The global gaming industry has seen significant changes over the last few decades. Ever since the first computer game called Nim was designed by American physicist Edward Condon in 1940, there’s no looking back for the industry.
The video game console was introduced in the 1970’s and this evolution was rapid over the next few years. As video game graphics improved, companies such as Electronic Arts [EA] and Activision Blizzard [ATVI] were found.
Heavyweights such as Sony [SNE] and Microsoft [MSFT] soon wanted a piece of the gaming pie and introduced popular consoles such as the PlayStation and Xbox. The global gaming market has grown at a spectacular pace and is expected to reach $137.9B by the end of this year, according to Newzoo.
The growth of eSports
The latest growing trend in the gaming space is eSports. eSports is a multiplayer video game played competitively by professional gamers.
While video games were traditionally played for recreation, it has now become a viable career option for gamers. The inflow of funds into eSports is set to drive prize money and sponsorship deals higher.
Gaming research company, Newzoo expects eSports to reach $905.6M by the end of 2018, a rise of 38% year-over-year. Newzoo estimates brand contribution alone to account for 77% of the eSports market or $694M this year. Better yet, the global eSports audience is expected to cross 380 million this year.
Major video game companies have entered the eSports space
The eSports segment has attracted the attention of top gaming companies. Activision Blizzard is already a market leader with its hugely successful launch of the Overwatch League.
The first season of the Overwatch League garnered attention from sponsors as well as spectators. The global audience spent 160 million hours watching matches of this league.
Activision recently announced the sale of eight new franchise teams bringing the total number of teams to 20. The gaming giant aims to have a total of 28 teams for the Overwatch League. While the first 12 teams were sold for $20M each, the next round of franchise sales was between $30M and $60M, according to ESPN.
Activision signed broadcasting deals with Amazon’s [AMZN] Twitch to stream live matches. It has a content partnership with Twitter [TWTR]. The company also bagged sponsorship deals with Intel [INTC], HP [HPQ] and T-Mobile [TMUS]. The broadcast rights and sponsorship deals have generated over $100M for Activision.
The worldwide eSports audience is estimated to reach 580 million by 2021 and this will lead to an increase in eSports tournaments.
Gaming firm’s such as Electronic Arts [EA] organized The FIFA Interactive World Cup, an annual video gaming competition. Companies including MLG, AHQ and Denial have multiple sports leagues as well.
Key drivers for eSports growth
Research company Newzoo expects the eSports market to touch $1.65B in 2021.
The company estimates that the growing industry will bring in contributions from sponsors and advertisers. Companies such as Twitch and YouTube [GOOG] will also eye media rights and broadcasting deals. Gaming publishers are paid ‘Game Publisher Fees’ to host tournaments.
There are also tickets and merchandise revenue generated via ticket sales for eSports events. The industry’s sponsorship revenue rose 55% to $250M last year while Twitch paid $90M this year to broadcast the Overwatch League.
Increase in viewership data and prize money
Twitch is an online streaming platform and primarily focuses on broadcasting eSports competitions from around the world. It has managed to grow its viewership base at a compounded rate of 21.3% in the last three years.
In 2017, viewers tuned in to watch 6 billion hours of content on Twitch. Earlier this year, YouTube made its largest eSports investment to date and signed a multi-year broadcasting deal with Faceit.
These partnerships and deals have resulted in a substantial increase in prize money. The total prize pool for the Dota 2 tournament exceeded $20M.
The above chart shows the earnings of top gaming players. Japan’s Kuro Takhasomi leads the eSports earnings with a prize money of $3.74M to date.
Tencent expects China to lead the eSports market
Tencent is the leading global gaming company in terms of revenue. The company estimates China’s eSports sector to reach 350 million users by 2020 and generate annual revenue of $1.5B. If this happens, the country will account for 59% of total viewers.
What’s more, the total number of eSports viewers might exceed Tennis viewership in the United States. As per Newzoo estimates the most popular eSports team will have a Twitter following exceeding that of Golden State Warriors.
With the game-streaming content set to exceed 10B hours across major platforms, the world’s 10 biggest cities might just invest in a dedicated eSports stadium.
$137 Billion On The Line With Jeff and MacKenzie Bezos Divorce
A year after becoming the richest person, Jeff Bezos, founder of Amazon.com, is getting a divorce from his wife MacKenzie. The news broke in the below tweet from Jeff last Wednesday.
— Jeff Bezos (@JeffBezos) January 9, 2019
MacKenzie is said to have played a significant role in Amazon in the early years of the company. If the split goes as predicted, she will then become the richest woman in the world.
Investors will be comfortable once the divorce does not affect the growth and profitability of Amazon.
What Are Your Favorite Christmas Songs And How Much Money Do They Make?
Christmas is the gift that keeps on giving for a select group of singers, songwriters and producers. An article in Forbes recently pegged U.S’s Christmas Music as the “Global King” compared to other genres of music like Pop.
So how much money are they talking? CNBC’s Tom Chitty explains.
This Uber Killer Wants To Drive You Around In A Lambo…For £5
While all that was going on, another ride-hailing service called miwhip (“my whip” — get it?) came out of left field, announcing their desire to drive ride-hailers around in luxury sports cars like Lamborghinis, Ferraris, and whatever the hell else the heart desires.
But as usual, there’s a caveat…
Not going to call it a bait-and-switch, but here’s what Forbes wrote on their Instagram:
A new Uber rival in London, miwhip, lets you travel in gold supercars, and trips can cost as little as £5.
The ride-sharing app launched at the end of last month with an Austin Powers villain-worthy Lamborghini Aventador, Ferrari 488, Rolls Royce Ghost II, Mercedes G Wagon and McLaren 720s.
Within 48 hours of receiving the private hire operator license from Transport for London, miwhip spent over £1.5 million on supercars.
Miwhip takes 10% less commission than their competitors and offers daily cash outs as an homage to the five cofounders’ father, who was a mini-cab driver who worked to juggle work and family life.
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A new Uber rival in London, miwhip, lets you travel in gold supercars, and trips can cost as little as £5. The ride-sharing app launched at the end of last month with an Austin Powers villain-worthy Lamborghini Aventador, Ferrari 488, Rolls Royce Ghost II, Mercedes G Wagon and McLaren 720s. Within 48 hours of receiving the private hire operator license from Transport for London, miwhip spent over £1.5 million on supercars. Miwhip takes 10% less commission than their competitors and offers daily cash outs as an homage to the five cofounders’ father, who was a mini-cab driver who worked to juggle work and family life.