Kids nowadays only want to do a few things, most of them involving consumer electronics of one type or another – all of them connected to the internet. Many of them are very active in the field of video games: when they don’t play them, they watch videos or even live streams of others playing them on popular outlets like YouTube and Twitch. One generation ago, spending all your time playing games online may have earned you the “wasting life” label. Today’s youth has it easy: they can always invoke the “I’m doing sports” excuse. eSports, to be exact.
The average video game is a source of revenue for the developer and the publisher (and the retailer, of course). There are, in turn, a few of them built around the concept of players competing with each other over the internet. Sometimes, in an organized way similar to traditional sports. And in recent years, these eSports have seen their following, viewership, and player base explode, turning into a billion-dollar industry.
eSports is getting bigger
According to video game market specialist Newzoo, eSports had close to 450 million followers in 2019, generating more than $900 million in revenues. The growth of eSports will continue in 2020, Newzoo predicts, with its revenues exceeding $1 billion, and the number of viewers, 500 million. Just $1 billion, mind you because there will be no live events this year due to the ongoing pandemic.
Gaming for money
Playing video games can make money in two ways: either through a popular gaming channel on YouTube (where the videos get a cut of the advertising revenue) or through becoming a professional and joining a successful team.
Being a YouTuber is a dream job for kids in the US and the UK – many of them are probably following the example of Felix Kjellberg aka PewDiePie, one of the most followed YouTube stars who made a name for himself with his “Let’s Play” videos. Pewds has more than 104 million subscribers and reportedly generates revenues of up to $15 million a year.
The other way to make money while playing games is the harder way: becoming a professional gamer. This is in many ways similar to becoming a professional athlete – players need the right skill set to be really good at a game, they have to put long hours of training in the matter, and earn a spot in one of the teams’ roster.
How much money does an eSports team make?
eSports teams – just like professional sports teams – have several revenue streams: sponsorships, endorsements, merchandise, and prize money. Winning a major international gaming tournament can add millions to the teams’ purse – but big money comes not from prizes but from sponsors and broadcast rights.
Among the sponsors pouring money in competitive gaming, we find brands like Nike, Coca-Cola (especially with their energy drink brand Monster), Red Bull but also car brands like BMW and Honda, and even Louis Vuitton have struck deals in the world of eSports.
Competitive gaming is an ever-growing phenomenon. The big brands pouring money in it and even the International Olympic Committee voting its confidence, it will continue to grow for years to come, giving a generation a great excuse to spend even more time playing games online: preparing for a professional gaming career.