The Future of Esports and Gaming

The esports and gaming industry has exploded in recent years, with projections indicating that it will reach a whopping $256 billion in total value by 2025. That's a staggering figure and highlights just how massive this market has become. But what does that actually mean in terms of the different segments within the industry?

That's where the concept of the Serviceable Available Market (SAM) comes in. By breaking down the total addressable market (TAM) into its key SAMs, we can get a better understanding of the specific areas within the esports and gaming industry that are driving growth and shaping the future. In this blog post, we'll take a deep dive into the various SAMs within the industry, exploring what's driving growth in each segment and what that means for the future of esports and gaming.

AR and VR Gaming

Virtual reality (VR) and augmented reality (AR) are changing the gaming industry in unprecedented ways. Over the past decade, the gaming industry has experienced a major technological evolution, and VR and AR have emerged as the new frontrunners in gaming innovation. According to a report by Statista, the VR and AR gaming market is expected to reach $12.1 billion by 2024, with a CAGR of 18.5% from 2019-2024.

The potential for AR and VR gaming is vast. For instance, AR technology allows game developers to overlay virtual objects onto the real world, providing a more immersive gaming experience. According to a survey by Grand View Research, the AR gaming market is expected to reach $284.93 million by 2027, with a CAGR of 20.5% from 2020-2027. Additionally, VR technology allows players to feel like they are inside the game, offering a more realistic and interactive gameplay experience. The VR gaming market is also projected to grow exponentially, with a CAGR of 30.2% from 2021-2028, according to a report by Research and Markets.

Esports and Gambling in Gaming

Esports has emerged as a significant player in the gaming industry, with millions of people tuning in to watch tournaments and competitions. In 2019, the global esports market generated $1.1 billion in revenue, with a projected revenue of $1.8 billion by 2022, according to a report by Newzoo. Moreover, the industry is expected to grow at a CAGR of 14.5% from 2020-2025, reaching a market size of $5.05 billion by 2025, according to a report by Mordor Intelligence.

One segment of the esports industry that has been gaining a lot of attention in recent years is esports gambling. This involves placing bets on the outcomes of esports tournaments and competitions, and it is becoming increasingly popular among fans of esports. The esports gambling market is projected to reach $30 billion by 2025, according to a report by Zion Market Research. However, there are concerns about the potential negative effects of esports gambling, particularly on young people. As the industry continues to grow, it will be important to monitor and regulate esports gambling to ensure that it is safe and responsible for all participants.

Investors in Gaming

Investors are also recognizing the potential of the esports industry, with many investing in esports teams and tournaments. Celebrities like Drake, Michael Jordan, and Ashton Kutcher have invested in esports teams, showing that there is significant potential for growth and profitability in the industry. In addition, more and more brands are investing in esports, with a projected global sponsorship revenue of $277 million by 2022, according to a report by Newzoo. The report also notes that the number of brands investing in esports has grown from 130 in 2016 to over 600 in 2019.

Cloud Gaming

Cloud gaming is also emerging as a major trend in the gaming industry. With the rise of 5G technology, cloud gaming is expected to become even more popular. The cloud gaming market is projected to reach $3.07 billion by 2027, with a CAGR of 45.2% from 2020-2027, according to a report by Allied Market Research. Cloud gaming eliminates the need for expensive hardware, allowing players to enjoy high-quality games on devices that would not normally be able to handle them. This makes gaming more accessible and affordable for everyone.

The rise of 5G technology is expected to further fuel the growth of cloud gaming. According to a report by Ericsson, the number of 5G subscriptions is expected to reach 3.5 billion by 2026, with 60% of the world's population covered by 5G networks. The report also states that 5G technology will enable low-latency and high-speed connections, making it ideal for cloud gaming. Furthermore, the report predicts that cloud gaming will become more popular than console gaming by 2025.

Custom Gaming

Personalization and customization are also becoming increasingly popular in the gaming industry. Players want to be able to create their own avatars, design their own environments, and choose their own gameplay experiences. This trend is already prevalent in games like Minecraft and Roblox, where players can build their own worlds and share them with others. According to a report by Newzoo, player customization is a crucial factor in game design, with 63% of gamers saying that they enjoy games more when they can customize their avatars.

Conclusion

The gaming industry is evolving rapidly, with new technologies and trends changing the way people experience games. VR and AR are providing more immersive and interactive gameplay experiences, while esports is emerging as a legitimate sport with massive growth potential. Cloud gaming is also making gaming more accessible and affordable for everyone, while personalization and customization are becoming increasingly popular among players. As the industry continues to evolve, it will be interesting to see how these trends shape the future of gaming.