Sport is one of Australia’s favourited pastimes and is key to its national identity.
In parallel, gaming has also become one of the leading hobbies amongst both children and adults alike with gaming participation now at record levels and “gamers” – slowly but surely – becoming household celebrities.
According to industry statistics, around 46% of Australians play games on a regular basis with that number continuing to grow year-on-year.
Another intriguing statistic is just how quickly this adoption has occurred considering that only a small minority of people played games regularly before the advent of mobile phones, apps and greater game immersion made possible by photo-realistic graphics.
Furthermore, games have advanced to the point of allowing players to interact with dozens of other online players simultaneously. That’s no easy feat considering that games are rapidly becoming more sophisticated, complex and realistic thereby requiring greater internet connection speeds.
The marriage of these two opposites promises to deliver not only a new pastime for consumers but also a sizeable industry in its own right that rakes in billions in each year.
The dawn of eSports
eSports is a combination of sports and online gaming with a peloton of fans already watching players compete on a weekly basis.
According to analyst estimates, eSports as an industry turned over US$655 million in 2017 – a 32% increase on the previous year’s US$493 million. Gaming companies are expecting the annual revenue haul to climb as high as US$1.5 billion by 2020 and compound annual growth rates to reach as high as 35-55% in the next five years.
The world’s leading annual eSports event – The International – took place last week for its 8th time and welcomed the world’s best players to battle it out on the game Dota 2.
The total prize pool for was a record for an eSports event at US$24.8 million – a figure that dwarfs prize pools even for grand-slam tennis events or major golf tournaments.
The XLive eSports Summit welcomed the first senior-level forum of its kind that brought together eSports industry stakeholders and traditional professional sports franchises under one roof to discuss the development of teams, players, organisation infrastructure, collegiate-pro ecosystems and player unions.
It’s not just gamers and gaming developers that benefit from eSports – companies are making a market from spectators watching professional gamers play high-profile games and using the carnival atmosphere to sell various other peripherals, accessories, online currency and hardware.
This weekend, the eSports extravaganza will take place in Melbourne – the inner sanctum of Australia’s media and art talent – after two successful shows in Sydney held over the past 12 months.
The current eSports global leader which organises competitions and gaming teams that compete for millions of dollars in prize money is ESL (formerly Electronic Sports League). The company has taken an early lead over other eSports hopefuls and has set up an extensive circuit of gaming tournaments in the US, Asia, Europe and Australia.
The popularity of eSports reflects a broader shift in consumer preferences in society and plays on existing interests such as sport, entertainment and gaming: the three themes that underpin its early growth and that will ultimately “forge an entirely new industry” according to Nick Vanzetti, managing director of ESL.
“In tandem with TEG, we have put on two eSports mega-events in Sydney over the past 12 months. The popularity of the event was staggering, and we welcomed at least 15,000 people to Sydney’s ‘Extreme Masters’ event,” he said.
In Melbourne, we’re taking a slightly different tact by ensuring the event is more of a gaming carnival rather than a gaming competition amongst professional gamers only,” Mr Vanzetti told Small Caps.
“We’re keen to see an open tournament that welcomes everyone and is all-inclusive of all gaming preferences. To do this, we’ll be setting up multiple open tournaments in real-time to allow spectators to become active participants,” added Mr Vanzetti.
Prize money galore
One of the more intriguing aspects of eSports has been the rapid increase of prize money that’s typically offered at internationally-acclaimed events such as the one in Melbourne this weekend.
Although Australian prize pools are still some way off the eSports gaming pacesetter: the US.
Tournaments in the US often offer US$1 million-plus prize pools with the largest tournament, The International, offering US$24.8 million in prize money this year.
Sydney’s two tournaments offered $350,000 while the Melbourne show will offer $50,000 but will have multiple smaller tournaments as opposed to one major event.
“The Sydney events were more like headline concerts with one prime act, whereas the Melbourne show is more of a day-out festival with several attractions available for spectators,” says Tim McGregor, managing director of TEG, a media and events company that organises dozens of events every year and owns popular Australian brand Ticketek.
Both ESL and TEG have confirmed that the games titles showcased for visitors will all be family-friendly and will include the likes of Forza Motorsport, Minecraft, Fortnight, League of Legends and Overwatch.
Mr McGregor explained to Small Caps that “the Melbourne eSports Open will have two headline competitions on Saturday and Sunday evening. The Overwatch tournament will take place on Saturday while the League of Legends tournament will conclude on Sunday; with the winners being admitted to the global championships in addition to their $50,000 winners cheque.”
“The event will have a range of access passes including a floor pass and a VIP pass that will allow visitors a different level of access to the event. All the organisers and participants have committed to putting on an open tournament with a carnival atmosphere that is suitable for everyone,” said Mr McGregor.