To many, videogames exist in a separate realm from “real” sports, and time spent perfecting offensive strategies in a fantastical cyber world is time wasted.
But competitive eSports are becoming a huge worldwide phenomenon.
The Middle East’s video games industry is worth more than $1 billion, and is expected to rise to $4.4bn by 2022, according to a study carried out by the consulting firm Strategy& and the Abu Dhabi media free-zone twofour54.
Despite this, the most talented and dedicated of this crop of gamers still lack the sponsors, promotion, regular competitions and league infrastructure to compete with their counterparts in Europe, North America and the Far East.
“No one’s really thinking of creating a consistent, structured scene,” says Karim Mousa, who launched an organisation called Cyber Sports League in Dubai in 2015 to help unite and develop the regional gaming community. “The benefit in that would be massive to everyone involved: the sponsors, the players, the network cafes. The potential is there. In the Middle East we’ve got one of the youngest populations in the world, one of the highest gamer bases in the world, one of the highest penetration rates in the world, one of the highest monetisation rates in the world.”
Individual videogame championships have attracted more viewers than the baseball World Series, with a peak 14 million fans streaming the League of Legends final concurrently during the 2015 Riot Games, broadcast from an arena in Berlin.
The prize pool surpassed $18 million at the Seattle-based final of a popular League of Legends spin-off game, Dota 2, the same year. And the biggest platform on which these games are streamed, Twitch, was bought by Amazon in 2014 for nearly $1bn.
In the Mena region, videogame competitions have been around for almost as long as the games themselves, but they have only begun to get serious, with serious money involved, in the past few years.
The world’s biggest eSports league, ESL, held its first tournament in Dubai last year, but only pro teams from Europe and the US were invited to compete for the $250,000 prize pool.
The opportunities open to regional players are not yet at that level – the Jordanian organisation AFKG set a record in December with a Counter Strike: Global Offensive tournament that offered $15,000 in prize money. But a growing crop of passionate gamers are determined to build the infrastructure that eSports athletes need to compete with their counterparts in the West and Far East.
“No one has properly invested in these gamers,” says Mr Mousa.
At present the only regular competitive outlet for the scene consists of scattered, informal events at network cafes (internet cafes that cater particularly to people playing multiplayer videogames for several hours at a stretch).
Mr Mousa says for companies to capitalise on this growth, they could consider spectator tickets, deals with streaming platforms, product placement behind commentary booths and commercial stands at live events: “The revenue streams are kind of infinite.”
Cyber Sports League’s third tournament, with a prize pool of Dh5,000, took place over the first weekend of this month.
Players from around the Mena region competed remotely via the internet, and the game was streamed on CSL’s Twitch channel.
Meanwhile, AFKG, which was also launched last year with the aim of uniting the industry, is working on an international event to be held in September 2016.
The next two years are going to be transformative for the Mena eSports region, AFKG’s founder Ahmed Hijazi says. “You’re talking about 18 countries that are untapped.”
Saeed Sharaf agrees. He is the Dubai-based founder of another competitive gaming organisation called eSports Middle East (ESME), which organised a Call of Duty tournament in Bahrain in 2014, and put on similar tournaments last year as part of Games 15 and the Middle East Film and Comic Con.
“ESports in the region is a really hungry market,” Mr Sharaf says, “and companies must start penetrating that market.”
One of the factors that will make a difference, he says, is the development of a “hub or website that has all the information about the activities going on, because if the market doesn’t have any official statistics, it’s a risk for investors”.
In addition to this centralisation of information, Mr Sharaf says publicity for gamers will help to grow their fan bases, and opportunities for regional athletes to compete at a high level will motivate them to put more effort into training.
He describes one dedicated gamer whose parents saw him as a “loser” until he began to earn a revenue through eSports. Eventually they came to understand that what they’d seen as a brain-numbing pastime could actually be a rewarding, lucrative career.
As a new crop of gamers grows up in videogame-crazy countries like UAE and Saudi Arabia, this shift in perspective is inevitable.
“The upcoming generation is split in half,” says AFKB’s Mr Hijazi. “You’re either a social butterfly, bouncing around talking to people, or you’re a gamer.”
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The Brutalist
Director: Brady Corbet
Stars: Adrien Brody, Felicity Jones, Guy Pearce, Joe Alwyn
Rating: 3.5/5
Europe’s rearming plan
- Suspend strict budget rules to allow member countries to step up defence spending
- Create new "instrument" providing €150 billion of loans to member countries for defence investment
- Use the existing EU budget to direct more funds towards defence-related investment
- Engage the bloc's European Investment Bank to drop limits on lending to defence firms
- Create a savings and investments union to help companies access capital
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Transmission: 10-speed automatic
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Opening day Premier League fixtures for August 9-11
August 9
Liverpool v Norwich 11pm
August 10
West Ham v Man City 3.30pm
Bournemouth v Sheffield Utd 6pm
Burnley v Southampton 6pm
C Palace v Everton 6pm
Leicester v Wolves 6pm
Watford v Brighton 6pm
Tottenham v Aston Villa 8.30pm
August 11
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
FIXTURES
December 28
Stan Wawrinka v Pablo Carreno Busta, 5pm
Milos Raonic v Dominic Thiem, no earlier then 7pm
December 29 - semi-finals
Rafael Nadal v Stan Wawrinka / Pablo Carreno Busta, 5pm
Novak Djokovic v Milos Raonic / Dominic Thiem, no earlier then 7pm
December 30
3rd/4th place play-off, 5pm
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