ESports Popularity Leads to Skyrocketing Revenue, Fanbase

ESports is booming, having earned $756 million in 2017 and anticipated to reach $1 billion in 2018. Traditional sports leagues are launching eSports leagues and buying eSports franchises, and more than 60 colleges and universities offer eSports programs recognized by the National Association of Collegiate eSports (NACE), while many more have unofficial programs. Colleges are doing everything from supporting student eSport athletes with scholarships and building eSports arenas. UC Irvine actively recruits talented players.

Engadget reports that the university investment in eSports is still small compared with that made in college football. But UC Irvine has garnered sponsors including Logitech, iBuyPower and Vertagear and supports “League of Legends” and “Overwatch.” UC Irvine most recently recruited Nick Theodorakis, who “performed well in a regional ‘Overwatch’ tournament hosted by Blizzard’s collegiate eSports arm, Tespa.”

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Tespa now has 220 chapters in North American colleges and universities, and helps organize the Fiesta Bowl as well as other tournaments.

For those colleges and universities that want to catch up to UC Irvine, “outside organizations are stepping in to help college players build eSports programs at their schools.” The Find Your Grind Foundation and ReKTGlobal just unveiled a “$450,000 annual scholarship fund for students interested in eSports.” The National Collegiate Athletic Association (NCAA) is now “investigating the collegiate eSports scene,” bringing on marketing firm Intersport to put together a report.

Regardless of whether the NCAA gets involved, eSports continues its upwards trajectory, with “more than 10 million people tuned into the debut week of the Overwatch League in January” and 12 worldwide teams paying $20 million each to buy into the OWL. Other games are offering millions in prize money and selling out huge stadiums.

According to VentureBeat, market researcher Newzoo reports that, “global eSports revenues will grow 38 percent to $906 million in 2018 and further grow to $1.65 billion by 2021,” of which “North America will account for 38 percent of the 2018 revenue, or $345 million, while China will be 18 percent, or $164 million.”

Its report stated that, “brands will be responsible for $694 million of the revenues in the eSports industry, or 77 percent of the total market in 2018,” growing to “$1.4 billion by 2021, representing 84 percent of total eSports revenues in that year.” The fan base is expected to grow 15.2 percent, “from 143 million in 2017 to 165 million in 2018, while the number of occasional viewers will grow from 192 million in 2017 to 215 million in 2018,” reaching 250 million enthusiasts by 2021.

“As a business, eSports is now entering a new and critical phase towards maturity,” said Newzoo chief executive Peter Warman. While investments, sponsorship and media rights are maturing, profitability will be challenged by soaring player salaries and a “select number of globally operating teams and game franchises.”