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Sports betting: paving the way for eSports monetization?

With sports betting being rolled out across the US, wagering on eSports tournaments could be part of the mix.

Activision and other big-name video game publishers behind popular eSports titles would benefit massively from adding in game sports betting elements to their games, according to research by US banking giant Morgan Stanley.

The video games such as Overwatch, Call of Duty, FIFA and NBA 2k have about 85m active users every month in total, and players spend more than $2bn on in-game purchases, according to the bank’s analysts.

“We see eSports gambling (along with licensing/sponsorships/merchandise) as important new monetization channels for the franchises going forward,” Morgan Stanely said in a research report released last week.

“We estimate 30% of eSports viewers could each wager $40/$20 annually across Overwatch/Call of Duty events.”

There are many things to consider before the profits are tallied up, however, including licensing and digital streaming rights, sponsorships, digital merchandise, ticket sales, physical merchandise and most importantly, whether gamers are gambling.

When Morgan Stanley’s study factored in those variables, the bank predicted that if 10% of Activision’s Overwatch league viewers wagered between $20 and $40 every year, the publisher could have an income of $13m just from wagers alone, giving Activision an annual, recurring revenue of $641m by 2020.

The future of sports betting on eSports in America is uncertain, however.

Last month when the Supreme Court did away with PASPA, New Jersey made last minute changes to their sports betting bill, adding a ban to eSports betting.

The updated bill reads: “A prohibited sports event includes all high school sports events, electronic sports, and competitive video games but does not include international sports events in which persons under age 18 make up a minority of the participants.”

The issue could be addressed by having eSports leagues put age restrictions on who can participate to ensure minors aren’t being exposed to gambling, however, The Overwatch league already requires players be aged 18 or over.

Written by: Jake Patel
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