04 January 2017

2016 FIDE Congress : Whither the World Championship?

A year and a month after 2015 FIDE Congress : Whither the World Championship? (December 2015), what can we learn from Spectating the 87th FIDE Congress (December 2016)? In that '2015 Whither?' post, as well as previous yearly 'Whither?' posts, much of the news came from the annual report delivered by FIDE President Ilyumzhinov. In 2016, the focus shifted to Agon. The first point from the 87th FIDE Congress; Baku, Azerbaijan; General Assembly; 11-13 September 2016; MINUTES, was about Agon's transparency:-
4.2. Agon Limited

Mr. Makropoulos [FIDE Deputy President] informed the General Assembly that as appeared in the EB minutes, he has sent a letter where he was asking Agon to establish a corporate structure in one of the following jurisdictions: European Union, United Kingdom, United States or Canada. Because of issues of transparency FIDE would have preferred if they have established this corporate structure in one of these areas. His letter has been approved.

Mr. Merenzon [Agon CEO] said in the next few months they will register Agon in United Kingdom and all financial and ownership details about the company will be public. The General Assembly ratified the recommendation of the Executive Board for FIDE to send a letter to Agon regarding jurisdiction of the company and sign the same agreement with the new entity.

The General Assembly ratified the recommendation of the Executive Board for FIDE to send a letter to Agon regarding jurisdiction of the company and sign the same agreement with the new entity.

Annex 94 is a presentation from Agon.

All annexes can be found by following the links in my 'Spectating' post. I captured part of the presentation in a post on my main blog Agon Presentation (September 2016). One slide I hadn't seen before is shown below.

Official National Sponsor Package
Sponsorship of the National Player

The next paragraph explains further.

Mr. Merenzon presented his report. He started with the changes in the Grand Prix format. From now 24 players can take part in the Grand Prix Series instead of 12 and it will last 11 days instead of 16. He said they are setting up a sponsorship model where FIDE and local federations have sponsors. They are also paying for the prize fund so it will be much cheaper to organize an event. At the same time they have the idea to sell sponsorships not only for the events but for the players. The cycle is planned to be exactly 2 years which makes things easier for the sponsors.

Regarding the upcoming World Championship match in New York, he presented the venue. He also said that VIP area will become a main revenue stream as they will sell access to it. The area will have good catering, special guests like celebrities and commentators which will make it a great experience. They are partners with an agency which is called CAA (Creative Artists Agency). It is the most famous sports agency in the world selling hospitality packages for Formula 1, top football clubs etc and now they will offer hospitality packages for chess and they will test it as a revenue opportunity. They are also changing the spectators' area. The players will be playing in a sound proof glass box so the experience of enjoying chess as a spectator will be completely different, spectators will be free to use their phones, talk and discuss the moves. They tried this in Moscow during the Candidates Tournaments, it worked fine and they are now improving on this method.

They are working with FIDE to make sure that anti-cheating rules are followed and at the same time the visitors are being taken care of. Another thing they are doing is that every day there is going to be first move ceremony in the Match, they are bringing celebrities, members of charities and other important people, so they are making it a media event in every first move. He also introduced new technology decisions for the match. They have developed a new broadcasting system and they are also working for protecting the moves legally. In Moscow they banned all other sites from broadcasting moves.

Their point was that according to laws which apply in Russia, USA and other countries, if it costs money to produce an event those who spend the money [own] the live broadcast. They worked with a top US law firm to produce a legal opinion on this and also spoke to US Southern Court which confirmed that they are right. What they will be doing now is something different, there is currently a new reality in chess, the game has over 1 billion downloads, chess is in almost all smartphones and the number of people playing chess has increased dramatically.

For the first time in any sports the World Championship is going to be broadcasted in 360 degrees virtual reality. That means that everyone around the world can download the application and be in the room with the players. They can be closer to the action than ever before. The cameras will be placed between the players so the match could be seen through the player's eyes. They can also wear 3D glasses. The cardboard with the glasses will just cost a dollar. They are producing a lot of them to give them to schools and also inside the venue. They will also have multiple cameras inside the playing room to choose from.

Regarding the dashboard, he said that they have been criticized for not offering the best online viewers experience so they worked with FIDE and other chess organizers and he believes they developed the best possible dashboard for chess, there is analytics, chats, multifunctional boards and other great features. They are also introducing [pay per] view like many other sports have done. There will still be free version as well, anyone can go into the official website and follow the moves but if somebody would like to get premium features like the 360 degrees video, they are charging for it. The model is call freemium. For him this is the best approach to make chess sustainable in the 21st century.

They are building a studio and it is going to be fun to watch chess which means it will not be targeted only to chess players. It is also the first World Chess Championship for the iPhone generation. In general the price for the premium features (right to ask online questions during press conferences, analytics, 360 degrees video etc) will be 15 dollars for the whole tournament, for 45 dollars they are selling subscription to the next cycle which includes the next Championship Match, all the Grand Prix and the Candidates Matches, for 99 dollars they will sell all of that plus premium gifts like signed posters, pins and other souvenirs.

He said that Mr. Carlsen is a huge supporter of this concept. He thinks chess will never go back to free and that this approach creates good reasons for the federations to develop their membership. So building communities and offering to their members subscriptions for events will be a way to bring revenue to the federations and further to the whole sport.

He explained that generally chess has a huge potential and the market size is very big, there are 300.000 paying subscribers in top 5 chess sites, 4.4 million who follow chess events and the overall market is even bigger, 35 million who regularly play chess online on top 5 sites. According to US studies, more people play chess than tennis and golf combined so the marketing opportunity is amazing. They would like to get partnerships with federations so they will send them an email with the option of signing up. They will offer affiliate programs. They will use selected partners: federations, major medias and chess websites so they will be able to follow the games on their media if they want to but if they prefer premium subscription the federation or the chess site will get commission.

This was followed by a Q&A where the 'protection of live transmission rights' was the main topic. Two months after the Congress, Agon's position was struck down by the courts; see my post World Championship Bullying (November 2016), for more on this.

The Grand Prix changes mentioned in the first paragraph above are also significant. Let's skip ahead in the minutes to the discussion of the group sometimes called the WCOC.

5.20. Commission on World Championship and Olympiads

5.20.1. FIDE World Cup 2017. • The event shall be held in Tbilisi, Georgia, 1-25 September 2017. Mr. Azmaiparashvili asked for permission to move the event to Batumi and to start on 15th September in case it is not clashing with other events. He said the hotel prices will be cheaper. He said only the final match will be held in Tbilisi and the organisers will cover the expenses for that extra day.

5.20.2. FIDE World Cup 2019. • The event shall be held in Khanty-Mansiysk, Russia, dates to be provided.

5.20.3. FIDE World Championship Match 2016. • The event shall be held in New York, USA, 11-30 November 2016.

5.20.4. FIDE Candidates’ Tournament 2016. • Annex 40 is Chief Arbiter’s report.

5.20.5. FIDE Grand-Prix series 2016-2017. • [...] Annex 41 is Regulations for the 2016-2017 FIDE World Chess Grand-Prix series. Mr. Merenzon informed about the Grand Prix Series in his presentation.

5.20.6. FIDE Women’s Grand-Prix series 2015-2016. • [...]

5.20.7. FIDE Women’s World Championship 2016. • Mr. Makropoulos advised that Tehran was interested in bidding and recommended that it be awarded to Tehran should the offer be acceptable. The General Assembly awarded the organization of the Women’s World Championship to Tehran, Iran, February 2017, provided the terms of the offer are acceptable.

5.20.8. FIDE Women’s World Championship Match 2017. • The event will be moved to the beginning of 2018. Bidding procedure will begin once the winner of the previous Championship is known.

5.20.9. FIDE Women’s World Championship 2018. • The event has been awarded to Khanty-Mansiysk, Russia.

From Annex 41, 'Regulations for the 2016-2017 FIDE World Chess Grand-Prix Series':-

1. Introduction

1.1. Following the approval of the FIDE Presidential Board, the World Championship and Olympiad Commission of FIDE (WCOC) has agreed on these Regulations which will apply to the Grand Prix Series which forms part of the World Championship Cycle for 2016-2018. [...]

2. Format of the Grand Prix 2016-2017

The Grand Prix Series will consist of four tournaments to be held over two years (2016-2017). 24 top players will be selected in accordance with Section 3 below to compete in these tournaments. Each player agrees and will contract to participate in exactly 3 of these 4 tournaments. [...] Each tournament will have 18 players with a schedule of a nine (9) round swiss system. The dates scheduled for the Grand Prix tournaments are listed on the FIDE website and may be subject to change. The winner and second placed player overall of the Grand Prix Series will qualify for the Candidates Tournament to be held in the first half of 2018. [...]

3. Qualifiers for the Grand Prix 2016-2017

The players who qualify for selection to play in the Grand Prix Series will be chosen on the following prioritised basis until 24 players have accepted:

3.1 World Championship Match: The current World Champion and his opponent in the most recent World Championship Match (2 players).

3.2 World Cup: The players who have qualified to the semi-final stage of the FIDE World Cup 2015 (4 players).

3.3 FIDE Rating: Based on an average calculation [...] (8 players).

3.4 ACP Tour: The one (1) highest-placed participant of the most recently completed ACP Tour, who has not qualified with the previous criteria (1 player).

3.5 Organiser Nominees: Nine (9) players nominated by AGON with a published rating in classical (standard) chess of at least 2700, in at least one FIDE rating list of 2016 (9 players).

3.6 Replacements. [...]

Not to be forgotten in all of this are the ongoing U.S. Treasury sanctions against FIDE President Ilyumzhinov. I covered this in my previous 'Spectating' post and have nothing more to add here.

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