The Future of Fandom: Why Esports and Gaming Are Outpacing Traditional Sports
09 June 2025
Read Time 5 MIN
Traditional Sports Are Losing Their Grip on the Next Generation
For more than a century, leagues like Major League Baseball (MLB) and the National Basketball Association (NBA) have served as cultural cornerstones in American sports. But in 2024 and beyond, signs of structural decline are becoming more evident, particularly when it comes to younger viewers.
MLB is struggling to connect with Gen Z. According to a 2024 CivicScience study, baseball ranks lowest in interest among Gen Z fans compared to other major leagues. Rule changes aimed at shortening games and making the sport more accessible have yet to produce meaningful gains in youth engagement. On the business side, the financial strains are becoming more public. ESPN opted out of a decades-long partnership with MLB, citing that it was paying roughly $550 million in rights fees annually for content that generated just $150 million in advertising revenue. That’s not a sustainable equation.
The NBA, often thought of as a digitally savvy and youth-oriented league, is also encountering headwinds. Viewership on ESPN was down 28 percent as of late 2024, and opening night ratings dropped 42 percent compared to the prior year. While the NBA excels in short-form, highlight-driven social media content, it’s increasingly clear that Gen Z and younger Millennials are seeking more authenticity and depth - qualities not always present in the NBA’s broadcast product. In response, ESPN has reportedly cut back on long-form analytical coverage in favor of viral clips, a move that may actually be driving fans away.
Esports and Gaming Offer What Modern Audiences Actually Want
While traditional sports are struggling to reinvent themselves for a digital-first world, eSports and gaming are meeting young audiences where they are on digital platforms, with interactive content, and in spaces that prioritize community and participation.
The eSports audience surpassed 570 million in 2024 and is projected to grow to over 640 million by 2025. Nearly half of this global audience falls under the age of 35, positioning eSports squarely within the demographic traditional leagues are losing. The broader gaming industry is even more impressive, on track to reach $321 billion in global revenue by 2026.
Esports Revenues Worldwide in Billions
Source: Statista as of 2024. For illustrative purposes only. Not a projection of future results. Past performance is no guarantee of future results.
What sets eSports apart is its inherent interactivity. Unlike passive broadcast formats, eSports events often take place on platforms like Twitch or YouTube, where fans can engage directly with streamers, teams, and each other. Viewers can participate in real-time chats, vote on in-game decisions, and even contribute financially to their favorite content creators. This type of two-way engagement is absent in traditional sports and helps build strong, sticky relationships between fans and franchises.
Esports also integrates seamlessly into the larger entertainment ecosystem. Events frequently feature musical performances, influencer crossovers, and community-generated content. This blend of gaming, pop culture, and real-time interaction has created an entirely new kind of fan experience, one that aligns perfectly with the expectations of Gen Z and Gen Alpha.
Key Differences Between Esports and Traditional Sports
The structural differences between traditional sports and eSports go beyond format. Esports and gaming have a fundamentally more scalable, globally accessible, and digitally monetizable model. This table highlights several of the most important contrasts:
| Category | Traditional Sports | Esports and Gaming |
| Digital Revenue Share | Approximately 30–40% | More than 80% |
| Capital Expenditure (CapEx) | Stadiums, teams, logistics | Low – Software and cloud infra |
| Fan Age Demographic | 35–54 (aging) | 16–34 (growing) |
| Content Format | Broadcast, passive | Interactive, always-on |
| Global Scalability | Limited by geography and licenses | Digital, borderless, instantly scalable |
| Recurring Revenue | Seasonal ticketing and media deals | Continual in-game purchases and subscriptions |
Source: VanEck as of 2025
Scalability and Fan Interactivity Are the Real Growth Drivers
Perhaps the biggest strategic advantage eSports holds over traditional sports is scalability. Traditional leagues must rely on physical venues, geographic markets, and linear broadcasting contracts to grow. Esports, on the other hand, is global by design. A tournament in Seoul can be streamed live to millions across the U.S., Europe, and South America simultaneously with minimal infrastructure investment.
Additionally, eSports generates recurring revenue through game-as-a-service models. Titles like League of Legends and Fortnite monetize through battle passes, in-game cosmetics, and seasonal events. Fans aren't just watching, they're participating. Many eSports fans actively play the games they follow, further reinforcing brand loyalty and deepening engagement. Traditional sports struggle to replicate this level of ecosystem stickiness.
That engagement also translates into revenue frequency. A baseball fan might attend a few games a year. A gamer may log in daily, spending money frequently and participating in a digital economy that is always evolving.
Investment Implications: Embracing the Digital Shift with ESPO
For investors seeking exposure to the growing eSports and gaming sector, the VanEck Video Gaming and eSports ETF (ESPO) offers a compelling thematic opportunity. ESPO tracks the MVIS Global Video Gaming and eSports Index which includes companies that derive at least 50% of their revenues from video gaming and/or eSports.
As of April 2025, ESPO’s top holdings include leading global publishers and platforms such as Nintendo, Applovin, Tencent, Roblox, and Netease, each playing a significant role in the evolution of the digital entertainment landscape.
These companies exemplify the structural growth potential in gaming, from mobile distribution and immersive game development to social gaming ecosystems and global content delivery.
ESPO Index Outperforms Broad Indices Over the Last Twelve Months
Source: Morningstar as of 6/3/2025. Past performance is no guarantee of future results. Index performance is not representative of fund performance. It is not possible to invest directly in an index.
Key Takeaways
The sports world is evolving quickly. What was once dominated by stadiums, cable networks, and passive viewing is being replaced by interactive platforms, global audiences, and deeply participatory ecosystems. Traditional leagues like MLB and the NBA may not vanish, but their cultural and financial dominance is clearly eroding.
Esports and gaming aren't just a niche alternative, they are the new mainstream. And for those looking to invest in the future of fandom, the time to act is now.
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