Video games are not just a pastime. Or at least not anymore. Motor racing, battle royale, strategy games and all other genres are part of a huge industry that mixes sport and entertainment: this is the world of e-sports, the definitive version of the gaming universe, now behaving like a real segment of the labour market, with entrepreneurs, employees and major sponsors.
Technically, these are professional-level video game competitions. And this is the golden age of an industry that in 2020 approached the $1 billion mark in revenue, according to Newzoo, one of the world’s leading gaming monitoring agencies, with growth of +15.7% on the previous year and with three quarters of total revenues coming from sponsorship deals and broadcasting rights across multiple platforms.
The Italian segment
The world of e-sports is already a reality in Italy. there is also a growing trend in our country, as explained by those who live it every day from the inside. “There was definitely a boom with the pandemic, and yet it is a sector-wide path of expansion that goes back a long way: it was there before 2020 and it will be there in the years to come“, says Nicaldan, nickname of Nicola Lillo, who last year became continental e-Football champion by winning the Pes e-European Championship with the Italian national team.
Nicaldan is also a coach and is specialising in these capacities on the rival title, Fifa. His change of role is, in a small way, a testament to the expansion of the e-sports world. “Many e-sports teams are now growing as a corporate structure, and most have coaches, doctors, social media managers, psychologists and personal trainers on staff. But also at higher levels: companies grow in the number of managers, marketing and communication departments”.
Many e-sports teams are now growing as a corporate structure, and most have coaches, doctors, social media managers, psychologists and personal trainers on staff
This is why e-sports, according to many observers, will boom in terms of employment in the coming years. A research on the e-sport world presented during Round One, the event dedicated to companies active in the sector, revealed the economic impact generated by e-sports in Italy. In terms of job and business creation, this amounts to €45-47 million, of which €30 million directly and over €15 million indirectly. This was Nielsen’s estimate in the Landscape report of the export sector in Italy, commissioned by Iidea (Italian Interactive & Digital Entertainment Association), the trade association of the video game industry in Italy, and the consulting company Ninetynine.
Looking at the direct impact, i.e. everything related to employment in the sector, namely 65% (€20.4 million) comes from e-sports teams, followed by organisers with 16% (5.1 million) and publishers with 4% (1.1 million). The remaining 15% (€5 million) comes from companies that, for example, provide dedicated rooms or hardware manufacturers, developers and others.
The survey, supplemented with data compiled by Nielsen Sports, was conducted among teams, organisers, publishers and other operators. The portrait of the sector is that of a new medium and entertainment platform with great capacity to engage users compared to traditional media. The report states that “e-sports offer attractive sponsorship opportunities even for non-endemic brands, i.e. outside this sector, and the possibility of creating new specialist skills and professional opportunities“.
The increase in sponsorship is, as in all sectors, linked to a growth in the fan base: Compared to 2019, when the numbers were just over a million, there are now over 1.62 million fans, Iidea reported last May. Iidea president Marco Saletta explains that the “e-sports sector in Italy seems worthy of consideration as an area of possible investment by both the private and public sectors because of its growth potential”.
The e-sports sector in Italy seems worthy of consideration as an area of possible investment by both the private and public sectors because of its growth potential.
Marco Saletta, Iidea president
A sector characterised by the high productivity of its resources, according to Tommaso Mattei, consultant responsible for Europe at Nielsen Sports & Entertainment: “Considering the continuous growth of the fan base, it is increasingly urgent to define a common path together with institutions and private individuals in order to overcome the critical technological and regulatory issues that hinder further industrial and employment development”.
Those who have been in the sector for years complain above all about a lack of regulations, which in a way is the same as those that afflict the Italian sporting world: there is no professionalism in Italian sport, with the exception of a few oases; a fortiori, therefore, there is nothing comparable in the newborn world of e-sports.
“There is no federation to regularise contracts and professionalism. In the rest of the world an e-sport athlete is recognised as an athlete and sportsman, in Italy we are video gamers, just guys holding joysticks. There are no rights or obligations”, says Alessandro Panebianco, co-founder of the e-sports team Hexon that works with Fiorentina in Fifa tournaments.
In the rest of the world an e-sport athlete is recognised as an athlete and sportsman, in Italy we are video gamers, just guys holding joysticks.
Alessandro Panebianco, co-founder of Hexon
The absence of a clear framework and regulations creates above all imbalances with foreign countries, in a global and very open market where it is all too easy for a player to move from one team to another, especially if there are huge imbalances in economic terms.
The Nielsen survey also indicates that the main obstacles to the further growth of e-sports in Italy are the lack of incentives or economic concessions from institutions, the difficulty in finding ready-made figures with vertical skills and the technological gap in terms of infrastructure and network between the various areas of the country.
“This creates a problem of sustainability of the business model for those trying to work with e-sports: foreign clubs have noticed Italian talent, and are proffering contracts at prices we cannot afford, yet this weakens the entire Italian movement: A lot of teams, even the most famous ones, are closing down because they can’t compete at certain figures”, explains Panebianco.
Compared to other sectors, the impact of COVID-19 on e-sports has been minor. In some cases, the emergency has even given a boost to the spread of competitive gaming, both in terms of game play, i.e. active users, and in terms of audience.