By Barry Janoff
February 15, 2017: Envisioning it as the next battleground for brands, marketers, media and players, a new study indicates that the growth of eSports around the world, which has been on an impressive climb over the past few years, will continue for at least the next four years.
The number of eSports participants globally will reach 58.4 million this year, up from 49.8 million in 2016; the global eSports audience will reach 385 million in 2017, up from about 256 million this past year; and the eSports economy predicted to grow to $696 million in 2017 for year-on-year increase of 41.3%,
And the beat will keep going. Longer-term, eSports revenues will near $1.5 billion by 2020, according to the just released 2017 Global Esports Market Report from research and consulting firm NewZoo, San Francisco.
"As the convergence of games and traditional media accelerates, eSports is leading the way,” Peter Warman, CEO for NewZoo, wrote in the study. "Already, eSports has been broadcast on TV in more than a dozen new countries, major media companies have invested big into eSports and numerous traditional sports teams and agencies have entered the industry."
North America ranks as the largest eSports market, with revenues of $257 million in 2017 and projected to double to reach $607 million by 2020.
The global eSports audience will reach 385 million in 2017, made up of 191 million eSports enthusiasts and an additional 194 million occasional Viewers.
The number of enthusiasts is expected to grow by 50% by 2020, reaching 286 million, driven by growth in such emerging regions as Southeast Asia and Middle East & Africa.
"Increased viewership from TV broadcasts, and new franchises like FIFA and Overwatch are the main drivers of global eSports viewership growth," writes NewZoo.
Global eSports awareness will reach 1.3 billion in 2017, up from 1.1 billion in 2016; and is estimated to approach 1.8 billion by 2020.
"This growth will be aided by game publishers incorporating eSports into their game clients and other communication channels, along with increased coverage of eSports in the media," offers the report.
With a growing number of brands attaching themselves to eSports leagues, players and competitions, sponsorship will reach $266.3 million worldwide in 2017 and advertising will top $155 million, according to NewZoo.
"Sponsorship is the largest revenue stream and will grow to $655 million by 2020. New brands, especially non-endemic brands, entering eSports will drive the growth in sponsorship revenues in the coming years. Advertising generates the second most revenues and will grow to $224 million by 2020," per the 2017 Global Esports Market Report.
The playing field that already includes such companies as Coca-Cola, Taco Bell, Buffalo Wild Wings, Slim Jim, Mountain Dew, Bud Light, Domino’s Pizza, Snickers, Ford, Hyundai, Audi, Gillette, Mobile, Axe and Turtle Wax.
NewZoo sees "even more major non-endemic brands (signing) big sponsorship deals with teams, leagues, and events."
As an example, taking their rivalry from traditional sports to eSports, "Nike, adidas and Under Armour will battle it out for jersey (deals) in 2017," per the report.
Although barely six weeks old, this has been a busy year for eSports. Among other moves, the NBA said it would join with one of its partners, Take-Two Interactive Software, to build the NBA2K eLeague, involving all 30 NBA teams, with a scheduled launch in 2018.
This week, international entertainment provider GINX eSports TV said it would align with Canadian-based broadcast network Super Channel to "create and distribute 1 24-hour eSports channel, the first in Canada." It is planned to launch this summer.
Also this week, Italy’s AS Roma soccer club said it would join with Fnatic, an eSports group based in London, to build a competitive eSports team.
AS Roma is the latest soccer club to enter the category, following such teams a Manchester City, Valencia and PSG, all under the auspices of FIFA, the governing body for global soccer.
"The involvement of sports clubs and personalities, leagues, and agencies will significantly accelerate the development of the global eSports industry and help local eSports scenes to grow," writes NewZoo. "Traditional sports clubs and leagues bring with them an established local fan base, along with a well-known and respected brand."
Although sponsorship is the largest category, NewZoo reports that "the fastest-growing revenue steam is media rights, which will generate $340 million by 2020, up from $95 million this year.
"Exclusive content deals, as seen in traditional sports, will drive this growth."
NewZoo cites Turner and its eLeague as a prime example of a media company driving eSports content domestically and worldwide. Its Counter Strike-driven platform is licensed for broadcast in such countries as China, France, Russia, throughout Africa, Latin America and Asia, in addition to TBS in the U.S.
More evidence of the growth of eSports: In 2016, there was $93.3 million in prize money worldwide.
That figure is up from $61 million in 2015, $36 million in 2014 and what was less than $20 million in 2013.
The majority, 56% is from events in North America.
"eSports is not only growing exponentially as a new independent business and industry, it is also accelerating the convergence of various established industries," according to NewZoo’s 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 live streams and events, gaming has entered the realm of broadcasters and media that now can apply their advertising business model to a market previously out of reach for them," wrote Warman.
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