Esports Market Outlook, 2028

Video games are becoming more popular by each passing year and more gamers are finding their way into new trend called virtual world. As the name suggests, esports (electric sports) turns online gaming into a spectator sport. It mimics the experience of watching a professional sporting event, except instead of watching a physical event, spectators watch video gamers compete against each other. Gaming is no longer just a hobby for many. Professional gamers are finding their way into professional eSports and compete against each other in competitions for sometimes high prize money. Gaming and esports are two completely different things. Esport is defined as “the playing of video games on a competitive level with teams or individuals facing each other within leagues or in tournaments.” It describes the world of competitive, organized video gaming. Competitors from different leagues or teams face off in the same games that are popular with at-home gamers: Fortnite, League of Legends, Counter-Strike, Call of Duty, Overwatch and Madden NFL, to name a few. These gamers are watched and followed by millions of fans all over the world, who attend live events or tune in on TV or online. Since its debut in the 1980s, esports has drawn increasing numbers of players and spectators. In 1980, the first official esports tournament took place in Los Angeles, when 10,000 gamers faced off in Atari’s Space Invaders Championship. Today, millions of people around the globe watch esports games. Modern technology allows gamers and streamers to play or watch from anywhere with an internet connection.

According to the research report, “Global Esports Market Outlook, 2028” published by Bonafide Research, the market is anticipated to attain market size of USD 4380 Million by 2028, increasing from USD 1684.39 Million in 2022. The overall market is projected to grow with 17.52% CAGR for 2023-2028. With over 320 Million fans worldwide, esports is fast becoming a gaming mainstream industry. Increasing live streaming of games, formidable investments, rising audience reach, engagement activities, and infrastructure for league tournaments are the factors influencing the market growth. The profitable opportunities created by increasing professionalization in the industry for influencers, gamers, and event organizers, and game developers are driving the growth of the market. Millennials consider esports a professional career option, owing to the increasing popularity of gaming tournaments, one-to-one sponsorships, streaming revenues, and impressive international prize pools. Additionally, colleges and universities have started providing dedicated esports programs to develop skilled professionals.

According to the report, the global market is segmented into five major regions including North America, Europe, Asia-Pacific, South America and Middle East & Africa. Among them, Asia-Pacific market is anticipated to lead the market with more than 45% of the market share. Countries including China, Japan, and India are anticipated to experience robust demand considering the rapid shift on digital platforms for entertainment through sports events. The vast opportunities for the gaming and entertainment industry in Asia Pacific have surged the demand for electronic sports. Asia-Pacific is always been an attractive market for the gaming industry due to the growing youth population, ease of entry, and surging number of esports sponsors, spectators, and events from western countries. As for the North America and Europe, both the regions are expected to account for more than 42% of the market share. However, South America has a significant population interested in sports; hence, this is expected to fuel the business expansion opportunities. Considering the vast growth opportunities in the region, various brands and sports companies are investing in South American countries.

Further, the market is segregated into various revenue streams including sponsorship, media rights, merchandise & tickets, publisher fees, digital and streaming. Among them, sponsorship segment leads the market with higher market share. The segment had more than USD 1005 Million market size in 2022. Sponsorships allow brands to reach their potential customers directly through online and offline media channels. Booths, interactive advertising, posters, freebies, video displays, and many additional creative methods enable the brand to target potential customers. Many leading brands such as Nvidia Corporation, Red Bull, BMW AG, The Coca-Cola Company, and U.S. Air Force have already established sponsorship deals with esports leagues and teams. On the other hand, the media rights segment is one of the significant revenue-generating segments. Media rights comprise all the revenue paid to teams, leagues, and event organizers to obtain the rights to broadcasting esports content on a channel. Media rights are anticipated to generate considerable revenue because of numerous individual leagues, championships, and events held on various streaming platforms regularly. Twitch Interactive, Inc. has the eminent platform for live streaming adopted by fans to watch major tournaments. Recently, Twitch had witnessed fans spending 24 Billion hours watching streamers in 2021. Additionally, in March 2022, Rooter Sports Technologies Private Limited acquired the media rights for all IPs of Sky Esports for one year. Based on the obtained data, streaming segment is projected to grow at a higher CAGR for 2023-28.

The global esports market is further segmented into various device types including mobile (smartphone, tablet, etc.), PC (laptop, desktop), gaming device (console, handheld devices) and other (VR, smart TV, etc.) Among them, mobile segment is leading the market in 2022 and is expected to continue its dominance during the forecast period due to improvements in game quality and internet usage by millennials. As of April 2022, there were more than five Billion internet users worldwide, which is around 63% of the global population. Furthermore, due to its wireless portability and cost-effective usage, smartphone adoption for playing Esport is significantly increasing among end-users, which adds significantly to the global market's growth. Based on the latest data reveal, the number of “unique” mobile users was close to 5.48 Billion in October 2022. On the other hand, the growth of the Esports gaming console segment can be attributed to a variety of benefits provided by these devices, such as high gameplay quality, which results in a better gaming experience. Further, penetration of 5G network, VR and AR technology, smart & connected devices are projected to witness higher market growth during the upcoming timeframe.

The investments in the esports market are expected to increase during the forecasted period owing to the increasing number of franchise-style leagues and rising audience. Investors' growing interest is likely to result in the market's steady growth in the estimated period. The free-to-play gaming model has been found effective, with considerable in-game micro-transactions fuelling the companies' revenue, consequently supporting the industry growth. The games in the free-to-play gaming model have become popular as they have no upfront costs, and the fees are charged for featured or additional content. The free-to-play model has promoted diversity and helped to bring young gamers together in the esports ecosystem resulting growth of the overall gaming population. Micro-transactions have played a crucial role in the esports market ensuring the overall revenue growth of the esports market. Also, online video streaming platforms such as YouTube, Facebook, and TwitchTv are key applications driving the Esports Market globally. People all over the world are showing huge interest in Esports and investing their time, effort, and money in it.

Based on the game type, the market is categorized into shooter (first-person shooter & third-person shooter), multiplayer online battle arena (MOBA), Real-time strategy, fighting and others such as role playing, simulators, racing & sports. Among them, shooter games as well as multiplayer online battle arena games are contributing for more than 60% market share in 2022. Various game providers are offering a vast number of first-person shooter games. The games earlier offered a realistic 3D environment. Its popularity in virtual and video games is surging its demand in the market. In 2022, the number of video gamers worldwide stood around 3.03 Billion. Multiplayer online battle arena games to witness higher demands during the forecast period owing to their competitive and lucrative genres. The growing popularity of multiplayer is expected to fuel its growth. Some of the examples for this genre are Counter-Strike: Global Offensive (FPS), Overwatch (FPS), Fortnite (FPS), Dota 2 (MOBA) and League of Legends (MOBA) etc. Audience and awareness numbers are increasing in emerging markets in South America, the Middle East and Africa, and Southeast Asia. This mostly due to urbanization and advances in IT infrastructure, coupled with explosive mobile titles like PUBG Mobile and Garena Free Fire.

Tournaments and other events can attract viewing crowds that rival most traditional professional sports outings. When Major League Gaming first launched in the early 2000s, its tournaments drew dozens of fans. Today, esports’ largest tournaments are nearly as large as traditional sporting events. In 2016, The League of Legends Championship sold out the 15,000-seat Los Angeles’ Staples Center in an hour, then sold out the 40,000-seat World Cup Stadium in Seoul while drawing an online audience of 27 million. The 2017 League of Legends World Championship drew more than 80 million viewers, making it one of the most popular eSports competitions ever. In July, ESPN and Disney XD announced they secured a multi-year deal to broadcast the Overwatch League, a brand-new international league with 12 franchises centered on the incredibly popular multiplayer first-person shooter came, Overwatch. According to research from Newzoo, 588 major esports events were held in the same year. In 2019, the Intel Extreme Masters tournament, held in Katowice, Poland, drew 173,000 fans to the stadium over two weekends. Other popular global esports venues include London’s Wembley Arena (12,500 fans) and Seattle’s KeyArena (10,000 fans). ESL ONE (Electronic Sports League ONE), ESL Intel Extrem Masters (IEM), League of Legends Championship Series (LCS), League of Legends World Championship and the International are some of the popular esports tournament across the globe.

With the recent explosion of web3, blockchain, and cryptocurrency technology, companies in these spaces have also joined the race in getting involved with sports. The Staples Center being rebranded as the Crypto.com Arena and Coinbase’s $7 Million QR code ad is just some of the most buzzworthy examples. In eSports, these large checks and deals are also widespread. London based team Fnatic, for example, signed Crypto.com’s first eSports deal in late 2021, amounting to $15 million. Also, in early 2022, crypto exchange Bitstamp signed with UK-based Guild Esports in a $6.1 million deal. The growth of esports has been phenomenal, with new games being launched every year. Some games, however, dominate the landscape and are more popular than the others. Some games are more popular globally while others are regional successes. Some have a lot more players while others organize bigger tournaments with large cash prizes. League of Legends World Championship, MPL Indonesia Season 9, MLBB Southeast Asia Cup 2022, MPL Indonesia Season 10, Mobile Legends: Bang Bang Southeast Asian Games, Mid-Season Invitational, PGL Major Antwerp, The International 2022, VALORANT Champions 2022 and Free Fire World Series 2022 Sentosa are some of the highest viewed esports events in 2022.

Many big companies have found opportunities in the Esports market, leading to a series of advertising, sponsorship, franchise, and brand integration deals. For example, the well-known sports apparel giant, Nike, established a relationship with LPL (The League of Legends Pro League). They designed unique team uniforms for Esports clubs within the competition, such as T-shirts, shoes, and other spin-off clothing. Apparel brands such as Adidas and PUMA have similar partnerships with Esports. The diversity of Esports also allows for diversity in advertising as well. This allows for massive multiplayer online events. In 2020, during a Fortnite game, famous rapper Travis Scott held an online concert, with twelve million players watching the concert simultaneously. Red Bull, a well-known sports drink brand, is also an important brand investing in Esports. There is growing interest in esports from tournament organizers around the world. The 2022 Commonwealth Games in the UK will include esports as a pilot event for the first time. Esports is also making its debut at the 2022 Asian Games in China, featuring games such as DOTA 2, League of Legends and EA Sports FIFA. In the same year, major valuable esport teams include TSM (Team SoloMid-Los Angeles), G2 Sports (Berlin), Team Liquid (Netherlands), FaZe Clan (Los Angeles), Cloud9 (California) and 100 thieves (Los Angeles).

Over and above that, the global esports market consists of a vibrant startup ecosystem. Over 100 start-ups are expected to innovate and develop sports analysis solutions for end-users. Such an ecosystem is expected to create strong competition, resulting in existing companies to continually implement and update new advancements in their product offerings. Therefore, rise in competition is expected to create more opportunities for market participants and grow the market size.

Key Industry Developments:

• January 2023 - Furia, a Brazilian eSports organization, opened up a new venue in Miami, United States. This 5200 square-foot establishment dubbed as 'Furia Experience' is part of the company’s efforts to expand its presence in the U.S.
• November 2022 - An India-based eSports start-up called Gamerji announced that it had raised US$ 3 million in a Pre-Series A funding round that was led by Unicorn India Ventures and GVFL. The company allows gamers to host and compete in eSports tournaments.
• August 2022 - Regression Games, an eSports company founded by Aaron Vontell bagged US$ 4.2 million in a seed round that was led by New Enterprise Associates (NEA), a global venture capital firm. The AI-focused organization was expected to use the capital to expand its engineering team.
• 2022 - Digital Virgo, a France-based specialist in mobile payment with Etisalat Misr, and the Egyptian Telecom company launched a full-service E-sports platform for delivering top-tier educational and entertaining content in Egypt.
• January 2022 - A new category of 1440p NVIDIA G-SYNC esports screens and seven new games benefit from low latency thanks to NVIDIA Reflex. Since reducing system latency is recognized by gamers and game developers as essential to a quality gaming experience, the NVIDIA Reflex low latency ecosystem has grown significantly over the past year. Eight top-ten competitive shooters, including Apex Legends, Valorant, and Fortnite, support Reflex. Each month, more than 20 million GeForce gamers battle with Reflex ON. More than 50 mouse and screens support their Reflex Analyzer, enabling players to assess system latency quickly. Such developments are expected to flourish the esports market in the forecast period.
• February 2022 - Nintendo delivered its first Direct event of 2022 in a 40-minute presentation that featured several brand-new games and remakes. Highlights from Nintendo Direct 2022: Switch Sports, Mario Strikers, and announcements of other games. The market is expected to expand due to the release of multiple games.

Mergers and Acquisitions

• In 2022, Savvy Gaming Group, a Saudi Arabia-based Esports investment company, acquired ESL, a German-based Esports organizer and production company, and FACEIT, a UK-based Esports platform for $1.5 Billion. Through this acquisition, Savvy Gaming Group will integrate ESL's expertise in creating, broadcasting, and commercializing premium Esports ecosystems, including arena events and festival shows, with FACEIT's ability to develop top-notch tools for competitive games.
• On April 2021, Rollic, Inc. acquired Uncosoft, Inc. to expand in-house production in Izmir, Turkey and will expand its mobile gaming portfolio through innovative games design and aims to reach millions of players across the globe.
• On December 2020, Microsoft, Inc. acquired Smash.gg to expand its offerings, innovate games, and accelerate content offerings. The company will create competitive products, and expand its Esports market.

Partnerships, Collaborations, and Agreements

• In April 2022, Tencent and Beijing Universal Resort announced their partnership for the 2022 seasonal event. Tencent’s Honor of Kings, Peacekeeper Elite, QQ Speed, card game Doudizhu, as well as several other games, will be officially added to the Beijing Universal Resort parade.
• On November 2017, Electronics Arts partnered with FIFA to launch an esports tournament series for the Electronics Arts FIFA video game franchis.
• On November 2017, Turner Broadcasting System-owned ELEAGUE partnered with Warner Bros. Interactive Entertainment for the live streaming of ELEAGUE Injustice 2 World Championship across TBS, Twitch, ELEAGUE.com, and YouTube.

Product Launches and Product Expansions

• On February 2021, Electronic Arts Inc. announced a multiyear UEFA license extension, ensuring the pinnacle of club football remains exclusive to EA SPORTS. EA is expanding football video game access through multiple in-development mobile offerings, and by broadening the PC free-to-download FIFA Online 4 title’s reach to potentially 80 million players in more than 15 new countries.
• January 2020: Activision Blizzard announced the league for Call of Duty. This launch aimed to make Activision the largest operator of professional electronic sports leagues, where players compete in front of audiences.

Covid-19 Impacts:

Due to the arrival of COVID-19, the nature of eSports has changed. The lines between eSports, live streaming, and even influencer marketing have become blurred. The pandemic led to viewing spikes across all live streaming platforms. People were required to spend time at home during the lockdown and so turned to live streaming to while away their time. While the eSports market faced challenges during this time, it also saw considerable growth and expanded into markets where there had previously been little activity. However, the industry suffered from the cancellation of many in-person events, and some international events had to be replaced by regional competitions. . Due in part to the digital nature of esports, in response to the COVID-19 outbreak, the industry has been able to rapidly pivot to online streaming and broadcast programs and activations.

Major Companies present in the market:

Activision Blizzard Inc, Intel Corporation, NVIDIA Corporation, Valve Corporation, Electronic Arts Inc, Wargaming Public, Rovio Entertainment, alphabet Inc (YouTube), Twitch Interactive, Inc., Facebook, Inc, Beyond The Summit, Riot Games, Inc, Sony Group Corporation, HTC Corporation, Gameloft SE, Gfinity plc, Nintendo, FACEIT, Epic games, Loco (Stoughton Street Tech Labs Limited).

Considered in this report

• Geography: Global
• Historic year: 2017
• Base year: 2022
• Estimated year: 2023
• Forecast year: 2028

Aspects covered in this report

• Global esport market with its value and forecast along with its segments
• Region-wise esport market analysis
• Various drivers and challenges
• On-going trends and developments
• Top profiled companies
• Strategic recommendation

Regions & Countries covered in the report:

• North America (United States, Canada, Mexico)
• Europe (Germany, United Kingdom, France, Spain, Italy, Russia)
• Asia-Pacific (China, Japan, India, Australia, South Korea)
• South America (Brazil, Argentina, Colombia)
• Middle-East & Africa (UAE, Saudi Arabia, South Africa)

By Revenue Streams:

• Sponsorship
• Media Rights
• Merchandise & Tickets
• Publisher Fees
• Digital
• Streaming

By Device Type:

• Mobile (Smartphone, Tablet)
• PC (Laptop, Desktop)
• Gaming Device (Console, Handheld Devices)
• Other (VR, Smart TV, etc.)

By Game Type:

• Shooter (First-person shooter, Third-person shooter)
• Multiplayer Online Battle Arena (MOBA)
• Real-time Strategy (RTS)
• Fighting
• Other (Role-playing, Racing, Simulators, Sports, Others)

The approach of the report:

This report consists of a combined approach of primary as well as secondary research. Initially, secondary research was used to get an understanding of the market and list out the companies that are present in the market. The secondary research consists of third-party sources such as press releases, and annual reports of companies, analyzing the government-generated reports and databases. After gathering the data from secondary sources primary research was conducted by making telephonic interviews with the leading players about how the market is functioning and then conducting trade calls with dealers and distributors of the market. Post this the publisher has started doing primary calls to consumers by equally segmenting consumers into regional aspects, tier aspects, age groups, and gender. Once the publisher has primary data with us we started verifying the details obtained from secondary sources.

Intended audience

This report can be useful to industry consultants, manufacturers, suppliers, associations & organizations related to the esport industry, government bodies, and other stakeholders to align their market-centric strategies. In addition to marketing & presentations, it will also increase competitive knowledge about the industry.