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The rise of esports has seen a world championship competition with a prize pool worth $62.5 million created and a betting market with an estimated annual revenue of $2.25 billion.
It has now been officially recognized by the International Olympic Committee and has deep pockets, energy, engagement, and youth on its side.
But look just a few years back into esports history and you’ll find it was once viewed, by some, as the domain of pasty-faced, sun-averse, teenage kids, locked in their bedrooms.
These are the ‘anti-jocks’, happy to trade spawn points, berate campers, and bunny hop, flashbang popflash, their way to victory.
Today, Mom is buying you a next-gen console and locking you in the bedroom. If you want to make something of yourself: beat that boss and get to the next level. The money is waiting – lots of it.
This year, the inaugural Esports World Cup (EWC) was held in Riyadh. As the dust settled on the Paris Olympics, the fast-fingered and furious gathered in the Saudi Arabian capital to compete in 21 different game-specific events, including Call of Duty, Modern Warfare, Fortnite, Tekken, and StarCraft.
And where there is money and competition, someone is making a bet. Esports wagering is leveling up. Nearly every mainstream gambling platform now offers players a wide range of esports betting markets. props and lines.
Here, we’ll take a detailed look into the world of esports, starting at level one. How it began, when the betting kicked in, where it is now, and what the future holds.
Level One: Pong, Invaders and Atari
The rise of esports has seen it become a global phenomenon. It’s not a surprise; video gaming is an industry driven by technological evolution. It shows no sign of slowing down, any time soon.
In the 1970s, the very first consoles appeared, featuring ball and paddle games like Pong, Breakout and Rebound. By the end of the decade, the introduction of the game cartridge was a seismic shift for the industry, enabling players to switch between different games on the same console.
The Atari 2600 was the dominant console, selling more than 30 million units. One of its most popular games was its version of Taito’s iconic arcade game Space Invaders.
The First Official Tournament
In 1981, Atari organized a Space Invaders Championship:
- It attracted more than 10,000 competitors, from all over the world.
- Four finalists were eventually selected to a space-off (sic) at the grand final in New York.
- The winner was 17-year-old Rebecca Heinemann (William Heinemann at the time) who won an Asteroids Deluxe $2,000 table video game.
- She was the first person to win a multiplayer national video gaming tournament.
- Heinemann was not only the first esports champion, she also went on to have a career as a video game designer and programmer.
In the following years, the console and game developers would host a range of different events and tournaments; always focused on either a specific game or a console.
Donkey Kong, Street Fighter, Mortal Kombat, and Golden Eye were a few of the popular games selected for competitive tournaments.
Level Two: High Scores, Stats and Tourneys
To be a bookmaker, you need to understand form, statistics, and data. Information is how you price a bet and set the line.
In the early days of esports history, there was no recorded information. It was a blank canvas; there was no ‘form’ to study.
In 1981, futures trader Walter Day bought a video game arcade in Iowa called Twin Galaxies. Day was inspired by a Time magazine article about the growth of gaming to create a definite database of video game high scores. He named the database after his arcade: Twin Galaxies.
Day traveled across the US accumulating data, as well as taking dozens of phone calls every day (pre-Internet!). Within six months, Twin Galaxies was recognized as the definitive source of high scores. Day was hailed as the ‘King of Video Game Stats’.
Magazines and publishers used his data. In 1983, he was the official verified video game score supplier to Guinness World Records.
Now, thanks to the existence of a definitive record, competitive gamers had benchmarks and goals; something to aspire to, achieve, and beat.
The Twin Galaxies database also enabled the inauguration of the industry’s first super gamer Billy Mitchell, who took the crown with a perfect score on Pac-Man, as well as the highest-ever Donkey Kong score. But this was not without controversy in later years, with allegations of cheating.
Level Three: Getting Connected and Rise of Esports
In the 1990s, online gaming and gambling both finally arrived at the party.
PC games offered players serious computer power and Internet connectivity; multiplayer, collaborative, gaming was de rigueur, with teams able to play, collaborate, and communicate in real-time.
First Esports Leagues
This connectivity led to the formation of the first esports leagues and tourneys, including the Professional Gamers League (PGL), the Cyberathlete Professional League (CPL), ClanBase, and QuakeCon.
Although both the PGL and CPL have been superseded, QuakeCon is still a thing, with thousands of competitors heading to Texas, every year, with their own computers, to play classic games like Doom and (of course) Quake.
By the end of the millennium, video gaming was popular, ubiquitous, and here to stay; television shows like GamesMaster and Bad Influence showcased the latest video games, with live play and competition.
There were dozens of esports tournaments in play; many which still compete today.
Level Four: First Bets and Exponential Growth
Online sports betting arrived in 1998, when Austrian-based sportsbook Intertops accepted the first Internet bet. Decades later, the best esports betting sites now offer markets on all the major competitions.
Owners could see the potential but didn’t have the necessary knowledge to offer odds. In the early days, there was very little interest in esports betting. Some books did offer very low stakes, low risk, props but the take-up was low.
In 2010, Pinnacle was the first online sportsbook to get serious about esports betting, offering lines on the legacy esports title StarCraft 2.
By 2014, Pinnacle had processed more than one million esports bets. More of the best online sportsbooks were quick to follow, eager to capture a share of this valuable market.
In South Korea, high-speed broadband, combined with the popularity of LAN gaming centers and Internet cafes, led to the foundation of the Korean e-Sports Association, a branch of the official Ministry of Culture, Sports and Tourism.
It was the first step towards making esports a real, widely recognized official sporting event.
Esports were now defined by different types and categories, including:
- Multiplayer Online Battle Arena (MOBA) events, including classics like League of Legends and Dota 2
- First-person shooter (FPS) games like Modern Warfare, Halo, and Call of Duty
- One-to-one fighter games like Mortal Kombat, Street Fighter, and Super Smash Bros
- Sports Games like Madden and NBA2K
- Other events, including card games like Pokeman and real-time strategy
Level Five: Twitch
The first televised esports event took place in 2006, when the USA Network broadcast a Halo 2 tournament. It didn’t catch on.
It would take technological innovation and evolution to put the world of esports into hyperdrive. It was sped up rapidly with the 2011 arrival of the live-streaming platform, Twitch, giving people immediate, intimate, access to competitive gaming.
If you were a fan of games like League of Legends, Dota 2, and Counter-Strike, you could now watch the masters at play and chat with them.
- In 2011, the first League of Legends World Championship (LoLWC) was held in Sweden, with a $10,000 prize pool.
- Just one year later, Los Angeles hosted the event, with a live audience of 10,000 and a million-dollar prize pool.
- In 2017, the LoLWC tournament had a viewership of 60 million; higher than the totals for both the MLB and the NBA.
Growth of esports Betting
Betting is now also firmly established. The sportsbooks have the data, the experts, and the traffic volume.
Players of yesteryear are now grown and happy to add a little action to the tournament play, by putting their money where someone else’s mouse is.
According to Statista, the global esports betting market in 2024 will reach $2.5 billion. With growth predicted at 7.27%, the market volume is anticipated to hit $3.3 billion by 2028. The US is the dominant market in this sector, with revenues of $721.2 million in 2024.
Now, the market is so advanced, there are bookmakers taking crypto bets, like here at the best Bitcoin esports betting sites.
Level Six: Olympic Ambitions Achieved
You can debate endlessly about the sporting nature of esports and esports history. Is it vaguely athletic? The International Olympic Committee (IOC) certainly considers esports to be a sport.
The fact of the matter is: to be exceptional, you need to practice – a lot.
Modern gamers have professional coaches, nutritionists, and doctors helping them work on their posture and mental health.
The IOC has been collaborating with many international esports federations to create the Olympic Esports Series. It recently announced that it will host the inaugural Olympic Esports Games in Saudi Arabia, in 2025.
The Saudi Arabian Minister of Sport HRH Prince Abdulaziz bin Turki Al Faisal said: “Saudi Arabia is hugely excited by the prospect of partnering with the IOC and helping to welcome a completely new era for international sport.
We believe that to take part in the Olympic Games is one of the greatest honors any athlete can achieve.”
Level Seven: Unity and Discord
The Esports World Cup (EWC) is the most significant gaming event ever staged; a multi-genre competition, involving many of the world’s top organizations, including Gen.G, Fnatic, G2 Esports, FlyQuest and T1.
The EWC is providing a sponsorship opportunity for more than 20 major brands including big hitters like Adidas, Pepsi, Amazon, and Sony.
Clearly, big-label brands want to associate with esports.
Female Gamers
There is, however, a huge gender-based elephant in the room: the sport is very much the domain of young men, mostly under 25.
The best-known and highest-ranked female player is Sash Hostyn, aka Scarlett; the 30-year-old Canadian is ranked 525th in the table of top esports earners.
The next highest-ranked female player is Xiaomeng Ki, aka Liooon, who is ranked 1,211th. It’s very much a man’s world, when it comes to banking the big esports money.
According to escharts.com, there are 67,538 registered esports players; of which, only 1,937 are female (2.9%).
Highest Earning Esports Gamer
The highest-earning player is Johan Sundstein. The 30-year-old, who plays under the moniker NOtail, has gamed his way to $7,184,163.
The Danish-Faroese professional Dota player has played in four Internationals, winning in 2018 and 2019, as well as winning four major championships.
Check out the best Dota 2 betting sites here, with odds on every match competition through the year.
Biggest Esports Markets
The United States is the largest esports market in the world, with a market volume of $1.07 billion in 2024.
The US also has the most active esports competition players, with more than 3,500 in 2023. The US esports market is expected to grow by 9.4% by 2027, reaching revenues of $1.46 billion.
China had a market volume of $383.4 million, in 2023, and is expected to reach revenues of $585.4 million by 2027. In 2023, China had 2,000 professional esports players.
In 2023, Europe generated $1.1 billion in esports revenues. It is expected to reach revenues of $1.76 billion by 2027
Level 8: Betting, Sponsorship and Regulation
With the growth of the esports betting market, it was only a matter of time before the sportsbooks would be seeking out sponsorship deals with esports clubs and teams.
In 2021, half the esports teams in Dota 2 and CS:GOs world championship events were sponsored by gambling companies.
Gambling companies actively sponsoring esports teams include: Betway, Bitcasino.io, Parimatch, VBET, FUN88, Letou, Betway and Jing Ji Bao.
Other sponsors include large brands like BMW and Nike, as well as alcohol, energy drinks, and crypto trading companies.
To get an idea of the scale: the teams sponsored by gambling companies had more than 25.8 million followers, across three social media platforms.
Associating with esports is a brand benefit, according to Pinnacle’s Head of Esports Alex McBride.
“What makes esports unique is that fans follow their favorite teams and not necessarily their closest team like in soccer.
“If we can align our brand with their team, create content that appeals to those needs and create cool activations that add value to the team by association, then we’re ticking the boxes when it comes to creating a favorable experience between those fans and what we set out to achieve.”
Relationship Between Gaming and Gambling
Esports is now huge, but very little research has been conducted into the relationship between the fans and the betting companies.
Esports is very much perceived as a land of opportunity. With fans younger and disproportionately male. In the UK, a YouGov poll estimated that 70% of adult esports fans were aged between 18 and 24.
A study by the University of Bristol found that esports gambling content especially appealed to a younger audience:
- 45.2% of 11-17-year-olds, and 72.4% of 18-24-year-olds, said they see esports gambling advertising at least once per week on their social media feed.
- 15 out of 24 esports gambling adverts triggered positive emotions such as “excited”, “happy” or “delighted” in children and young persons. In stark contrast, only 7 out of 24 ads triggered positive emotions in adults.
- Gambling content marketing is 3.9 times more appealing to children and young persons than adults.
- 11 out of 12 gambling content marketing ads triggered positive emotions in children and young persons – only 7 did for adults.
- Esports gambling advertising was substantially more appealing to children and young persons than to adults.
- Adults are four times more likely to feel intense negative emotions towards esports advertising.
Level Nine: Final Boss? Not Even Close
Behind the scenes, the Esports Integrity Commission (ESIC) is paving the way for regulation and oversight; laying the foundations for gambling and sponsorship.
It’s a multi-billion-dollar market, with potential for huge growth – especially in Asia.
Esports are the present and future. The average age of a typical fan is between 18 and 34. Players are aged between 20 and 25.
Money is pouring into the sport, from every direction: government, sponsors, gambling.
If little Johnny hasn’t emerged from his bedroom for six days, because he’s taking a deep dive into Dota 2 – don’t sweat it. Send up some pizza, keep him happy, and get him a coach. He could be paying off your mortgage before he learns to drive a car.
References
- Atari 2600+ – Official Atari Video Game Consoles
– Atari® (Atari) - The Walter Day Collection – About Walter Day (Thewalterdaycollection)
- https://www.twingalaxies.com/ (Twingalaxies)
- Billy Mitchell’s Donkey Kong Historical Records Reinstated After Multi-Year Dispute With Twin Galaxies – IGN (Ign)
- QuakeCon – Home (Quakecon.bethesda)
- MLG and USA Network to air game tourneys (Engadget)
- Targeting the next generation of gamblers? Gambling sponsorship of esports teams | Journal of Public Health | Oxford Academic (Academic.oup)
- What are the odds? The appeal of gambling adverts to children and young persons on twitter | PolicyBristol | University of Bristol (Bristol.ac)
- https://esic.gg/about/ (Esic)
