Esports is a competition which is held through video games. In other words, it is a gaming competition between professional gamers. The participants choose to play either individually or in teams.
The phenomenon of digital gaming has emerged because of the plethora of tech devices like iPads, Play Station, Nintendo, etc. During the late 2000s, professional gamers entered the arena. The viewership of these games also increased exponentially through live streaming.
During the past few years, esports gaming enthusiasm has surged. Developers are cashing in on the popularity of esports by creating games specifically designed for esports.
The above chart illustrates how esports has taken viewers by storm. Currently, the number of esports enthusiasts is roughly around 215 million. This figure is expected to grow to 250 million within the next two years, while the number of occasional viewers will increase to 307 million. These figures are impressive by any standard!
The Rise in Investment of Esports
World Economic Forum suggests that the number of global esport viewers will increase to 380 million with 215 million as dedicated esports enthusiasts. Also, revenues from esports are set to cross the billion-dollar mark by the end of next year.
Investors and venture capitalists are the first to recognize the immense opportunities presented by this rapidly rising phenomenon. In the U.S. alone, startup investment in esports has increased by more than a thousand percent during the last five years. In monetary terms, around $160 million was invested in 2017, with more to come shortly.
Real estate investors are also gearing up to make considerable investments in esports because high-level competitions can only occur within curated environments. With the ever-increasing fan base, the organizers of these tournaments will need more space for developing areas where both the players and viewers can have excellent gaming experience.
Since it has become a $900 million industry, some of the revenue generated by esports comes from direct investments that include advertisements and sponsorships. Esports is sponsored by several brands, including Nike and Adidas.
It has also opened opportunities for investors who prefer publicly traded stocks. Amazon became a big name in esports when it acquired Twitch a few years ago. It is a safe and stable investment. Enthusiast Gaming Holdings is another option for investors. The company successfully completed its Initial Public Offer (IPO) in 2018.
Esports Enthusiasm in Colleges
The University of Akron is planning the world’s largest esports facility which, according to its officials, will allow the institution to take a giant step into the future. It is only one out of eighty educational institutions in North America that are currently offering esports programs to its students. Some of the colleges are also providing scholarships to talented students who are good at esports.
As per experienced educationists, more universities will be building sports arenas to attract the attention of would-be students. Universities in the U.S. and Canada have recognized the vast potential in esports and do not shy away from investing in this gaming sector.
Who Watches Esports?
One of the main reasons for the rising popularity of esports is the fact that it is continuously evolving. Take for example baseball and football – two of the most popular and widely followed games in the U.S. While still wildly popular among viewers, both these games fail to offer variety apart from some occasional minor changes in the rules.
Esports, on the other hand, offers and bet on football the kind of variance that traditional games cannot provide. First, there are a few games to choose from. Second, game developers are continually coming up with novel gaming concepts. With each new game, even a seasoned gamer must learn new techniques and come up with his/her own formulae for cracking level after level of the game.
Esports’ ability to come up with new games, and the gamers’ ability to learn to crack them, is what keeps the interest of the viewer heightened at all times. Unlike traditional games where a player may dominate the scene for years, esports competition may see an amateur gamer unexpectedly beating a seasoned pro. The uncertainty and the thrill keep both the gamer and the viewer on their toes throughout the tournament.
Betting in Esports
Betting is part and parcel of any kind of spectator sport. Esports in no exception to this rule. Total global esports wagers has crossed the 7 billion-dollar mark. By the end of next year – 2020 – the amount is set to double. Here is an illustration of the esports betting market.
Esports betting market has had a boost after the Supreme Court did away with the Professional and Amateur Sports Protection Act (PASPA) last May. The act, commonly known as PASPA, made sports betting unlawful.
After PASPA was struck down, it became the prerogative of each state in the U.S. to regulate sports betting as they deemed fit. Four states – Mississippi, Nevada, New Jersey, and Delaware – have legalized sports betting. There is a chance that the rest of the states will follow suit.
Betting on esports is almost like betting in traditional sports where bets are placed on the outcome of esports competition. Most of the esports betting is carried out through cash.
Esports is an emerging entertainment genre. There are several stakeholders in the esports ecosystem, but the most important among all of them are the publishers who create and own these games.
The esports market has been growing at a rapid pace – around 32% CAGR over the past six years. China and North America are leading this growth. This exponential growth is spawned by the increase in esports viewership on the one hand and matching growth in the revenue’s streams linked with the phenomenon.
Global esports related revenue will reach $900 million towards the end of the current year, with 40% of earned income coming from sponsorship fees paid to organizers. This number will likely crease to more than 1.5 billion within the next two years.
As of now, the majority of esports viewers are males between 21 and 35 years of age. Yet, the interest in this gaming sector is increasing with more age groups coming into the fold.
Sustained growth in esports means more and more talent will be making its way into the arena. There will be an increase in the number of esports tournaments and a proportional increase in the development of dedicated spaces for holding these tournaments.
Prize pools will also increase gradually, rendering it more lucrative for the young and ambitious. An increasing number of universities are cultivating their own esports teams. Scholarships are being awarded to skilled gamers.
There is every possibility that the International Olympic Committee will include esports in the upcoming competitions to be held in 2024.
The Wrap Up
Electronic sports and gaming have evolved with technological progress in gaming concept and design. Only a few years ago, it was considered the niche of young – often regarded as weird – population. As the esports phenomenon made its way into the mainstream, more and more people joined this unique gaming environment.
All the indicators point towards growth of esports in the future. This growth will be spearheaded above all, by the creators of the games and the enthusiasm of those who play them.