By James T. Reese Jr., Ed.D. Associate Professor/Program Director, Sports Management, and Dr. Brian Freeland, Ed.D. Dean/Professor, Health Sciences, American Military University
In a little more than a decade, esports, in its current live streaming format, has quickly become a global phenomenon, ESI reports.
Esports is short for electronic sports. As ESI explains, “It is a form of competition where professional gamers square off either in teams or individually. Competitions take place in a multiplayer setting, and there are typically cash prizes awarded at the end of tournaments.”
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In addition to the U.S., 2020 competitive events were scheduled in Australia, Brazil, Canada, China, Denmark, France, Germany, Japan, Mexico, Poland, Russia, Singapore, Spain, Sweden, Ukraine and the United Kingdom. Even more impressive is that 100 million people watched last year’s League of Legends World Championship. That was more than the Super Bowl‘s 98.2 million.
In 2019, global esports revenues were projected to hit $1.1 billion, up 27 percent since 2018, according to Reuters. More than half of that revenue was generated from corporate sponsorships. Estimates are that the industry could hit $1.8 billion within the next two years. Esports viewership was already expected to reach nearly 600 million this year.
Coronavirus Pandemic Sets Off Explosion in Esports Participation
However, over the past few months, esports has exploded further, according to the Guardian. That’s because many people are forced to remain at home with fewer entertainment options, due to the coronavirus pandemic.
The Guardian noted that communications giant Verizon’s domestic peak hour usage was up 75 percent during the first week of the pandemic quarantine. Perhaps the most telling indication is that Twitch, one of the primary live platforms that allow gamers to stream their games for others to watch while they play, was up 33 percent in March.
Involvement of Professional Athletes and Governing Bodies
Whether esports actually qualifies as a “sport” has been a topic of debate for some time between the gaming industry and those involved with traditional sports. However, few can dispute the tremendous growth, popularity, and financial impact esports is having across the globe. Professional sports leagues such as the National Basketball Association and the National Association for Stock Car Auto Racing (NASCAR) have used the current hiatus in live sports to create new esports content and enter the live-streaming event market.
ESTNN reports that many prominent sports and entertainment figures have made financial investments in esports, including Michael Jordan, rap superstar Drake, Jennifer Lopez, Alex Rodriguez, Shaquille O’Neal, Steph Curry, Kevin Durant and Michael Strahan. Professional sports team owners such as Robert Craft (NFL), Mark Cuban (NBA), Dan Gilbert (NBA) and Stan Kroenke (NFL, NBA, NHL) are also seeing the potential financial impact of the esports industry.
Esports has even caught the attention of the International Olympic Committee (IOC). The IOC indicated that one day it might consider esports as an Olympic sporting activity, but only for sports-related electronic games.
New and Extended Corporate Partnerships
It’s not surprising that early esports sponsors such as Nintendo and Blockbuster in the 1990s had a direct connection to gaming. However, non-endemic brands are now getting involved in the esports movement because they recognize the opportunity to reach new markets.
For example, current sponsors like Chipotle, McDonald’s and Zaxby’s all recently renewed existing deals. Several weeks ago, Nestle’s Kit Kat brand initiated a new sponsorship deal with League of Legends academy team AGO ROGUE. In 2019, the gaming industry added other high profile sponsors including Adidas, AT&T, Audi, BMW, Bose, Coca-Cola, Domino’s Pizza, Honda, Jersey Mike’s, KFC, Kia, New Era, Nissan, Red Bull and Mars’ Snickers.
The Future of Esports
With revenue, viewership, and participation expected to soar over the next two years, according to LearnG2, the gaming industry appears to have few obstacles to continued success. In addition to dozens of high profile events streamed worldwide each year, esports is growing rapidly at the grassroots level with clubs and competitions in high schools and colleges.
There are approximately 15 colleges and universities that offer esports scholarships, among them Boise State, Utah, Cal-Berkeley, and Cal-Irvine. That list is expected to continue to expand rapidly.
Now with more structure and the “wild, wild west” days of laissez faire governance gone, it will be interesting to see if esports can maintain its current level of growth before plateauing or oversaturating the market. One or both will eventually happen, but it doesn’t look to happen any time soon.
About the Authors
Dr. Jim Reese is an Associate Professor and Program Director for the undergraduate and graduate sports management programs at American Military University. He holds an M.S. in Sport Management from Georgia Southern University and an Ed.D. in Physical Education: Sport Administration from the University of Northern Colorado.
Dr. Brian Freeland is the Dean of the School of Health Sciences at American Military University. He holds a B.S. in Teaching in Physical Education from Radford University, an M.S.S. in Sports Management from the United States Sports Academy and an Ed.D. in Sports Management and Leadership from Northcentral University. Both Dr. Reese and Dr. Freeland are co-faculty advisors for the APUS Esports Club.
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