Frontline Marketing

ESports Wagers Expect To Exceed $23 Billion By 2020

By | August 25, 2015 |

With eSports competitions gaining both large cash offerings (the recent International offered over $18 million) and massive audiences (this weekend’s League of Legends drew two million streaming fans without breaking a sweat), there’s no question that they’re gaining popularity. With them, however, wagering is expected to pick up as well, according to Forbes contributor Darren Heitner.

Based on research provided by gaming industry numbers team Eilers Research, the author believes that fans of eSports competition will bet more than $250 million on the outcome of eSports events for this year alone. However, that number will grow even larger over the next few years, as it’s estimated to reach an incredible $23 billion by 2020.

“Part of the equation is real-money fantasy eSports competition,” said Heitner. “Eilers Research estimates 590,000 paid actives for real-money fantasy eSports competition in 2015 along with 1.72 million paid actives for eSportsbooks. Fantasy eSports is similar to more common daily fantasy operations surrounding football, basketball, baseball, hockey, etc., where individuals may submit an entry fee and compete against others for predetermined prize pools. However, eSportsbook wagering is akin to traditional sportsbook wagering, which allows people to place wagers against the house on the predicted outcomes of individual matches.”

Eilers also indicated a “bull case”, where 32.5 million betting fans will wager an estimated $42.9 billion by 2020, which in turn will generate $3.3 billion in revenue for operators. The numbers look big, but actually end up being pretty modest in the context of eSports audience/spend. eSports betting, not fantasy, will drive the overwhelming majority of the growth, said Chris Grove, Senior Consultant at Eilers Research. I ll readily admit that this is a largely speculative exercise. It s a nascent and opaque segment. But I believe we have arguments that provide a firm, rational foundation for our projections.

During a recent panel at the SportsManias Digital Media Summit in Miami titled “Tomorrow’s Audience Today How to attract and retain millennials as content consumers and producers, too“, eSports was a large point of topic, as millennials are a key audience when it comes to eSports, as part of fantasy-based league spending. Their purchasing power is great, as their purchasing power will extend anywhere from $600 billion to $1.4 trillion over the next five years. The age group will also have $200 billion spending annually through 2017, and over $10 trillion in their lifetimes. That’s a lot of money, and a good amount of it could go towards betting in eSports.