Esports work as a domain because they have the intrinsic ability to attract people. They do this on both sides of the equation - they are able to appeal to players who gradually become so good at one or more game that this allows them to turn pro. On the other side are the viewers who enjoy watching the same players and are willing to spend time and sometimes even money to attain access to this content.
This alone is enough for a business ecosystem to develop. The same system then generates a two-way street - it exchanges fun and enjoyment which the viewers get for profits which the organizers and players attain. However, the same process in esports today is very similar to that of the traditional sports. Here is how the current setup functions, followed by ways it could work thanks to its digital-first nature.
The Traditional Sports Broadcasting Model
In broadcasting of sports events, which is right now a tradition reaching back more than a century to the age of radio, the calculation was simple. With enough eyeballs (or earlobes) on a particular broadcast, there would be willing advertisers who would pay for a small part of that huge audience and its attention.
This allowed for the creation of commercial blocks which are still the main source of broadcast revenue, followed by sponsorships and similar things. The in-broadcast advertisement is, however, the bread and butter of the traditional marketing system, peaking with insanely expensive airtime during events like the Super Bowl. Right now, esports broadcast approach appears to be practically identical to the traditional one. But it does not have to be.
Digital and Online Changes All
Traditional sports might be played in the real world, but esports are not limited to it. While physical locations still play a role in esports, the online sphere offers countless other possibilities for monetization. These can be both lucrative and engaging for the viewers themselves because in-game events could be tied directly into the broadcasts. In some ways, Twitch platform has already started the pioneering work on this front with the ability of viewers to tip their favorite streamers and so forth.
But, this is only the beginning and the realm of possibilities is much wider. For example, viewers could ban together while rooting for a pro player and then send them small in-game bonuses which they purchased using real money. From a game design standpoint, this is sheer madness because it opens the door to not just pay-to-win but entertain-to-win. In other words, the most fun to watch players and those with the biggest and most loyal audience would have an advantage in matches thanks to these in-game drops.
The problem would be that in this case, the odds would always be on the more popular competitor. The same would, in turn, make the games more boring and thus bring down the viewership numbers. That is why any esports league will have to regulate these monetization means so that they do not do more harm than good in the long run.
A World of Opportunities
Any new and unique monetization mechanisms that appear in the esports broadcasting community will have their adjustment period. But, even with it, there is little doubt that esports leagues and organizers should look to other digital media for inspiration on how to innovate their monetization mechanisms beyond the decades-old TV system. Once the right candidate is found, the same monetization principle will prove to be a huge success almost instantly.