A few weeks ago, an e-sports version of March Madness got underway on Alphabet's YouTube.
Google is the exclusive streaming platform for FaceIt's Esports Championship Series, in which gamers test their shooting skills off the hardwood in the multi-player battle game Counter-Strike: Global Offensive.
Even though e-sports is considered a nascent market, Google and Amazon take gamers seriously. Google's YouTube launched the YouTube Gaming app in 2015, and Amazon spent close to US$ 1 billion for game streaming outfit Twitch in 2014. Facebook has stirrings with a deal with Activision, and could take a bigger role.
"Amazon and Google are already an early beneficiaries of the ad dollar flow into eSports media due to their ownership of Twitch and YouTube, respectively," Macquarie analyst Ben Schachter wrote in a report on the gaming face off.
E-sports sponsorships, advertising, prize money, betting, ticketing, merchandizing and media rights were an US$ 892 million business last year, Schacther suggested. For perspective, that's less than the US$ 970 million that Amazon paid for Twitch. By 2020, Macquarie expects e-Sports revenues to quintuple, hitting US$ 5 billion.
That is still a small number for Amazon, with US$ 165 billion in projected 2017 revenue and a US$ 400 billion market cap, or Google parent Alphabet, which has a projected US$ 87 billion revenue and a US$ 578 billion market value.
While the dollars are modest in Silicon Valley terms, e-sports can attract tens of millions of young eyeballs around the world and represents an attractive demographic.
The final contest of the 2015 League of Legends gaming championships drew 36 million online viewers, topping the 31 million who watched Lebron James lead the Cleveland Cavaliers beat the Golden State Warriors in the last game of the NBA finals last year. The numbers are relative, of course. The gamers on the Koo Tigers and SK Telecom squads don't attract advertising dollars in quite the way that LeBron James and Stephen Curry do.
Gamers' numbers do count, though. More than 35,000 made their way to San Diego for TwitchCon 2016, Amazon Game Studios announced three new games at the three-day event. Late fall Amazon also announced a new slate of gaming benefits for users of its Prime service.
"Twitch helped drive [Amazon]'s ~$1bn+ in display ad revenue last year," Macquarie's Schachter wrote. "Additionally, Google is ramping up on YouTube Gaming to capitalize on eSports' growing grassroots community of streaming gamers and fans."
Google is the exclusive streaming platform for FaceIt's Esports Championship Series, in which gamers test their shooting skills off the hardwood in the multi-player battle game Counter-Strike: Global Offensive.
Even though e-sports is considered a nascent market, Google and Amazon take gamers seriously. Google's YouTube launched the YouTube Gaming app in 2015, and Amazon spent close to US$ 1 billion for game streaming outfit Twitch in 2014. Facebook has stirrings with a deal with Activision, and could take a bigger role.
"Amazon and Google are already an early beneficiaries of the ad dollar flow into eSports media due to their ownership of Twitch and YouTube, respectively," Macquarie analyst Ben Schachter wrote in a report on the gaming face off.
E-sports sponsorships, advertising, prize money, betting, ticketing, merchandizing and media rights were an US$ 892 million business last year, Schacther suggested. For perspective, that's less than the US$ 970 million that Amazon paid for Twitch. By 2020, Macquarie expects e-Sports revenues to quintuple, hitting US$ 5 billion.
That is still a small number for Amazon, with US$ 165 billion in projected 2017 revenue and a US$ 400 billion market cap, or Google parent Alphabet, which has a projected US$ 87 billion revenue and a US$ 578 billion market value.
While the dollars are modest in Silicon Valley terms, e-sports can attract tens of millions of young eyeballs around the world and represents an attractive demographic.
The final contest of the 2015 League of Legends gaming championships drew 36 million online viewers, topping the 31 million who watched Lebron James lead the Cleveland Cavaliers beat the Golden State Warriors in the last game of the NBA finals last year. The numbers are relative, of course. The gamers on the Koo Tigers and SK Telecom squads don't attract advertising dollars in quite the way that LeBron James and Stephen Curry do.
Gamers' numbers do count, though. More than 35,000 made their way to San Diego for TwitchCon 2016, Amazon Game Studios announced three new games at the three-day event. Late fall Amazon also announced a new slate of gaming benefits for users of its Prime service.
"Twitch helped drive [Amazon]'s ~$1bn+ in display ad revenue last year," Macquarie's Schachter wrote. "Additionally, Google is ramping up on YouTube Gaming to capitalize on eSports' growing grassroots community of streaming gamers and fans."
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