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Global esports revenues to top $1 billion in 2019: report

TechnologyFeb 12, 2019 11:39AM ET
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© Reuters. FILE PHOTO: Players are pictured on video screen as they attend the PUBG Global Invitational 2018, the first official esports tournament for the computer game PlayerUnknown's Battlegrounds in Berlin

By Hilary Russ

NEW YORK (Reuters) - Global esports revenues will hit $1.1 billion in 2019, up 27 percent since last year amid ballooning revenues from advertising, sponsorship and media rights to competitive video gaming, a report said on Tuesday.

Brand investments through those three avenues will make up 82 percent - or $897 million - of total revenues. In all, brand support will have nearly tripled since 2015, according to data from Newzoo, a gaming industry analytics firm.

Esports is a form of competitive video gaming with multiple players battling against each other usually in teams, often in matches that are streamed live to throngs of young fans.

Esports has burst into the mainstream, with its own superstars and leagues, celebrity athlete owners and tournaments that sell out stadiums and award prizes worth millions of dollars. League of Legends, Dota 2 and Counter-Strike: Global Offensive are some of the most popular esports.

Early investments by big brands are now taking root, Newzoo CEO Peter Warman said.

"This is not experimental budgets. This is for the long term, and it's good amounts of money," he said. "It's what the ecosystem needed and what investors wanted to see."

For instance, Activision Blizzard (NASDAQ:ATVI) Inc's Overwatch League named Coca-Cola (NYSE:KO) Co as its official global beverage sponsor for non-alcoholic drinks on Friday.

The game developer, which runs the professional esports league, also inked sponsorship deals with carmaker Toyota Motor Corp, wireless provider T-Mobile US Inc, computing companies HP Inc (N:HPQ) and Intel Corp (NASDAQ:INTC).

North America will generate $409 million of esports revenues in 2019, the most of any region, Newzoo's report found. China will generate 19 percent and South Korea 6 percent, with the rest of the world comprising the remaining 38 percent.

While advertising is the bulk of revenue, merchandise and ticket sales are also expected to grow 22 percent to nearly $104 million, though game publisher fees will likely drop 3 percent to $95 million, the report showed.

The total audience - comprised of both enthusiasts and occasional viewers - is expected to grow 15 percent to 454 million.

By 2022, total global esports revenues could be $1.8 billion, Newzoo found.

Newzoo does not include prize pools, player salaries, capital investments in esports organizations or betting in its revenue projections.

Global esports revenues to top $1 billion in 2019: report
 

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