Esports has grabbed the attention of more than just the gaming industry, and for good reason.
The industry’s rapid rise has benefited from numerous omnichannel platforms that allow for unprecedented viewership and engagement from a diverse audience. With the “new abnormal” defined by Covid-19, esports has proven that media consumption is not just about what people can watch on the major networks. Instead, people are turning to streaming platforms like Twitch and YouTube for competitive-based content.
Today, more than 1.5 billion people are aware of esports, while approximately 500 million people make up its audience. By 2023, this figure is expected to grow to more than 650 million. In terms of viewership, major esports events are gaining ground against professional sporting events produced by the NBA, NHL, Formula 1, NASCAR and NFL. Starting in March, esports gained the attention of these leagues (which were largely shut down for months) and numerous others as it consistently gained new followers and partnerships despite the pandemic.
Esports encompasses organized video game-based competitions. Players can compete via several platforms, but the PC remains the preferred choice of hardcore gamers. PCs utilized by these players rely on multiple processors and robust graphic capabilities. Hardware companies like Alienware and D-Wave continue to focus on this area of investment to provide these players with high-level products.
Alternatively, consoles such as Sony’s PlayStation products, Microsoft’s Xbox, and Nintendo’s products offer simple, yet advanced platforms for gaming. These consoles are inclusive of almost everything needed for advanced gaming, including items and add-ons such as virtual reality headsets and haptic controllers.
Players also can participate via mobile gaming applications including those offered by Google and Apple. While this is the fastest-growing segment for the casual gamer base, it’s still limited in terms of screen real estate, processing power and controls. Regardless, it provides one-device access to entertainment on the go and has proven to be popular for certain games such as “Call of Duty: Mobile” and “Mobile Legends.” With streaming applications like AirPlay and SmartCast, players are also given the ability to play and consume content via their phone and TV. This has further enhanced the gaming experience and engaged the player base.
Views and Revenue
Platforms such as Twitch (Amazon) have as many as 1.4 million daily active viewers. According to TwitchTracker, more than 650 billion minutes of content was streamed in 2019, with more than 55,000 live streaming channels available to viewers at any time. This included an average of 13,000 games streamed weekly. So far in 2020, more than 590 billion minutes of content has been streamed, representing 54 percent growth over this time last year.
The esports market is well established in North America, China, Japan and throughout Europe. According to Newzoo, as a result of its prevalence in these major markets, global esports revenue reached nearly $1.1 billion in 2019 and is expected to reach upwards of $1.5 billion in 2020 and nearly $2.6 billion in 2023. It’s estimated that approximately 40 percent of this revenue was driven by North American patrons alone, with most of that revenue generated through sponsorships.
However, esports provide multiple options for investors seeking brand exposure, as well as other opportunities for the gaming industry specifically, namely wagering. Industry stakeholders benefit from a diverse array of revenue streams, including media rights, sponsorships, branding, content licensing, game publisher fees, ticket sales, merchandising, entry fees, arcade time, viewership, advertising, in-game purchasing and digital economies.
Article courtesy of Global Gaming Business Magazine