They say you should follow the money, and investment dollars for esports is rapidly gaining momentum.
The esports industry is transitioning from an interesting experiment, from a sideshow – “You’re investing in what? Video games?” – to a freight train headed towards mainstream acceptance and mainstream dollars.
Sporting title esports, such as FIFA and NBA 2K, are still lagging behind traditional esports titles like League of Legends, Defense of the Ancients and Counter-Strike.
Digital Pulse by PricewaterhouseCoopers published a report in mid-2017 that found esports revenue, not including merchandise, is set to hit $US874 million ($A1.09 billion), up from $US42 million ($A52 million) in 2012. This growth is significant, and it appears the people who matter are starting to take notice.
In the future esports will no longer be confined to niche markets and audiences. The riches of mainstream viewership is looming large.
Blizzard’s much-hyped Overwatch League (OWL) recently debuted after reports suggested a $US90 million ($A112 million) deal was struck between OWL and Twitch for exclusive streaming rights to all league matches.
The synergy of Blizzard and Twitch’s relationship is evident in the ability for viewers and players to earn in-game rewards by tuning into the broadcast. The initial weekend slate of games was a resounding success viewership-wise, with a peak of 437,000 concurrent viewers during the Seoul vs Dallas match.
That brings us to 2018, when several major players are set to begin esports league play throughout the year, including:
Adding to the pile-on of esports investment, the NFL recently advertised for a league office-level esports expert on their team.
With so many leagues establishing themselves in 2018 the intriguing dance will be where the broadcast deals come from, with Twitch being the convenient partner.
For these leagues it is convenient that Twitch has Amazon money and should be interested in shelling out for a world-class content.
Esports as an on-screen spectacle, especially on Twitch’s platform, is favourable to advertisers, with a measurable hyper-targeted audience and excellent on-screen marketing capabilities.
EA Sports’s FIFA football in conjunction with the respective professional football Leagues around the world are ramping up their esports efforts, announcing two partnerships in the last three weeks, with Australia’s A-League announcing a nine-week league and a tournament-style finals.
Details are scarce, but the league has announced each professional club will employ two FIFA players to compete in their club colours. FIFA players will have the opportunity to be drafted into the league.
North America’s Major League Soccer have announced their own eMLS league to compete as a part of the 2018 EA Sports FIFA world league.
EA Sports FIFA is a great on-screen product and easy for the lay-person to understand, positioning itself for crossover appeal between sports fans esports fans.
The NBA in partnership with 2K Games and parent company Take Two Interactive have spawned the NBA 2K League, where 17 of the 30 NBA franchises are competing in league-style play. Players will live and practice in shared housing and compete online for a spot in the player draft, where they could be offered competitive salaries.
The NBA 2K League called for a minimum investment of $US750,000 ($A935,000) for the first three years of its existence. All leagues, investors and esports professionals should be watching the 2K League with interest as the NBA has taken a top-down approach to building an esports league rather than having the community build the league from the bottom.
The NBA have adopted a build-it-and-they-will-come approach with the 2K League. NBA 2K routinely ranks on the lower end of the concurrent viewer metric on Twitch.
The secret to the NBA 2K League’s success will come from leveraging the NBA’s brand appeal and marketing prowess, and with the sport’s popularity and revenue being at an all-time high there’s no reason the 2K League can’t capture those crossover fans who have a casual interest in esports.
All of the 2K League’s teams are named after their respective NBA franchises, which ensures each team is instantly recognisable to fans.
Now if only a developer could make a competent rugby union game or an engaging cricket title.
Part of the allure of esports is being able to engage with the on-screen product. Viewers cannot only play the games they watch, but some games allow viewers to collect rewards in the game. Viewers can interact in the chat box while the stream is taking place, or they can donate money to their favourite streamers in return for a shout-out, increasing that connection the viewer feels to the content or streamer.
The outlook is bright for esports, and when we look back at the foundations of esports, 2018 could be the tipping point where it all starts to gain serious momentum. Esports sponsorship revenue in the USA was estimated at $US44 million ($A54.8 million) in 2016 and is expected to double by 2021.
Finally, be sure to keep an eye on the NFL and EA Sports’s Madden for the next foray into esports, followed by the Formula One Esports Series.