The Future of eSports Betting in the UK

Posted by Harry Kane on Friday, November 30, 2018

Unless you spend a great deal of your time hibernating, you’ll have noticed that eSports have become increasingly popular over the course of the last few years. This not only applies to its status as a spectator sport, either, as the betting market surrounding eSports also continues to enjoy incredible growth.

This is borne out by the figures, with the eSports betting market expected to achieve a total market value of $23.5 billion by 2020. Back in 2015, this market was worth just $315 million, and this highlights the pronounced rate of growth that has gripped the sector in recent times.

With competitive eSports betting now being legalised in a number of different jurisdictions, this market is poised to grow even faster in the long-term. In this post, we’ll appraise these developments in closer detail while asking what the future holds for eSports betting.

What’s the Current State of the eSports Betting Market?

The UK remains at the forefront of the global online gambling and sports betting markets, thanks to the progressive regulatory approach of the UK Gambling Commission (UKGC).

This means that eSports betting has already made its mark on the UK marketplace, with an estimated 6% of Brits having wagered on competitive events over the course of the last 12 months.

This number is surely set to increase too, after the announcement that eSports betting platform Unikrn has been granted a license to provide live betting on competitive video games in a number of different jurisdictions.

This platform was awarded a wagering license by the Isle of Man, enabling Unikrn to roll out betting in more than 20 countries across Europe and Asia (in addition to the U.S.). These nations will join the UK in offering various eSports betting markets to gamers, serving as the catalyst for sustained and worldwide growth on an incredible scale.

There’s a slight distinction with the U.S. licensing, as spectator betting will not be allowed across any of the 52 states. In the case of skill-based betting on games such as Fortnite and the League of Legends, however, gamers will be able to wager on their own abilities and back themselves in specific tournaments.

Once they’ve verified their age and location, players will receive odds from the Unikrn platform based on the profiles that exist within individual games and place their desired wagers.

This specific licensing agreement has been authorised in 41 U.S. states, and while no fixed date has been set for the rollout it’s expected to be implemented over the course of the next 12 to 18 months.

In the European and Asian jurisdictions where sports betting has already been fully legalised, gamblers will now be able to lay down wagers on the outcome of major eSports tournaments across the globe. This includes the ongoing League of Legends World Championship, which has produced a thrilling and unpredictable tournament and is set to conclude with the finals on November 3rd.

This means that spectators in these jurisdictions will be able to place live and in-play bets on tournaments, boosting the value of the overall market and creating a lucrative new revenue stream for gambling operators.

Embracing the Future of the eSports Betting Market

At present, the League of Legends joins CSOG and Dota 2 as ‘the big three’ in the burgeoning eSports betting market, with tournaments based on these games claiming an impressive 60% share.

Less popular titles such as StarCraft, Hearthstone and NBA 2K make up the lion’s share of the remaining market share, although the revenue generated by the recent sports betting legislation may enable organisers to invest more in promoting associated tournaments.

This will play a pivotal role in fulfilling the exponential growth forecast for the market, which currently generates an estimated $900 million a year in revenue. This will more than double over the course of the next two years, even without accounting for largely unregulated and unspecified activities such as skin betting.

While more relaxed betting regulations will contribute heavily to the growth of the market, this alone cannot account for the seismic growth forecasts made by experts. So what else will impact on the future of the eSports betting market and drive such pronounced expansion?

One of the key considerations is the investment made by prominent brands, which tipped the scales at a hefty $517 million last year. This is expected to double by the end of 2020, however, with a significant percentage of this spend being invested in lucrative sponsorship deals.

This translates into far greater exposure for individual tournaments and significantly higher prize money, creating a larger global audience that is incentivised to participate directly in eSports betting.

Interestingly, this will even benefit the relatively restricted U.S. market, as an increase in prize money will boost the coffers of the most successful players and enable them to bet more on their future successes.

This trend is already taking hold, with the prize pool for Fortnite alone in the 2018/19 season expected to peak at $100 million. When you consider that the average player in the NBA makes an estimated $7.4 million a year (and only 15 competitors earn in excess of $25 million a year), we’re already seeing a generation of eSports performers who can singlehandedly drive growth in the market’s betting sector.

Of course, this revenue is split between various parties, but competitive eSports betting is certain to boom as awareness, prize money and branding grows.

The Last Word

If eSports is an unstoppable juggernaut that continues to revolutionise the sporting world, then its associated betting markets are having the same impact in the online gambling sphere.

Make no mistake; the eSports betting market is expected to grow incrementally over the course of the next two years on beyond, against the backdrop of relaxed gambling regulations, increased investment and incrementally rising prize money.

This is definitely an interesting space to watch in the near-term, although whatever happens, it’s fair to surmise that the UK market will play a leading role in driving sustained growth.