The interactive entertainment opportunity
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During our Capital Markets Day, one of the new areas of growth we explored in detail was interactive entertainment, in particular esports. By 2025 we estimate the esports wagering market could be worth around $12bn, opening up a new opportunity for growth for Entain.
Esports has a growing audience. There are over 300m Esports viewers already today and by 2025 that is expected to have grown to over 430m
In esports, players can be grouped into three broad categories:
- Train at least 8 hours every day
- Being paid and/or sponsored to be a part of a team that compete at major tournaments
- Often organised by or with the major game manufacturers.
- Mostly enthusiastic players, with some trying to get into professional teams
- Often ranked by skill and performance
- Some make a living streaming their game play on platforms like Twitch
- A fairly sizeable untapped betting market
- Largest market – seeking general entertainment
- Spend their leisure time watching streamed play, playing on their own or with friends
- Typically watch little or no conventional television content but seek entertainment through the gaming ecosystem
But we think the most interesting market is among the casual gamers, where there is an embryonic skill-based wagering market starting to evolve. Players can bet on themselves, as groups of friends against each other or other teams, or even on what will happen to other players.
From our customer research we know that there is huge affinity amongst esports viewers with wagering, with the vast majority of them already engaging in sports betting or gaming. This provides us with a major potential market for skill-based wagering, but also opportunities to cross sell into real money betting in other sports.
Demonstrating our commitment to grow in this space, we also made two announcements as part of our Capital Markets Day – the appointment of Justin Dellario as Head of esports at Entain, and the acquisition of the technology platform, products and team of Unikrn, a leading esports betting and entertainment media company. Justin joins from Twitch as former head of esports – the pre-eminent global platform for esports players and viewers. He has incredible knowledge of the global industry and is a fantastic hire for us as we look to grow in this new area. In looking for the right way to enter the esports market, we engaged with a number of operators and, in the process, identified a number of challenges where we could leverage the power of our platform. UNIKRN stood out as the most advanced business in this sector by quite some margin. UNIKRN brings skills and assets that compliment those of Entain to succeed in esports skill based wagering. they have built a skill-based wagering sportsbook that provides products to the broader casual gaming audience that, for example, enables players to bet against each other or bet against the platform. They also have the sort of exciting and original content that drives engagement with customers, as well as providing streaming and social activities to back that up.
The potential for the esports market is huge, and it is growing at a staggering pace. We are now on a path to create the first scalable esports skill based wagering community that will drive further significant value for our stakeholders.