Rise of eSports in the Middle East
The global pandemic has not fundamentally changed the eSports market, it rather impacted some aspects of its development due to the ongoing safety measures. The first half of 2020 witnessed a peak in growth of the gaming market in terms of spending due to the fact that it is becoming a means of escapism, entertainment and interacting with family and friends. It is possible that a percentage of the consumers may play and spend less after the pandemic, but the signs are pointing to the significant growth in both engagement and revenue being permanent.
Social and physical engagement
In terms of online social engagement and reach, the news media outlets within Middle East countries including Saudi Arabia and United Arab Emirates have mentioned the term “eSports” in more than 4,000 news articles. This is a 107% increase in the total media exposure in comparison to 2019. Also, “eSports” has been used as a keyword consistently since January 2021 on social media platforms with over 100,000 mentions in the Middle East.
As for the offline physical engagement, eSports has been seeing significant growth in communities in terms of specialised events on the Middle East grounds and for Middle Eastern players. For example:
- Anubis Gaming, one of the most popular eSports organizations in Egypt and the Middle East had Egyption eSports athletes who represented Egypt in the Intel Arabian Cup(a tournament organized by Riot Games, Intel, and Lenovo). The team competed with teams from around the globe and won first place. Usually, it is South Korean and Chinese gamers dominating the eSports athletes ranking but the Middle Eastern players are now getting in the game and competing against the best.
- ESL; Electronic Sports League which is one of the biggest organisers in eSports on an international level are planning to expand their reach in the Middle East due to the riding wave of eSports currently happening. (Mercedes-Benz renewed its partnership with ESL as their global mobility partner, as the company is pleased to be part of the rapidly growing gaming community).
- The Gulf Cooperation Council(GCC) hosted one of the largest gaming events called the Middle East Games Con during October 2020. It was an eSports tournament that took place online due to Covid-19 after being planned to take place in Abu Dhabi National Exhibition Centre and gamers from all over the world joined this tournament.
- Riot Games is launching League of Legends: Wild Rift for the Middle Eastern gamers as an eSports tournament. This event is taking place online and the finale will be offline during September 2021 in Beijing Olympic Sports Center as a part of the Esports Beijing 2021.
In terms of revenue, according to Strategy& Middle East, the gaming industry is currently worth $129 billion with an estimate of 2.5 Billion gamers all over the world. Speaking of revenue figures, this is more than the annual worldwide box office, annual music streaming and album sales combined with the annual take of the top five wealthiest sports leagues.
Revenue opportunities for Telecommunications industry
A growing gaming market means more data consumption thus an opportunity for Telecom operators in the Gulf region to diversify their portfolio by getting deeper into the world of gaming:
- The American video game publisher Activision partnered with STC, the Saudi Telecom Company and introduced servers dedicated from Call of Duty to provide better connection for the Middle East players. The servers were brought to Saudi Arabia, particularly Riyadh and Jeddah.
- Zain Group, the Kuwaiti Telecom Company launched Zain eSports. It is a brand that will be hosting a wide range of competitive gaming tournaments in the Middle East. In collaboration with EA Sports, Zain began its eSports endeavours by hosting the FIFA 2020 tournament during December 2020.
Revenue opportunities for Investors
This industry introduced endless investment and venture opportunities which lie in the eSports teams, players, leagues, competition hosting, streaming services, advertising and sponsorship:
- -According to Nasdaq, the video game industry is now reportedly bigger than both sports and movies combined. The gamers are spending more than $100 billion a year on the gaming virtual assets and currencies, which is five times the size of the global music industry. In fact, gamers can now own items in the games they are playing and easily sell it to other players and this is what could open up doors to the virtual economy.
- -Social tokens: eSports organizations, gamers and streamers are launching their own social tokens in order to strengthen their engagement with their fans. For example, the streaming house called DownToQuest on Twitch offers tokens for the fans that allows them to purchase physical merchandise, often charging less in coin value than it is equivalent to in US dollars. This is not yet very common, but it is on the rise and an upcoming investing opportunity.
Fastest-growing country in the Middle East in the eSports market
Saudi Arabia is one of the fastest-growing countries in the gaming and eSports markets and is soon to be the gaming industry’s hotspot. Here are some reasons why:
- The very rapid growth of eSports and the gaming market in general, is fueled by a goal to become the gaming capital in the Gulf region.
- Due to the fact that the Kingdom is opening up on the cultural front, brands like: Intel, Microsoft, Sony Playstation and Acer are focusing on the Saudi market. In fact, according to Paul Collins, Acer’s general manager for MEA, the vendor's gaming portfolio has recorded a 94% growth in its PC gaming models with 64% of the growth in the Middle East during 2020.
- The gaming market in Saudi Arabia has been growing at a significant and steady pace due to the region's demographic, half of the population is under 25.
- The ultra-fast Fibre-to-the-Home (FTTH) broadband networks and 5G provided by the Telecom operators guarantees a low latency and high-speed experience which is definitely a vital factor for the gamers and this advantage allows for eSports activities such as competition hosting.
So, is eSports rising in the Middle East? Definitely, Game On.
It is not only rising, in fact becoming a mainstream culture. The gaming industry is real, growing on a global scale and holds monetization opportunities. If you are in the gaming industry and are planning on hosting esports tournaments, Saudisoft can support you with the help of our eSports organization partner.