Gfinity’s UK Broadcast Deals Highlight Esports Gambling Opportunities, Challenges

Written By Scott Longley on August 8, 2017 - Last Updated on January 22, 2018

[toc]Three recent announcements from UK-listed esports tournament and broadcasting provider Gfinity have highlighted the potential for esports to enter the entertainment mainstream.

But they leave open questions regaresding the opportunity for gambling operators to capitalise on the growing popularity.

High profile broadcasting deals borne of increased demand

There was a flurry of social media excitement in late July when Gfinity announced it would be partnering with the BBC, the UK’s national broadcaster, to broadcast games from the newly-launched Elite Series tournament from the Gfinity Arena in London on the youth-facing digital-only channel BBC Three.

A separate agreement followed a matter of days later announcing that digital sports channel BT Sport is showing highlights from the Elite Series as of the start of August.

Previously in July, Gfinity also announced it had signed a contract with on-demand esports broadcaster Eleven Sports. It will provide content from the Elite Series to markets globally including the US, Italy, Poland, and Taiwan.

The Elite Series has seen eight professional teams competing in CS:GO, Rocket League, and Street Fighter V over nine weekends. It started in early July for a total of £225,000 ($295,000) in prize money.

The controller of BBC Three, Damian Kavanagh, said that esports’ popularity with young audience was the key to its appeal with the channel’s “mainstream audience.” And Andy Haworth, managing director of content and strategy at BT Sport, said the popularity of competitive gaming is “growing rapidly.”

Meanwhile, Neville Upton, chief executive at Gfinity, said the deal with the BBC was a “defining moment for esports.”

Teams involved in the Gfinity Elite Series

  • Team Inthused
  • Reason Gaming
  • Excel Esports
  • Prophecy
  • Team Envyus
  • Endpoint Esports
  • Method
  • Epsilon Esports

Path to monetisation remains unclear

James Watson, head of esports with data provider Sportradar, said his early impression of the BBC Three news was overwhelmingly positive. “As a specific case is that it’s a fantastic step for grassroots esports in the UK, since the Gfinity tournament is clearly aimed at this side of the esports spectrum,” he said.

Paul Leyland, analyst with gambling consultancy Regulus Partners, said in the wake of the two Gfinity broadcast deals that the popularity of esports among millennials has been obvious for a while. But he noted that the ability of either game publishers or the professional teams to monetise this remained “unproven.”

“Since listing on AIM in December 2014, Gfinity has grown its profile, offering and reach, however, it is yet to translate this into material revenue scale or profitability,” Leyland said.

Leyland added that Gfinity had so far shown little willingness associate with gambling:

“To date, it has resisted any association with gambling, unlike some other esports providers – a good indication of the potential risks seen in close dealings with the sector, the cultural hurdles gambling must still overcome to be genuinely mainstream (with public perceptions going the other way), and the fact there is not – possibly yet – enough value seen in the relationship for money to overcome these concerns.”

Stop that train

Watson pointed out, though, that esports gambling operators are sure to gain indirect benefits through the increased awareness of esports generally.

“Bookmakers are now starting to realise that the train is leaving the station, and if they want to be part of the esports ride they have to buy a ticket soon,” he said. “The iGeneration of new-breed punters is turning its attention firmly towards sports that excite them, and those that they follow in their spare time.”

This poses a dilemma for the gambling operators: How do you promote the gambling opportunity in esports to a potential new audience without losing sight of the original audience?

Watson suggests the easiest solution for betting operators: to continue business as usual. With esports transitioning towards the mainstream, operators can simply cross-sell to their existing sports-betting player base:

“The other side of the fence, myself included, believe quite strongly that the pool of esports-only fans strongly outweighs the mainstream audience that would be interested in esports. Ultimately the cultural demographics are totally shifting and bookmakers will have to constantly innovate to keep ahead of the curve in this competitive market: appealing direct to esports fans is a sure-fire way to achieve those goals.”

Gfinity backstory

Founded in 2012, Gfinity raised a further £6.25m in May this year from a share placing in order to fund the production of the Elite Series. The company further enhanced its esports footprint in July when it acquired esports technology and services provider CEVO for $2.7m in cash and shares.

Leyland at Regulus Partners said Gfinity’s recent deals showed the company “has made its intentions known that it aspires to big things both domestically and further afield.”

Among the products the company has developed is a suite of proprietary anti-cheat software. A number of leading league organisers and producers use the software.

Watson from Sportradar said the rush of broadcast deals and the increased attention on both tournaments and leagues raise the issue of integrity.

“With increased awareness around such events comes an increased betting appeal, and it only follows that integrity-related questions are the next logical step,” he said. “We can’t lose track of the fact that many of these tournaments still bear low prize pools and thus still carry the risk of match-manipulation.”

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