Most likely, you have heard about esports. Moreover, most of you regularly check betting tips for future professional games. But still… it is unclear to you what they represent, especially all the intrinsic business potential of this market.
Esports transform online gaming into a real sport, followed by thousands, if not millions, of live or streaming viewers. Like in traditional sports, fans can enjoy watching their favourite athletes compete in various games. Professional players in this industry compete in different tournaments, and spectators can entertain themselves by having the same community experience as traditional sports.
The consequences of the pandemic
Before the forced closure due to Covid-19, most players were already widely followed through online channels. Still, this event significantly increased the “virtual” audience. Furthermore, during the lockdown, it was found that esports enthusiasts increased the hours of play on PC (48%), as well as had a positive impact on streaming and on-demand purchases (15%), the video game downloads (15%), and in-game purchases (11%).
More than 40% of fans said the closing period impacted their time watching online esports events and playing video games.
The different realities of esports
The video game industry has had an incredible explosion in recent years, thanks to the different ways you can play today. It would seem that the main reason for the growth is the innovative game modes now available to the public, such as mobile gaming.
Esports aren’t just for Generation Z or millennials anymore
Today, this sector presents numerous opportunities for technology specialists, programmers, network operators, event organizers, and game developers. But only! Due to continuously expanding, the demand for jobs in esports-related areas will be increasing too. The eSports companies will need personnel for event management, facilities management, marketing, engineering, artificial intelligence, virtual reality, and more.
Because of this incredible market growth, traders also are looking for opportunities in the esports sector. Today there are five main areas of profitable activity in the industry:
- Team ownership/franchise
Teams can create revenue streams independently, just like traditional sports teams. For video games for which leagues have been made, publishers may also decide to sell the “teams” that can participate in those leagues.
- Advertising rights
Ad deals have already been made with several major platforms, and analysis shows they will be the fastest-growing source of revenue, reaching $506 million by 2023.
- Tickets
Revenue from ticket sales for esports events will rise to $706 million by 2023.
- Sponsorships and advertisements
These are currently the largest source of revenue. It is also estimated that sponsorships and ads will reach $724 million in 2023.
2. Betting
Betting on esports has not yet been legalized around the world. Indeed, each country has different rules and regulations regarding sports and betting. Allowing esports companies to partner with betting companies could be a game changer for the industry, and this is already starting to happen.
These various revenue opportunities are also tempting traditional sports stakeholders. Major professional sports clubs have begun buying and creating esports companies, such as the NBA, which launched the NBA2K league. While the number of spectators is similar to that of some professional sports and the gap with others (i.e. NFL) is closing, the revenues are lower due to the relatively early stage and evolving platform.
Football star David Beckham has also launched an esports team where he will assist in coaching. He also plans to launch various programs for young esports players.
The esports market is innovative, has an agile infrastructure, and passionate users support the market. But these strengths are accompanied by a lack of industry regulation.
Can esports be considered a sport?
The equation of esports with traditional sports is one of the most controversial and debated issues of recent years. It is since there is no shared definition among everyone. Just as there is no generalized sharing of which video games can be considered esports and which ones should remain outside this category. However, there have been positive signs recently. Esports have been recognized as medal sports at the 2022 Asian Games, an essential step for esports, which have long had Olympic ambitions.
The prospects
The growth of esports is closely linked to the involvement and commitment of market stakeholders. The sector is developing rapidly, and further, many countries are planning to invest in digitization which will allow the industry to have countless advantages. At the moment, all is ready for it to become one of the most exciting growth markets on the market, both for entrepreneurs and professionals.
