NEW YORK, Sept. 23, 2019 /PRNewswire/ -- With a $30 million prize pool on the line, and over 2 million people tuning in…One event has piqued the interest of a generation. And with this new industry as a whole slated to pull in $3 billion in just a few short years, investors can't ignore the esports boom any longer. Mentioned in today's commentary includes: Formula One Group (NASDAQ:FWONA), The Goldman Sachs Group, Inc. (NYSE:GS), Alphabet Inc. (NASDAQ:GOOGL), Facebook, Inc. (NASDAQ:FB), Porsche Automobil Holding SE (OTCPK:POAHY).
Teams are already selling for tens of millions of dollars…and the stars of this sports niche are earning a cool million every month. That's more than the top MLB players.
This is the new reality of sports, and it's fueled by young, internet savvy enthusiasts who spend a collective 355 billion hours watching their favorite players. And this overlooked industry is only getting bigger.
In fact, according to Goldman Sachs, it's set to grow 240% percent by 2022. And one little-known company with a market cap of only $10 million is quickly becoming the talk of the town thanks to its strategic acquisitions and partnerships with some of the biggest names in the space.
5 Reasons to keep a close eye right now on this digital trend:
#1 Sports, Redefined and Ready To Hit $3 Billion
By next year, tech consulting firm Activate forecasts that 70 million people will watch a single esports final. And by 2021, esports in the U.S. is set to have 141 million viewers, beating out every single U.S. sport except the NFL.
This is the fastest rise of any industry to date. One out of every three 18-25-year-old spends more than an hour a day playing video games. Last year, 250 million played Fortnite alone. Already in Q4 2018, it boasted 400 million viewers, with total e-sports revenues reaching $870 million. As 2019 comes to a close, e-sports is set to come in with $1.1 billion in revenue.
According to an in depth report on the esports industry by Goldman Sachs (NYSE:GS), by 2022, the global esports market is expected to triple, hitting the $3-billion mark. A 240% rise in just 3 years.
Goldman also mentions that the total esports audience on streaming platforms YouTube and Twitch has already surpassed that of HBO, Netflix and ESPN combined, with viewers spending a collective 355 billion minutes on Twitch alone.
It's anything but a passing fad. It's global in scale, and major universities are even offering esports scholarships. What's pushing all this profitability?
It's simple: Esports viewers want to be able to watch their favorite teams, players and tournaments on any screen, at any time. That's exactly where Millennial Esports (GAME, MLLLF) comes into play.
There are multiple billion-dollar prize pools, and Millennial is jumping into all of them:
- Media rights
- Big Data
- Game development
#2 The Formula (One) for Success
When it comes to game developing and the holy grail of branding, Millennial (TGAME, MLLLF) is on full throttle. The news flow on Millennial's game development is moving faster than an F1 race, and the brands behind the name are top of the line.
The company has acquired Eden, a video racing game developer linked to the Formula One (NASDAQ:FWONA) brand. Eden just rolled out Gear Club Unlimited 2 in 2018, and more games are in the pipeline. It also just secured exclusive partnerships with Porsche (OTCMKTS:POAHY) and Nintendo.
Published by Microids and developed by Millennial Esports' gaming studio Eden Games, Gear.Club Unlimited 2 Porsche Edition will bring virtual versions of iconic Porsche vehicles into the hands of Nintendo Switch gamers.
Eden Games founder, David Nadal noted, "When we first launched Gear.Club on the Nintendo platform 2017 we were thrilled with the reaction from gamers. We already had an amazing collection of cars from some of the biggest manufacturers in the world, but to now work with Porsche is a great addition."
Now with the Formula One link, Millennial is eying even bigger prizes. The F1 isn't just a race, it's an obsession. Its 12 teams are worth over $4 billion, and each race is watched by over 100 million viewers. Millennial will be rolling out these big-name brands for its major esports event, World's Fastest Gamer, which offers the biggest prize in esports racing history. It pits big-name racers against the best of the gaming world for a killer cash prize of $1 million for the winner.
Nearly 57 million people are expected to view this year's Season 2 event, which could bring in $15 million in media value alone, with Aston Martin playing a key role and former F1 and Indy 500 racers behind the e-wheel. That includes former F1 Ferrari driver Rubens Barichello and 2x Indy champ Juan Pablo Montoya.
Once the flags are waved on this race, it will be full speed ahead for Millennial's exposure. By the time these drivers hit the $1-million finish line, Millennial hopes to have established itself as the world's biggest esports racing brand. But it will also have delivered a much bigger message at the finish line …
#3 Big Data, Even Bigger Upside
The nearly $200-billion Big Data industry is the massively lucrative difference between esports and an esports empire.
Big Data is the kingmaker for every segment of industry. That's how companies like Google (NASDAQ:GOOGL) and Facebook (NASDAQ:FB) have carved out their positions among some of the most valuable companies in the world.
Facebook, for its part, collects a shocking amount of data from its 2.4 billion users which it uses to fine-tune its potential to target those same users with curated advertisements. In fact, as of early 2019, Facebook has an average of over 52,000 unique data points on each of its users. Though Facebook has come under fire from less-than tech-savvy regulators, the company has shown no signs of slowing, with its share price growing by 22 percent this year alone.
And Google is even more shocking. The internet giant knows everything its users have ever searched for and everywhere they have been, both in the real world and online. It has so much data, actually, that if a person were to download their file, it would add up to millions of Word documents.
Now the same thing is happening in the gaming industry. It's great to develop one of the hottest new games, but the real upside is when you can harness all the data you collect from millions of players and turn it into premium analytics that everyone wants.
That's exactly what Millennial (GAME, MLLLF) is doing through a well-timed acquisition of Stream Hatchet, a data-collection and processing service, which could be described as the "Nielsen of Gaming".
Stream Hatchet collects analytics on esports, specifically, and then helps its clients identify influences and trends in the industry. This is where the esports industry gets intelligent.
The way to make money in this industry is to know what gamers are doing, how many hours they're doing it for, what's influencing them and how to harness that data. Now gathering this data is under the Millennial umbrella. And it isn't only hitching a ride on the next generation of revenue stream …
Companies are actually buying their own data back from Millennial. So that's double the upside.
Big data gets even bigger for Millennial, too. It has working relationships with everyone from the biggest streaming companies, social media sites and game platforms on the collection end, and the world's biggest developers, publishers and studios on the development end.
It's cornering the market on esports and gaming data, which means it's essentially holding a secret key to industry revenue. That means it's also got a secret code book for monetizing data through licensing and reporting fees.
#4 The Godfather of Esports
It helps when a company has the "Godfather" of racing esports at the helm. Millennial's CEO is exactly that: Darren Cox masterminded the World's Fastest Gamer event, and he's also the former Global Motorsport Director for Nissan, managing global sales and marketing for the brand.
He's landed F1 Ferrari driver Rubens Barrichello for Millennial, along with Indy 500 champion Juan Pablo Montoya. He's an expert in branding. He's even managed to turn gamers into professional racers at the GT Academy. He is THE name in esports.
He understands that this isn't just about developing games, and he's in the process of building an esports empire—and nothing less. Cox is ready to tap into every single revenue stream connected to esports, and his string of acquisitions only adds fuel to the fire.
#5 The Value in Undervaluation
We're talking about a $10-million market cap company positioning itself to try to corner the market in racing game development, branding and big data analytics in an industry some predict will explode to $3 billion by 2022.
It's also part of a bigger gaming industry that could be worth $300 billion by 2025. The wider industry will be very interested in the big data code book held by Millennial, too. It's already an industry offering up massive cash prizes in the tens of millions, and Millennial's "World's Fastest Gamer" event could be the next big Fortnite-style 'World Cup' to captivate global audiences.
It started with two critical acquisitions:
· Eden gaming, with the F1 branding and new racing games in the works
· StreamHatchet, with the keys to e-sports big data
The next big push will come when the flag is waved on the "World's Fastest Gamer" and the F1 obsession hits the digital racetrack around the world later this year. When it comes to esports, there is no doubt the Millennial Esports (GAME, MLLLF) is in poll position.
By. Philip Drew
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