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Capcom’s new Community License for Street Fighter V tournaments is a dangerous misfire

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By Shiburizu | March 1, 2022

Capcom’s foray into another year of supporting competitive Street Fighter V has begun with a controversial new precedent. On Monday afternoon Capcom announced the Street Fighter V Community License Agreement via the Capcom Fighters Twitter account, which is a set of policies that events must comply with so the organizers can apply for legal permissions to run SFV tournaments. The policy has left many organizers and players with more questions than answers and threatens to poison the well for grassroots Street Fighter in a totally unnecessary way. Let’s talk about the License and what it could mean for Street Fighter’s presence in tournaments if this remains as-is.

The Street Fighter V Community License Agreement

It’s not unusual for a developer/publisher to set out terms for any sponsorship or affiliation program for a game. These programs have become highly popular with the most recent generation following the long running success of the Capcom Pro Tour’s affiliation to offline majors. The Tekken Dojo system, SNK’s Esports Support Program and Melty Blood Type Lumina Event Support are just a few examples of companies stepping in to back up grassroots events in various ways. Where the Street Fighter V Community License Agreement (henceforth called “License”) is different is that no compliance means no Street Fighter V tournament in any capacity:

This Street Fighter V Community License Agreement (the “Agreement”) sets out the terms and conditions under which you may use the Game in community tournament events.

BY CLICKING THE “ACCEPT” BUTTON, YOU AGREE THAT THIS AGREEMENT IS ENFORCEABLE LIKE ANY WRITTEN CONTRACT SIGNED BY YOU AND CAPCOM U.S.A., INC. (“Capcom”). IF YOU DO NOT AGREE TO THIS AGREEMENT, DO NOT USE THE STREET FIGHTER V SERIES (THE “GAME”) FOR ORGANIZING OR HOSTING A TOURNAMENT.

This License currently has 2 versions applicable to the Americas and EMEA (Europe, Middle East and Africa) regions. You may mistakenly read this as a document intended for events affiliated to a future Capcom tournament program because of the CPT regional branding on the page, however the License requires you make it explicit that you receive no support and have no affiliation:

No Capcom Affiliation. You cannot promote Your Event in a way that suggests that Your Event is endorsed by or affiliated with Capcom or our licensors in any manner. You cannot use Capcom’s company logos or trademarks (e.g., CAPCOM) to promote your Event. Furthermore, you must include the following statement in a prominent place on Your Event website and other key marketing materials: “This event is not affiliated with or sponsored by Capcom”. Do not incorporate Street Fighter intellectual property, the Street Fighter name, or the Street Fighter logo into Your Event name or visual advertising.

A Capcom representative has already stated on Twitter that the choice of using CPT branding was a mistake.

It’s clear now that Capcom wants a say in what you can or can’t do at a Street Fighter V tournament, so what are the demands?

Your $10 entry fee might be too esports for Capcom

For many organizers interested in compliance with the License, the troubles begin right at Section II titled “Qualification Criteria”:

Qualification Criteria

  • In order to be qualified as an Event, Your community tournament event must meet the following Criteria:

    • Your Event involves gameplay of the Game by participants.
    • The prize pool for the Event must be set and clearly disclosed in advance of the Event in the Event Rules (see Section III(1)) and must be under $2,000 USD per Event.
    • The total prize pool within any given 12-month period must be under $10,000 USD.
    • The sponsorship contributions must be under $5,000 USD per Event.
    • The total sponsorship contributions within any given 12-month period must be under $20,000 USD.
    • No cable or over-the-air TV broadcasts are permitted.
    • No manufacturing or sale of merchandise products based upon the Game Assets are permitted.
    • You may not charge any fee to spectators to participate in an Event

  • For the avoidance of doubt, this Agreement only covers Events and does not grant a license to operate permanent commercial establishments (e.g., arcades, e-sports bars).

  • If Your event is beyond the scope of the Criteria set forth above, You will need to apply for an e-sports license according to Section IX below.

On the face of it, requiring that Capcom be consulted (and often compensated) for usage of its intellectual property at popular tournaments with lots of cash being thrown around is not bad or even new. If you’re interested in an outside example, Blizzard’s license agreements look very similar to what is stipulated above. However, several points of this criteria very blatantly fly in the face of what community events are used to and indeed what the precedent for these agreements is.

The condition that a prize pool be “set and clearly disclosed in advance of the Event” runs afoul of the way paid entry fees and crowdfunding programs like Matcherino have come to benefit the FGC. Generally entry fee to the tournament becomes money for a prize pot and this can’t be disclosed ahead of time owing to on-site registration or player attendance spiking or falling at the last second. Matcherino is an excellent service that provides crowdfunding for gaming tournaments and only requires that spectators take a few seconds to contribute the redemption of coupon codes, participation in advertising campaigns or outright donations to the pot, which is pretty much always done while the tournament is running and has become a common talking point during the down time on live streams.

Assuming the challenge presented above can be resolved by the organizers, the prize pool limitations are ridiculously prohibitive: It only takes a 20-strong weekly with $10 entry fee running every week of the year to run afoul of the $10,000 limit per 12-month period and require this mysterious “e-sports license” which Capcom has provided no public details for. Larger recurring tournaments such as Next Level Battle Circuit can also run afoul of the $2,000 prize pool limit per Event on frequent occasion. At least NLBC head Spooky has said he would apply for this e-sports license if Capcom deemed it necessary.

There are a few other stipulations in here that just suck: The prohibition of products based on the game threatens the presence of artist alleys, the license refuses coverage for commercial establishments where often times locals are established through patronage to bars or gaming centers, and the common practice of charging spectator fees to help cover event costs is a no-no. Other gross morsels of greed in this document include an exclusive license to using your footage with no compensation or notice (not necessarily new, just a bad look on this License) and prohibiting paywalled video content. With services like Patreon and YouTube introducing locking videos behind membership fees to incentivize creator support it certainly feels like Capcom has found just about every way to keep your local organizer broke so long as they run Street Fighter V.

The E-sports license

Capcom gives no details about what you can do to get around any of the criteria except for apply for an e-sports license. Long time Capcom community figure and attorney at law in the United States UltraDavid published an analysis of the License and said the following about how negotiations generally go:

What will licenses look like for events that don’t satisfy the above criteria and are therefore classified as esports events? Short answer: I don’t know. I haven’t seen any recent licensing agreements between Capcom and any events it considers to be esports, so I can’t speak directly on this.

However, from my previous work with TO and broadcaster clients in both the FGC and other esports, I can say that these non-community licenses have usually required substantial payments to the rights holder, up to the five and occasionally even six-figure range. I want to be clear that that’s not always the case; I’ve seen even very large rights holders come to agreements with TOs and broadcasters with no licensing fees. But even in those cases, there are often other requirements like giving the rights holder some power over venue choice, layout decisions, event date, third party sponsorship choices, and more that can have major financial impacts even aside from licensing fees.

This paints a very bleak picture for trying to run an event beyond the scope of the criteria for a Community License. I highly recommend the full writeup. It’s already common practice and legally required in many cases for organizers of majors both offline and online to consult the license holders and pay these fees or negotiate terms in order to bring you your favorite fighting game to the big stage. What isn’t common is waving this in the face of every single person interested in organizing a Street Fighter V tournament in multiple continents. This just scares off prospective organizers and the communities they are attached to. Schamtoo on Twitter put it succinctly:

https://twitter.com/Schamtoo/status/1498471841869877253?s=20&t=3frIfOc8v_fZJbUi-WPggg

The community reacts

It’s safe to say that many people in the larger fighting game community think the implementation of this License sucks all around:

Commenters have made comparisons to Nintendo’s rampant copyright strikes against grassroots Smash events, while others worry that Capcom is simply going to lose all of the goodwill built up over Street Fighter V’s lifespan with the looming threat of legal action for events that fail to comply. You don’t make rules you don’t intend to enforce, and now a time bomb has been planted where an event may be forced to cancel Street Fighter V’s presence or be punished for noncompliance with legal action from Capcom. I do not look forward to the community’s reaction when this inevitably comes to pass.

It doesn’t help that the Community License is just one of many tabs on the Capcom Pro Tour website with no clear indication that this change is in effect. While ignorance is not innocence, it will simply cost someone far too much to run astray of these ridiculous rules in only a matter of time. What will likely happen for events in the know is that they will weigh the cost of compliance versus phasing out or replacing Street Fighter V and find it all too easy to find plenty of other perfectly good fighting games with active competition in 2022.

Revisions are promised

After a day of online reactions, Capcom has responded with a statement on Twitter:

Yesterday, we published the new Street Fighter V Community License Agreement for both The Americas and EMEA. Our aim was to make running an event with SFV:CE easier. When TOs have contacted Capcom about running community events with SFV:CE in the past, the approval process has always taken a lot of time. We want to make the rules clear and to allow much faster approvals. We’re also keen to build tighter relationships with TOs and to encourage safe spaces to play SFV:CE. Thank you to everyone who has sent us feedback thus far on the new agreement. We are reviewing this feedback with the wider Capcom team and will follow-up with more updates soon.

While the above statement implies the strong community response will result in changes we do not have specifics and the License Agreement has not been withdrawn, meaning the terms laid out still stand.

The Editor’s take

It is as confusing as it is disgusting that a company which was once leagues ahead of everyone else with the Capcom Pro Tour publish such an ill-conceived policy. While I acknowledge that many good things can come from such policies and that Capcom is likely to respond to feedback in a constructive way, I insist that the License Agreement as it stands be withdrawn and revised without impacting the community. Now organizers must be consulted and feedback shall be taken meanwhile many venues will simply withdraw from running Street Fighter V until more reasonable criteria arrives, at which point they may simply decide there is more competition to be had elsewhere. This License is a mistake, and damages the long term future for Capcom in the FGC.

Oh, and you get some image assets to use for your event promotion if you do get a license. See you in Street Fighter 6!

SuperCombo.gg attempted to reach out to Matthew Edwards, Senior Community & Esports Manager for Capcom Europe for input prior to the publication of this article but did not receive a response.

 

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