Watching Video Games—one of the most profitable, popular and effective forms of entertainment

In less than ten years, video gaming has become without doubt one of the most effective forms of entertainment in the world. Not only by the sales of the games but by the incredible number of hours of user-generated content showing individuals playing a whole universe of different games. It is not a surprise, then, that advertising dollars are flying to support the sector’s low-cost videos. eMarketer predicts that this year US ad revenues from video gaming content will reach $1.79 billion. The audience, the money and the amount of content are growing, and it will continue to do so. Twitch (owned by Amazon since 2014,) the most popular video game live streaming platform, may become the next YouTube in terms of audience. The rest of the entertainment industry needs to catch up as they compete for the same thing: attention.

An already mature industry, video games boomed during the 1980s with the adoption of color and games like “Space Invaders.” In the 90s, gaming went into PCs. Users moved to computer-based games. Although they no longer needed consoles to play, they still used them: the gaming industry was investing in its own devices like Nintendo, X-Box and PlayStation. Despite the ubiquity and the popularity of the Internet, video games only went online in the early 2000s and joined the streaming boom recently. Now, the video gaming sector has become a leading voice regarding technological innovations, like virtual and augmented reality (VR and AR,) and, of course, in terms of online on-demand video. 

Streaming: eSports and other games. Whereas the rise of eSports has put video gaming in the advertising map, eSports do not lead the market in terms of revenues or number of viewers. The audience for eSports, organized multiplayer video gaming competitions, is growing—in 2023, eSports expect to reach 46.2 million viewers (52.5% increase.) This immediately translates into dollar signs. Just in advertising, this year, eSports ad revenues will reach the substantial sum of $178.1 million. Plus, eSports count with multiple revenue streams besides ads such as sponsorships, live events and media rights. But despite the media coverage eSports get, it does not dominate the market. More general video gaming content does. 

The possibility of live streaming all gaming activity has US viewers connected to their screens enjoying viewing other people play the same way they enjoy broadcasted live and eSports. 

The most popular content within video gaming seems to be individual games live streamed online. According to eMarketer, US video gamers spend more time watching content from streaming sites like YouTube and Twitch than eSports competitions. That is to say: Twitch is the future. Moreover, video gaming influencers are bringing larger audiences to these streaming sites (and larger advertising budgets to amateur content.) This type of amateur content is the future and present of low-cost entertainment.

This shift from more professional content to live streamed, homemade kind of videos is nothing new in the entertainment industry. YouTube was created precisely for amateur videos, just like Twitch was launched for video gaming content. Instead of ‘organized’ reality TV shows, viewers could scroll through YouTube recommendations to watch hours and hours of homemade content. Within the thousands of video hours, and millions of viewers, some personalities emerged: YouTubers, who posted homemade videos talking about their lives, professions or specific topics, and got thousands of views and advertising revenue in the process. Now, influencers are achieving celebrity status in video gaming, whereas YouTubers have already professionalized YouTube’s amateur content.

We can reach three conclusions from the meteoric rise of amateur video gaming. First, US viewers relate more to on-demand homemade content than predisposed competitions. Moreover, there are thousands and thousands of hours of amateur content available online—increasing every minute, —whereas eSport tournaments are scarcer. Two, very much like YouTube, Twitch is making amateur content the mainstream. Within it, influencers are rising and ready to professionalize an unprofessional endeavor. Three, in the battle for attention, video gaming is taking the lead and media companies should learn from some of its formats. The most obvious one is the interactivity. Netflix already did, starting interactive mainstream movies with Bandersnatch, a Black Mirror Episode (see Bandersnatch: Netflix does it again.) Other entertainment and media companies must learn that interaction matters, rooting for a team increases engagement, and being able to click videos on-demand is a must. 

In conclusion, media outlets and entertainment companies should never forget that today video gaming plays the same game as they do: the war for the viewers’ time. The techniques are similar (video, interaction, amateur content, and availability.) The rewards—time and money—are also the same. Now it’s time to learn from video gaming.