On Feb. 19, an international athletic showdown took over the MGM Grand Garden Arena in Las Vegas. It was the culmination of a five-day tournament that had teams from Denmark, Poland, Germany, Sweden, Canada, Australia, Brazil and the U.S. competing for $450,000 and priceless bragging rights.
As the last two squads battled under the lights during the final evening, analysts tracked the action, fans roared over particularly brilliant play, reporters watched for pivotal moments and confetti was readied for the victors.
Which is to say, the event played out like any sporting contest. Only in this case, the participants were seated in plush office chairs behind computer screens, and the game in question didn't require sneakers or anything resembling a ball. That's because this tournament was DreamHack Masters, and the game was multiplayer first-person shooter "Counter-Strike: Global Offensive."
Esports, essentially competitive video gaming, has been around for a long time, but in recent years its growth has been astronomical. In 2014, Amazon purchased Twitch, a video-streaming site and social platform for gamers, for $970 million. Last year, the Intel Extreme Masters (IEM) World Championship in Katowice, Poland, drew 113,000 fans over the course of three days while another 34 million viewers live-streamed the event online in 26 different languages. Market research firm Newzoo estimates total esports revenue in 2016 at $493 million and projects the figure to hit $696 million in 2017, a 41% jump year over year.
Pause for a second and imagine those 34 million IEM viewers around the world watching the tournament play out inside MGM Resorts' new T-Mobile Arena on the Strip. That's a pretty impressive marketing opportunity — for the arena, for the company, for Las Vegas itself.
That's exactly the idea behind the Nevada Esports Alliance (NVEA), a nonprofit that launched last month dedicated to establishing Las Vegas as an esports destination. The organization's founding directors are Fifth Street Gaming CEO Seth Schorr; Brett Abarbanel of the International Gaming Institute at the University of Nevada, Las Vegas (UNLV); Chris Grove of Narus Advisors and Eilers & Krejcik Gaming; and Jennifer Roberts of UNLV's International Center for Gaming Regulation.
"In order for Las Vegas to maintain its position as entertainment capital of the world, we as a city and industry need to constantly embrace new forms of gambling, entertainment and sports," said Schorr, who's also chairman of the Downtown Grand Hotel & Casino. "Esports is one of the few platforms that really embraces all three."
The Millennial Esports Arena recently officially opened at the Fremont Street Experience’s Neonopolis complex. The facility hosts competitive video-gaming events and seats 200. Photo Credit: Jonathan Austin
The Downtown Grand has been an early adopter of esports as a hospitality strategy. Since 2015, the hotel has sponsored a professional esports team (whose members lived onsite), hosted professional and amateur tournaments, held watch parties for major competitions and created a dedicated esports lounge right on the casino floor. The property employs an esports manager, and in November it became the first American casino to offer wagering on competitive video gaming when its William Hill sports book took bets on the IEM tournament in Oakland. Bettors could also wager on DreamHack last month while it was playing out up the street.
"We've sat for over a year and a half strategizing about how we can create an experience that's compelling to the video game community," Schorr said. "First and foremost, it's been a profitable exercise. It's created a new revenue stream. It's created more excitement and energy, and it's introduced our property to a whole new pool of guests."
Downtown Grand isn't the only Vegas resort pursuing esports. Last April, 13,000 people attended MGM Resorts' first ticketed esports event, the League of Legends North American League Championship Series (NA LCS) at Mandalay Bay Events Center, while another 500,000 watched from home.
This July, the casino will host the EVO Championships for the second straight year, and MGM Resorts has begun accepting bets on esports contests held at company properties.
"For Las Vegas, [esports] provides us an opportunity to create event programming that appeals to an audience looking to experience Las Vegas differently than previous generations," said Rick Arpin, senior vice president for MGM Resorts International. "This certainly isn't a new conversation for Las Vegas or MGM Resorts. For a number of years, we have been refining our offerings to appeal to this younger audience."
At the Downtown Grand, meanwhile, Schorr is expanding the esports lounge, moving it into the 8,000-square-foot space that formerly housed the Commissary restaurant. Just down the street, Millennial Esports recently opened a 15,000-square-foot, 200-seat arena dedicated exclusively to esports.
"As the Las Vegas traveler evolves, we must continue to find entertainment content that will appeal to them and drive visitation," said MGM Resorts' Arpin. "We believe there is significant potential for Las Vegas to host the biggest esports events in the future, similar to how we already host the biggest boxing matches, college basketball games and concerts."