Esports has become a global phenomenon over recent years. What started out as a niche sport, enjoyed only by a handful on the fringes of the gaming community, has now grown into a multi-million dollar industry.
Nowadays, Esports even threatens to surpass traditional sports in key metrics. Not convinced? Let’s do a little comparison.
The Super Bowl, the grand final of the NFL season, typically nets about 110 million viewers.
In 2018, the League of Legends World Championships final series, an event comparable to the Super Bowl in the world of Esports, garnered 99.6 million viewers. Mad, right?
Clearly, then, Esports is a seriously popular form of entertainment. But just how big is the Esports industry, and where is it headed? We’ll answer these questions in this article.
First, however, let’s do the basics. What exactly is Esports?
What Is Esports?
Esports, short for ‘Electronic sports’, is a form of competition using video games. They typically take the form of organized multi-player competitions between professional players, competing either as teams or as individuals.
The games played in Esports are as varied as the genres of games in the video game industry itself.
From battle-royales and sports games to multiplayer online battle arenas (MOBAs), if the demand is there for it, it’s played competitively as an Esport.
Organized gaming competitions have in fact been a part of video-game culture for decades, with competitions between amateurs happening as far back as the early 1970s.
However, it is only since the late 2000s, with the advent of professional gamers and live streaming services, that Esports has properly gained traction.
In recent years popular games such as League of Legends, Dota 2, Counter Strike Global Offensive, and Fortnite have helped Esports to flourish.
How Big Is The Esports Industry?
Ok, so the League of Legends World Championships nearly had as many viewers as the Super Bowl in 2018. But can the industry as a whole really be that big? Perhaps unsurprisingly, the answer is yes.
Growth had been steady in the early 2010s, but in recent years Esports has exploded in popularity.
Previously familiar only to those within a fringe community of gamers, Esports is now starting to move out of the shadows and integrating into the mainstream.
Estimates abound as to exactly how much the industry is worth, but it is certainly over $1bn. Forecasts have suggested that this will climb to $1.6bn by 2023, with the industry maintaining an impressive 15% growth rate.
Viewership figures are massive and growing at an impressive rate. In fact, estimates suggest there will be 29.6 million monthly Esports viewers in 2022, up 11.5% from the previous year.
Key Industry Trends
More Big-Name Brand Sponsorships
Like in traditional sport these days, the vast majority of the revenue created in the Esports industry comes from sponsorships, broadcasting rights, and media deals.
As with traditional sports, Red Bull is one of the biggest sponsors of Esports. Monster Energy is heavily involved too, as are computer hardware companies like Intel and Alienware, as you would expect.
But plenty of businesses have moved into the space recently that have no vested interest in the industry.
Amazon (European Championships), NASCAR (Allied Esports) and Mastercard (League of Legends European Championship) have moved into the industry.
Whilst giants like Coca-Cola and BMW have been sponsoring some of the biggest Esports organizations and competitions for a few years.
Crypto Esports Sponsorships
Crypto has begun infiltrating the sports market in recent years, and Esports is no different.
Unsurprisingly given the similar target demographics of both industries, crypto exchanges have been doing more and more partnerships with Esports teams and one would expect that trend to continue over the next five years.
Hong Kong based FTX did a ten-year deal worth $210 million with American Esports organization TSM IN 2021, with similar deals being done by Crypto.com and Coinbase with Esports organizations in the U.K and Germany.
Market Growth Away From Asia
The Asia-Pacific market (APAC) is the largest in the industry, with a majority of Esports viewership being concentrated in this market. There are 1.5 billion gamers there, many of whom are already switched onto Esports.
But what about elsewhere? There are hundreds of millions of gamers across the rest of the globe who have yet to be introduced to Esports.
Particular areas of interest would be Europe, which only accounts for about 10-15% of Esports revenues, and Latin America.
Many people argue that mobile gaming is the future of gaming, and many would say that makes it the future of ESports, too.
Whilst gaming remains quite a niche market, nearly everybody, particularly in developed countries, has access to a smartphone.
The potential size of the mobile gaming market is jaw-dropping, and in fact, already constitutes a slight majority of the $173 billion worldwide gaming market.
Popular competitive games like PUBG and Fortnite have already gone mobile, so it feels like a matter of time before Esports on mobile gains traction.
It might not be the most morally sound revenue stream, but betting is big business in sport.
There’s no reason why that won’t be the case with Esports, too, and indeed one of the biggest sponsors of Esports out there already is Betway, which has even created its own Betway Esports brand.
Expect more betting companies to move into the space, and to bring some of betting’s more recent innovations- like live in-play betting- with them.
The Esports Industry: A Bright Future
The Esports industry is unquestionably one of the biggest potential growth industries in the world today. The market is already worth over $1bn and that is certain to increase in the coming years.
What was once the preserve of a tiny subset of society is moving into the mainstream.
Many of the trappings and trends of traditional sport will come with this growth: Esports betting, as well as sponsorships and partnerships with big name brands and crypto-currency exchanges, are the future.
Couple this with almost unparalleled growth potential, both from untapped gaming markets and in the form of mobile Esports, and the future looks bright for the industry.
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