ESL and DreamHack have announced an imminent merger that will likely see both companies jointly hosting esports events moving forward. The new entity will be known as ESL Gaming.
Both ESL and DreamHack are part of the ownership group of Modern Times Group. Till now, they have been operating independently, hosting their own respective esports tournaments.
Going forward, DreamHack will likely keep its name as the principal organiser of the festival series, but under the newly-formed joint ownership group. ESL’s co-CEO’s Ralf Reichert and Craig Levine will lead the new ownership group while DreamHack CEO Marcus Lindmark will stay on to lead the larger festivals, which he has been doing since 2014.
”Through maximum cooperation and collaboration, and the melding of some of the best creative and visionary gaming minds in the industry, we will, together, continue to advance the innovation that drives this space via the most exceptional products and events,” Levine said in a news release. ”For our partners, there will be more opportunities to engage with us through a wider range of activations across all levels of esports, and all aspects of gaming. And for our fans, it means we will offer one of the most expansive esports and gaming lifestyle portfolios available.”
According to ESPN, since MTG acquired majority stake of ESL and ownership of DreamHack in 2015, the two companies have operated relatively independently – with ESL focused on its Intel Extreme Masters and ESL One events, as well as a number of other pro leagues in various titles and white label production, and DreamHack primarily in the festival space. However, in the past couple of years, the two companies have slowly started sharing more resources and leaning on one another to grow in their respective areas. Combined, they are the largest tournament organizer in esports and one of the few major ones that are not owned by game developers or participating teams.
At the outset, this seems like a massive move to bring two of the biggest esports organisers in the world under one brand. However, they have both worked majorly in tandem to advance the esports industry, albeit via different channels.
ESL and DreamHack host tournaments in multiple esports, including Counter-Strike: Global Offensive, StarCraft II, Hearthstone, Super Smash Bros., Street Fighter and Rainbow Six: Siege. If anything, they’ve created quite a significant barrier to entry for other organisers across the world, which isn’t necessarily a boon for the advancement of the industry. However, from a business perspective, there is a lot of sense in this move. MTG, now a majority stakeholder in the merged entity, would have seen the possibility of a monopoly and substantially-higher top-line revenue.