into tournaments with many more millions in prize and sponsor money at stake. How the competition grew so fierce—to the point that millions of fans stream professional “League” games each week—is a testament to Beck and Merrill deviating from industry norms, analysts and early Riot investors said.
Revenue reliance
UNLIKE big gaming companies that had to sell a new game every year, Riot launched “League of Legends” in 2009 as a free online download. Updates are free, as well, with the company reliant on the in-game transactions for revenue.
The setup enables players to go much deeper into a single virtual universe, as Merrill and Beck longed to do as gaming-obsessed teenagers.
The game lacks a single-player mode. And though the goal of destroying the enemy’s base is easy to follow, getting a grip on how to succeed is difficult. The decisions emphasized “League” as a community, where even just being a spectator was OK.
Rick Heitzmann, managing director at FirstMark Capital and an early Riot investor, recalled how Merrill compared big gaming publishers to Disneyland. They could afford to develop a crazier roller coaster, or game, every year.
With much less cash, Riot had to be “pickup basketball or soccer, where it’s not about the field or court, it’s about the social interactions and competitiveness and community,” Heitzmann said.
Growing mediums
THOUGH the strategy worked, the laser focus on “League of Legends” has invited scrutiny about whether Riot left money on the table by not seizing on its popularity to market additional games. “It’s very rare to see a company focus on one game for such a long time and not introduce any sequels, spinoffs or even brand-new” titles, Niko Partners analyst Daniel Ahmad said.
Beck said it comes down to valuing long-term potential over short-term gains and that development of “League of Legends” is far from done.
Teut Weidemann, a longtime gaming executive and consultant, said looking elsewhere too soon would have distracted Riot. But he noted that the company could be challenged if players shift attention to similar smartphone and virtual-reality games, two growing mediums where Riot hasn’t carved out a big spot. Already in China, Tencent’s “King of Glory”—regarded as a “League”-like mobile game—has hit 30 million daily users, according to Niko Partners.
A cautious approach to developing a new game gives Riot time and space to fit its core value—doing right by its players—into a larger ecosystem.
“We feel comfortable doing R&D [research and development] on big, risky, crazy ideas and failing internally multiple times before shipping to players,” Beck said.
Image credits: Riot Games/TNS