Esports to capture $60,000 of K-12 annual budgets in US and Western Europe

The adoption of esports in education continues to gain a significant foothold across many world territories. A new report from Futuresource Consulting reveals that K-12 schools in the USA and Western Europe will spend an average of between $50,000 and $60,000 each on esports capabilities over the next two years. This spend is being largely driven by the upsurge of local and international tournaments, which represents a significant opportunity for vendors and integrators alike, with schools committing to providing their players with elite equipment to compete.

The report, based on 600 interviews conducted across the esports supply chain and with end users, builds a clear picture of the current and future landscape. Futuresource forecasts also show that the global installed base of PCs used primarily for esports in K-12 schools will grow by around 16% CAGR between 2022 and 2027, and 15% for universities.

Esports sponsorship, engagement and a move towards the curriculum

“The esports market broke through the $1 billion barrier in 2021,” says Claire Kerrison, Principal Analyst, Futuresource Consulting, “competitive gaming is becoming increasingly popular – and more young people are hoping to turn their passion into a career. Whilst some schools across the world are keen to help their students obtain one of the growing number of esports scholarships, they are unified by a desire to use gaming as a way to engage with disconnected students

“Esports’ draw is so strong that it is not only becoming an increasingly popular extra-curricular pursuit, but is also gradually becoming integrated into K-12 curricula. Esports offers multiple benefits to students whilst the career opportunities extend from gameplay to event management and broadcasting…”

“However, despite the prospects and the rise in student participation, it isn’t a clear-cut situation. The vast amount of marketing material and sponsorship hype surrounding esports in education is making it increasingly difficult for vendors to determine the level and location of the opportunity.”

A fragmented funding model

Funding for school esports capabilities is typically derived from many sources, with the majority coming from the school’s annual IT budget. Futuresource expects grant funding to rise in the mid-term, as governments invest more in grassroots esports in order to continue the development of the industry, and secure a talent pipeline.

The rise of esports-as-a-service

In the USA and Western Europe, the majority of schools sought advice on esports purchases, with integrators being cited as the most influential party. This appetite for Esports-as-a-Service (EaaS) presents a lucrative, sustained revenue opportunity for integrators. More than 90% of schools in Europe and the USA that took part in the Futuresource research study stated they would be at least somewhat interested in EaaS.

Growing popularity also breeds detractors

The attitude towards esports entering the curriculum varies by country. Esports academies are becoming increasingly popular in South Korea and Japan, with some set to open in the Middle East. However, beyond the academies, there is criticism from parents and teachers, with many doubting the advantages that could be achieved by allowing esports to enter mainstream classrooms. And despite being the largest esports country market in the world, government restrictions in China have quashed any esports activities in its K-12 schools.

Esports investment in universities

In universities, growth is being driven by a general increase in popularity, the development of collegiate gaming across Europe, and a rise in the number of higher education qualifications related to esports.

Many universities are investing in esports to improve student recruitment and retention. As facilities feature highly in marketing literature, they want to ensure their facilities appear cutting-edge, representing a significant opportunity for integrators as a simple equipment swap-out will no longer suffice.

Rapid replacement cycles

“Despite the growing concern with aesthetics, equipment performance remains central to the success of a university’s esports endeavours,” says Kerrison. “According to leading channel players, PC components are being replaced every 18 months, and specialist gaming accessories are refreshed, on average, every three years or so, in order to reduce potential lag and deliver optimum performance for their esports teams.”

Futuresource Consulting’s 200-page Esports In Education report quantifies the demand for esports IT hardware across K12 and higher education, at present and over the next five years. It explores the regional purchasing behaviours of schools and universities, exploring the drivers of esports adoption and the barriers that remain. For more information or to make a purchase, contact ben.thrussell@futuresource-hq.com

About the author

Claire Kerrison

Claire Kerrison leads the Education team, overseeing Futuresource’s quarterly K-12 PC tracker and end-user research programs. Claire is closely involved in the formation and delivery of custom projects covering the EdTech sphere.

Claire joined Futuresource in 2011 from the University of Birmingham where she collaborated on a broad range of market tracking and strategic projects covering the Displays industry. Claire went on to lead the Displays team, with a focus on developments in the Front Projector market.