Have you heard of “eSports”? If you haven’t, it’s probably because you’re not a gamer. But get ready, because while it might be a niche industry at the moment, soon it won’t be. Current estimates indicate that a billion people will be familiar with eSports by the end of 2016. And two to three-hundred-million people will participate—either as viewers or players—growing this market to an astounding $463 million in 2016. This is an increase of 43% over 2015.
At its most basic, eSports involves gamers watching others gamers (aka “cyber athletes”) play video games. It can also take the form of organized multiplayer video game competitions between professional players. Content is viewed either live in-person, live-streamed, or on-demand.
On demand and in demand: a 2015 live-stream of the League of Legends World Finals saw 36 million people around the world stream the event (a 33% increase from 2014), watching a total of 360 million hours of live coverage. Another live tournament last year for Dota2, a popular multiplayer online battle arena game at the Theater at Madison Square Garden In New York City, sold out in ten minutes.
The revenue from eSports is generated through event tickets along with merchandise, sponsorships, online advertising, and media rights. A big part of the industry also relies on the platforms that live-stream individual gamers’ “playthroughs” on a daily basis, along with the big, organized competitions. These platforms, such as Twitch and YouTube Gaming, turn gaming into an interactive performance others can enjoy—and they rely on the subscription model to monetize viewers’ access to the action.
Some of the incredible growth in the industry is due to the increased willingness by consumers to subscribe to online eSports channels and broadcasts for gaming and related content. Indeed, Juniper Research has predicted that subscription revenues could reach almost $1 billion by 2020.
As is the case with many different streaming services, they’re continually expanding and diversifying their content offerings. Visit the Twitch.tv site, one of the biggest and most popular gaming platforms, and you’ll see them promoting a new original series from Playstation, called Powers. There are also gaming talk shows on the site and even a live feed from the Maker Faire on the Twitch Creative channel.
Juniper’s prediction regarding the huge potential for eSports subscription revenue is not going unnoticed by the big cable broadcasting companies. TBS just premiered its inaugural eSports competition on May 27th. This ten-week championship series will be both televised and streamed live, kicking off the network’s new “E-League”—a professional league formed in a partnership between TBS and talent management and events firm, WME/IMG.
As described by an article in Adweek, “The test will be to see if TBS' sports fans who watch March Madness and Major League Baseball will tune in Fridays from 10 p.m. to 1 a.m. to see E-League's first-shooter game Counter-Strike: Global Offensive.” Advertisers and other programmers will undoubtedly be watching closely to see how effective TBS’s efforts are to reach the core gamer audience—traditionally tech-savvy young men.
TBS’s foray into eSports is not the first for TV. Last year, ESPN2 aired a college competition called “Heroes of the Dorm”—a riff on the popular “Heroes of the Storm” multiplayer arena video game. The event however scored a dismal 0.1 Nielsen rating, indicating that the attempt to move the sport from its traditional online digital realm to TV may not be as straightforward as those broadcasters believe.
There certainly can be no doubt of the genre’s popularity. With viewership numbers in the tens of millions, eSports streaming may very well be primed to break out of its online roots to reach a wider audience.
To learn more about how Recurly can support your subscription eSports play, talk to a Recurly expert at (844) 732-8759 or sign up for a demo below.