E-Gaming development in Saudi Arabia
Sports and Event Management Focus
E-gaming is a rapidly growing industry that is becoming increasingly popular among young people. Saudi Arabia has seen a surge in the number of e-gaming tournaments and events in recent years, as well as the rise of e-gaming cafes and lounges.
Law Update: Issue 362 - Sports and Event Management
Bandar Al HamidaniPartner,Corporate Commercial
Ayidh Al Kahtani Trainee Lawyer,Digital & Data
In Saudi Arabia, e-gaming is a rapidly growing industry that is becoming increasingly popular among young people. Saudi Arabia has seen a surge in the number of e-gaming tournaments and events in recent years, as well as the rise of e-gaming cafes and lounges. The e-gaming industry is reportedly estimated to be worth between USD $200 billion - $300 billion and Saudi Arabia wants to play a major role in this industry in the years to come.
One of the reasons for the growth of e-gaming in Saudi Arabia is the high level of interest in video games among young people. According to a survey conducted by the Saudi Arabian General Authority for Statistics in 2019, more than 70% of Saudi youth aged 15-29 play video games, with mobile games being the most popular.
In addition, the Saudi government has recognized the potential of e-gaming as a growth industry and has taken steps to support its development. In 2017, the Saudi Arabian Federation for Electronic and Intellectual Sports (SAFEIS) which was later changed to Saudi E Sports Federation, it was established to oversee and promote e-gaming in Saudi Arabia. The Saudi E Sports Federation has launched several initiatives, including organising major e-gaming tournaments and events, training and supporting Saudi e-gaming athletes.
The Saudi E Sports Federation is in charge of overseeing developments to make Saudi Arabia one of the top countries in this sector. The Federation work stream is comprised of two complimentary workstreams that which are as follows: The first stream aims to create competitive gamers at every level, from amateurs in their local communities all the way up to top-tier professionals who can compete on an international level by supporting talent and encouraging the industry, the second stream aims to build the whole value chain for gaming and esports.
In September 2022, the Crown Prince HRH Mohammed Bin Salman as the Chairman of the Council for Economic and Development Affairs unveiled the National Gaming and Esports Strategy which focuses on making Saudi Arabia the main hub for the industry by 2030. The National Strategy was launched to diversify the economy, create new jobs in many sectors and provide a world class entertainment for the citizens, resident, visitors, and others in Saudi Arabia.
The National Strategy consist of three main pillars which are:
quality of life improvement by providing a great ecosystem for the industry and for the players to thrive and developed to participate in international tournaments;
creating new opportunities by introducing initiatives that will help improve the industry and to elevate Saudi Arabia’s status in the industry; and
making an economic impact that contributes SAR 50 billion (approximately USD $13.3 billion) to Saudi Arabia’s gross domestic product.
Additionally, it is predicted that the National Strategy would strive to produce approximately 39,000 new job opportunities by 2030, demonstrating the significant influence that this industry has on the country.
Saudi Arabia aims to implement the National Strategy through 86 initiatives covering all aspects to the industry including and not limited to establishing gaming studios to produce more than 30 competitive games and hosting gaming events. For instance, one of the biggest e-gaming events, Gamers Con is held annually in the city of Riyadh. The event attracts thousands of gamers and fans from around the region and features a range of e-games, including Fortnite, FIFA, and Dota 2. In 2019, the event had a prize pool of SAR 2 million (approximately USD $530,000).
This year in 2023 Saudi Arabia (through the Saudi Esports Federation) hosted a bigger and larger gaming event than Gamers Con called “Gamers8” for eight weeks for different gaming tournament such as FIFA, Tekken7, Fortnite, Pubg mobile and many others competitive games. The total prize pool of Gamers8 is SAR 45 million (approximately USD $12 million).
In recognition of the importance of esports in Saudi Arabia, the Saudi sovereign wealth fund Public Investment Fund (“PIF”) have invested over SAR142.5 billion (approximately USD $38 billion) in the industry and have established a gaming company called SAVVY Gaming Group (“SGG”) and its main goal is to become the leading gaming and eSports group domestically and internationally and will work to further develop an integrated ecosystem for the industry. SGG has purchased ESL gaming - one of the biggest independent e sport companies- for SAR 3.9 billion(approximately USD $1.05 billion) and acquired an e sports platform Faceit and it merged the two companies and became ESL Faceit Group to create one of the world’s leading entities for the e sports industry and it will play a key role to achieve the goals of SGG and the PIF for the industry.
In efforts to promote the e gaming industry SGG also became the main sponsor to one of the most decorated football clubs in Saudi (and Asia as a whole), Al Hilal Football Club.
The future of esports in Saudi Arabia looks promising. With ongoing government support, investments in infrastructure, and the growing enthusiasm of the youth, Saudi Arabia is well-positioned to become a regional esports hub. As e sports and continue to gain mainstream recognition worldwide, Saudi Arabia has the potential to host major international tournaments other than Gamers Con and Gamers8, further cementing its place in the global esports landscape.
Overall, e gaming and e sports is a rapidly growing industry in Saudi Arabia that is attracting a new generation of young gamers and fans. Esports in Saudi Arabia has come a long way in a relatively short period. Government support, investments in infrastructure, the emergence of local esports organisations, and a growing fan base have all contributed to its rapid development. Saudi Arabia's commitment to esports is clear. With continued investment and a focus on talent development, Saudi Arabia is poised to make a significant impact on the global esports stage in the coming years. As the esports ecosystem in Saudi Arabia continues to evolve, it is an exciting time for both players and fans of e gaming in Saudi Arabia.
For further information,please contact Bandar Al Hamidani and Ayidh Al Kahtani.
Published in October 2023
