Over 15 years ago, Riot Games struck gold with League of Legends, or LoL as it is known today. The multiplayer online battle arena has a unique mixture of hero action-combat and real-time strategy, and became one of the most famous games of all time.
Today, LoL still has tens of millions of active players, along with the fact that it is one of the most popular esport titles in the world. This popularity means that the corporate coffers of Riot Games are in great shape, despite the present and persistent crisis in the game development industry. In fact, 2023 was their best year in terms of revenue - the business made 1.5 billion USD. The profits from that are going to prop up League of Legends, but they will also serve for developing new releases, including the upcoming 2XKO, a team-based fighting game.
However, Riot Games also believes that some domains are overly saturated right now and that they have no place for their titles. That includes the rapidly expanding user-generated gaming content industry. In that competitive, all-vs-all match, Riot Games is planning, at least for now, to stay on the bench.
The primary reason for the Riot Games’ decision is the fact that the UGC marketplace is highly competitive and populated by enormous companies. During a Q&A session, Andrei van Roon, Riot's head of League Studio, stated that he and his team did not plan to pick a fight with someone like Epic Games over UGC players and creators. In his words, Riot Games comprehends the user-generated niche as one that is primarily related to the creation platforms and technology tools they utilize. Here, Riot has very little to offer, being that all of its games use relatively old gameplay systems and game engine setups. Even the relatively new additions to the Riot library, like the auto-battler Teamfight Tactics or Legends of Runeterra, a digital collectible card game, is a very simple ecosystem that could offer little to content creators.
When compared to Roblox or Minecraft, Riot Games has nothing that could grow into tooling or other necessities for UGC.
The approach that Van Roon laid out might seem like one of isolation, shutting LoL in its own ecosystem. However, Riot Games is very much interested in broadening the appeal of their games. They are steadily creating spin-off games and broadening the lore and world of League of Legends. Arcane, a TV animated series set in the world of LoL, has been a massive success.
The same goes for their focus on esports competitions and the creative space around them, which regularly includes hit musical tunes from big global superstars like Lil Nas X. So, the company doesn't shy away from expansions and using unorthodox means to attract new players and esports audiences. Still, the ultimate, long-term problem with UGC, as Riot sees it, lies in the assumption that the current slugging match against the heavyweights will have a single winner.
Many believe that the future of user-generated content in gaming is a huge selection of platforms, approaches, and development spaces. In that vision, big and small players in the UGC industry will coexist or even share their platforms through interconnectivity.
Riot Games, on the other hand, believes the setup will sooner or later turn into a winner-takes-all market. In other words, whoever manages to define and present the first functional metaverse will be the one who gets the UGC market. That fact is debatable and no one can predict the future of UGC in a certain way.
Riot is taking into account the first-mover advantage. They recognize that being the first to market can position a company as the industry leader, making it difficult for competitors to catch up. This is similar to how social media platforms like Facebook and Twitter became dominant by being early and setting the pace for user expectations and network effects.
Riot Games' approach can be seen as a hedge against the fragmentation of the UGC market. In a highly fragmented market, resources could be spread thin across multiple platforms, each vying for a piece of the pie. By concentrating efforts on building robust UGC features within their existing ecosystem, Riot Games aims to centralize user engagement, reducing the risk of their user base migrating to competing platforms.
The fact that Riot Games is shaping its business decisions on this assumption is likely a shrewd move. While it could, theoretically, stop Riot from building its LoL metaverse, it is guaranteed to save the company huge sums of money that would have otherwise been wasted on a tech platform that could never find a competitive slice of the UGC market.
