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Can esports become a lucrative revenue source for OTT platforms?

In an exclusive conversation with, industry players stated that while esports on streaming platforms is generating significant revenue and has a highly engaged audience, it is still catching up to traditional sports in terms of revenue and community engagement

Esports is fast becoming one of the most popular forms of entertainment on OTT platforms, with a large number of viewers tuning in to watch tournaments and events. As a result, the industry has attracted the attention of many brands and marketers. 

In an exclusive conversation with, industry players stated that while esports on streaming platforms is generating significant revenue and has a highly engaged audience, it is still catching up to traditional sports in terms of revenue and community engagement. 

Others spoke about how ad revenue, sponsorships and privacy remain some of the biggest challenges that OTT platforms face when it comes to monetising esports content. 

As various OTT platforms are foraying into esports, let’s delve deeper to find out how lucrative esports is for these streaming platforms. 

Popularity of esports surged over the past decade, it has attracted the attention of brands

Firasat Durrani

According to Firasat Durrani, Co-Founder and VP Operations, Loco, esports is one of the fastest-growing forms of entertainment globally, with tournaments and events drawing millions of viewers online. It has firmly established itself across the world as an engaging form of entertainment, which has been advantageous for the industry as a whole.

“The popularity of esports has surged over the past decade and online streaming platforms have been a significant contributor to this growth. For instance, Loco today has over 55 million registered users, with a 65% DAU (daily active users) by market share, 9X DAU growth and a 4X YoY creator/streamer sign-up growth. These numbers highlight the growing popularity of esports and the promise this industry holds for the future,” Durrani stated.

Additionally, the interactive nature of esports, coupled with the massive reach of online streaming platforms, has created an engaging and immersive platform for brands to connect with their target audiences, he said. 

In India, esports on streaming platforms are still in their early stages of development compared to traditional sports in terms of revenue generation and audience engagement. However, the esports industry in India is growing rapidly, and the potential for revenue generation and audience engagement is significant. Today, top esports tournaments are already drawing crowds rivalling traditional sporting events such as the Football World Cup and the Olympics, Durrani said.

“Traditional sports have a long history of generating revenue through ticket sales, merchandise, sponsorships, and broadcast rights. However, esports has largely relied on sponsorships, advertising, and prize money. Nevertheless, esports is quickly catching up in terms of revenue generation, with some tournaments offering multi-million dollar prize pools and top esports teams securing multi-million dollar sponsorship deals,” he added.

Haroon Shergill

Speaking along similar lines, Haroon Shergill, Chief Marketing Officer - iTAP, a youth-oriented OTT and gaming platform, said esports on OTT platforms is still a relatively new phenomenon but has already shown tremendous growth in terms of revenue generation and audience engagement. Here are some ways that esports on OTT platforms compare to traditional sports: 

Revenue generation - While traditional sports still generate more revenue overall, esports on OTT platforms have shown rapid growth in terms of revenue. In 2020, the global esports market generated $1.08 billion in revenue, with a significant portion of that coming from online streaming platforms.

“Another way is audience engagement. Esports on OTT platforms have also shown strong engagement from audiences, particularly among younger demographics. While traditional sports still attract a larger overall audience, esports has been shown to have a more engaged and interactive fan base. Esports fans are often more likely to engage with players and teams on social media, watch live streams of matches, and attend esports events in person,” Shergill added. 

Furthermore, he said that one of the major advantages of esports on OTT platforms is their global reach. 

“Traditional sports are often limited by geographic factors, such as broadcast rights, which can make it difficult to reach a global audience. Esports, on the other hand, can be easily streamed and accessed from anywhere in the world, which has helped to drive their popularity in emerging markets,” Shergill added. 

Durrani said that 2020 was a pivotal year for live streaming, as it became an integral part of everyone's lives during the worldwide lockdown.

“Streaming platforms such as ours have had to take various measures to adapt to the changes brought on by the pandemic. The initial ones were to implement robust protocols for things like managing server upkeep and bandwidth to ensure entertainment for millions around the globe. Secondly, with millions of users on the platform it was important to maintain a healthy and engaging atmosphere on streams,” he stated. 

Furthermore, he said that while the pandemic had caused significant disruption to the sports and entertainment industries, esports proved to be more adaptable and resilient thanks to the flexibility of online streaming platforms. Many of the behavioural shifts made during this time are likely to dictate this industry’s future.

Limited ad revenue, sponsorships and privacy remain a challenge

Durrani said that while esports has become a major source of revenue for streaming platforms, there are still some challenges that they face when it comes to monetising esports content. Some of the biggest challenges include: Limited advertising revenue - One of the primary ways that streaming platforms monetise content is through advertising. However, esports content can be difficult to advertise on as it often has a young and diverse audience, making it harder for brands to target specific demographics.

Sponsorship is another way that streaming platforms monetise esports content. However, it can be difficult to find sponsors that align with the values of the esports community, he added. 

Revenue sharing: Streaming platforms must navigate revenue-sharing agreements with esports leagues and teams. These agreements can be complex, and platforms must ensure that they are earning enough revenue to cover their costs while also providing a fair share to their partners, as per him.  

While monetising esports content on streaming platforms presents a unique set of challenges, but as the industry grows, these challenges are likely to be addressed and overcome, he added. 

While stating some more challenges, Shergill added, “Some of the biggest challenges we face are that esports events can be costly to produce, with high-quality production values and technology often required to create an engaging viewing experience. This can make it difficult for smaller OTT platforms to compete with larger, more established players in the market.”

“Piracy is another major challenge in the esports industry, with many fans turning to illegal streaming sites to watch their favourite events. This can make it difficult for OTT platforms to monetise their content, as they are competing with free, low-quality streams,” he added.

Durrani stated that the most successful types of esports content on streaming platforms tend to be those that are engaging, exciting and accessible to a wide audience. Some examples of successful esports content on streaming platforms include: Live streams, tournaments and competitions, analysis and commentary and creative content.

According to Shergill, mobile esports are becoming increasingly popular in India, with many big tournaments taking place each year. Some of the biggest mobile esports tournaments in India are: Free Fire India Championship (FFIC), PUBG Mobile India Series, Clash of Clans World Championship and Call of Duty Mobile India Cup.

“At iTAP, we currently hold a monthly Garena Freefire Tournament for our users called the iTAP Premier League. The prize pool is Rs 50,000 and this tournament is gated exclusively for the users of iTAP. Overall, mobile esports are quickly becoming a major part of the esports scene in India, with many big tournaments and events taking place throughout the year. With the increasing popularity of mobile gaming in India, these tournaments will likely continue to grow in size and significance,” Shergill stated.

Esports tournaments tend to have a younger and tech-savvy audience

According to Durrani, in recent years, India has seen some of the biggest esports tournaments and events taking place. For example, the Battleground India Masters Series 2022 recorded over 258,000 concurrent live views for a single esports broadcast stream on Loco. This event saw higher viewership on Loco than on TV, marking the highest live sports viewership after cricket in India.

The year 2022 was particularly exciting, Loco witnessed multiple streams crossing the 100K concurrency mark. Loco streamer, 8Bit Thug’s Invitational tournament in January crossed 1,00,000 concurrent live views, marking the first 6-digit record on the platform. Followed by another platform record of 1,60,000 concurrent live views during the finals of Skyesports' AMD BGMI Grand Slam tournament in February, he added. 

Compared to traditional sports events, esports tournaments tend to have a younger and more tech-savvy audience. Esports tournaments largely take place entirely online and are broadcasted on streaming platforms. This makes it more accessible to viewers as they can be watched from anywhere with an internet connection. Additionally, esports events often have a larger prize pool than traditional sports events, with some esports tournaments offering multi-million dollar prizes, he stated.

Pandemic disrupted the production and distribution of esports content

Shergill, meanwhile, said that the pandemic had a significant impact on the esports industry on OTT platforms, both in terms of viewership and production. On the one hand, the cancellation of live events and the increased time spent at home led to a surge in online gaming and esports viewership, as people looked for new forms of entertainment to fill their time. 

The pandemic disrupted the production and distribution of esports content, as events are forced to move online and production teams face new challenges in adapting to remote work, Shergill added. 

“At iTAP, we have taken a number of measures to adapt to these changes and ensure that we continue to provide engaging and high-quality esports content to our subscribers. Some of the steps we've taken include investing in new technologies and production methods, expanding our partnerships with esports organisations, focusing on mobile esports and experimenting with new formats and genres," he stated. 

Esports and advertising

Karan Anand

Karan Anand, SVP – Strategy, Interactive Avenues (A Reprise Network Company and the digital arm of Mediabrands India), while discussing the advertising opportunities said that there are various opportunities including in-stream ads, sponsored content, display ads, branded content, and influencer marketing. 

"These advertising options can effectively reach the target audience of younger esports fans, who are tech-savvy and quick to adopt new products and services. However, marketers must ensure that their advertising aligns with the values and objectives of the esports community and is transparent and authentic in its messaging to avoid appearing irrelevant or exploitative," he added. 

Shanu Jain

As per Shanu Jain, Vice-President – Media Planning and Strategy, Dentsu Creative India, one big possibility which is there on the platform is personalised display advertising. 

“It means that if a consumer has come to look for adventure games you can modify your advertising strategy based on that. Another opportunity for advertisers is active integrations which makes it possible for customisations based on the brand requirement, on the platform,” Jain said.

“For esports advertising, brands should focus more on engagement as when the gamers are playing games, they don't pay attention to advertising. Hence, it is very important that brands look at it more from a consumer engagement point of view in terms of branding,” he added.

When deciding which esports events and players to sponsor, brands typically take into account audience demographics, brand relevance, and potential return on investment, Anand stated. 

"To measure the success of their campaigns, they use metrics such as brand exposure, engagement, reach, return on investment, and brand awareness. Tracking these metrics enables brands to evaluate the effectiveness of their campaigns and make necessary adjustments to improve their impact and achieve their marketing objectives,” Anand stated.

“It is crucial for brands to understand the audience and their interests when choosing which events or players to sponsor and ensure that they align with their brand messaging and values. Measuring campaign effectiveness is also essential in justifying the investment and determining whether the desired outcome was achieved," he added.

Esports on OTT platforms is a rapidly growing and lucrative industry, both in India and globally, with a projected market size of $ 1.6 billion by 2025, according to Anand. 

The number of esports players in India has doubled from 300,000 in 2020 to 600,000, indicating a significant increase in interest in the industry. With expanding audiences, government support, infrastructure, and investment opportunities, the future of esports in India looks very promising, he added.

In view of Jain, the content quality that one can see on esports versus any other channel, is not so much education-driven. Esports will guide you from one end to another from a perspective of how you should be playing a game, which other platforms do not provide.

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