Why The GCC Is Investing In Gaming & Esports

Vivek Falod, Commercial Partnerships Director at ELLVEE, speaks about the untapped potential in gaming & esports in the GCC (Gulf Cooperation Council).

What makes gaming & esports an exciting prospect for the GCC?

Globally, the gaming industry is worth over US$ 300Bn and it is growing fast. Already gaming is larger than the combined markets of movies and music. Esports is the professional competitive aspect of gaming. Esports attracts a large youth audience, ~75% under 35 and more than one third female. 

“We are now seeing local female talent emerge on the world stage, like the FIFA e-Football winner Najd Fahd.”

This makes gaming and esports an attractive proposition for GCC countries where more than half the population is under 25 years of age. Saudi Arabia, for instance, has more than 23M gaming enthusiasts and is set to become the Gulf’s gaming powerhouse as the largest gaming market in the region.

And how is gaming & esports impacting the local communities?

From a social perspective, gaming and esports serves as a platform to inspire and drive societal change, including local job creation, local business participation, building inclusive communities and driving female empowerment. 

For instance, we are now seeing local female talent emerge on the world stage, like the FIFA e-Football winner Najd Fahd. Najd became the first Saudi woman to win an e-football title in October 2020. This moment was even more special because it was the first edition of the tournament and the first title for Saudi Arabia in the female category.

Certainly a proud moment for Saudi Arabia with Najd. And is there an untapped economic potential for gaming & esports?

The regional industry remains nascent despite having some of the richest gaming demographic across the world. Majority of the region’s potential gaming and esports revenues are captured overseas, leading to high value leakage.

“Equity investments in esports and gaming are increasing, given the strong economic growth potential.”

This points to the big gap in local content, both in gaming and esports. It presents an untapped opportunity for global gaming publishers and esports organisations to adapt their content for this market and spearhead localized content and esports events.

Have governments in the region taken note of this potential? If so, can you talk us through some of the major investments happening?

Certainly, investments in gaming and esports have grown exponentially and are expected to continue.

Equity investments in esports and gaming are increasing, given the strong economic growth potential. The involvement of sovereign wealth funds, such as the Public Investment Fund (PIF) in Saudi Arabia, shows the strategic importance of this growing market for the Kingdom. During the last two years, the PIF made significant bets on video game franchises such as Capcom, Electronic Arts, Take-Two Interactive Software and Activision Blizzard. In early 2022, the PIF launched the Savvy Gaming Group to develop the local gaming ecosystem and to make international investments in the industry. Savvy announced its first wave of acquisitions in esports with the reported US$1.5bn takeover and merger of ESL and FACEIT.

“Gamers Without Borders 2020, hosted by the Saudi Esports Federation, drew over 200,000 participating gamers from 80+ countries in its inaugural year.”

Hosting major esports events and developing new esports event IPs are also becoming strategic ambitions for host cities in the region. Such events profile the host destination to the world’s youth as a hub for gaming and esports and boost demand within the local gaming communities to watch and play. For example, Gamers Without Borders 2020, hosted by the Saudi Esports Federation, drew over 200,000 participating gamers from 80+ countries in its inaugural year and has recently announced the launch of its third edition which will be the qualifying competition for a summer of gaming and esports events being planned for Riyadh this summer.

How does ELLVEE support these ambitions? 

We set up ELLVEE for the exact purpose of helping to bridge the gap between rightsholders and potential clients for major events, with whom we have built trusted relationships in the region over the years.  We support our international clients to help them identify business opportunities in the region, such as sourcing host venue deals, sponsorships and other market entry openings. 

Author: Vivek Falod