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Video game publisher Activision Blizzard ( ATVI ) is taking steps to capitalize on the growing e-sports trend. On Thursday, Activision announced the launch of its e-sports broadcast network, as part of the recently acquired Major League Gaming platform. It also revealed new content and broadcast experiences, as well as a distribution partnership with Facebook ( FB ). “This marks an important step given Activision’s broader ambitions as a media/entertainment company, and is a natural evolution of the Major League Gaming assets acquired early this year,” Baird analyst Colin Sebastian said in a research report Thursday. “E-sports is still in its infancy (think fantasy football 20 years ago) and represents significant near- and long-term incremental monetization opportunities given Activision Blizzard’s portfolio of owned-IP.” Sebastian rates Activision stock as outperform, with a price target of 42. Activision stock rose 1% to 38.29 on the stock market today , more than 9% extended from a 34.76 buy point, touched April 13, out of a cup-with-handle base. The Santa Monica, Calif.-based company presented its Activision Blizzard Media Network plan for advertisers at the IAB Digital Content NewFronts 2016 conference in New York. ABMN will launch the new content and broadcast experiences during the MLG Anaheim Open, a two-day “Call of Duty: Black Ops 3” tournament beginning on June 10. It will be available for live streaming through Facebook. “E-sports could become a meaningful revenue and profit contributor to Activision within 2-3 years, as the company monetizes its IP (intellectual property) and product portfolio across alternative distribution channels,” Sebastian said. Baird predicts the e-sports industry will grow from $200 million last year to $1 billion in 2018 and $1.8 billion in 2020. “We see a significant opportunity with tournaments, advertising/sponsorship, broadcasting, and fantasy/wagering, contributing incrementally to game publisher revenues and earnings,” Sebastian said. Other companies pursuing e-sports initiatives include Time Warner ’s ( TWX ) Turner Sports and talent management agency WME-IMG, which have partnered on E-League, a “Counter-Strike: Global Offensive” league. On Wednesday, Turner and WME-IMG announced the first group of brands to join E-League as official marketing partners. They include Arby’s, Credit Karma and Buffalo Wild Wings ( BWLD ). The inaugural season of E-League starts on May 24. Meanwhile, Walt Disney ( DIS )-owned ESPN has teamed with Activision on “Heroes of the Dorm,” a tournament for the game “Heroes of the Storm.” RELATED: Disney’s Exit From Toys-To-Life Video Games Could Boost Activision Scalper1 News
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