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Worldwide Esports Market Set to Cross $1 billion in 2019

Punyesh by Punyesh
February 20, 2019
in eSports, News
4 min read
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The esports market has come a long way. What was once a small sapling has grown into a giant oak tree. And with its rise, it has brought with it massively popular tournaments and leagues across the world.

Not only popular but also lucrative, according to analysts at Newzoo who report that global esports is expected to generate revenue exceeding $1.1 billion dollars this year with a revenue increase of 26.7% year-over-year. The most optimistic estimates are at $3.2 billion in revenue and the, in contrast, the most pessimistic at $1.3 billion.

Endemic and non-endemic brand investments (media rights, advertising, and sponsorship), the report says, will make for 82 percent of the total market, about $897.2 million, according to Newzoo’s “2019 Global Esports Market Report” estimates. The highest-grossing revenue stream will be sponsorship which is estimated to generate $456.7 million in revenue in 2019, and the fastest-growing esports revenue stream being media rights.  Additionally merchandising and ticket sales are predicted to surpass the publisher fees revenue for the first time.

Newzoo analysts also estimate that the global esports audience will reach 453.8 million people worldwide in 2019. This makes for a year-on-year growth of 15 percent. The audience can be classified into 201.2 million Esports Enthusiasts and 252.6 million Occasional Viewers. The former is estimated to show +16.3% year-on-year growth and the latter +14.0% year-on-year growth.  

“Esports’ impressive audience and viewership growth is a direct result of an engaging viewership experience untethered to traditional media,” says Newzoo CEO Peter Warman. “Plenty of leagues and tournaments now have huge audiences, so companies are positioning themselves to directly monetize these Esports Enthusiasts. While this began happening last year, the market is constantly expanding on its early learnings. The result: 2019 will be the first billion-dollar year for esports, a market that will continue to attract brands across all industries.”

NON-WESTERN MARKETS ARE KEY

With the growth and maturation of the esports market, an increase in the number of local events, leagues etc the average revenue per fan is expected to grow to $6.02 by 2022.  Much of the growth is a result of increasing recognition and awareness of esports in emerging markets such as Latin America, the Middle East, Africa, and Asia. China, in particular, is estimated to generate, by Newzoo analysts, around $210.3 million in revenue this year, finally dethroning Western Europe as the second-largest region with regards to revenue. Additional factors include the popularity of MOBAs, Battle Royales and mobile gaming in general.

North America, however, will still remain the largest esports market, with estimated revenues of $409.1 million in 2019. Newzoo predicts increasing growth as we head towards 2022, with revenues predicted to reach $691.1 million. Not unlike the global esports market, the source for the largest share of North America’s 2019 esports revenue will also be sponsorship, estimated at around $196.2 million. Growth in media rights is similarly expected to make up the bulk most to this growth with it being the fastest growing and second largest esports revenue stream in the region.

THE INVESTMENT POTENTIAL

Non-endemic brands, the report states, presents a huge investment opportunity as the esports market grows and attracts greater and greater investments. Additionally, digital broadcasters and TV media companies have made inroads as far as investment in the market is concerned. The degree to which the deals with such industries will generate a direct return on investment will impact the pace of media rights growth.

Other ongoing developments that have the potential to bring in higher revenues include an increase in esports franchising, new content formats and premium passes, the success of mobile gaming, team profitability, and the success of new focus on professionals and streamers as brands.

 

Tags: esportsesports investmentnewzoo
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Punyesh

Punyesh

Hi, I'm Punyesh Kumar. I'm from Bhubaneswar, Odisha and I write about video games for esportsportal. Aside from games, I love reading, painting, and listening to music. You can usually find me playing FTL, XCOM and Half Life

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