New Report: Esports Audience Could Almost Double To 600 Million By 2020, With Big Growth For Esports Betting

Market intelligence company Newzoo has issued its “Global Esports Market Report 2017.” The 119-page report forecasts that the global audience for esports will grow from 323 million viewers in 2016 to 589 million in 2020.

• The full report can be purchased here.
• Newzoo is offering a free light version of the report here.

Revenue forecasts match the 15.4 percent compound annual growth rate (CAGR) of the audience figures.

Newzoo predicts that total revenues excluding esports betting will grow from $325 million in 2016 to $1.488 billion in 2020 — a CAGR of 35.6 percent.

The forecast revenue totals include media rights, advertising, sponsorship, merchandise and tickets, and game publisher fees. For 2017, the forecast revenue constituents are:

That growth prospect is what has investors clamoring to take a piece of the trend, even though the esports industry is still at an early stage of development.

Esports betting will be even bigger than the esports industry

Newzoo explains that sports betting revenues are not included because reports on traditional sports don’t include betting revenues — the “two industries are separate for obvious reasons.”

However, Newzoo notes that betting on esports is likely to mirror that on traditional sports and be an even bigger industry than the sport itself (for things like CS:GO betting and League of Legends betting.)

Quoting figures for the NFL, Newzoo explains:

“As an example, the NFL generated $13 billion last year, but betting and fantasy leagues around the NFL games are supposed to have made north of $50 billion. With most big betting companies already embracing esports betting on a global scale, it’s possible that esports betting alone is larger than the esports economy itself.”

In a recent tweet, leading esports betting operator Pinnacle reported that it had taken its five millionth esports bet. Pinnacle took its first esports bet in January 2010, and its one millionth esports bet five years later in November 2015.

Thereafter growth has accelerated and Pinnacle expects to double its total bets to 10 million in January 2018.

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Newzoo explains esports growth drivers

One of the biggest drivers of esports industry growth is the sale of media rights. That’s according to Newzoo CEO Peter Warman.

This is closely followed by the rise in sponsorship deals by non-endemic brands that constitute the largest element of esports revenues:

“Media rights trade is becoming a serious business and is expected to grow sevenfold from only $50 million in 2016 to close to $340 million in 2020. Further, even more major non-endemic brands will close big sponsorship deals with teams, leagues, and events.

Nike, Adidas, and Under Armour will battle it out for jerseys in 2017. Early movers are increasing their investment by several factors year on year. Ultimately, esports provides brands an entry point into the favourite pastime of digital natives and Millennials: gaming.”

Esports is getting the advantage of the industry convergence between brands, media and entertainment.

“Games rely on consumer spending while media companies rely on advertising for the most part of their revenues. In the long term, this convergence of industries will provide media conglomerates of the future with a more diverse and sustainable revenue mix.”

Esports spend per fan is increasing

Esports spending per fan remains far below the equivalents for traditional sports. The average basketball fan worldwide spends $15 per year, and the average spend for all sports is $54.

Esports spend for this year is expected to be “an average of $3.64 each in 2017. This includes all revenue streams. The average direct spending per fan on merchandise, tickets, or subscriptions is $0.33 in 2017.”

Newzoo explains that this is the result of low merchandise spending, and the widespread availability of free esports content. Newzoo expects spending per fan to increase with dramatic results.

“If the average direct spend per fan increased to $2.00, the industry would generate more than $1 billion this year.”

Audience demographics support increased spending forecasts

Newzoo breaks down the demographic details of the esports fan base. It determined that around half is  between the ages of 21 and 35, with 71 percent male.

Fifty-eight percent of occasional viewers has a full-time job. Sixty-two percent of enthusiasts in full time employment. Forty-seven percent of occasional viewers and 50 percent of enthusiasts are classed as high-income earners.

“This makes them a very desirable target group for different parties, especially big brands. Esports Enthusiasts are digital natives, and are more likely to be consuming content online than through traditional media outlets.”

These figures confirm earlier research that esports fans are generally older than the common perception, with higher levels of disposable income.

The Newzoo report includes much additional data, covering tournaments, ticket prices and regional revenue and audience breakdowns.

Overall the report presents a strong case that esports is one of the hottest areas of economic growth in today’s market. via legalsportsreport

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Esports’ future is female

The esports industry is one of the fastest growing segments in sports and entertainment, on pace to generate as much as $5 billion in revenue by 2020 — and advertisers obviously want in. One of the primary reasons that esports has such tremendous growth potential? The involvement of women. Brands need to be aware that the industry is seeing more and more women enter not only as spectators, but also as players, infrastructure builders, game designers, and more.

Women create, play and compete

This growth of women in gaming can be seen across multiple areas, including game developers, collegiate players, professional athletes, and mobile competitors. The International Game Developers Association found a significant jump in the number of female game developers between 2009 and 2014, with the amount doubling to 22 percent.

Earlier this year, Stephens College in Columbia, Missouri became the first all-female school to announce a varsity esports program supported by scholarships. More women than ever are moving to the professional level, such as the all-female Counter Strike: Global Offensive Team Dignitas squad. I’ve also directly witnessed the rise of women in esports. Today, over half of the 12 million registered gamers on the Skillz platform are women.

Women engage and purchase more

A study this year also found that women lead men in mobile gaming engagement, as they’re more likely to register and spend within mobile games. This makes women the ideal, preferred consumers in what is now the largest digital gaming market in the world. Women also now comprise about a third of the U.S. esports audience, and are projected to account for half of viewer growth over the next 12 months. And according to one study, more women than men self-identify as being involved in esports.

Clearly, data shows that women are a significant demographic in gaming and esports. For these industries to continue to thrive in the future, female participation will be crucial. So, the fact that women have to prove themselves worthy to be part of the gaming world is not only contradictory — it’s a detriment to business.

Yet women are disregarded

As a woman who has been a gamer her entire life, and as the head of engineering at the world’s leading mobile esports provider, one thing about the gaming industry has been an ongoing disappointment to me: the industry’s systematic disregard and discrimination toward the female demographic that has proven essential for its continued growth and success.

Sadly gaming and esports are widely considered “male industries,” a characterization that disenfranchises the women in the field, as well as the millions of female esports fans around the world. Perhaps the most serious consequence of this characterization is that it permits, and sometimes even encourages, the mistreatment of women in gaming. It’s something we’ve seen time and again from online communities, live-stream viewers, and even professional esports athletes.

Women face adversity

Unfortunately, examples of this behavior are continuing to emerge. The infamous #GamerGate in 2014 saw anonymous online attackers threaten developer Zoe Quinn and many others with violent and sexist threats. This had a chilling effect on women and other marginalized people across the entire game industry.

Meanwhile, one study last year found that comments on female Twitch channels are characterized by objectification from viewers about the streamer’s physical appearance and relationships, while male Twitch channels mostly see comments about the game being played. Earlier this year, two professional Overwatch athletes solicited female esports fans – some of them underage – for photos and private meetups.

This attitude toward female gamers isn’t just an abstract concept happening to a select few. I have also noticed a difference in how I’m treated by fellow competitors when I’m playing online. A lot of games provide few, if any, female avatars, so sometimes I just use my favorite avatar regardless of how it relates to my gender. Due to this, fellow players usually just assume I’m male, and are surprised if they discover that I’m actually a woman. It just makes me wonder why my gender comes up at all. We’re playing a game: gender shouldn’t affect that.

But it does. Inappropriate behavior, sexually-charged comments, and hostility regarding the perceived inferiority of women’s gaming skills work to push women toward the margins of gaming. However, this marginalization seems rather counterintuitive in an industry that’s increasingly thriving, due in large part to female consumers.

Women need support

As the VP of Engineering at Skillz, I feel extremely fortunate to be developing a product that offers everyone, regardless of gender, background, or skill level, a chance to compete in mobile esports. However, a broader shift in thinking is needed across the entire industry.

If you’re still not convinced by the data, take it from someone who’s witnessing the democratization of esports and the rise of female gamers firsthand. For the esports industry to reach its true potential, the continued participation of women will be critical. Isn’t it about time for the industry to truly support and encourage women, whose involvement will make or break modern esports?

Miriam Aguirre is the Vice President of Engineering at Skillz, the worldwide leader in mobile eSports, which was recently named the fastest-growing company in America by Inc. Magazine.

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Where to bet on esports

There’s plenty to bet on this week but not all sites have every tournament and esport listed. Even if they do, it’s worth shopping around to see what good value esports betting odds are on offer. Here’s a rundown of what the esports bookies are up to this week.

Betway

So far this week, Betway has only listed odds for CS:GO, League of Legends and StarCraft 2. I’m sure they will release some more of their special bets, especially for the CS:GO DreamHack Malmotournament, as it’s clear they are big fans of the game.

Bet365

Bet365 has been pushing boundaries again this week by being the first major bookmaker to release odds for a Playerunknown’s Battlegrounds (PUBG) event, namely the PUBG Gamescom Invitational. Team SoloMid is currently the favorite at odds of 5/1 (6.00) with Cloud 9 and Team Liquid at 11/2 (6.50).

The majority of odds listed on Bet365’s site are League of Legends (LoL) games as they have a variety of markets for each event. As an example, for the LCK Regional Qualifiers alone, there are 20 different bet types.

SkyBet

SkyBet has a healthy selection of LoL games on offer as well as odds for the CS:GO Pro League, Dota 2 Pro Dota Cup, StarCraft 2 – Global League and Hearthstone LB Brawl. Although its odds aren’t always the most competitive, SkyBet does have some markets available that many other bookmakers don’t.

Pinnacle

Pinnacle has similar esports available to SkyBet this week but with the addition of some markets for the Warcraft 3 – Golden Championship Series. There is a variety of CS:GO tournaments on offer at Pinnacle but as usual, very few betting markets to choose from. Interestingly, its only CS:GO matches are of the Star Challenge tournament, despite there being multiple better options to choose from.

Unikrn

At the time of writing, Unikrn has markets for CS:GO, StarCraft 2 and LoL. I would expect more from an esports-specific bookmaker but fingers crossed Unikrn adds some more odds to the site throughout the week.

Betspawn

Betspawn is certainly one of my favorites again this week, with great odds and a ton of esports tournaments to choose from. There are odds for eight different CS:GO tournaments listed on the site already, as well as odds for Dota 2, LoL, Hearthstone, StarCraft 2, Heroes of the Storm, Warcraft and Crossfire. It is a seriously underrated bookmaker and always worth looking at when deciding whom to bet with.

GG.bet

GG.bet seems to be releasing its PUBG odds a little later in the week, perhaps taking notes from Bet365, which was the first to list odds for the event. Elsewhere on the site, there’s plenty to choose from in multiple esports, despite missing a few decent tournaments from the list.

Unibet

I mentioned last week that Unibet was worth keeping an eye on when comparing odds, and that’s still sound advice. Its odds will move regularly and sometimes you can pick up some great value on top esports matches. For this week so far, it has listed odds for CS:GO, StarCraft 2 and LoL.

In British Columbia Canada ?

You can check out our local BCLC site : https://www.playnow.com/ for wagering on all your esports action.

How eSports betting works

• Learn how a bookmaker works
• How to compare eSports odds & payouts
• Why payouts are the key to profit

How does a bookmaker work?

Bookmakers work out the probability – the chance – of popular events occurring, like the English Premier more obscure stuff like betting on Brexit or who’ll win eSports matches. They turn that probability into odds which punters can place eSports bets on, but crucially bookmakers offer slightly poorer odds than the real probability of either side winning.

Bookmakers work by offering slightly poorer eSports odds than the real probability of either side winning.

Say CS:GO Team A are playing CS:GO Team B. They have played 10 times recently, with Team A winning six times and losing four times.

Keeping it really simply and assuming conditions are the same, basic probability would suggest that Team A has a 60% chance of winning (6 / 10 * 100), while Team B has a 40% chance.

Bookmakers wants to make a profit so rather than offering odds that reflect the probability (based on the form) they exaggerate each team’s chances. So bookmaker odds for the matchup may suggest a 62% chance of Team A winning and 42% for Team B.

This is how that looks with Decimal odds (which most European bookmakers use).

Fair Assessment

• Team A
• 6 wins / 10 matches
• 60% Chance
• Decimal Odds of 1.66
• Team B
• 4 wins from 10 matches
• 40% Chance
• Decimal odds of 2.50

Bookmaker Assessment

• Team A
• 6.2 wins / 10 matches
• 62% Chance
• Decimal Odds of 1.61
• Team B
• 4.2 wins from 10 matches
• 42% Chance
• Decimal odds of 2.38

Now you might think ‘If I bet on Team A and they win I am still quids in!’ That is true, but because you aren’t getting paid out in true proportion to the riskiness of your bet, if you keep placing more bets over time the bookmaker’s edge will eventually mean that you will lose.

Imagine flipping a coin with a friend that is slightly biased towards heads. The coin would land on both sides, but heads would show up slightly more than chance, and if you kept flipping you would eventually lose your shirt.

The cost of placing a bet

That amount that the odds are tweaked – the edge the bookmaker has in their favour – is called the margin. That is the cost to the bettor of placing a bet.

If you go back to the example above the sum of the Fair Assessment of the chances of Team A and Team B is 100%. But in the Bookmaker Assessment the total chances are 104%. The margin is therefore 4% in the bookmaker’s favour. So long as they take bets on both sides in proportion to the odds they will make 4% of the total sum of bets.

This should ring some bells with anyone who has used skin-betting sites because they are doing a very similar thing by a change a commission on bets.

Why payouts are so crucial

When you look at the eSports odds comparison tables on Beo we display the Payout for each matchup, rather than Margin. The higher the Payout the better the value. Margin shows the odds from the bookmaker perspective – what they take – whereas the Payout is what you, the bettor, gets. Payout is the inverse of Margin, so a 4% margin means a 96% payout.

What this means is that if you bet £100 across both sides, in proportion to the odds, (not advisable) you would only get £96 back. The Payout is the only way to compare eSports odds, so you should pay close attention to it when you choose where to place your eSports bets. It isn’t the only consideration, but it is one of the most important.