In recent times, electronic sports or professional video games have amassed a huge following mostly from millennials. Though figures from different reports suggest that esports is rising in popularity, there seem to be some reservations among many as they still view betting on computer game competitions as a small niche.
There is a saying that numbers don’t lie so we are going to explore and do comparisons between esports and conventional sports betting to see if the numbers are indeed true or if for potentially the first time if the numbers are somewhat lying.
Looking at the spectrum of European and American facing bookmakers that offer both conventional sports betting and esports such as William Hill, Bwin, and PAnoDeposit.com, they largely highlight conventional sports betting on the front end while negating esports. From the outset, this point a picture that conventional sports betting is more pronounced than esports.
For some of these bookmakers like William Hill, this is indeed correct. To support their claims, they state that in the year 2016, esports had an annual turnover of $1m, which according to them is the equivalent of a non-Wimbledon tennis major. This then according to William Hill shows that esports still has a long way to go to be on par with conventional sports betting.
In addition, William Hill also gave the comparison between the annual turnover of esports equalling revenue generated from games between English Premier League mid-table teams such as Newcastle and Stoke City. Basing on this, it paints a picture that esports is still a small emerging niche that has a long way to go before it challenges the more established conventional sports betting.
However, many other houses share a different view. According to market researchers, Newzoo, esports has emerged as a stand-alone gaming niche. In 2015, Newzoo reports that esports generated $325 million from ticket sales and advertising, merchandising and media rights. A market research by Eilers, predicts fans to bet around $23.5 billion in 2020 in esports generating approximately $1.8 billion in revenue for operators. These figures rank above projected revenue figures in conventional sports betting in 2020.
The projections for the rise in esports is centred around the betting on the outcomes of competitions. Newzoo reports that precedent was already set in March this year when gamers placed more bets on the expected outcome of the video game, ‘League of Nations’ than on the outcome of this year’s UEFA Champions League. Though the exact figures are not yet announced, it looks like esports bettors outnumbered those who placed bets on the Champions League final by at least a quarter. Most of the ‘League of Nations’ bettors were millennials.
The managing director of Gaming Research Partners, Alex Igelman, said that esports matured considerably over the past couple of years resulting in it operating on par with some conventional sports betting niches like rugby, tennis,and golf. Igelman acknowledged that esports is still in its infancy but it’s promising a huge potential. Igelman stated that basing on the rise of esports over the past few years comparing it to the rise of conventional sports betting in its early years, esports has risen far more rapidly than conventional sports betting and this on its own shows that esports has the potential to overtake conventional sports betting in the near future more so if it continues to attract the millennials.
The growth of esports betting lies in that it offers more forms of betting than conventional sports betting and not every form of betting under esports has been explored in-depth. Forms of conventional sports betting include micro-event betting, fantasy team betting, event betting and match betting. Esports offers three of these i.e. fantasy team betting, event betting and match betting plus the popular, roulettes betting. Micro-event betting in esports has not been explored thus therein lies another major potential revenue generator.
Micro-event is absent from the list of esports betting forms offered by many bookmakers but a simple look at the markets under micro-event shows that there is huge potential. Micro-event includes betting markets such as which player is going to get the most kills, who will win the first half, what time the first tower will fall, who gets most kills and who will get first blood.
Esports also attracts the young, most people playing or betting on competitive video games fall under the age of 25 thus, there is thepotential of generating more and more customers every year for bookmakers.
Currently, there is no doubt based on the evidence of figures released by research companies and bookmakers themselves that conventional sports betting is more lucrative than esports. However, esports has already disrupted conventional sports betting’s hegemony in the gambling industry. The potential for esports is huge and in a few years, it can simply outplay conventional sports betting.