The eSports economy will grow to $696 million this year, according to Newzoo’s latest report—a year-on-year growth of 41 percent that will reach $1.5 billion by 2020. Brands will contribute $516 million of this growth in 2017, the analyst firm predicts, and investments will more than double over the next three years. In addition, the sales of eSports content licenses are expected to generate $95 million this year on a global scale, up 81 percent from 2016.
Consumer spending this year on tickets and merchandise will amount to $64 million, with another $98 million to be invested by game publishers through partnership deals with white-label organizers.
The World Is Watching
According to Newzoo’s 2017 Global ESports Market Report, the global eSports audience will reach 385 million in 2017—made up of 191 million eSports enthusiasts and a further 194 million occasional viewers. This fandom is expected to keep on growing by another 50 percent, totaling 286 million by 2020. With revenues of $257 million expected this year ($113 million of which are sponsorships), North America is the largest eSports market that will reach $607 million by 2020. With its 25 million enthusiasts, North America generates twice as much revenue per year than in any other region.
Gambling In ESports? You Bet!
“With most big betting companies already embracing eSports betting on a global scale,” Newzoo stated, “it’s possible that eSports betting alone is larger than the eSports economy itself.” Betting companies see eSports as a huge “blue ocean” opportunity and while betting on professional gaming has been around for many years, Newzoo noted, it does not require the involvement of any eSports companies to organize.
Compared to betting on traditional sports, the eSports economy stands to make significant income outside of sponsorships and media rights. Newzoo used the NFL as an example, having generated $13 billion last year—but betting and fantasy leagues around the NFL games are supposed to have made north of $50 billion.
“ESports is not only growing exponentially as a new independent business and industry, it is also accelerating the convergence of various established industries,” commented Newzoo CEO Peter Warman. “For brands, media and entertainment companies, eSports provides a chance to capitalize on the favorite pastime of digital natives and millennials: playing games and watching game content. With the arrival of livestreams and events, gaming has entered the realm of broadcasters and media that can now apply their advertising business model to a market previously out of reach for them.”
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