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Activision `Best Positioned' for Coming Billion-Dollar Bonanza

Activision `Best Positioned' for Coming Billion-Dollar Bonanza

(Bloomberg) -- Activision Blizzard may have the best seat in the house as the sport of watching gamers game heats up.

The company is "best-positioned" in eSports, as the activity is known, according to Bank of America Merrill Lynch analyst Justin Post. He estimates Activision’s established leagues and tournaments for games "Call of Duty " and "Overwatch" will generate revenue of over $100 million in 2018. Morgan Stanley analyst Brian Nowak previously predicted "Call of Duty" eSports alone could make up $105 million of 2020 revenue.

eSports are expected to generate direct revenue of over $900 million this year and cross the $1 billion threshold in 2019, Post said. But those figures may just be scratching the surface.

"Over time, and using a traditional sports analogy, we believe eSports advertising (streaming, sponsorship), ticket sales, promotions, and merchandise sales could reach $15 billion," Post wrote in a note on Monday.

While there’s certainly money to be made for game businesses, players also have the opportunity to cash in. Epic Games announced it would put up $100 million to fund tournament prize pools for its hit game Fortnite. "We’re getting behind competitive play in a big way," the company said in a blog post Monday.

To contact the reporter on this story: Krista Gmelich in New York at kgmelich1@bloomberg.net

To contact the editors responsible for this story: Courtney Dentch at cdentch1@bloomberg.net, Christiana Sciaudone

©2018 Bloomberg L.P.