6 Ways to Play the Hottest Investment Sector of the Year

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NEW YORK, Sept. 30, 2019 /PRNewswire/ -- The soon-to-be $300-billion gaming industry isn't just growing - it's exploding. Forking off in so many different directions that investors are struggling to understand all of these lucrative new sectors. The $1-billion (and counting) esports segment, for example, is literally tearing down the walls of traditional sports, and giving everyone in the world access to the newest events. This is the very best of globalization and technology.  Mentioned in today's commentary includes:  Comcast Corporation CMCSA, AT&T Inc. T, Intel Corporation INTC, Advanced Micro Devices, Inc. AMD, Micron Technology, Inc. MU

By next year, tech consulting firm Activate forecasts that 70 million people will watch a single esports final. That's a viewership that would challenge any traditional sporting final. By 2021, esports is set to have 84 million viewers, beating out every single sport except the NFL on a daily basis.

By 2022, the global esports market is expected to triple, hitting the $3-billion mark, according to Goldman Sachs.  Investors in this segment have a nearly unlimited choice of entry points, from game developers and publishers to media rights holders, data collectors, streamers, and even … beverages.

If you're looking for someplace to invest capital in this fast-growing industry, here are 5 back doors that provide plenty of potential upside while no one's caught on just yet:

#1 Comcast Corporation CMCSA

Comcast (Xfinity) isn't going to be left out of this game.  That's why it's recently announced it will build a $50-million esports arena.

The 'Fusion Arena' will be housed in downtown Philadelphia will have a 3,500-seat capacity and more than 2,000 square feet of LED screens, training facilities and private rooms for players to stream video to their fans. This will be the home of Comcast's own esports team, the Overwatch League, but it will also be the East Coast esports hub. And it's a first: The first-ever arena built from the ground up, solely for esports.  

The arena is slated to open its doors in 2021 and is symbolic of Comcast's determination to become a leader in the esports revolution.

Comcast has plenty going for it right now, with Q2 2019 gains that showed revenue up 24% year-on-year last quarter and adjusted profits up 13%. Cable TV is still a drag, but Comcast may have found its next great revenue driver.

#2 Millennial Esports Corp. (GAME, MLLLF)

If you really want to get your game on in this segment, Millennial is the Ferrari of esports. One of the best ways to monetize this industry is to corner it from every angle imaginable - simultaneously. That's what GAME is doing.

It's securing multiple revenue streams, including everything from lucrative game development (think: Formula One) to one of the biggest missing links in the monetization puzzle: data collection. 

One of the biggest growth areas in esports is game development, and Millennial (GAME, MLLLF) is on the fast track in more ways than one. It's bringing the $700-billion auto industry into the digital arena with the Formula One racing game.

That makes GAME a leader in this space. But that space is now about to expand further with Millennial's acquisition of Eden, a video racing game developer linked to the Formula One brand.

Eden, just rolled out Gear Club Unlimited 2 in 2018, and more games are in the pipeline. And it also just secured exclusive partnerships with Porsche and Nintendo. 

In August, GAME bought a controlling 51% stake in the market-leading motorsport simulator manufacturer, Allinsports, which has a technical partnership with Ferrari in simulator development and founded by a Formula One engineer. And it's also developed the most iconic esports racing event on the planet: World's Fastest Gamer.

The first season was a global sensation, broadcast across 48 countries and reaching an estimated 400 million households. Now the second season is set to be bigger, with this year's prize valued at $1 million - the biggest prize in esports racing history.  All of this accounts to major exposure for Millennial Esports. And with that exposure, GAME is breaking into another huge segment of esports - data analytics. 

Millennial has just acquired Stream Hatchet, the first service dedicated to gathering user data on online gaming, data that it can deliver to Big Tech and media companies. The big data industry is worth nearly $200-billion already and will be the kingmaker of the esports fiefdom.

So, not only is Millennial (GAME, MLLLF) developing one of the hottest games in a sector with unlimited potential, it's also harnessing the endless upside of the data that it can collect from millions of players and viewers.

When it comes to a backdoor entrance into esports, there are few opportunities with so much blue-sky potential.

#3 Micron Technology MU

The gaming industry is absolutely reliant on new innovations in the world of hardware, and Micron Technology is a force in this world.

From ultra-fast solid-state drives to RAM and graphic card memory, Micron has pushed the boundaries of what is possible for computers, both inside the gaming world and out. Its main export? Memory. And it's fueling the esports revolution. Whether it's streaming or developing new games with faster speeds and better graphics, memory is responsible. And Micron is the leader in this field.

Not only is Micron fueling a gaming boom, but it is also applying its knowledge and expertise of the technology to other sectors. In fact, it's carving its way into the Internet of Things revolution and even deep into scientific endeavors, teaming up with CERN with deep learning and memory solutions to help physicists solve some of the biggest questions in the universe.

#4 Advanced Micro Devices AMD

AMD is another monster hardware producer helping to fuel the gaming boom. In fact, it is responsible for the renowned Radeon graphic card series. Their cards are widely favored among serious gamers and professionals alike.

And AMD is not just hardware producers, either.  The company is also constantly producing software vital to the gaming experience, from power management to software that optimizes how computers are used when playing games.

With such a clear devotion to gaming, it's clear to see why AMD is a leader in the field. Now only are they considered by many as the top chipmaker in the business, they're also supporting the growth of esports, as a whole. Currently, AMD is sponsoring two esports teams, Fnatic and Evil Geniuses. 

#5 AT&T T

AT&T's

acquisition of Time Warner Inc

has launched the telecoms giant squarely into the esports arena.  That $85-billion mega merger brought things like ELeague and Rooster Teeth into the AT&T fold.  

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ELeague

is part of Turner Sports, a subsidiary of AT&T's WarnerMedia, which televises its major events.

Nintendo just announced in August that it is partnering with Eleague to broadcast The Nintendo 2019 World Championships on CBS, and Eleague hosts a lineup of other popular competitive games including Rocket LeagueCounter-Strike: Global OffensiveStreet Fighter V, and Overwatch.

And perhaps more importantly, 5G will be the holy grail of the esports future - and AT&T is all over that.

#6 Intel INTC

None of this happens without the hardware, and Intel is one of the biggest esports proponents out there. As such, it's positioning itself firmly and very visibly in this segment.  Right now, among many other things, Intel is investing heartily in digital tech for the upcoming Tokyo Summer Olympics in 2020.

And it's not just hocking hardware, either. It's take a center-stage approach, hosting and broadcasting esports tournaments ahead of the Olympics, including Street Fighter V and Rocket League.  Welcome to the Intel World Open, with a $500,000 prize pool.

This is where to watch for the tech advances. Intel is planning innovations for 5G platforms, combining artificial intelligence and esports.  It's also planning to employ 3D Athlete Tracking (3DAT) technology - a pioneering tech using AI to enhance the view experience for Olympic fans. Further, it's working on using virtual reality for training.

We expect big things from this hardware company that has proven to be much more than a backend onlooker. They're in the front row of the esports arena.

By. Ian Rogers

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