Engine To Merge News, Gaming, Esports
Torque Esports, an esports content creator; Frankly, a news management company; and WinView, a gaming mobile app company, are combining to create an integrated platform dedicated to live news, sports and esports.
Engine (an amalgam of esports, news and gaming) was announced Nov. 22 and the deal is expected to close in January or February 2020, aiming to open up new revenue sources for broadcasters losing money to cord cutting.
The new venture is looking to expand into the growing demographics of cord-cutters, promoting audience engagement through such activities as betting and second screen gaming.
Under the agreement, Torque Esports CEO Darren Cox and Frankly CEO Lou Schwartz will co-lead Engine Media Holdings, while WinView Executive Chairman Tom Rogers, who is also chairman of Frankly, will serve as executive chairman of Engine.
Rogers, who created CNBC and MSNBC and once led TiVo, says Engine is a business-to-consumer play that is also a business-to-business answer for issues affecting the media industry.
“It became clear to me that these were forces that needed to be addressed,” Rogers says of the need to meet cord cutters on the streaming platforms to which they’re headed.
“The question is how do we make local broadcasters or news distribution more relevant in a market when entertainment, news and other content is being consolidated in alternate over the top platforms like Netflix, Hulu and Apple TV+?” Schwartz says.
Engine is hoping that a combination of live sports, esports and gaming will help draw a coveted younger male demographic, Schwartz says. “The ability to engage audiences on a second screen” through a video game or betting “makes local broadcasts more relevant.”
In addition to a portfolio of 68 issued patents, WinView brings an app to the company that allows TV viewers to play skill games in real time — while watching live sports on TV — and win cash prizes.
“It provides another enhanced experience” that helps them engage consumers, capture data and “drive streams of revenue that didn’t exist,” Schwartz says.
He foresees an array of future cross-platform integrations on Engine such as a news anchor doing a trivia game. It could be used “in a variety of different content genres,” he added.
Schwartz says the combination will make it possible to deliver unique forms of content across digital and OTT platforms, something that local broadcasters may need if they’re able to access syndicated content for OTT use.
“How will they fill that space? They’re looking for new forms of content,” Schwartz says. “That’s where we think there’s a unique opportunity.”
Rogers says Engine isn’t expected to operate under any single business model. He says Frankly has largely operated on a combination of fees and advertising; WinView receives user fees but sees opportunities for sponsorship and advertising as that scales; and Torque receives a combination of fees and sponsorship.
“All these businesses have the ability to have that combined ad revenue and fee support,” Rogers says.
At the same time, Rogers says he wonders when the media industry itself will begin to feel “the extreme urgency” that its traditional sources of revenue support are declining, particularly in the face of continued cord cutting.
“They’re not responding as dramatically as they need to salvage news and sports business models,” he says.
Rogers says he believes that over the next year, as streaming services “really begin to cannibalize” the way people get cable and satellite bundles, the urgency will “set off a new scramble” as broadcasters work to figure out new consumer experiences, into which upstarts like Engine will have an early mover advantage.