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The rise of esports in Asia: market impact & insights

Ivan Cheung
Ivan CheungAP COO, CAP Regional General Manager and Vice President
I head up a fortune 500 company’s operations in over 13 markets across Asia Pacific, including ASEAN, Hong Kong, Macau, Taiwan, and Korea. I've been a part of the team growing our business from a Chinese based company to a truly global player. I’m always looking to work with the next generation of customers, collaborators and talented people.

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The growth of gaming, and the rise of esports in particular, has been remarkable over recent years. And the Central Asia Pacific region is at the centre of much of the action. That means there are exciting prospects for continuing sector growth and engagement, along with sponsorship opportunities for brands to appeal to a burgeoning group of super fans.

Figures this year predict the global market is expected to reach approximately $700 million in 2017 (China and South Korea accounting for 22% of this), growing to about $1.5 billion by 2020 as investment doubles.

In any case, there’s no doubt gamers, fans and viewers in Asia and around the world are flocking to esports in huge numbers. The total global esports audience will be around 385 million people in 2017 – a vast number – split into “enthusiasts” (191 million) and “occasional viewers” (194 million). Once again, Asia Pacific accounts for 51% of the core “enthusiasts” group.

The appeal of esports is not difficult to comprehend when you consider the excitement and prestige, not to mention the rewards on offer. The prize money for popular esports tournaments such as Dota 2 – The International ($18 million) compares very favourably to globally recognised sporting events such as the Tour de France ($2.6 million), The Masters golf ($10 million) and Wimbledon Mens and Womens Singles ($14.86 million).

 

What are esports?

Just to define, the esports industry is comprised of professional games where cyber athletes compete against each other, often in teams of five versus five. The most common game tournaments feature the titles Dota 2, League of Legends, StarCraft II, and Counter-Strike Global Offensive among others. Game types will typically be what are known as real-time strategy (RTS), fighting, first-person shooter (FPS), and multiplayer online battle arena (MOBA) games.

Even though video game competitions themselves date back to the 1970s, the last five or so years has really seen the pace accelerate largely due to more powerful gaming machines, faster internet bandwidth, and the popularity of streaming platforms like Twitch (now owned by Amazon) and Youtube.

 

What is the opportunity for brands?

The leading market intelligence provider for esports and gaming, Newzoo, estimates that brands will spend $517 million in 2017 within the esports economy, a figure comprised of advertising, sponsorship and media rights.

Some of the most active brands advertising in this space include Audi, Coca-Cola, and Gillette, while event sponsors include IGN, Youtube, Google and Redbull. Each of these organisations is hoping to capitalise on the intense enthusiasm from esports fans. Playing games and watching gaming content is no doubt a favourite activity of the audience many brands wish to target: digital natives and millennials.

Our own business has made a big push into the gaming market with our Lenovo Legion range of gaming PCs, laptops and accessories. In fact, we’ve just announced a whole new range at gamescom in Germany. So it’s been a very natural fit for us to get involved in some exciting events in Asia recently. That has included a presence at League of  Champions 2017 in Thailand this year, hosting the best League of Legends players from Asia, and we’ve also recently created an active Lenovo Legion PC gaming community online.

 

What are the implications for the PC market?

The traditional PC market has flattened in recent years as consumer trends have emerged which include mobile devices, tablets and multi-mode 2in1 products. However, gaming is also one of these exciting trends and has the potential to reignite the PC market to a certain extent – understandable when you consider the numbers mentioned in this article.

I believe esports will follow in the footsteps of sports like soccer or basketball where the general population easily classifies participants as professionals, not just players. If you take leagues like the NBA or EPL, the player and team sponsorship is harnessed to heavily promote brands, sell products, and involve more and more fans. Esports will go this way too.

The net effect will be interesting. As its popularity increases, esports will attract a wider audience, not just professional players but the fans who want to watch and emulate their heroes. Just like basketball fans purchase merchandise (for example, shoes and shirts) in appreciation of their heroes, we will also see the PC market shift again as more fans purchase greater numbers of high-end gaming machines. This is certainly a change; in the past, it was mostly the professional gamers buying high-end machines. Now the fans want them too.

The other related shift we see in the market is around new technology. Increasingly, every new generation release of a CPU, GPU or OS now triggers a new wave of gaming machine purchases as a core group of growing gaming customers have a high appetite for increased performance. Interestingly, we also see this desire for the latest tech trickling down as a trigger for mainstream PCs as well. This denotes a general cultural shift impacting the overall PC market instigated by gaming and esports. Hopefully we see the overall PC market continue to grow as a result of these trends! We shall see.

Lastly, we expect VR and a combination of VR and AR to impact the market. This should play out in two ways: potentially a tournament which features purely VR or AR gameplay, and also as a channel for fans – where the audience can watch the professionals battle out through a VR or AR interface.

It’s been an interesting few years watching the rise of esports with its impact on Asia, and the globe.

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