Twitch co-founder Justin Kan recently told Fortune that without eSports, there’d be no Twitch. New data from research firm Newzoo shows just how true that is for the Amazon-owned streaming platform.
According to the Newzoo Twitch Tracker, 21.3% of all hours watched on Twitch from July to December 2015 was eSports content. That’s 475.5 million hours of eSports content watched across all of the top eSports game franchises, an average of over 79 million hours a month.
The most popular eSports genres watched by gamers are MOBAs (multiplayer online battle arena) such as Tencent-owned (tcehy) Riot Games’ League of Legends and Valve’s Dota 2, which account for 58% of total hours watched. Shooters such as Valve’s Counter-Strike: Global Offensive, Activision’s (atvi) Call of Duty, Microsoft’s (msft) Halo 5, and Ubisoft’s Rainbow Six Siege make up 27% of hours watched. And strategy games such as Blizzard’s StarCraft II and Hearthstone account for 10%, or 47.3 million hours watched.
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While Twitch generated over 2.2 billion viewing hours from its top 100 games, the top 5 games were all eSports titles: League of Legends, Dota 2, Counter-Strike: Global Offensive, Hearthstone, and StarCraft II. Newzoo found that in addition to these five games’ popularity as eSports titles, they’re also the most played PC games overall. This shows the direct correlation of eSports engaging viewers to watch video content as well as to play the actual games on their own.
According to Peter Warman, CEO of Newzoo, large events such as eSports tournaments are driving traffic to Twitch. During ESL’s Intel Extreme Masters (IEM) World Championship in Katowice, Poland, in March, viewership for Counter-Strike: Global Offensive nearly doubled to almost 400,000 concurrent viewers. And at one point during the finals, it spiked at 525,000 viewers. The week before IEM Katowice, viewership peaked at around 200,000.
“Virtual as well as physical attendance is driven by big eSports events,” Warman says. “This is something brands should bear in mind when deciding their eSports sponsorship strategy.”
Newzoo forecasts that brands will spend $128 million on eSports sponsoring and another $197 million on advertising around eSports video content in 2016. This brings total brand spend to $325 million, or 70% of all eSports revenues—an increase of 49% over last year.
“Brands are set to pump more than $800 million into eSports by 2019, the same year the total market passes the $1 billion mark,” Warman says.
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Warman says the two biggest industries investing in eSports are telecom/mobile brands and financial companies. MasterCard (ma), the biggest sponsor of the Champions League in Europe, is making its first moves by sponsoring smaller tournaments like the Alienware Cup. Paysafcard was one of the main sponsors of the ESL One event in Cologne, Germany. Vodafone is the main sponsor of eSports in Spain.
“The next wave of companies are the sports apparel brands such as New Balance, Nike, and Adidas, who are all in talks to be the clothing and merchandise supplier/sponsor,” Warman says.
Coca-Cola (ko) has established itself as a major sponsor for League of Legends. Sprite is sponsoring the League of Legends: League of Tencent in China.
Warman says the challenge for companies not yet invested in eSports is to decide where to put their money: on teams, leagues, events, or channels.
“One challenge is that eSports is very international, while the majority of marketing spend is local,” Warman says.