Esports Reaching the Next Level with COVID-19

The international video game industry is still in the process of the development, despite the widespread economic disruption caused by COVID-19. Why is it so? The answer is quite simple. With all the social distancing policies, people have started looking for alternative options in the gaming world. Video gaming options offered at are based on an engaging distraction for people interested in social interaction. Initial data demonstrates huge growth in playing time and sales since the lockdowns started.

The gaming business model

The revenues received from the global video game market is worth almost 160$ billion in 2020. Asia-Pacific is considered to be the biggest market covering almost 50% of the games market by value. Meanwhile, North America covers a quarter of revenue.

Gaming revenues are mainly driven by consumer spending, although the business strategy has evolved considerably in recent years. Today, consumers purchase fewer games than in previous years, but those who play tend to spend more time with games. Thus, the industry is oriented on increasing involvement per user. Apart from making video games, the business strategy for doing so has been the implementation of in-game monetization chances. This additional downloadable content (DLC) can involve expansion packages, new characteristics, instruments, and heroes.

This business strategy has come along with improvements to gaming hardware and mobile internet, which have turned high-quality titles into an affordable form of investment. While COVID-19 has increased involvement with video games, it has made hardware and software development easier. Apart from social actions, the consequences of COVID-19 on video gaming were introduced by a considerable increase of the audience available to publishers.

Luckily, video gaming has both interactive and linear consumption business approaches, so watching gaming video streams and video on-demand has demonstrated rapid growth. Simply, people experienced a considerable need for social interaction.

The Bottom Line

The short-term impact on the esports industry remains quite limited. Over 70% of esports revenue is generated from promotion and broadcasting. If limitations on mass gatherings continue, esports-based income would certainly decline. With esports accounts for less than 1% of the gaming market, the possible risks do not cause any problems to the development of the whole industry.