Remember that time your mom told you to pay more attention to playing Super Mario Brothers? Neither do I. If the recent news stories are to be believed, though, moms might start warming up to the idea of letting their children play more video games.
For those that haven’t been paying attention, eSports is a massive, global series of video game competitions, typically played by professional gamers. esports is no joke—according to one source, the market made almost $700M in revenue in 2017, with an audience of almost 400 million people. Nothing to sneeze at.
esports is now making serious inroads into the college sports arena, though varsity scholarships for esports have actually been in existence since 2014. Since then, many colleges (including Division 1 schools) have started developing their own esports collegiate teams. Currently, dozens of colleges across the country have their own teams, at least 8 of which were established in 2017. There is even a National Association of Collegiate esports, consisting of 45 schools and their varsity esports programs.
Most of this shouldn’t be surprising. Video games are a serious business and have been for a long time. The question is, now that they are sharing space with athletics and sports programs in colleges, where do they stand? For now, the scholarship amounts themselves serve as a good benchmark. While video games are getting more viewership from the 18-25 age demographic in the U.S. than the NBA Finals or the World Series, the scholarships are nowhere in the ballpark of those given to college sports. The highest scholarship figures top out around the $20K mark, while most tend to hover much lower around $2-5K.
The payout from winning esports events, however, averages about $15K per player. Big companies have wisely invested in these competitions, associating their brands with the cutting edge of eSports competition. Recently, I spoke to Frank Soqui,
The media networks are also on board.
While money seems like a good incentive for the player’s investment of time, most college players don’t pursue their gaming careers to go professional. Gaming for them is first and foremost a fun way to pass the time, that surprisingly allowed them to get a college scholarship. esports is dynamic—meaning that it keeps changing with new games, new players, updates, and the player’s general interest in the game itself. Additionally, these changes come extremely fast in the world of gaming, which survives on an audience with a very short attention span. esports athletes’ careers, therefore, tend to be short-lived.
Colleges have embraced the idea of esports, as it feels like the trendy thing to do. Recently, schools like the University of Utah, Boise State, and Miami University, OH, have created these programs to attract a unique breed of students. Compared to other sports, esports tend to be massively cheaper to develop. Additionally, it allows schools to appear more tech-savvy among the collegiate community.
For the players and students, it is an opportunity to learn skills like critical and analytical thinking. The mainstays of esports (like Riot Games’ League of Legends and
The biggest benefactors of this rise in popularity are obviously the gaming companies. The craze has allowed Riot Games and Blizzard to become the behemoths that they are today. It has given them access to people who were not traditionally into gaming. Gaming has taken the form of a genuine spectator sport, complete with bands like Imagine Dragons performing in their opening ceremonies. The development of Twitch and other streaming services allow millions of people to watch their favorite esports teams play live.
Gaming companies also realize the importance of nurturing their players. Blizzard has partnered with Tespa (Texas esport Association) and launched an initiative this year to provide its players with scholarships and awards worth $1M. Additionally, the NBA is trying to launch its own league in association with Take-Two Interactive Software’s 2K Games.
All being said, esports is definitely here to stay. We’ll see if the NCAA wants to bring esports into its massive fold—time will tell. Also, as VR technology gets better and cheaper, more and more esports will make the obvious jump. Additionally, esports will likely take the augmented reality route, and try to recreate the buzz last seen around Niantic’s Pokemon Go. For that reason, I think phones will likely be the next battleground for esports.
Kids can now tell their parents that the time they’re spending in front of these games is key to their college education. The times are changing, and the possibilities are endless.
Disclosure: My firm, Moor Insights & Strategy, like all research and analyst firms, provides or has provided research, analysis, advising, and/or consulting to many high-tech companies in the industry, including Advanced Micro Devices, Applied Micro, Apstra, Arm Holdings, Bitfusion, Cisco Systems, Dell EMC, Diablo Technologies, Echelon, Ericcson, Frame, Gen Z Consortium, Glue Networks, GlobalFoundries, Google (Nest), HP Inc. Hewlett Packard Enterprise, Huawei Technologies, IBM, Jabil Circuit, Intel, Interdigital, Konica Minolta, Lenovo, Linux Foundation, Mapbox, Mesosphere, Microsoft, National Instruments, NOKIA, Nortek, NVIDIA, ONUG, OpenStack Foundation, Peraso, Pure Storage, Qualcomm, Rackspace, Rambus, Red Hat, Samsung Technologies, Silver Peak, SONY, Springpath, Sprint, Stratus Technologies, Synaptics, Vidyo, Xilinx, Zebra, which may be cited in this article. I do not hold any equity positions with any companies cited in this column.
