A few decades ago, the term ‘esports’ (electronic sports, or competitive video gaming) barely existed. Today, it’s an industry that generates around $1 billion from sponsorships, media rights, merchandise, streaming and more, according to analyst firm Newzoo, with an estimated 495 million viewers.
A few decades ago, the term ‘esports’ (electronic sports, or competitive video gaming) barely existed. Today, it’s an industry that generates around $1 billion from sponsorships, media rights, merchandise, streaming and more, according to analyst firm Newzoo, with an estimated 495 million viewers.
These figures are set to rise to $1.6 billion and 646 million viewers by 2023, but can it be considered a mainstream form of entertainment?
If you compare this to the world’s biggest sport, football, which FIFA claims has five billion fans around the world, esports is not quite in the same league. But the above numbers put it alongside the likes of rugby, baseball and basketball, and some reports have claimed that esports is even bigger than other sports.
Then there’s the general awareness compared to sports – esports has a lot of catching up to do. Team Liquid are not as well known as Manchester United. The League of Legends European Championship (LEC) is not the Premier League. Lee "Faker" Sang-hyeok may be a god among gamers, but he’s not quite a household name like David Beckham is. (And even Becks is getting involved in esports now.)
However, it’s almost disingenuous to directly compare esports to sports. Yes, they share similarities – in terms of the spectator element, team storylines and the performance factor – but there are big differences too. Esports is sedentary, the rules are set by individual game publishers rather than larger associations, and new games can emerge fast, shaking up the ecosystem. It’s also worth noting that esports is a blanket term for several competitive games. A fan of League of Legends might not be a fan of Counter-Strike, just as a football fanatic may not follow golf.
Let’s look beyond the numbers and those surface differences to explore the real state – and stature – of esports right now.
Broadcaster backing
Esports has found a home on digital platforms like YouTube and at times even Facebook. But it’s Amazon-owned Twitch that’s most prevalent in the live-streaming world, with top streamers and channels drawing millions of followers. It has its own unique culture and interaction is key – viewers can ask questions, have discussions and contribute to broadcasts in real-time.
For Twitch, it’s not a case of esports becoming mainstream, because to them, it always has been. Pontus Eskilsson, VP Partnerships EMEA, says: “Streaming of esports has actually been around since as early as the ‘90s. However, it wasn't until 2009/10 that esports started to become accessible to a broader audience when Twitch's predecessor, Justin.tv, and other streaming services started to look at the opportunity esports offered.
"As the world's largest live-streaming platform with an average viewership of two million people at any given moment, we've seen record highs in hours watched, creators and daily active viewers [during the pandemic], and there has been a significant uptick in new creators streaming on Twitch. Our overall viewership is up across a broad range of categories, with sports and music in particular seeing growth from new users.”
The BBC is almost the opposite of Twitch. As one of the longest-running and well-respected traditional broadcasters, it has faced challenges following the rise of the internet, in terms of how it adapts and reaches a younger audience accustomed to live and on-demand content on their apps and mobile devices. But over the years, traditional broadcasters like the BBC have grown to better target millennials – and understand esports.
The BBC has covered the UK League Championship (a tournament previously sponsored by Barclays), the Counter-Strike: Global Offensive BLAST Series, Rocket League Championship Series X, the League of Legends World Championship and more. It even ran a five-part documentary recently following Excel Esports – one of the UK’s biggest esports organisations – on its journey in the League of Legends European Championship. ‘Fight For First’ is narrated by actor Cillian Murphy and aired on BBC Three and iPlayer – plus it was mentioned during the FA Cup match between Arsenal and Newcastle on BBC One in January 2021. It’s rare for esports to receive this kind of national coverage.
Ben Gallop, Head of Digital for BBC Sport, explains: “After the pandemic hit last March and all 'traditional' sport stopped, we had big gaps in our schedule and in this sporting vacuum it made sense to try something different, which led us to stream a number of esports events.
“At this point, we'd say esports isn't mainstream yet and certainly what we have done so far has not caused esports to have to change or adapt. If anything, the mainstream is changing in order to accommodate and emulate esports. It’s learning from esports and how to build and maintain online communities with livestreaming at the heart.
“If esports is to break into the mainstream, it would need to try and appeal to a mass market by involving big mainstream personalities and those with big social media followings outside of the esports community.”
Star appeal and sports crossover
This celebrity interest in esports is already happening, and it’s increasing the amount of investment coming into the space. Esports has drawn the interest of big-name footballers and sportspeople, like Mesut Özil, Gareth Bale and Ronaldinho – all of which have launched team organisations.
Meanwhile, several esports businesses are acquiring funding through venture capital firms or investors, like Tej Kohli, who invested some €20 million into Team Vitality in late 2018, while esports jobs site Hitmarker secured more than £500,000 from hundreds of investors around the world. Others are now looking at crowdfunding. UK-based organisation Fnatic raised more than £2 million via Crowdcube last year.
Arguably the one that generated the most headlines is David Beckham – investor of London-based Guild Esports set up in 2020. Guild fields professional players in titles like Rocket League, FIFA and Fortnite. With Beckham behind the brand and other big partnerships signed, it could help propel Guild – and other esports teams – into the mainstream in the future.
“With traditional sports and physical events hampered throughout 2020, an entirely new audience was able to find a home within esports,” says Guild Esports’ Executive Chariman Carleton Curtis. “Not only that, but major mainstream brands have enhanced their investment in these spaces, with many taking stock of the current ecosystem and seeing esports as an obvious entry point.
“Sponsors and media rights holders are also excited by the size and passion of the esports community, and we are confident this interest will continue to the benefit of the industry. We signed our first major sponsorship deal, a £3.6 million three-year agreement with a leading European fintech group, and some of the biggest tournaments are attracting big-name corporate sponsors.”
Tournaments that saw growth during the pandemic in 2020 included not only endemic competitions like the League of Legends European Championship (see ‘Lessons from the LEC’ below), but also sports-related ones like the ePremier League, the F1 Esports Series and Virtual Grand Prix.
The F1 Esports Series 2020 drew a record number of fans, with a total of 11.4 million live stream views across all digital platforms (up 98% year-on-year), while participation increased 117% to 237,000 players.
These initiatives have attracted traditional sports fans who may not have previously been aware – or understood the appeal – of esports.
John Clarke is CEO of Gfinity, tournament operator for the F1 Esports Series, ePremier League, V-10 R-League and Cadbury Heroes League. He says: “The lockdown brought gaming into the mainstream with linear broadcasters embracing gaming, and they saw that when done well, it resonated with a broader audience.
“The F1 Virtual Grand Prix series showed that by mixing young F1 drivers with sports stars from the world of football and entertainers from bands such as One Direction, the audience size can grow significantly.
“The opportunity is massive. Over a seven-week period, more than 35 million viewers on ESPN 3 tuned in to the V-10 R-League, a made for broadcast virtual racing format not seen before.”
Other examples of sports and gaming crossovers include Manchester City teaming up with FaZe Clan for a Fortnite tournament, and sporting brand Adidas signing a deal with G2 Esports as a major partner and sports apparel provider. The International Olympic Committee has also been looking into gaming as a side activity at Olympic events.
Beyond sports, the world of entertainment is jumping into esports, too. DJ Khaled performed at the Overwatch League finals, Riot Games enlisted musicians to perform as its virtual pop group K/DA (which has amassed hundreds of millions of views and listens), and the ownership team at London Royal Ravens and Rogue parent company ReKTGlobal includes artists like Steve Aoki and Imagine Dragons.
Lessons from the LEC: How Riot Games adapted during the pandemic
When Covid-19 hit in early 2020, many events organisers around the world were forced to cancel or postpone their events. The esports world was no different, and many companies were hit hard by the changes.
But as esports is digital, companies quickly shifted their tournaments to an online-only approach: companies like Riot Games, who quickly began broadcasting competitions like its League of Legends European Championship from the teams’ and commentators’ homes.
After a while, the company reintroduced stage events, with safety measures in place including social distancing and glass screens between desk hosts.
Riot reported that hours watched across the 2020 LEC Summer Season reached 40 million – a record for the league and an increase of 85% year-on-year.
Alban Dechelotte , Head of Partnerships and Business Development EMEA at Riot Games, comments: “Esports has definitely broadened its reach in the last few years. Firstly, new generations are increasingly looking at gaming as their main source of entertainment. Secondly, mainstream press and sponsorship partners are introducing their audiences to our universe and converting fans every day.
“While the Covid-19 epidemic brought the majority of traditional sports to a grinding halt during the various lockdown periods, we saw that more and more marketeers discovered our world. Additionally, we're reaching a point at which gaming as a culture bridges generations: gamers are having kids and those kids are also interested in gaming.”
Growing awareness
Even governments are learning more about esports. In the UK, the Department for Digital, Culture, Media and Sport has supported major events such as ESL One Birmingham, while UK Research and Innovation (UKRI) awarded £4 million of government funding to a consortium led by tournament operator ESL UK to create new audience experiences for esports fans, including virtual reality, augmented reality and more.
Elsewhere, councils and property developers have esports on their mind. A multi-purpose 4,000-seat arena is being proposed for Dundee, Southport Town Deal Board wants to open a new convention and events centre, a 1,500-seat arena is being proposed for Bristol, and Wigan’s Galleries Shopping Centre is to get its own new venue as part of a £130 million redevelopment. And they all want to host esports events.
Parents have a greater understanding of what their children are doing within esports, too. The Coalition of Parents in Esports (COPE) was set up in 2020 by the parents of pro gamers and other talent in esports, to help educate other parents and understand areas such as tax in esports, contracts and more.
Anne Fish, the mother of professional British Fortnite player Benjyfishy, and an adviser at COPE, says: “I think it will take a while before we see more regular esports coverage and matches on TV. But Twitch is certainly becoming very popular, hundreds of thousands of people are watching tournaments on there, so it’s going in the right direction.”
Fortnite has significantly helped put esports on the map. The $30 million Fortnite World Cup in 2019 saw another British player, Wolfiez, finish runner-up in the duos tournament and picking up more than $1 million in prize winnings. He secured major media coverage and was later signed to Excel Esports.
Kieran Holmes-Darby, co-founder of Excel, says that esports is becoming a household term, but the understanding of the industry and the big players within it ‘is still definitely not mainstream.’
“Being able to access more areas of society can only be beneficial for esports, so long as the people reporting on the industry are well-informed,” he states. “Proper education and honest reporting of the industry to a wider demographic will be very positive for esports' development.”
At the semi-pro level, teams are crying out for greater recognition to help elevate them to the next level.
Tony ‘Newts’ Newton, founder of UK-based Bulldog Esports, works for the army in a full-time role and runs his esports team in his spare time. He’s planning on opening new esports zones with the army, with multiple systems allowing the forces to play together for recreation.
“We have to reach the mainstream,” Newton comments. “If we’re going to grow, we need more people to see esports and get more players involved. We need to embrace those outside of esports more to help grow it.”
What’s next for the world of esports?
While esports revenues and viewers is set to grow further in the coming years, there are other trends that have been emerging that will likely remain big areas of focus in the future too.
Mobile esports, franchised leagues and diversity initiatives will likely rise in prominence, and don’t be surprised if a few new games break through and make a big impact in esports, just like Fortnite and Valorant have done in recent years.
Technologies such as 5G and virtual reality may have a larger part to play in competitive gaming, and as lockdowns lift in the coming years, expect esports to enjoy a new swathe of live events and audiences attending in their droves. The future is certainly looking bright and exciting.
Richard Huggan, Managing Director at esports jobs site Hitmarker, says: “For the future, my hope is that esports is able to capitalise on the momentum it's been able to generate during the global pandemic to further accelerate its growth.
“There appears to be an appreciation that esports has been able to continue online during lockdown when most other competitive pursuits were forced to stop altogether, and that ability to pivot has definitely attracted people to our industry during a very strange time for the world.
“I believe we'll see esports continuing to professionalise in how it operates as more and more organisations find routes to revenue. We're still very early in esports' overall journey as an industry and it's still a small industry when compared to some others, but the interest is there, the growth potential is there, and as more mainstream players get involved the more knowledge will be there too.”
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