Financial Report Points at the Likely Reason Behind Capcom Cup PPV

The recent news about the Capcom Cup 12 finals being locked behind a rather expensive pay-per-view ticket has been a big shock for the community, and even the developers.

However, a likely reason has emerged through Capcom's financial reports that point at hefty losses on the behalf of their esports division.

Even for a company like Capcom, using nearly 7 million USD to run the Capcom Cup is nothing to sneeze at. In terms of game budgets, this wouldn't be enough to fund a AAA game, but it would certainly make up a decent portion of the budget. For example, the recent Ghost of Yotei game supposedly has a budget of roughly 60 million USD.

However, it's important to look at these losses in context. It's not like Capcom is just burning this money, they're funding the most prestigious competitive Street Fighter event. Combined with one of the biggest prize pools out there, Capcom Cup is what gets people excited and talking about the game. That excitement is then converted into sales. Not just sales of the game, but DLCs, cosmetics, merch, or even just other Capcom games, since it's a distinctly Capcom branded event.

For this reason, it makes more sense to look at this as marketing expenses. Marketing is always "losing money" because you don't earn money from the marketing, you earn it from the products or services that are being marketed. It is entirely possible that they don't consider the return of this investment to be worth it, but we must keep in mind that it does, in fact, earn them money to run the event.

The bigger issue is that they are potentially shooting themselves in the foot by trying to solve it with the fairly expensive PPV tickets. It's hard to gauge the reaction of the Japanese players, and perhaps domestic earnings will justify their decision, but outside of Japan it's exceptionally unlikely that PPV will be popular. Even for people living in the more well off countries, 30 to 40 dollars is not a negligible amount of money, especially for 2 days of watching fighting games late at night. This proposition only gets worse when we go to less well off countries, where the amount they ask for PPV is enough to feel your family for a week.

Nakayama already explained that the developers were not the ones behind this decision, but it's so strange that they weren't even consulted about other options. Everyone who has been around for SFV will remember the Capcom Cup DLCs that supported the event. With SF6 having even more avenues for MTX, there are so many better solutions to try and make the competitive side of SF6 more profitable without resorting to something so drastic.

That said, there are apparently still some internal discussions about it, so maybe this could still lead to a more agreeable resolution for both Capcom and SF6 fans.