Traditional Sports Leagues Are Rapidly Losing Ground to Esports

Competitive videogame-based esports leagues are gaining on the more traditional American professional sports leagues, and it’s probably too late to reverse the trend.

Millennials, that universally-coveted demographic, are packing stadiums to watch other millenials face-off in team and solo matches of DOTA2, League of Legends, Counter-Strike, Injustice 2, and NBA 2K. Legions of esports fans are also catching live streams via Twitch, Twitter, and YouTube on their mobile phones or laptops, according to TechCrunch — and its all free to watch!

A recent LEK Consulting survey revealed that 40 percent of millennials favor esports over traditional sports leagues. And that audience is increasing year-over-year, according to VentureBeat. Alex Evans and Gil Moran of LEK explain:

Though they represent a large and increasingly integral segment of the U.S. sports fan base, millennials bring to the table a unique challenge. Unlike their Baby Boomer and Gen X predecessors, millennials follow a much broader range of both traditional and alternative sports as adults, and despite having less time on their hands, have a far greater selection of viewing alternatives.”

However, that’s only one piece of the puzzle.

Video games have been around since the 70s and multiplayer games are nothing new, but seemingly overnight the esports phenomenon has taken root. One key reason: global interest. There are nearly 150 million esports ‘enthusiasts’ around the world (and growing rapidly) and esports are becoming the target of choice for sponsors and advertisers, according to Sports Illustrated.

The traditional professional sports leagues — NFL, NBA, MLB, NHL — are primarily viewed by American audiences via broadcast and cable television. By contrast, esports are an international sensation and accessible by virtually any Internet-connected device — and millennials love their Internet-connected devices. Another big puzzle piece.

Traditional sports also require massive time investments by their fans. A typical NFL game can take 3-4 hours to complete, an NBA game over 2 hours — that’s a lot of time to spend sitting on the couch. However, millennials are constantly on-the-move, they’re always connected to their smartphones, and they watch far less TV than previous generations. It’s a recipe for catastrophe for the major American pro sports leagues.

These sports leagues and their broadcast and cable partners were all caught flat-footed by the rise of esports, and they’ve been sluggish to respond. They’re trying to make up ground, but the more nimble online streamers and app developers — Twitch, Twitter, Mixer, and YouTube are all eating their lunch. Esports viewing now surpasses HBO, Netflix, ESPN, and Hulu combined, according to TheTechReviewer. For example, ESPN now regularly broadcasts esports competitions, which they’re hoping connects with their X-Games fans’ interests.

A few traditional sports teams, like the NBA’s Golden State Warriors, have actually invested in esports, as reported by the Mercury News. The Warriors own two affiliates: Golden Guardians of the North American League of Legends Championship Series (NA LCS) and the Warriors of the NBA 2K eLeague — the latter is owned by the NBA. The Warriors are hyping their participation during live Warriors basketball games via TV and radio broadcasts, connecting traditional fans with the already-engaged millennials. It’s a calculated but clever move by the Warriors, which few other traditional sports teams have made.

Another big reason for esports popularity with millennials is that the ‘athletes’ are millennials just like them. The barrier to entry for most esports athletes is a video game console or PC… and lots of practice. For example, to compete in the NBA 2K eLeague players must win 50 games of NBA 2K in a ‘Pro-Am’ mode and submit an online application, where they can be drafted by individual teams. Compare this to the actual NBA where precisely zero fans ever go from couch to hardwood.

All of this only touches the surface of everything that’s going in esports. The overall industry earned nearly $700 million in 2017, and it’s estimated to crack $1.5 billion by 2020 (while also growing their global audience to almost 600 million viewers). Sponsors, media rights, advertising, merchandise, and tickets (for selected major events) are contributing to the revenue pool, which is still far, far below what the NFL alone earns, but these are still early days.

Bottom line, America’s traditional professional sports leagues are at a crossroads. Millennials (and the Z-generation behind them) just aren’t interested in sitting passively on a couch, barstool, or stadium seat for three or four hours. The whole sports dynamic is changing because of millennials and esports, in large part because they’re highly accessible, the athletes look like them, sponsors love them, and literally any of them can become the next big esports star. That’s powerful!

People once laughed at ESPN’s X-Games, which are now a staple of cable sports and the Winter Olympics, and esports has much, much bigger potential. The NFL, MLB, NHL, and NBA simply aren’t connecting with the next generation of fans, and that’s a big problem. These traditional sports leagues had better wake up to this reality and innovate (if they can) before their next media contracts come up for renewal.

SOURCE: SportsIllustrated, MercuryNews, VentureBeat, NBA, TheTechViewer, BusinessInsider, TechCrunch