Can Las Vegas become the Mecca of eSports gambling? [PART 2]

The Rundown: 

Everyone is talking about bringing eSports to television and all the money that Disney will make from exclusive content partnerships. However, we’re overlooking the eSports gambling market that will emerge as the real breadwinner because the masses will be educated and familiarized with eSports. By 2045, MGM Resorts will open an eSportsbook in one of their casinos.

Media conglomerates are going bananas over exclusive media rights for broadcasting eSports leagues and tournaments. Newzoo predicts that with competition between the media moguls Disney, Comcast, and AT&T and the more fitting eSports providers of Twitch and YouTube Gaming, we’re going to see content rights exceed $420 million annually in the next three years.

This is going to be great for awareness of eSports, bringing these bizarre displays of competition to TV screens nationwide. However, I think it’s a bit of “smoke in mirrors”.

Gaming culture is a distinct revolt against the old ways of television entertainment. Any media company that doesn’t have a plan in place to meet gamers and eSports viewers where they are, is going to be wasting money producing these tournaments on TV. They may profit minimally from advertising on the networks. But the long-term plan is non-existent. Especially considering we’re in the midst of a tumultuous time for television.

Regardless, in the next five years, we’re going to see a nine-figure deal for eSports media rights.

In the process of bringing eSports to the mainstream market, there is an entity that stands to do really well from this increased attention… if they play their cards right.

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Vegas Wins Again

Las Vegas is in the business of exploiting addictive activities. It’s something they’ve done very successfully for over 70 years. Now, there’s a 21st century addiction taking shape: video games. Although it may seem like a joking matter. It’s not. This is most evident in China where there are boot camps designed to break video game addictions in teens. Obviously, the problem is not localized to that country, though.

Couple the widespread potential for addiction with the fact that some eSports tournaments have seen as many as 8.5 million concurrent viewers, well, Vegas sees an opportunity.

This is why Vegas is keeping a close eye on the eSports betting platform, Unikrn. Unikrn has their own cryptocurrency which pro gamers can wager on themselves when playing other teams. It’s eSports gambling at the highest level. However, the real money in this is opening up the gambling to the masses – the everyday observer that doesn’t know a great deal about eSports, but has some money to burn. (DraftKings is particularly suited to this market of “amateur betters” offering up a League of Legends fantasy betting option.)

Late last year, MGM Resorts (the casino conglomerate) partnered with Unikrn to bring eSports tournaments and video game facilities to their MGM Grand Hotel & Casino. Although it doesn’t appear that this partnership will include any gambling efforts, I believe it’s a part of a long-term strategy.

The larger strategy includes the MGM Luxor Hotel & Casino announcing they’d be opening an eSports competition venue with the company, Allied eSports Arenas. This is a strategic move to create the “Madison Square Garden of eSports”. They’ll be housing Ninja (the wildly famous gamer) as a headliner to attract crowds, in the same way that Caesar’s Palace locked down Tom Jones or the Mirage headlined Siegfried & Roy.

Vegas is realizing that younger audiences are gravitating to this new form of entertainment. And it’s important that Vegas becomes synonymous with eSports main events in the same way they are with Boxing and UFC.

Observing this Beast

This is a very fragmented industry right now. There’s a huge variety in video games. There are many leagues emerging. Not to mention, it’s hard to predict which video games are even going to be around in a decade or two.

This really doesn’t even cover the fact that a lot of the gambling happening within video games is with virtual currency. In Counter Strike, one of the main virtual currencies used are skins – essentially decorative designs for their weapons and players that have no effect on the gameplay whatsoever.

It’s hard for The House (casinos) to gain an edge or even get a part of the action with all this fragmentation. For the time being, Vegas has the ability to casually observe, create brand positioning with their arenas, and make the eSports gambling moves later. The eSports arenas, tournaments, and events are going to do a great job of bringing younger audiences to their casinos, thus funnelling them into the gambling systems that Vegas has already perfected – slots, craps, poker, blackjack, etc.

The comparison to traditional sports betting will enlighten why Vegas is still years away from getting heavy into eSports betting.

There’s not much legal gambling taking place in sportsbooks (place where sports wagers are made). All the sportsbooks in Nevada rarely take home much more than $25 million per month. Compared to the $1.6 billion in income they reported last year, you realize how little the sportsbook plays in the grand scheme of casinos.

This raises the question if Vegas will ever open an eSportsbook. I think the answer is yes. But before this happens, they’re going to want to see more consolidation among the leagues. They’re also going to need to observe these leagues and gameplay for quite some time before they understand how they can gain an edge (this is where the Arenas come in handy). I predict this probably won’t happen for at least another two decades.

By 2045, MGM Resorts will open an eSportsbook in one of their casinos.

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