The eSports industry is growing up fast. It's becoming so big in fact that I feel compelled to write a second post about it (see my initial post outlining the burgeoning sector). Aside from discussing why eSports is blossoming and breaking down the key characteristics and trends, its also interesting to look at the some of the mind boggling numbers and statistics. In this post, we will look at where the money is in the industry and then trace where it is flowing. This post draws on data from NewZoo and eSportsEarnings.com, and another post written by Matthew Wong @ CB Insights.
The Global eSports Market Is Still Relatively Small But Growing Fast
According to data by NewZoo, the industry is growing at a 40% annual growth rate and will reach $765M by 2018, almost half of which is online advertising. This isn't a multi-billion dollar industry but it sure is growing fast.
The Number of eSports Enthusiasts Is Growing Quickly
Viewership is growing across the board with eSports enthusiasts alone reaching 165 million viewers by 2018. Apparently, many of the "occasional viewers" in 2015 switched over to being enthusiasts, hence the decline in occasional viewers. The enthusiast audience is also very globally distributed - in 2015 alone China had 53.9M viewers, North America had 18.5M and Europe had 16.8M.
eSports Boosts Player Numbers
Unsurprisingly, eSports is good for games and game developers. The below chart shows the impact that Twitch viewership had on Dota 2's marquee tournament, The International. During the event, both viewership and daily DotA 2 players spiked. Following the tournament, the player base stabilized to a higher level than before the event.
eSports is Dominated by Asian Countries
So where is the money going? It appears that China, South Korea and the US dominate the scene. Each country has close to $30M in total prize money earned by players. Other countries are growing quickly but still remain quite small. In terms of number of players, the US has a much larger competitive player base but it's clear that pound for pound the Asian gamers perform better. It's also interesting to see some of the smaller countries like Pakistan and Ukraine hit above their weight (very few players winning significant prize pools).
League of Legends and DotA 2 Dominate The Top Prize Pools
Looking at the top 100 tournament prize pools, League of Legends and Dota 2 clearly take the cake. Still, there is an impressive long tail of games that have vibrant and highly engaged player bases.
However, while League of Legends and Dota 2 have a comparable number of large tournaments, it's really no contest in terms of who has the largest pots. Dota 2 had 21 tournaments generating $43M of winnings, or roughly $2M per tournament. League of Legends on the other hand only had $10M worth of prizes for a similar number of tournaments. This does not mean that all DotA tournaments have solid prize pools. In fact, it's quite skewed - the largest DotA event had an $18.4M prize pool which dwarfs all other major DotA tournaments.
The Top Players Do Really Well For Themselves
The below chart visualizes the earnings distribution for the top 100 players. The top players easily earn between $1-2M in prizes with lower ranked players still earning hundreds of thousands of dollars. Note that this only includes tournament earnings and does not include income from things like sponsorships or ad revenue from live streaming. Taking everything into account, players can do quite well, especially given the fact that many players are young, typically between the ages of 18 and 26.
...Though The Top Players Mostly Play DotA 2
Of the top 100 players by winnings, 55 of them play DotA 2. The remaining players are spread out across a variety of other games. This makes sense since players are likely following the money.
The industry seems much bigger than it really is given all of the hype and buzz in the space. Regardless, while the industry is still relatively small it is growing extremely quickly. Currently, the eSports scene is dominated by China, South Korea and the US but other countries are gradually catching up. Top players generally do really well for themselves in terms of income but it gets a lot tougher outside of the elite few. Most of the industry is centered around League of Legends and DotA 2 while the latter is really the juggernaut when it comes to total dollars. All in all, it's still early days and while eSports still feels like the wild west there are a ton of tailwinds behind it.