The COVID-19 pandemic has laid waste to global economies and annihilated entire industries. However, some industries have fared better than others during the outbreak. One of these is the esports sector and its unique business models. Once the reserve of video gaming enthusiasts, the esports market grew in popularity in recent years and managed to weather the COVID storm as necessity drove gamers and spectators online.
2020 Esports Business Model
The global online gaming sector experienced a surge in profits in 2020, with more than 21.1 billion dollars generated in just 12 months. This equates to significant year-on-year growth, with the growth margin unprecedented when compared to previous years. While the online gaming market always fared well, this boom in revenue is largely down to gamers being forced to play online by necessity. By the end of 2020, there were more than 2.69 billion gamers worldwide. By the end of 2021, that number looks set to exceed 2.8 billion.
How Has Esports Survived?
One of the key reasons the esports industry thrived during the pandemic is that months-long lockdowns forced consumers to pursue new pastimes away from their usual routine. With billions at home without 9-to-5 to keep them busy, user engagement with video gaming and esports rose substantially.
Although live events and attendance have long been a staple of esports, the nature of virtual gaming has allowed the sector to overcome the issues that have throttled conventional sports. That is not to say that the pandemic hasn’t caused disruption to esports tournaments. Many major live events, including the Summer Game Fest, Gamescom and Capcom Pro Tour, all adjusted to restrictions. Some events were canceled entirely, while others moved exclusively online.
By and large, esports organizations and their business models managed to adapt fairly well to the logistical nightmares presented by the pandemic. However, a handful of organizations failed to adapt quickly enough. One of the losers of the pandemic has been North Esports, a Danish organization that announced it was ending operations in February 2021.
Despite the near-exclusive move to online broadcasting and streaming, esports events still proved lucrative. With a substantial rise in the number of those playing video games and watching esports events, the sector is more attractive than ever to sponsors and advertisers.
Additionally, it is now incredibly easy for esports enthusiasts to remain updated on league and tournament developments. Platforms such as 1337PRO provide a wealth of resources for esports enthusiasts, while also serving as a centralized destination for online streaming.
Can Esports Sustain Growth?
As COVID vaccinations become more accessible and populations become unshackled of lockdown restrictions, the question remains as to whether esports business models can continue to capitalize on its surge in popularity. One of the clearest indicators that this upward trend will continue is the upswing in engagement. The biggest esports titles, such as League of Legends, are likely to continue attracting new players in the millions. Likewise, the audience figure peaks that online tournaments have enjoyed in recent months are likely to remain high.
Future of Esports Business
Esports organizations are also likely to maintain the new approaches they have had to adopt during the pandemic. The move from live events to exclusively online tournaments has demonstrated that high engagement is still possible. What’s more, sponsors and advertisers have also seen that wholly online audiences can still provide a lucrative revenue stream.
While there are winners and losers during the pandemic, as within any other industry, esports remained largely untouched by COVID-19. However, the societal changes and move to online engagement has allowed the sector to capitalize on its inherent strengths and innovation.
Written by Esportz Network
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