Esports Companies To Set Maximum Salary Cap At Rs. 2.5 Lakh Per Month

Leading esports organizations such as S8UL, Revenant Esports, GodLike Esports, Enigma Gaming, Global Esports, and more, are discussing capping player pay at Rs 2.5 lakh per month, blaming the negative impact on team performance during competitions caused by player poaching. At a meeting last month, owners of up to fifteen esports organizations discussed how paying out large salaries in an attempt to attract the best players is driving many of them into loss.

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Esports Players' Salary To Cap At 2.5 Lacs

In an article by the Economic Times, information was disclosed about a meeting between esports organization owners where they discussed how exorbitantly high player salaries are affecting their existence in the industry. An owner, whose identity hasn't been disclosed, stated that poaching players by giving them high salaries is affecting their business and driving the company into heavy losses. Every organization has to provide devices to play, a boot camp to stay in Mumbai, train the players, build team strategy, manage their branding, travel expenditure as well as take care of their nutrition and mental well-being, making them spend a lot of money for the same. He claimed that the expenditure can go up to Rs. 20 lakhs per month.

Another organization owner quoted an example from sports to explain their situation better:

"Imagine the mood in the locker room if Virat Kohli suddenly announced departure from the Indian cricket team just before a critical match. This is how our players feel when suddenly their in-game leader joins a rival team. More than the business, it's about the team spirit for esports. You are playing behind a mobile/PC screen and the only cheer in the room is from your fellow teammates. This requires a very strong team culture."

Apart from covering expenses, organizations generate revenue through two main channels: the prize money earned in tournaments and brand endorsements. Nevertheless, players argue that imposing salary caps is unjust. A prominent esports athlete expressed that the team managers leverage their increasing popularity to offer higher compensation packages. Implementing salary caps would feel like constraining their value, regardless of their excellence in tournaments. 

Noteworthy video games such as Battlegrounds Mobile India (BGMI), Valorant, Counter-Strike, Dota, and Pokemon Unite have garnered massive participation in India, with millions either playing or avidly watching players compete in championships. These competitions initially streamed online on platforms like YouTube, Loco, and Rooter, have evolved into grand offline local area network (LAN) events held in stadiums, resembling the scale of traditional sports events, a trend well-established in the West. According to market estimates, the total prize money awarded in both online and offline competitions in 2023 was close to Rs. 30-35 crore, making it the largest prize money payout in India's history for online gaming.