Global esports revenues to top $1.4 billion in 2019: Report

Players are pictured on video screen as they attend the PUBG Global Invitational 2018, the first official esports tournament for the computer game PlayerUnknown's Battlegrounds in Berlin, Germany, July 26, 2018.
PHOTO: Reuters

NEW YORK - Global esports revenues will hit US$1.1 billion (S$1.5 billion) in 2019, up 27 per cent since last year amid ballooning revenues from advertising, sponsorship and media rights to competitive video gaming, a report said on Tuesday.

Brand investments through those three avenues will make up 82 per cent - or US$897 million - of total revenues. In all, brand support will have nearly tripled since 2015, according to data from Newzoo, a gaming industry analytics firm.

Esports is a form of competitive video gaming with multiple players battling against each other usually in teams, often in matches that are streamed live to throngs of young fans.

Esports has burst into the mainstream, with its own superstars and leagues, celebrity athlete owners and tournaments that sell out stadiums and award prizes worth millions of dollars. League of Legends, Dota 2 and Counter-Strike: Global Offensive are some of the most popular esports.

Early investments by big brands are now taking root, Newzoo CEO Peter Warman said.

"This is not experimental budgets. This is for the long term, and it's good amounts of money," he said. "It's what the ecosystem needed and what investors wanted to see."

For instance, Activision Blizzard Inc's Overwatch League named Coca-Cola Co as its official global beverage sponsor for non-alcoholic drinks on Friday.

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The game developer, which runs the professional esports league, also inked sponsorship deals with carmaker Toyota Motor Corp, wireless provider T-Mobile US Inc, computing companies HP Inc (HPQ.N) and Intel Corp.

North America will generate US$409 million of esports revenues in 2019, the most of any region, Newzoo's report found. China will generate 19 per cent and South Korea 6 per cent, with the rest of the world comprising the remaining 38 per cent.

While advertising is the bulk of revenue, merchandise and ticket sales are also expected to grow 22 per cent to nearly US$104 million, though game publisher fees will likely drop 3 per cent to US$95 million, the report showed.

The total audience - comprised of both enthusiasts and occasional viewers - is expected to grow 15 per cent to 454 million.

By 2022, total global esports revenues could be US$1.8 billion, Newzoo found.

Newzoo does not include prize pools, player salaries, capital investments in esports organisations or betting in its revenue projections.