A new report issued by IHS Markit, a leading global analytics company, outlined the continued rapid growth of esports. Titled “Esports and The Future of TV,” the report includes details of the current state of the market and an outlook for the future. One of the more important findings is the amount of esports content watched last year – a whopping 6 billion hours.
Esports attracts eyes from all sides of the business
IHS Markit reports the amount of hours watched rose 19 percent year-over-year. Additionally, China represents the largest market for esports videos by far. The country delivered a total of 11.1 billion video streams in 2016. This is roughly four times the amount that the second biggest region, North America, delivered: 2.7 billion video streams.
The rise of esports viewership also spurred the interest of business players from other areas. Within the last couple years, an increasing number of diverse companies have shown interest in the competitive gaming market. With the consistent growth of revenue and funding in the industry, it’s not that big of a surprise to see the industry attracting so many endemic and non-endemic companies and organizations.
“The rapid growth of esports audiences has attracted some of the industry’s largest media and technology companies to the genre, with the likes of Amazon and MTG acquiring key assets,” said IHS Markit Research Director Ted Hall. “Some of these acquisitions are initiating shifts in esports business dynamics, with players such as China’s Tencent seeking to control assets across the value chain, and publishers moving into league operation.”
“Investment in esports will pay off for its big-name backers, as the genre expands both within its target demographic and outside it, with increasing exposure on linear TV set to bring in casual and new fans,” Hall added.
Advertising in esports is growing massively
Similar to findings in a recent report by SuperData, IHS Markit also points out the increased advertising money in the industry. The London-based company says the $280 million that was spent on advertising in 2016 is expected to grow to over $1 billion by 2021.
Additionally, the company says esports videos might forecast in the TV business.
Dan Cryan, IHS Markit’s senior director, commented:
“The rise of esports provides some valuable lessons for channels and programmers more broadly. In particular, it demonstrates the value of aggregating audiences globally, rather than the more country-specific approach that defined much of the traditional TV business.
“Esports video is a perfect example of the increasingly complicated competitive landscape in TV. In the ‘old world,’ broadcasters would compete with broadcasters and pay TV operators would compete with pay TV operators. Today, an emerging class of new entrants competes for audiences driven by objectives and business models that are orthogonal to traditional TV.
This is not just online channels taking a traditional business model and moving it online; this is something new. Publishers, for example, deliver esports video because it helps their other commercial interests rather than having content monetization as their primary focus. This sort of competitive diversification is set to become more common and spread to other genres with time.”
The IHS Markit report partially served as promotion for last week’s Media and Technology Conference. The schedule included some esports topics and also delved into more general media topics, including streaming, digital content, and UHD.