Esports Invades The Las Vegas Strip: What The Luxor Arena Means For The Future

Written By Joss Wood on April 13, 2017 - Last Updated on January 22, 2018

[toc]Esports is coming to Luxor in Las Vegas.

The Luxor Hotel and Casino, owned by MGM Resorts International, brought the Sphynx and Great Pyramid of Giza to the Las Vegas strip. Now the iconic property will shift into the future with its first esports arena.

The Luxor esports deal, at a glance

MGM has struck a deal with Chinese company Allied Esports to transform a 30,000-square foot nightclub at the Luxor “into a multi-level arena complete with a competition stage, LED video wall, telescopic seating, daily gaming stations, a robust food and beverage offering, and state-of-the-art streaming and television-quality production studios.”

Niklas Rytterstrom, general manager of the Luxor, said:

“Our company is the leader in the entertainment industry and recognizes the exciting growth in esports. With this partnership, we will introduce a new experience to the market, once again elevating the city’s vast entertainment offerings.”

It is plain that the partners have big ambitions for the new esports venue. Senior Vice President of Allied Esports Jud Hannigan added:

“The arena will provide a ready-to-go championship destination for tournaments, leagues and high stakes match-ups in a setting designed to deliver an unparalleled fan experience.”

Esports is already in Vegas

The Luxor is not the first Las Vegas casino to recognize the potential of esports. The Downtown Grand began studying the esports industry in 2015.

Since then it has created the first casino esports venue in Las Vegas.

“We had viewing parties, and now we have contests where aspirational sports players go to the casino floor and pay a cash entry fee to play in a tournament, play for a cash prize, and that happens every Friday and Saturday night,” CEO Seth Schorr told ESBR. “Once we saw that happening and working really well, we realised we were on to something.”

When Esports Betting Report interviewed Schorr in May 2016, MGM had already put on two major esports events. Almost anticipating the Luxor announcement, Schorr said:

“There’s no question that every major casino in Las Vegas is talking about esports. It’s certainly a topic in the boardroom. MGM has done a fantastic job producing two large events.”

Esports betting is definitely on the Luxor horizon

Through partner William Hill, Schorr managed to provide the first online esports bet late last year. He has ambitious plans for the expansion live esports betting.

He has worked closely with the Nevada Gaming Control Board to educate them in the risks and potential of esports betting.

When Schorr gave evidence to the Nevada Gaming Policy Committee in May 2016, one of the committee members listening most closely was Jim Murren, CEO and chairman of MGM.

In this deal with Alliance, Murren has brought esports into a high-profile casinos on the Las Vegas strip. Esports betting will be an integral part of the arena’s growth strategy.

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Other casinos are likely to launch their own esports offering

The Downtown Grand pioneered the way, now the industry heavyweights in the form of MGM are taking Las Vegas esports mainstream.

It cannot be long before other casinos on the strip follow in their footsteps. They may aim for the same destination, but are likely to take a variety of routes.

A dedicated esports venue is only one way to ride the esports growth trend, and Vegas may be limited in how many venues the market can support.

Casinos are not the only businesses interested in esports. Millennial Esports opened its esports event and production complex in the Neonopolis building on Fremont Street in downtown Las Vegas last year.

Millennial has already established a toehold in the global esports scene by partnering with Microsoft and Electronic Arts (EA) to hold the Madden Championship Series, Madden NFL 17 Tournament on Xbox One and PlayStation 4.

Millennial is open to the potential of esports betting. But it recognizes that it will have to wait for the regulatory opportunity.

The MGM venue will seek to compete for such signature events, but there a limited number of top competitions. Too many venues will spread revenues thinly.

Casinos may opt to treat esports betting like traditional sports betting

Esports fans love live competitions. But the majority of play is online, so casinos have the option to treat esports more like traditional sports betting.

Casinos with sportsbooks don’t play host to the NFL or NHL events on which they take bets. There’s no reason why the same strategy can’t work with esports betting.

These factors are likely to contain the growth of Nevada esports venues to whatever the market will support. That number is likely to be a higher than it is now, but there is a limit.

Hannigan is in no doubt as to the level of dominance that he expects to achieve:

“Just as Yankee Stadium, Madison Square Garden and Wembley Stadium are considered their sports’ most aspirational venues by players and fans alike, Esports Arena Las Vegas will be the iconic destination in esports and complement the city’s incredible appeal, attracting video gaming competitors and fans from around the world.”

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Joss Wood

Joss Wood holds an English degree from the University of Birmingham and also earned a master’s degree in organizational development from the University of Manchester. Joss has a special focus on the international online gambling market, though he also writes extensively on US regulated markets, sports betting, and esports betting.

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