Esports is a major industry in itself and has been now for some years. It attracts crowds of tens of thousands in arenas around the world, sees millions paid out in prize money, attracts the biggest brands as sponsors and pays the salaries of hundreds of live streamers.
Despite this, sportsbooks, both traditional and crypto, have struggled to turn the entertainment value into a viable betting product which has attracted esports fans or cross-sold to other sports bettors on-sites. Saying that, we've seen early success stories with those who focus on esports as a key complement to its betting product, as opposed to those who use it to bolster content and hope they'll hit a goldmine with a new audience segment. The former, such as Sportsbet.io, FortuneJack and CloudBet, are certainly paving the way for many traditional operators – who tend to fall in the latter category – to follow.
Some crypto operators have also tried their hand at esports specific sites, with Luckbox and Unikrn two prime examples, but it seems as though the potential is still not being fulfilled in esports industry-wide.
Esports boom in 2020
However, 2020 is set to be the year that esports finally takes off and earn a prime share of sportsbook's gross wins, at least according to H2 Gambling Capital research. The company has claimed that gross win from esports betting will grow by 39% year-on-year in 2020, reaching $343m. This may be comparatively minor compared to what we see in other major sports, but with a youthful audience and a growing fanbase, H2 expects this to rocket in the coming years.
By 2024, projections for esports betting stand at $862m in revenue, while bookmakers can expect to see esports' share of GGR jump from 1.6% in 2019 to 3.2% in 2024.
These projections come on the back of a healthy, well-managed and increasingly regulated esports industry that seems to be the major growth area as a global sport, as well as betting vertical, in the coming years. However, we also can't ignore the fact the recent COVID-19 pandemic's impact on global sports has had a significant role to play.
With various major events cancelled, traditional and crypto bookies alike scrambled for new content and fortunately, esports betting was prime to step in, in terms of both quality and quantity. Sports betting saw GGR fall by three quarters in the period April 1-10 this year, while in the same period, esports was estimated to double in GGR.
H2 estimates that the majority of this esports betting growth will be from Europe and Asia, with little take in the likes of Africa and the LatAm region. This is logical going on sportsbook popularity in those regions, but also the fact that esports tends to attract those from affluent areas with high-speed internet access.
The big three
In terms of esports as individual titles, the big three of League of Legends, CS:GO and Dota 2 still command the main share of betting activity. Indeed, H2 Gambling Capital estimates this to be around 95% share for the three esports. However, less professional esports such as NBA, FIFA and racing titles have seen significant upticks of late, particularly with their ability to turn around quickfire results and revenue streams, much akin to the virtual sports vertical.
Whether esports carries its momentum post the COVID-19 catalyst remains to be seen, but as a gambling product its looking in a healthy position to service crypto sportsbooks and their players for the foreseeable future.
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