Page 3 Online gaming business explodes worldwide
● Three of the world’s leading computer brands have unveiled new machines in the middle of a global lockdown — all focused on gaming.
In the same breath, a games company last week became the most valuable stock on the Polish bourse, overtaking the country’s biggest bank. In SA, the “e-sports” sector is exploding as sponsorship and prize money soar.
Even before the Covid-19 crisis, gaming had overtaken both the music industry and the cinema box office in overall revenue globally. In 2019, according to Nielsenowned market research firm Superdata, the industry was worth $120bn (about R2.2-trillion). It predicted a slow 2020, with 4% growth, but that was before Covid-19 hit, sending the world into social isolation. Now, most gaming companies are reporting a surge in activity and their shares are defying crashing stock markets.
Chinese giant Tencent, which owns 40% of Fortnite creator Epic Games and is partowned by Naspers, is trading comfortably above its January 1 level after a brief dip in mid-March. Nasdaq-listed Activision Blizzard, maker of gamer favourites like Call of Duty and World of Warcraft, along with mobile hits like Candy Crush, has been appearing on share analysts’ recommendations.
The most dramatic performance, however, has come from Polish games maker CD Projekt, which saw its market capitalisation reach more than $8bn this week. It is the developer behind Witcher, a wildly popular franchise that was recently turned into a Netflix series.
Gaming is moving rapidly from niche pursuit to mainstream pastime. “Now we are all gamers,” was the apt summing up by Ivan Besskyi, who handles technical public relations for PCs and gaming in Eastern Europe, the Middle East & Africa for Asus, one of the world’s leading makers of gaming hardware.
He was speaking during the virtual launch of the company’s latest gaming machines, including a format-bending device called the Zephyrus Duo 15, a laptop that features a main screen and a second screen that folds up from behind the keyboard.
As with rivals Lenovo and Dell Technologies, which launched their next-generation gaming computers at the same time, Asus is positioning itself as a technology leader, even if it does not lead in sales. When gamers are shopping around for new equipment, the brand wants to be top of mind.
The industry last year recorded sales of more than 16-million gaming desktops, 7.8million monitors and 19.9-million gaming laptops across all brands. Led by Dell’s Alienware and Inspiron sub-brands, it is an area of aggressive competition.
“Nowadays most people associate themselves with gaming and they play games on different platforms, on mobile, consoles and PCs,” says Besskyi.
In the same way, he says, specialist gaming laptops are powerful machines and workstations that can be used for working in different applications such as software development, movie or video creation. “These machines now can fulfil almost any task. So these two audiences, creators and gamers, overlap a lot.”
In the process, the gender balance between male and female gamers has evened out, with Asus statistics showing a split of around 54%-46%. It helps that gaming is increasingly viewed as a legitimate career — the winner of last year’s Fortnite World Cup took home a bigger purse than the Wimbledon tennis champion. In 2019, the winners in each of the five major e-sports tournaments walked away with more than the total prize pool of the Tour de France.
Richard Tyler Blevins, who goes by the name Ninja in the gaming world, has earned more than $17m in total from gaming. He makes about $500,000 a month from subscribers to his channel on the game-streaming platform Twitch. This epitomises the transition from competing for prize money to competing for viewers.
“It varies from country to country based on gaming events and sponsorship opportunities,” says Hayleigh Chamberlain, a South African technology reviewer who attracts more than 2-million views a month to her Hayls World channel on YouTube. The channel is her full-time job, earning a good living for herself and her channel manager, and she is increasingly venturing into gaming.
“Essentially, when a creator gains enough traction with an audience based on their gameplay and commentary, not only will brands seek them out for paid sponsorship, but the ad revenue from hundreds of thousands of views also racks up over time and becomes a full-time living for some.”
While streaming offers a steady income, gaming tournaments offer the biggest prizes, audiences — and sponsorships. Last year, according to gaming community portal Green Man Gaming, e-sports attracted 443-million viewers worldwide.
According to esportsearnings.com, 86 South African players earned a total of $113,000 last year. The country’s top player, Aran Groesbeek, 21, better known as Sonic, made $11,600 for his exploits in the game Counter-Strike: Global Offensive. He plays for US-based team Cloud 9, which features players from SA and North America.
SA’s most successful teams are professional operations and are run like businesses. Bravado Gaming, for example, is sponsored by Dell Technologies, and competes globally.
Andreas Hadjipaschali, CEO of Bravado, says it is not only about the players.
“The stars of Bravado are the players, the teams and the management who work tirelessly every day to aid the growth of esports,” he says. “Whether it be competing, teaching, communicating, managing or logistics — we’re all in this together, regardless of the role or position you have in Bravado.”
Sponsorship, he says, is essential. “Esports is a very expensive industry. The costs involved in media production, local and international travel, activations and events can be overwhelming.”
For Chris Buchanan, client solutions director of Dell Technologies SA, “gaming is a vibrant part of the PC market”.
“Gaming is a mainstream part of many consumers’ lives. The gaming market has formed an astute buyer who wants quality … they want good systems that can manage multiple tasks well. This desire for higherend machines is obvious in the growth categories of the PC market.”
Tramayne Monaghan, head of innovation at Tencent Africa, is heading the African rollout of a wildly popular online game, PlayerUnknown’s Battlegrounds. The mobile edition dominated global app revenues from gamers last month, taking in $232m.
Says Monaghan: “The growth of gaming in SA will be largely led by mobile. The phones that many potential gamers and e-sports players already own are a cost-effective [alternative] to a gaming console or PC.”
He says Tencent Africa tries to cut costs for gamers by keeping data requirements for its app to a minimum.
“Casters”, or “shoutcasters”, provide live commentary of games and represent another new niche career within gaming.
Samantha Wright, SA’s first woman professional shoutcaster, warns that it is not an easy career path.
“It isn’t impossible, but like any entertainment job, it really isn’t an easy ride.”