Esports betting is a relatively small market in the entire gambling sphere, however, it is one of the most dynamic verticals with fast growth. Let’s investigate what esports is and how its betting market looks like.
Industry of esports
Esports, or electronic sports, is a competition using video games where professional individuals or teams take part in online and offline tournaments. The industry started enlarging in the late 2000s when live streaming has contributed to its increase in popularity.
According to the global esports analytics company Newzoo, in 2017, the total esports audience reached 335 million, consisting of 192 million occasional viewers and 143 million enthusiasts. The number significantly increased in 2018, when the total audience reached 395 million.
As for the industry revenue growth, in 2017, global esports revenues reached $655 million, while this number expanded to $865 million in 2018.
Most popular genres and disciplines
Esports includes a wide range of various games and genres. Among the most common genres there are:
- first-person shooter (FPS);
- multiplayer online battle arena (MOBA);
- real-time strategy (RTS);
- collectible card games (CCG);
There are many various disciplines in esports but some of them have already become known even outside the esports world:
- Dota 2;
- League of Legends (LoL);
- StarCraft 2;
- Counter-Strike: Global Offensive (CS:GO);
Market for esports betting overview
It is estimated that total esports wagers will reach approximately $13 billion globally by 2020, while in 2016, the total bets were estimated at $5.5 billion.
Currently, there are two main types of esports betting on the market: skin betting and cash betting.
- Skin betting. It is also called item betting, where instead of using cash, players bet using “skins” – virtual items used in video games to change the player’s look.
- Cash betting. Cash betting is mainly used to place bets in three types of games: Esportsbook, Fantasy Esports, and Head-to-Head.
Popular games receive around 92% of total bets in cash. League of Legends has 38% market share, CS:GO has around 29%, 18% belongs to Dota 2, while StarCraft 2 has around 7%.
Types of Esports betting
Esports matches provide gamblers with opportunities to place a different kind of bets, and here is a list of the basic ones.
Moneyline betting is the most traditional type of betting, where users choose the side that will win in a game with two or more opponents.
Bets not on individual games but on winners of whole tournaments are called futures bets. This kind of bets list the odds on each team or player involved. Futures bets can also include wagers on players with the most kills as well. These bets are more long-term and engage gamblers in the whole tournament.
- Prop bets
They allow betting on more specific elements of the event which also maximizes profits as such bets require the deep knowledge of the specific team or player. It is possible to bet on the number of kills by the certain player, a team that gets first blood, length of the match and a pause.
Totals bets refer to those placed on the total number of specified events in a game, for instance, total kills, total points or total rounds.
Challenges of esports betting
As an emerging industry, esports experiences several difficulties and problems. Among the most threatening ones, there is a data challenge and match-fixing.
- Data problem. esports is the industry extremely rich in data, therefore, optimizing all the information and exploiting its potential is a challenge. Due to multiple tournament providers, publishers and teams, the data is fragmented and not optimized. Moreover, the data is not always available in real time, being delayed by match controllers. These delays can take from 30 seconds up to several minutes.
- Match-fixing. This problem refers to losing an esports competition on purpose. It usually happens when individual players or teams get paid to create a certain game outcome. While match-fixing and cheating remain a vital industry issue, the tournament organizers deal with the dishonest players by implementing stricter penalties and anti-cheat software.
Future of betting on esports
The esports market is expected to keep enlarging in the future. The industry revenue growth will reach around $1.096 million in total this year. Around 37% of global esports revenues will be generated by North America, while 19% will be generated by China alone. Moreover, by 2022, global esports revenues will reach $1.790.
The audience will keep growing as well. This year, esports overall audience is expected to reach 454 million, made up of 253 million occasional viewers and 201 million esports enthusiasts. In three years, the total audience will reach 645 million viewers, where 347 million will be occasional watchers and 297 million will be industry lovers.
Such market expansion will be the outcome of the game disciplines diversity created by emerging games, growth of streaming platforms, as well as increasing gamers interest and engagement.