The History of Esports: A Look into the Developments and Trends of Competitive Gaming
By: Andrew Chen (Project Lead), Zoey Meng, Jim Liu
“Watching another person play video games is like going to a restaurant and having someone eat your food for you” — Jimmy Kimmel (2015)
Introduction
To many, esports and video games in general are just something that kids do. Some consider time playing games to be better spent going outside, whereas others see video games as an opportunity to create friendships among like-minded people. But what is undeniable is that the esports industry has already generated over $1 billion of revenue in 2021 according to Statista. So is this entire industry, based around people staring at a screen just a fad, or is it a sign of the next big thing to come?
But first, what is esports? Simply put, esports is short for electronic sports. Ask any person to give an example of a sport and they’ll say things like basketball, football, baseball, or soccer. And just like electronic mail, electronic sports happen in the digital world. Instead of scoring touchdowns on a green field, the same objectives are achieved in a video game. But what separates an esport from a video game is the competitive atmosphere. Just like traditional sports, you can feel the roar of the crowds at tournaments, you can find fans that would die for their team, and of course, live broadcasts of the game with a bit too many commercials.
In this article, we aim to discuss some of our findings about the current state and the development of the esports industry, based on the data from our datasets. These findings include: a brief account on the development of Esport, the trends of prize pools, professional player bases, and number of esports tournaments hosted, the impacts of COVID-19 on esports, and new games that may bring changes to the esports industry.
Data Overview
We found two datasets on Kaggle that contained information about hundreds of games, including when they were released, what genre they were, how many tournaments there were, and much, much more. But what was really special about these datasets was that they tracked games over time, meaning that there was information about how many tournaments, professional players, and prize money was available for each game over the course of just over 20 years. With this in mind, we decided to take a look at exactly how esports has changed between the years of 1998 through 2020. To do so, we considered two primary factors: the number of professional, or pro players, and the amount of money that could be won from tournaments. We used the datasets to help us create many visualizations which you’ll see below to identify trends and patterns over time. Then, it was simply a matter of finding out why those trends occurred. And with all of that information, we compiled a short history of esports.
Niche to Mainstream
Spacewar. A game you and many others have probably never heard of or played but was regarded as the first game to kickstart the esport’s scene in 1972 at Stanford University. What prompted competitive video games into the limelight in the 1980s was the introduction of Twin Galaxies, a high score record keeping organization, that grew in popularity with arcade games at the time like Space Invaders and Pac-Man. As the race for the top began amongst casual players, increased exposure from televised esports events and improved interfaces from consoles such as the Nintendo Entertainment System only expanded the esports scene as larger tournaments were held internationally. In the late 1990s, professional esports leagues, such as the Cyberathlete Professional League and Quakecon, were established to hold video game conventions and tournaments with cash prizes, further rooting video games as something more than just a pastime. Within the past two decades, the esports scene has only made greater strides as video game platforms have grown much more accessible to the general public and streaming, or online broadcasting, through YouTube or Twitch has given everyone a way to watch a tournament or tap into their favorite professional gamer. By the 2010s, esports organizations, like Team SoloMid and Cloud9, were founded which allowed people to make professional gaming a full time job with sponsorships and team salaries, on top of the opportunity to win prize money.
Let’s take a look at the total pro player base for the top 10 games starting from 1998 to 2020. For many casual and competitive gamers, Counter-Strike: Global Offensive (CS:GO) and League of Legends coming in with the two largest professional playerbases will not come as a surprise as they garner over a million players together. First person shooter games, such as Counter-Strike and Overwatch, and strategy games, such as Dota 2 and StarCraft II, dominate the Top 10 chart. But what separates CS:GO from its other competitors and how has it garnered such a loyal pro playerbase? Counter-Strike, the predecessor to CS:GO, was first introduced in 2000 and paved the way for first person shooters yet to come. Counter-Strike was one of the first realistic multiplayer shooters with an in-game economy system and fast paced rounds that kept each game unpredictable from the last. The risk and reward system and randomly generated recoil patterns for each of its guns were innovative changes not seen in previous shooters at the time. Despite the unique changes, the straightforward objectives of planting and defusing a bomb kept the game accessible to new or casual gamers but was a refreshing change for competitive players. With many of these aforementioned traits seen in CS:GO, the most popular iteration, the casual and pro playerbase has remained steady for the past two decades. With the far and few between updates of CS:GO, the heart of the game has remained the same while still staying relevant with new modes and slight adjustments.
Big Money to be Made
A large incentive for teams and players alike is the ever expanding prize pool. The prize pool can be funded from a multitude of sources which includes crowdfunding, sponsors, tournament organizers, and even the game developers themselves. Crowdfunding allows for profits made from in game cosmetic items to be included in the prize pool for competitors. This can be seen primarily through Dota 2 as it has the largest prize pool in history and comes to a total of $240 million with their largest prize pool coming to over $40 million. According to the Dota 2 Wiki, this was primarily achieved through the game developer’s unique choice to crowdfund the prize pool by selling an in-game battle pass with bundles, items, and accessories to their playerbase. However, crowdfunding isn’t a primary source for funding the prize money which can be seen by popular games, like Counter-Strike: Global Offensive, Fortnite, and League of Legends, that trail far behind and opt to use sponsors and game developers. For example, Epic Games, the game developer behind Fortnite, pledged to provide $100 million to fund various prize pools for Fortnite competitions being held in the 2018–2019 season. (Source) This can also be seen by Riot Games providing millions to the League of Legends prize pool. This not only allows for game developers to stay connected within the communities they have created, but it also creates a continuously growing incentive for new players to join and for old players to continue improving.
So, how do esports organizations stay afloat and make a profit in this ever growing industry? Despite the previously mentioned tournament cash prizes that are available to teams, it’s not often to see the same teams consistently perform well enough to financially support an organization solely off prize money. This is why many companies rely on sponsorships, streaming and content creators, as well as merchandise. From household car brands like Lexus and BMW to cryptocurrency platforms such as FTX to drink brands like GFuel or Coca-Cola, there are plenty of big name companies investing in the esports scene and organizations. Additionally, esports teams are often known for their team of content creators that stream to large and consistent audiences. For example, 100Thieves not only has individual teams for games like Valorant, League of Legends, and Apex Legends, but they also have an extensive list of well known content creators like Fuslie, Valkyrae, and Nadeshot. This allows 100Thieves, and many other organizations, to advertise merchandise and sponsorship products to fans and audience alike. Lastly, a portion of team revenue comes from team merchandise such as hoodies, jackets, and sweaters and allows for fans to feel a part of the team.
Players VS Prize Pool
In terms of the number of professional players, just over 50% of players come from the ten largest games. And in terms of prize pool, the ten largest games account for 71% of all money that can be won. But there is an interesting discrepancy here. Why is that the game with the greatest number of pro players, CS:GO, does not have the largest prize pool? That title falls instead to Dota 2.
The answer is actually quite simple. Most tournaments are sponsored by companies promoting their products. They contribute some money to the tournament and they get to display ads. This is true for Dota 2 as well, but there is also another interesting component to their large financial rewards. In 2021, the largest annual Dota 2 tournament, The International, managed to put $40 million on the line for the teams competing, 18.2 million of which would go to the champions, Team Spirit.
That large sum of money is obtained through in-game sales of items in the game. Dota 2, like many other games, sells cosmetic items to the players. These sales then contribute directly to the prize pool available at tournaments.
This large prize pool might be great for whoever wins The International, but this may not necessarily be a good thing. Other games such as CS:GO, may not have as large of a prize pool, but they do have many more smaller tournaments. This allows more players to be involved in the competitive scene at varying skill levels with little to no cash reward. This is not the case with Dota 2, hence we see why CS:GO has so many players, yet Dota 2 has the largest prize pools.
And as you can see in the graph above, FPS games such as CS:GO typically have more tournaments than MOBA’s like Dota 2.
The Impact of Covid
For most of esports history, the prize pool for each genre of game has stayed fairly consistent. Most genres never see a total monetary offering over $10 million, yet there are three genres that have broken that streak and skyrocketed, with Battle Royales hitting past $90 million in prize money in a single year. This can be largely attributed to several of the largest games in the Battle Royale genre such as Apex Legends or PUBG, but most well known and important is Fortnite. This game has trudged through meme culture and hate on the internet, but that only served to increase its popularity. As a free to play game on nearly every gaming device, people had easy access to this game. That combined with cosmetic items featuring popular celebrities and even characters from other games quickly led to this game, and the genre as a whole becoming tremendously popular. The other two large genres include FPS and MOBA games. Games such as CS:GO, Dota 2, and League of Legends fall into these categories and are historically known to have tremendous prize pools.
But something worth noting is why the sudden drop off in prize money in 2020? The answer lies within a certain global event — the Covid-19 pandemic. As the virus spread around the world and companies became strapped for cash, sponsors were less likely to contribute money to tournaments, and therefore less money was offered in terms of prizes. But as the pandemic hopefully begins to subside, the size of the prize pool will hopefully start to grow once more.
The Covid-19 pandemic has not only created an enormous impact on the earnings of esports tournaments, but also the number of tournaments and the amount of player base. As cities declared emergencies and shut down non-essential businesses and events, the number of esports Tournaments decreased drastically. Less esports Tournaments that are hosted across the globe also meant that the decline in the demand for professional esports players. And as a result, the professional player base also decreased.
The New Kid on the Block
In late 2019, Riot Games, the company behind the massively successful game League of Legends announced Project A, a tactical first person shooter. Immediately, many people saw an attempt by a game company to overthrow the longstanding king of FPS games, CS:GO. Others saw it as a blatant copycat game with no future. Project A eventually became known as Valorant, a game that combined the nuanced shooter gameplay of CS:GO with the character abilities found in many other games. The game was heavily criticized at first, but the development team was quick to make adjustments and new content for Valorant was frequently reduced. This was in contrast to CS:GO, a game that rarely ever received new updates. These two FPS titles are similar in both gameplay and mechanics, but one is nearly a decade old and the other has barely started having major tournaments. But if money talks, Valorant seems to be catching up quickly.
As of December 2021, the three largest Valorant tournaments of the year already amount to nearly $2.5 million. Not bad for a game that’s been out for less than two years. This is still quite a ways away from CS:GO and the historic moneymaker that is Dota 2, but it is already roughly the same as what Riot Games’ other game, League of Legends, has offered in the same year. It is still far too early to say anything, but it seems that Valorant is here to stay and even become a contender for one of the largest esports of all time.
Conclusion
As this ever growing industry continues to expand, we can’t wait to see how game developers and organizations alike continue to adapt and compete to stay relevant. We hope to gather more data regarding 2020 and 2021 to further draw out more information to understand the impact of COVID-19 and how esports teams hope to bounce back from the lengthy competitive break. And as we’ve already seen with the rise and success of Valorant, esports is a dynamic industry where new games can disrupt the scene. But no matter what game you play and no matter your favorite team, remember to always be nice and have fun.
gg
