The popularity of electronic sports, or esports, may seem like a strange phenomenon at first glance.

Why do hundreds of thousands of people routinely watch live video of someone else playing a video game? Who would pay to watch people play a video game at all? How could something so absurd at first glance be anything besides a fad?

Consumer behavior has shifted in a big way for many who consume content and attend events. The entertainment and hospitality industries are taking notice, even as the esports sector remains in its infancy.

U.S. cities like San Francisco, Oakland, Las Vegas, and Washington, D.C. are looking to capitalize on the craze with venues that replicate the traditional sports arena format.

Professionals in the meetings and events sector should see a much bigger opportunity. The popularity of esports represents only the beginning of a wider acceptance of virtual events and the integration of physical events into digital content. Consumer trends always define behavior as people enter the workforce, and the next generation of workers and event attendees will have very different expectations than those of today.

Based on interviews with more than a dozen event technology professionals in the last few months, a key theme emerges, bridging the gap between physical events and the digital realm. This can happen both behind the scenes, when it comes to finding meeting space or marketing to attendees, or in the form of apps or other things that enrich an event’s programming.

For Gen Z and other digital natives, though, this divide never existed to begin with. The line between spectating and participating are blurred by the nature of how young people consume and interact with content.

Massively Multiplayer Events

Playing a video game may conjure the image of the loner in a basement, staring alone at a computer screen. But in reality, online multiplayer gaming creates lasting global social networks mediated by playtime and online communication services like Discord and Twitch. Tracing this evolution is worthwhile to show how technology has empowered these types of digital networkers.

Esports as a concept actually hearkens back to the 1980s, when arcades would hold competitions and organizations like Twin Galaxies would hold events challenging the best Donkey Kong or Galaga players in the world to compete against each other. TV game shows even popped, pitting children against each other in a variety of popular games.

As the World Wide Web became popularized in the mid-1990s, so too did gaming move online. Ranging from competitive shooters to online role-playing games, gamers could now play and communicate with competitors from around the world. In the late 1990s and early 2000s, a variety of leagues also emerged with real-life events featuring networked competitive gaming, although none became wildly successful at the time.

Over the last twenty years, improved gaming technology has coincided with the rise of mainstream social networks, enabling gamers to move beyond text chat rooms and forums to voice chat and video streaming. Games like Starcraft and Counterstrike became a phenomenon in Asia, with tournaments and professional players gaining exposure on video streaming sites, and then, through global tournaments with huge prize pools for winners and professionalized announcers.

Today, the culture and media surrounding gaming have become an entertainment category of their own. More than 600 million people around the world watched game streaming in 2017, a bigger audience than networks like HBO, ESPN, or Netflix.

Popular esports games like PlayerUnknown’s Battlegrounds, League of Legends, and Overwatch dominate the worldwide streaming landscape right now. Streaming alone is suggested to have generated $3.2 billion in revenue for streamers and video sites alone in 2017. The global video game industry, overall, generates more revenue than either the movie or music industry.

While the viewers of these streams are predominately males under the age of 34, according to streaming service Twitch, that audience will become more diverse as esports move further into the mainstream. Overall, U.S. gamers are split almost evenly across all genders and age groups.

Electronic Entertainment and Events

So, a global audience bigger than the viewership of ESPN and Netflix has a love of virtual events and is deeply engaged with the personalities and experience of competitive gaming.

What can the broader meetings and events sector learn from this phenomenon? Video games by their nature are experiential, so it’s no surprise that social and entertainment experiences have sprung up around them.

Arenas and lounges are springing up because people want truly social, in-real-life experiences, even if they can experience something at home while online. Gaming is an integral part of the lives of young people, less of a time-wasting hobby than a lifestyle choice.

These young people will soon enter the workforce, as well, bringing their digital-first habits and behaviors with them. It will be wise for the meetings and events sector to pay attention to how the lines between digital and physical events become even more blurred in the future.

Photo Credit: Esports are becoming big business for the entertainment industry. Its fans are shredding the divide between virtual and physical events. Bloomberg