Is E-Sports Betting the Next Big Thing in Online Sportsbooks?
E-sports, or organized competitive video gaming, have exploded in popularity over the last decade. Events like the League of Legends World Championship can draw viewership numbers rivaling traditional sports championships like the Super Bowl or UEFA Champions League final. This rapid growth shows no signs of slowing down. As a result, the emerging e-sports betting market is projected to reach revenues of $20.7 billion by 2027. This leads many to wonder – will e-sports betting become the next big trend in online gambling? Could the appeal to a younger demographic hungry for a new form of entertainment disrupt the industry as we know it today?
Rise of E-Sports Viewership
E-sports viewership has seen meteoric growth in recent years across all regions and demographic groups, including Betano UK. To put the numbers in perspective:
- The 2021 League of Legends World Championship drew over 74 million peak concurrent viewers, on par with viewership for the Super Bowl.
- 40% of e-sports viewers are aged 21-35 years old, an audience with high disposable income that will only grow over time.
- There are projected to be 646 million occasional viewers and 295 million enthusiastic followers of e-sports globally by 2024.
E-sports tournaments and leagues are now broadcasted by major networks like ESPN, Turner and YouTube. Top players have become celebrities with massive online followings. One can compare this rapid ascent to the early days of poker as a televised spectacle. Much like poker, e-sports betting seems primed to take advantage of this newfound popularity.
Current State of E-Sports Betting
While still a nascent industry, e-sports betting is growing at a breakneck pace in jurisdictions where online gambling is regulated. The total estimated handle was $12.7 billion in 2020, a number projected to reach nearly $20 billion by 2027. For comparison, Nevada sportsbooks accepted $4.3 billion in bets for the 2020 NFL season. And the variety of e-sports available for betting will only continue to expand along with viewership trends.
Most regulated online sportsbooks and casinos now offer odds for major tournaments in games like:
- League of Legends
- DOTA 2
- Counter-Strike: Global Offensive
- Overwatch
- Call of Duty
- FIFA
These sportsbooks cover head-to-head matchups, tournament outcomes, proposition bets and more. However, adoption still trails traditional sports betting in mature markets like the UK and Europe. This points to room for massive growth in e-sports betting as familiarity increases over time.
Why E-Sports Betting Appeals to Online Casinos
So why are online casinos jumping on the e-sports betting bandwagon? There are a few key reasons:
1. It Appeals to a Valuable Demographic
The typical e-sports fan is young, tech savvy and often has high disposable income. This makes them an extremely valuable demographic in the gambling industry. E-sports betting provides online casinos an avenue to acquire players early and retain them over many years by catering to an interest they are already passionate about.
2. There Is a Built-In Customer Base Ready for Conversion
Hundreds of millions already watch e-sports without betting on matches. While not all will transition to gambling, even a small percentage could provide a profitable new source of business. For example, a survey found 40% of e-sports viewers aged 21-35 would likely place a bet if it was legal and convenient in their state. That conversion rate would result in nearly 100 million probable new bettors based on current viewership.
3. It Allows Differentiation From the Competition
In the increasingly competitive world of regulated online gambling, operators look for ways to stand out from the pack. Given the newness of e-sports betting, being a first mover provides an edge with less saturation. Branding around expertise in this hot new activity presents a real marketing advantage.
4. Streaming Technology Lends Itself Well to Live Betting
A key driver of profits in sports betting comes from in-play or live betting markets. The streaming technology integral to e-sports provides the perfect vehicle for real-time odds based on how a match is unfolding. This ability to constantly update markets and offer new props at a moment’s notice proves part of the appeal for bookmakers.
Challenges Facing Mainstream Adoption
Of course, there remain challenges facing e-sports betting on its path to potentially disrupting the online gambling landscape. These include:
- Ongoing legalization efforts: E-sports betting presently operates in a fragmented regulatory environment globally. Only around 22 jurisdictions have passed laws specifically legalizing wagering on competitive video gaming. More progress towards mainstream legalization still needs to occur.
- Integrity concerns: Like any sport, scandals around match-fixing or cheating could hinder adoption. And the online nature of e-sports makes policing integrity more difficult compared to traditional sports. However, safeguard creation is underway via regulators and private watchdog associations.
- General lack of understanding: For many older demographics, acceptance of e-sports as a “real” sport remains low. And betting concepts centered around video game competitions may sound odd or off-putting to current gamblers. But this perception seems likely to shift over time much as it has for poker and MMA betting.
What Does the Future Hold?
In summary – could e-sports betting emerge as the next big disruptor of the online gambling industry? The potential certainly appears there given its rapid explosion in popularity and synergies with live betting technology. Projected market size based on current trends points to massive profits on the table. Online casinos and sportsbooks seem right to invest resources into attracting their share of this emerging sector.