The current global health crisis caused by the COVID-19 virus has had a major impact on almost every country, industry and person across the world. In March 2020, one industry that initially came to a complete halt was sports. As lockdown restrictions began to lift a few months after, fans saw numerous sports resume, albeit without live spectators and the usual sporting atmosphere.
But has this presented a chance for esports to grow in its place? We spoke to John Griffiths, chief commercial officer, Spicy Mango, about the changing world of esports, if traditional broadcasters can rise to the challenge, the opportunity presented and what role betting has to play.
Can you explain a bit about how the pandemic initially impacted the world of sport?
The world of sports has been majorly impacted by the coronavirus pandemic. When lockdown ground everything to a halt, most major sports either paused, postponed or cancelled their season, with huge delays in restarting many sports such as the English Premier League and Formula 1. Even the pinnacle of global sport, the Olympic Games, was announced to be postponed until 2021.
It’s estimated that esports revenues topped $1bn in 2019, a 27% increase from 2018’s figure. The last year or so has seen esports enter the big leagues, with Comcast announcing that it would build a $50m arena to accommodate esports tournaments
At a time when the vast majority of the population was confined to their homes, watching live sport on TV would have been a very pleasurable way to spend the extra hours saved on the daily commute. Alas, with all sport cancelled aside from a few repeats of classic matches or races, there was a huge void to fill for sports fans.
So, did this present an opportunity for esports and online gaming to become more mainstream? How will this, or did this, impact broadcasters and betting companies?
Absolutely. Esports is growing rapidly. In fact, it’s estimated that esports revenues topped $1bn in 2019, a 27% increase from 2018’s figure. The last year or so has seen esports enter the big leagues, with Comcast announcing that it would build a $50m arena to accommodate esports tournaments. Leading the way is Fortnite, which as of 2020 has 350 million registered users, with other games including Dota 2, League of Legends, Counter-Strike: Global Offensive and Overwatch also seeking to take a slice of the competitive gaming landscape.
Over the summer period, there was a massive increase in esports coverage as seen in motor racing, cycling (a virtual Tour de France), soccer, horse racing and even ice hockey. In some cases, this increased coverage has seen the opportunity for betting grow. In one example, this year’s virtual Grand National was watched by almost 5 million free-to-air viewers and the average bet on the race was £2 ($2.59), a significant increase from the 2019 virtual Grand National which had 737,000 viewers.
But unfortunately, this betting success has not been seen through other sports, which have been viewed as a substitution until the real thing is able to return. While esports might not yet be in a position to rival traditional sports, does it instead offer the sport and its fans an opportunity for year-round competition and for younger, emerging stars to showcase their talent?
However, as with any environment, the growth of esports has, and will continue to, undoubtedly come with teething problems. And with market leaders such as Amazon and Alibaba trying to take a path into the esports business, where is the future of its viewership heading? As a sport watched almost entirely by gamers, the question for broadcasters and betting companies is how can they make it appeal to the masses - and should they?
Is it an investment that broadcasters and betting companies should be making?
With Amazon’s Sport Now subscription now including Arena Esports into their monthly membership, and with broadcasters like the BBC among others having already taken a leap into the world of esports by broadcasting specific tournaments, broadcasters and OTT platforms are clearly attempting to capitalise on this ever-growing market. However, with 15 million people watching esports worldwide on sites like Amazon owned Twitch and Google owned YouTube per day, and the number of those 16 to 24 watching esports growing by more than 60% in 2019, how does a subscription or broadcast service compete?
The demographic of the esports audience plays an important role here: does the demographic and its spending power offer enough of an opportunity to broadcasters to decide if the investment is worth making? The spending power of the current largest demographic – the 16 to 24 year-olds - may not be compelling enough for more broadcasters or betting companies to consider the approach.
However, in reality, traditional sports can learn a lot from esports when it comes to digital fan engagement, with the ability to show real-time data, match stats and background on key players or participants, which viewers can then use to not only engage with the sport, but to inform their bets.
How does the experience differ between esports and traditional broadcast sports?
Streaming platforms such as Twitch offer users a unique experience. From esports tournaments to video game streamers to streamers who are just chatting, Twitch gives users autonomy over what they want to watch and when. Furthermore, with the ability to interact with other players through live chat, this platform creates a sense of community that gamers want to be a part of, a community sometimes more important than the tournament they’re watching.
However, with the static nature of broadcast only offering the viewer the chance to view, not interact, will gamers choose to watch it on the big screen? Again, this is where the audience of esports is important: by 2021, casual esports viewers will outgrow esports fans and players by 57 million, possibly due to increased awareness, which presents an opportunity for broadcasters to appeal to far more than the players themselves. Betting also plays a huge part in this; the fact that the experience of esports might not be considered to be as impactful means that esports betting could remain niche. Yet there is the opportunity for technology to be utilised to ensure esports and betting are given a fighting chance as live sports still remains restricted in the months to come.
What changes could broadcasters make?
For broadcasters considering a change in approach, if they aren’t able to offer a live-view of the game, they need to decide what they want viewers to get from their coverage of the sport. EA worked with ESPN on a four-part series called Road to Madden Bowl to help tell the story in the lead up to the Madden Championship, and this enabled EA to reach audiences beyond their traditional online distribution, which added to the hype of the tournament.
Watching traditional sports on OTT services has increased in popularity over the last few years. The appetite from sports fans is certainly there, with 63% of sports fans claiming they would pay for an all-sports OTT channel, and 56% stating they would pay more for online streaming than for traditional TV channels. So we are already seeing changes happening in this area
However, it doesn’t have to be purely about broadcasters making esports work for their formats, when esports could also change its formats to become time bound, and therefore more broadcast (and betting) friendly. Many mainstream sports are changing their formats to appeal to wider audiences – both live and on TV – such as Rugby X, The Hundred and Tie Break Tens. Esports could just as easily make this change to fit in with existing broadcast schedules, and therefore widen the audience and betting opportunities. Without the limitations of timescales, broadcasters will be wide open to make esports appealing and work for their audiences, and by better utilising available data, betting companies can also ensure they are broadening their opportunities.
What challenges does betting introduce to esports?
Watching traditional sports on OTT services has increased in popularity over the last few years. The appetite from sports fans is certainly there, with 63% of sports fans claiming they would pay for an all-sports OTT channel, and 56% stating they would pay more for online streaming than for traditional TV channels. So we are already seeing changes happening in this area.
However, what has always been a stumbling block is the delay that often comes with OTT streaming services - often 15-20 seconds - which in a critical World Cup match, can result in the viewer missing a winning goal or penalty. This is where, when betting is added into the mix, the challenge only increases.
If a viewer places a bet on the outcome of the match while watching on an OTT service, the delay could be the difference between the viewer cashing their bet in, or upping the stakes. That delay, however, could also mean that a viewer’s decision to cash out loses them money if the state of play had changed in the 15-second delay. This is an area that clearly needs attention, if esports stands any chance of becoming mainstream.
As one of the fastest-growing categories in online gambling, esports betting is expected to grow to $12.9 billion by 2020, and the growth won’t stop there. To keep the user experience intact, and to ensure OTT services don’t stop the viewer getting the most out of their bets, these providers need to consider how technology can best be used to reduce the lag, and provide the same betting experience offered by broadcast.
What do you think the future holds for esports?
It’s clear that despite its boom in popularity, esports is still very much still in its exploratory phase for broadcasters, gaming companies and betting organisations. While we hope the world does not see another global crisis like COVID-19 for many decades, it may just present an opportunity for esports to accelerate its growth and find a new audience, an audience that hopefully will see the excitement, exhilaration and enjoyment that younger audiences have enjoyed and nurtured for the last decade or so and that with a bit more spending power will drive faster growth of esports.
With lots of questions left to answer, it will be interesting to see what happens over the next few years in terms of which companies will decide to take part in the journey, and will broadcasters and betting companies be able to conquer the constraints and capture the wider audience’s interest.
