Largely unheard of before the 2010s, Esports have grown to a $1.64 billion industry and are projected to surpass $2 billion by 2027. Fueled by online streaming platforms like Twitch and YouTube, the past decade has brought Esports to billions of people worldwide and saw widespread tournaments offering multimillion-dollar grand prizes. The body of providers and online audiences continues to grow with the release of Kick earlier this year. This year, a new record was broken when the Saudi Esports Federation funded a $45 million prize pool for competitors in Gamers8: The Land of Heroes.
There’s profit for more than just the competitors; a 2019 tournament in Atlanta, Georgia saw a $500 million boom in the local economy. In 2021, an Esports finals match drew over 73 million viewers, just 20 million less than that year’s Superbowl. Numbers such as these will attract the attention of future hosting cities and advertisers, further fueling the growth of Esports worldwide.
Originating in East Asia, the Esports industry has only recently begun to grow in North America. Since the first purpose-built facility opened in 2015, the region has become the largest single Esports market. Much of this growth was made possible by Esports leagues partnering with their real-life counterparts; the NFL, NBA, NHL, and FIFA have sponsored their respective Esport equivalents. Since becoming legal and regulated, Esports betting has surpassed traditional sports betting helping to fuel industry growth.
Gamers8, as well as the upcoming Global Esport Games this December, was hosted in a purpose-build section of the Saudi capital city, Riyadh. The event featured 11 of the most popular Esports, as well as the FIFAe World Cup, which took place over much of the summer, from July 6th to August 28th. In addition to Esport tournaments, Gamers8 hosted music concerts, festivals, and conferences for industry professionals. Such scale was made possible by a Saudi investment of $500 million USD into the “Esport City” and is part of a larger initiative to diversify the country’s economy.
Despite a year of “Esport recession,” industry compounded annual growth rate (CAGR) estimates remain between 16 and 22% through 2030. The industry is not without conflict, however, with serious concerns arising from government involvement. Much of the industry infrastructure in the Middle East is funded by the Kingdom of Saudi Arabia and governing members of the Global Esports Federation are tied to the People’s Republic of China. The Esports market, like any industry, should be navigated with caution. As we’ve mentioned in previous articles, the Esports industry is still in its infancy and is poised for growth in the near future.
Authors: Barrett Ziegler and Josh Horowitz, Team Leader, Professional Sports and Esports |[email protected]
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