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Esports Betting: Revolution not Evolution

Esports Betting: Revolution not Evolution

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Esports, more formally described as competitive video gaming, is an entertainment genre that has evolved over recent decades from its beginnings as an almost underground niche to what is now an ever-expanding global phenomenon. Established as a mainstream feature of everyday life across a certain demographic, it now commands the attention of big business, the media, broadcasters, sponsors, the Olympic Games and, most importantly for us, the betting industry.

An entire generation that has grown into adulthood obsessively playing home video games on their PCs, PlayStations and Xboxes has taken several vital steps in this journey. Firstly they realised that competing against one another is more engaging and exciting than playing alone. Then they collectively added the connection that comes with team competition, then events, prize money and sponsorships entered the mix. Finally, and most recently, they realised that betting on outcomes gives the audience some very real skin in every game.

A heady cocktail of opportunity

The result is a global collection of elite players and teams, a calendar of premium leagues and events and a captive audience of tens of millions who both watch the stars and engage in competition themselves. From the perspective of the betting industry, this heady cocktail is further enriched by the fact that a vast proportion of this audience is ‘new’. They are younger, they are largely less fanatical about traditional sports, they understand technology, they have an instinctive bias towards new ideas and, in common with sports bettors, an instinctive belief in their own knowledge and expertise.

Sometime around five years ago, I was told by the founder of what is now a major esports industry player, that he was confident that esports betting could grow to become the world’s second largest sports betting market, after football (soccer). Given that ‘the beautiful game’ is a global phenomenon, and the major US sports, along with cricket and horse racing, do not enjoy worldwide mass popularity, this prediction is not as ridiculous as it may at first have appeared.

Dictating how the audience engages

We have said it before and we will say it again, in global terms esports is huge, and the growth of esports betting is an equally massive opportunity. To ignore it, or to fiddle around pursuing lesser and more minority possibilities, is beyond short-sighted. And the issue, as we see it, is partly due to the fact that many involved in ‘traditional’ sports betting are so deeply immersed in what they know that they simply do not understand – or embrace – esports. Many senior decision-making executives will inevitably be of a certain age and to many of them, the demographics of esports will be outside of their comfort zone.

As 2024 gathers pace, the esports betting industry is not only blossoming, but also now beginning to dictate how its audience engages with the entire genre. For many audience members, the only thing better than watching esports will be watching esports having placed a bet.

As digital entertainment itself rapidly evolves and grows its accessibility, with streaming services punching holes in the dominance of traditional broadcasting channels, so the audience expands alongside the capacity for real-time interaction. The avenues open to betting operators are now more varied and accessible than ever before. The pace of change means that this evolution is actually a revolution and with 2024 feeling like the year when esports betting will explode into the mainstream, we must all understand what will drive this demand and the obstacles facing the ongoing development of an entire new sector.

Why is esports betting different?

As already mentioned, the audience that most readily follows esports is, in betting terms, a new one. This fanbase is younger, brought up on technology and with little history of offline betting. Their personal devices are a vital component in their entire lives. In addition, they have grown up playing home video games that are non-language-sensitive, with major titles such as League of Legends and Counter-Strike achieving global popularity and status. Finally, and importantly, video gaming can be a 24/7/365 experience. Events and tournaments are not sensitive to the time of day or the unpredictability of the weather. There is no need to manufacture ‘virtual’ esports to fill up downtime, esports events can be ‘real’ at any time.

Constant advances in technology also play a vital and positive role in ongoing growth. Ever-improving live streaming services, coupled with data analytics and real-time interaction and the development of a distinct community enable a betting audience to improve their decision-making, increasing belief in their abilities to win.

The spectre of regulation

The greatest challenge facing any new betting or gaming concept is the spectre of regulation and the many and varied forms that this will take around the world. Esports is a worldwide phenomenon and esports betting platforms must accept that the maze of regulatory requirements across countless global jurisdictions will require meticulous and costly navigation. The ease of online access, coupled with the younger demographic of the audience, will require strict controls. The comparative ‘novelty’ of esports betting means that many regulators will be uncertain and cautious, and stakeholders within the industry must try to ‘leave their swords at the door’ and work together, collectively, towards a set of standards and practices that can most easily be uniformly adopted.

All eyes are on you

As is the case with all sports or events, the introduction of betting opportunities into the commercial mix brings with it significant additional revenue. Sponsorships become prevalent, production qualities improve and the prizes and opportunities for competitors change the landscape entirely. These factors in turn raise the bar in terms of quality of output, and the same cycle begins once again. The audience grows further and before we know it, the sheer numbers involve place you in the mainstream. Not that this would be a new thing, after all who in the mainstream had even heard of MMA as recently as the 1990s?

The flipside of this is that the introduction of betting brings with it attendant risks. Unfortunately, human beings seek an edge when betting, and some will cheat. Maintaining integrity and transparency will be essential. In order to remain legitimate and respectable, the entire esports and esports betting community will need to commit to the Esports Integrity Commission and keep its hands spotlessly clean. When you are one of the new kids on the block, all eyes are on you at all times.

As always, what might be ahead?

There is little doubt that the trends and developments that impact upon everyday life will also affect esports and esports betting. Technological innovation never stops, it just accelerates. Artificial Intelligence, Machine Learning and Virtual and Augmented Reality will shift the dials. Changes to payment processing, the further embracing of blockchain technologies and cryptocurrencies will enhance game design, security and user experience for everyone along the supply chain.

These are all variables that are now inside the horizon and there will be others that we cannot yet see. But one thing appears to be certain and that is that esports betting has a potentially huge role to play in the digital entertainment market of the future, and it simply cannot be an opportunity ignored.