eSports Closing In On $1 Billion Revenue Milestone, Analysts Say
Market research published by intelligence firm Newzoo has asserted that the global eSports industry will continue to grow into 2017, generating $696 million in revenue across the year.
Newzoo estimates companies will put $155 million toward advertising, $266 million toward direct sponsorships and $95 million on media rights.
They claim the remaining $180 million will come from consumers buying a tickets and merchandise for and during eSports events.
According to Newzoo’s chief executive Peter Warman, “Esports is not only growing exponentially as a new independent business and industry, it is also accelerating the convergence of various established industries,”
“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 live streams 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,” he says.
It marks a growth in revenue of over 40% and a major step towards the burgeoning industry passing the $1 billion revenue mark.
While tech companies have led the forefront on eSports sponsorships, more mainstream companies have begun to get involved.
Only last week, ice cream brand Maxibon announced a sponsorship with Australian eSports team organisation Avant Garde.
Newzoo’s report also claims that the audience for eSports will expand to 385 million people this year, with games like Overwatch drawing more casual fans to watch professional-level play.
Moving eSports closer to mass audiences is going to be a crucial factor here.
When we spoke to BenQ’s Martin Moelle at a recent launch event, he echoed that sentiments saying “mainstream TV has to be on the cards” for eSports to grow.
He says “the different organisations need to work with each-other rather than against each other.”
That said, some in-roads are being made.
FetchTV partnered with eGG last year to launch Australia’s first dedicated eSports TV channel and the Singapore-based network has achieved remarkable success so far.
Their broadcasting of the ELEAGUE CS:GO tournament brought in 3.3 million viewers while 1.8 million tuned in to watch The International Dota 2 Championships.
eGG told ChannelNews that their partnership with Fetch, “serves as the perfect platform to bring a new and rewarding viewing experience for Australian eSports fans, with eGG Network making its mark as the first 24/7 eSports channel in Australia. For eGG Network, this is an outstanding opportunity to further expand our content reach and viewership.”
They say they expect more eSports-focused networks to emerge outside of South East Asia in the coming years and that “it’s not impossible that eSports content will go mainstream” in the near future.