16 May 2024
by Prakash Kerai (PK)

Reflections from Shoosmiths: techUK's 'Exploring the future of Esports' webinar

Read Shoosmiths' key reflections from techUK's Exploring the future of Esports webinar.

On 16 May 2024, Shoosmiths' technology sector Partner, Prakash Kerai (PK), joined a webinar hosted by techUK exploring the future of Esports. Here are our key learnings from the event:

What is Esports and why is it growing?

Esports, or competitive video gaming, is a form of entertainment that involves players, teams, and spectators who watch or participate in online or offline tournaments. Esports has been around for decades, but it has gained popularity and recognition in recent years, thanks to the advancement of technology, the emergence of streaming platforms, and the support of sponsors and media. Yahoo Finance recently published that esports market size reached $1,983.4 million in 2023 and that by the end of 2024 the figure is set to increase to $2,396.9 million, resulting in an anticipated growth to $10,095.1 million by 2032.

The UK has managed to secure an initial advantage, largely thanks to its rich history in the video games industry. However, maintaining this lead is not guaranteed. The future of the UK’s position in the Esports industry will be significantly influenced by the development and adoption of new technologies like Virtual Reality and Artificial Intelligence, and also attracting people to the esports industry (and supporting them). These will play a crucial role in determining whether the UK can seize the potential opportunities in the evolving Esports landscape.

What are the main trends shaping the future of Esports?

Some of the key trends discussed during the webainr that are influencing the development and direction of Esports are:

  • The diversification of Esports genres and audiences. Esports is no longer dominated by a few genres, such as first-person shooters, multiplayer online battle arenas, and real-time strategy games. New and emerging genres, such as battle royale, racing, sports, and fighting games, are attracting new and diverse audiences, both casual and hardcore. For example, Fortnite, a popular battle royale game, has amassed over 350 million players and hosted several celebrity and charity events, while FIFA, a soccer simulation game, has become one of the most watched esports titles on Twitch, a leading streaming platform.
  • The convergence of Esports and traditional sports. Esports and traditional sports are becoming more intertwined, as both sectors seek to leverage each other's strengths and audiences. On one hand, esports is adopting some of the best practices and formats of traditional sports, such as franchising, league structures, and player unions. On the other hand, traditional sports is embracing esports as a way to engage with younger and digital-savvy fans, as well as to expand into new markets and regions. For example, the NBA has launched the NBA 2K League, a professional esports league based on the basketball video game NBA 2K, while Formula 1 has created the F1 Esports Series, a virtual racing competition that mirrors the real-world championship.
  • The innovation of Esports technology and infrastructure. Esports is constantly evolving and improving its technology and infrastructure, to enhance the quality and accessibility of its content and services. Some of the areas where esports is innovating include: cloud gaming, which allows players to stream games from remote servers without the need for expensive hardware; 5G and edge computing, which enable faster and smoother connectivity and latency for online gaming; artificial intelligence and machine learning, which provide insights and analytics for players, teams, and fans; and blockchain and cryptocurrencies, which offer new ways of monetisation and governance for the Esports ecosystem.

What are the main challenges and opportunities facing the future of Esports?

Esports, like any other industry, faces some challenges and opportunities that will shape its future. Some of the main ones discussed were:

  • The challenge of regulation and standardisation. Esports is a relatively young and fragmented industry, with different stakeholders, rules, and regulations across regions and games. This poses some issues, such as the lack of consistency and transparency in areas such as governance, ethics, integrity, and player welfare. Esports also faces some legal and social challenges, such as the recognition of esports as a legitimate sport, the protection of intellectual property rights, and the prevention of cheating, match-fixing, and cyberbullying. To overcome these challenges, Esports needs to develop and adopt more unified and comprehensive frameworks and guidelines, as well as to collaborate with relevant authorities and organisations.
  • The opportunity of growth and expansion. Esports has a huge potential to grow and expand, both in terms of its market size and its audience reach. Esports can tap into new and untapped markets, such as emerging regions, female gamers, and older generations, by offering more inclusive and diverse content and experiences. Esports can also leverage new and existing platforms, such as mobile devices, social media, and television, to reach and engage with more fans and consumers. Esports can also explore new and innovative ways of creating and delivering value, such as through gamification, personalisation, and community building.
  • The ethical and safety challenges. The world of Esports faces significant ethical, safety, and safeguarding challenges. Given the involvement of young participants, safeguarding their well-being is crucial. Recently the British Esports Federation officially joined forces with the NSPCC enabling both organisations to work together to address safeguarding children in Esports. Esports, like traditional sports, grapples with match-fixing and betting fraud – and ensuring integrity in competitions is essential to maintain fairness and trust.
  • The educational and social mobility benefits. Esports is emerging as a powerful educational tool with significant social mobility implications. Playing Esports cultivates skills such as strategic thinking, communication, leadership, and teamwork. These abilities are transferable to various career paths and enhance employability.  Engaging with Esports introduces students to technology, digital platforms, and online communities – increasing digital literacy, essential in today's digital age. Esports provides an inclusive space where students from diverse backgrounds can participate and excel. It breaks down traditional barriers and promotes equality. Integrating Esports into education taps into students' passions, making learning more engaging and relevant. Passion-led learning often leads to better outcomes.

Conclusion

Esports is a dynamic and exciting industry that has a lot to offer and to look forward to. However, it also faces some challenges and risks that need to be addressed and mitigated. By working together and adopting best practices, esports can achieve more recognition, legitimacy, and sustainability, as well as provide more value and enjoyment to its stakeholders and fans. Within the UK, esports offers a unique blend of skill development, digital literacy, inclusivity, and passion-driven education, contributing to both personal growth and social mobility in the UK.


Event round-up: Exploring the future of Esports

On 16 May 2024, techUK hosted its first webinar exploring the future of Esports.

This webinar took place on the 'Gaming & Immersive Technologies' day of techUK's 2024 Unleashing Innovation campaign week.

You can view techUK's event round-up here.


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Authors

Prakash Kerai (PK)

Prakash Kerai (PK)

Partner, Shoosmiths

Prakash Kerai (PK) co-heads the fintech service line at Shoosmiths and has been advising on technology, outsourcing, and FinTech arrangements for nearly two decades. His ‘in-house’ experience includes acting as the General Counsel of a FinTech organisation (a digital challenger bank).  As a member of the Shoosmiths’ Technology Sector Executive team, PK also helps lead on the Blockchain & Digital Assets sub sector. In 2023, PK was appointed as a member of techUK’s Financial Services Council.