(CelebrityAccess) Esports revenue is expected to exceed $900 million this year and is expected to break the billion-dollar mark in 2020, according to an industry report from Futuresource Consulting.
The rise of esports continues to present opportunities for pro AV, IT and broadcast companies, according to Futuresource.
“Esports has been around for a while, but is now really starting to enter the mainstream,” said Adam Cox, Senior Analyst – Imaging & Pro Video at Futuresource Consulting. “It’s riding a rising wave of consumer awareness, as celebrities and traditional sports teams get involved, household brand names take a piece of the sponsorship pie, and the likes of Turner, BBC and Sky invest in content acquisition and production.
“Key events such as Dota 2 are now enjoying viewing figures comparable to major conventional sporting events. As a result, securing exclusivity of major esports tournaments will become increasingly strategically important for both traditional sports broadcasters and established esports platforms such as Amazon-owned Twitch.”
The largest audience for esports has traditionally been in Asia, much of it in South Korea and China. However, high levels of growth have been tracked in North America and Europe, much coming from high levels of consumer spending power. Many venues have been built solely focused on the advent of esports as a live event.
German live entertainment company DEAG Deutsche Entertainment Aktiengesellschaft (DEAG) recently announced its subsidiary Handwerker Promotion e. GmbH, was forming a partnership with Wizard Promotions Konzertagentur GmbH and eSports specialist Ally4ever Entertainment GmbH, to establish a unique eSport stadium event in Germany. Meanwhile, Spectra, which is planning on building a $50 million esports arena, recently announced the hiring of Joe Heyer, who will oversee sponsorship sales for the company’s growing esports portfolio including the Philadelphia Fusion, the new Fusion Arena and N3rd Street Gaming.
“Esports currently caters for a global audience of approximately 410 million fans,” Cox said. “As organizers seek to attract older demographics and more females to the sector, we expect global audiences to almost double by 2023. This will result from a rise in popularity in emerging regions, as well as wider appeal in established markets.
“Sponsorship accounts for the majority share of industry income, contributing to over 40% of total revenues. With all the buzz around the sector and the promise of mainstream success, established esports sponsors such as Intel, Razer and HyperX are now being joined by non-incumbent brands such as Coca Cola, McDonald’s and Mercedes Benz. This is triggering significant tournament prize pools, with global prizes totaling $205 million for the 4,000 plus events hosted last year. In comparison, men’s tennis ATP Tour’s prize pool for 2018 totaled $135 million. We’re seeing a virtuous circle that can only increase the exposure and profitability of esports.”