Video Gaming and Esports: Taking Media and Entertainment to the Next Level
By John Patrick Lee, CFA, Product Manager
The video game industry is projected to reach $159B in revenues in 2020, and gaming is more popular than ever.1 More people around the world are turning to interactive games as a form of entertainment. Digital game sales are continuously breaking records, and industry revenues have continued to hit all-time highs for the last few years.2 Esports, a form of competitive video gaming, has taken hold around the world, with ballooning cash prizes and front-page news coverage. In-game concerts and events are drawing millions of people into their favorite game’s universe, blurring the line between the game and live events.The growing popularity of gaming, along with the revenue potential across the industry, help make this industry a compelling investment opportunity, in our view. In the whitepaper, Video Gaming and Esports: Taking Media and Entertainment to the Next Level, we provide an in-depth breakdown of the industry to help investors better understand what’s driving the long-term potential of this space as well as how to incorporate it into a portfolio. Key trends currently shaping this investment opportunity include:
- The video game industry is earning hundreds of billions in annual revenues, and reaching billions of consumers around the world.
- Trends like demographic shifts and changing consumer demands provide long-term structural support for this growth industry.
- Mobile gaming now represents the largest and fastest-growing platform by revenues.
- Publishers are using new businesses models to accelerate growth through recurrent in-game spending.
- Esports represents a segment of the broader video gaming industry, and video game publishers are steadily gaining control over revenue streams in this space.
- Risk factors affecting companies both individually and collectively as a group.
MVIS Global Video Gaming & eSports Index
Source: MV Index Solutions. Data as of 31/08/2020.
1 Newzoo, 2020
2 The NPD Group
John Patrick Lee joined VanEck in 2014 and is currently an ETF Product Manager focusing on video gaming, esports and international equities. His Responsibilities include business management of the existing ETF lineup, market strategy and positioning and product development. Prior to joining VanEck, John Patrick served as an Investment Advisor Representative with Dorsey Wright Money Management. He received a bachelor’s degree in English Literature from the College of William and Mary and holds a Chartered Financial Analyst® designation.
The article above is an opinion of the author and does not necessarily reflect the opinion of MV Index Solutions or its affiliates.