Competitive video gaming, or e-sports to give its full brand moniker, is experiencing hyperbolic hysteria within the i-gaming industry at the moment.
You may ask what all the fuss is about? The video and computer games industry is huge. At last count, analysts forecast that the mobile games market is worth $22bn and the video console market worth a staggering $55bn per annum.
Video gaming, whether that encompasses casual, mobile or a social gaming format, is ingrained in mainstream culture. It’s the new religion and entertainment first choice for the millennial generation, driven by huge leaps in software, hardware and technology. It is no longer a “hobbyist” or underground pursuit, confined to stereotypical computer nerds or hackers – it’s a full-blown mainstream social activity.
To provide some further context, according to Entertainment Software Association, some 155 million Americans play video games. That’s more than 50 per cent of the US population. Can you think of any other entertainment activity that offers that level of access to the population?
The video industry is producing games for every conceivable life or work experience we can think of, and more. In terms of category, the most popular are social games, followed by action games and puzzle-based games. Gaming connects us on an emotional and psychological level via the brain's limbic system. Gaming delivers instant feedback on progress throughout the gameplay thus stimulating many areas of the brain at once. It could be fair to say that we are hard-wired to video gaming.
The most lucrative or attention-grabbing facet from an i-gaming viewpoint is competitive e-sports in the form of offline and online tournaments, where players and teams, sometimes dubbed “digital athletes”, compete for significant monetary prizes; e-sports, both as a spectator and participation, is growing rapidly. In terms of structure, it’s no different to other sports and their set-up. It has leagues, teams, players and fans.
For example, the Electronic Sports League, known widely as the ESL, is the largest league for e-sports players in Europe. It has more than three million registered members and some 740,000 registered teams. They compete in various, regional, national and world championships sponsored by major brands such as Red Bull and Coca-Cola. The growth in real money e-sports tournaments worldwide has more than tripled from 430 in 2013 to 1,485 in 2014. This provides some idea of how many participants are turning from amateur to professional players – money pouring into the sport is a huge driver of growth.
In terms of who’s playing e-sports and watching the events as fans, it’s the much sought-after millennial generation, of males aged 18-34. This is a very desirable demographic segment for many brands, including i-gaming operators, desperate on securing this next generation as customers.
The demand curve for e-sports betting already exists. The major UK betting brands already allow their customers to bet on e-sports events and matches. William Hill takes bets on Counter-Strike and Dota 2, and provides a selection of e-sports matches to the likes of Paddy Power offering odds on the larger event tournaments. A major player in e-sports betting is Pinnacle Sports, which started offering betting on the sport as early as 2010. Pinnacle reported last year that it took its millionth e-sports bet and is on track for the two-millionth such bets in a much shorter time frame.
So who will win the e-sports betting game? It is fair to say that the size of the e-sports betting market will be determined by the customers within the e-sports supply chain themselves. Video gaming and real-money competitive gaming is similar to other games of skill such as poker, and is a very strategic and complex. Therefore, from a betting standpoint, it is not for the uninitiated fan or standard football bettor that hasn’t even heard of the likes of StarCraft 2, Dota 2 or League of Legends.
Conversely many millennial gamers may have never visited a casino, or played at an online sports betting website. That may be the biggest challenge, educating the nascent e-sports market of betting availability. Only time will tell who the real winners will be, but it would be folly to ignore the growing trend of video gaming to transform and transcend our now digital and connected lives.
