The burgeoning Esports industry presents an ocean of opportunity for the world of sports betting. While almost most every established sports betting company worldwide already has Esports divisions and daily bets available, the lack of cohesive and consistent Esports calendar discussed last week presents a major roadblock for revenue. This post will discuss the monstrous potential held within Esports betting, and the drawbacks that may come with it.
For most mainstream sports, the money circulating through the betting industry is far bigger than the sponsorship and consumer revenue streams combined. The global sports betting market has been estimated to be worth over $3 trillion – an understandably difficult value to calculate but impressive nonetheless. Esports may become a betting heavyweight because the lion’s share of that market value comes from Asian markets, which happens to be where the largest number of Esports players, fans, and competitions happen. I discussed last week the difficulty in creating revenue structures within a sport to maximise viewer spending, but betting bypasses any of this and allows the fan to become financially and emotionally involved in the outcome of any given event. This not only builds monetary momentum around the industry, but promotes culture and fanfare. The global Esports audience is estimated to be around 380-400 million people, half ‘enthusiasts’ and half casual. Enthusiasts are categorised as those who not only attend events, but also help to support them. Tapping into even a small percentage of either category is a humongous opportunity for betting agencies.
Sports betting is legal in most countries worldwide, but it is illegal in all but four of the United States. Yanks have to drive to Nevada (or Montana, Delaware and Oregon) for the thrill of the punt. The highly addictive nature of gambling and its detriment to the lives of its addicts makes this decision fairly wise. Sports betting elsewhere is indeed mostly legal, but usually highly regulated. These regulations prevent betting agencies from abusing tactical traps, pervasive advertisement and other misleading schemes somewhat levelling the playing field. Of course, betting companies are in the money making business, and the odds are never in the punter’s favour. Now is undoubtedly the time to impose any prospective regulations on Esports betting, because restrictions become increasingly difficult to impose as industries mature. Cultural traditions begin, external sponsorship relationships are founded, and tightening betting restrictions later could cause irreparable damage to the industry. This is yet another reason why having no international regulatory body for Esports becomes increasingly detrimental to the industry as time goes on. Without a unified body it is almost impossible to impose blanket rules, and the betting industry can continue – not unregulated, but unstructured. The financial detriment to betting addicts absolutely needs to be considered when deciding how to regulate the industry.
There is no doubt that Esports betting will grow organically. The nature of the games involved lend themselves to betting, in that outcomes are guaranteed, and there are dozens of variables on which betters can strategize. The biggest danger of Esports betting is, in my opinion, match fixing. Such a young industry, without formal regulation, with young competitors and very large sums of money appears to be a recipe for dishonesty and unethical behaviour. Existing tournaments watch their competitors very closely for any abnormality in gameplay, such as unusually low APM, or purposeful deaths (suiciding). The industry is still driven by the passion of the players, and the love for the games. However, if Esports betting becomes a billion dollar industry, match fixing will becomes one of the industry’s biggest threats.