Originally published on Forbes Asia.
Ben Wu’s hard work in college led to a degree in biomedical engineering and a well-paid job at a Chicago trading firm. But in spite of being the envy of many of his peers, he quit after just three years to become a professional PC online game player. Going by the name Merlini, he was able to earn more money playing games, like Defense of the Ancients (DotA), and working as a commentator for eSports tournaments than he ever did as a trader.
Wu’s career trajectory is emblematic of the growth of eSports, which are booming globally, but particularly in Asia where champions and commentators have achieved cult-like status. And people like Wu are playing digital games and earning more money than the majority of us make at our 9-5 jobs.
In a true testament to how big eSports have grown, look no further than the dictionary. Now an official word ondictionary.com, eSports can be used as a noun (usually used with a plural verb) or an adjective: (n) competitive tournaments of video games, especially among professional gamers; (adj) of or relating to eSports: an eSports event; eSports gambling.
eSports can be played on PCs or mobile devices, the latter segment is predictably experiencing a huge boom, especially in China. Massive live tournaments, such as the League of Legends World Championships, with millions of dollars up for grabs, are held every year and Chinese teams are a force to be reckoned with. Chinese Web giant Alibaba recently launched AliSports World Electronic Sports Games, touted as the world’s highest paying eSports tournament with 1,200 events planned this year across 15 Chinese cities and total planned payout of $5.5 million.
Today, eSports gamers like Wu are professionals leaving coveted jobs in finance to earn more money playing video games. These gamers have fans; Wu in particular has thousands of followers watching his online gaming tutorials on YouTube and Twitch, the streaming service that Amazon bought for nearly $1 billion. We estimate there are 100 million eSports fans in China now. They watch professional competitions, either live or online, on many video sites that are China’s answer to Twitch.
And, while eSports typically comprises PC online games today, there is already growth in the mobile eSports segment, too, where gamers play competitive eSports on mobile devices such as tablets or smartphones.
The most common games associated with eSport competitions are real-time strategy (RTS), fighting, first-person shooter (FPS), and multiplayer online battle arena (MOBA) games. The latter is one of the most prominent points of confusion: Is MOBA its own genre or is it just a subset of RTS games?
Much of the confusion over eSports and the MOBA genre stem from their relatively infant roots — both have only risen to significance only over the past five years, whereas the other genres have been around for much longer. Tournaments have existed for many years, too, but have only come to prominence recently as popularity and viewership has begun to soar online, live and on TV. The answer is that MOBA games do not need to be played professionally, but they are always competitive. So, the total revenue derived from amateur gamers playing MOBA games, such as Riot’s League of Legends, should not be included in total eSports revenue. Only the revenue from the professional events should be counted as eSports revenue.
Gaming competitions have existed for amateurs since the ’70s. Arguably the first eSports event took place in 1972 on the campus of Stanford University, where students battled each other in the game Spacewar for a grand prize of a year’s subscription to Rolling Stone magazine. Eight years later, in 1980, Atari held a Space Invaders tournament, the first large-scale video game competition, drawing 10,000 participants from across the U.S.
According to esportsearnings.com, the top 10 eSports games awarding prize money are:
|Rank||Title||Company||Genre||Prize Money Awarded|
|1.||Dota 2||Valve||MOBA||$60 million +|
|2.||League of Legends||Riot /Tencent||MOBA||$27 million +|
|3.||StarCraft II||Blizzard||RTS||$18 million +|
|4.||Counter-Strike: Global Offensive||Valve||FPS||$12 million +|
|5.||Counter-Strike||Valve||FPS||$10 million +|
|6.||StarCraft: Brood War||Blizzard||RTS||$6 million +|
|7.||Smite||Hi-Rez Studios||MOBA||$5 million +|
|8.||Hearthstone: Heroes of WarCraft||Blizzard||Card Game||$4 million +|
|9.||WarCraft III||Blizzard||RTS||$4 million +|
|10.||Heroes of the Storm||Blizzard||MOBA||$3 million +|
The dominance of MOBA games is perhaps the strongest case of all for its legitimacy as a bona fide genre. MOBA games have had a direct impact on turning eSports into a place for amateurs having fun into revenue-driving professional events. I believe that demand for MOBA games is driving a resurgence in demand for Internet cafés across China and Asia, as gamers prefer to play face-to-face and to socialize with their 5-person teams and 5-person opponents, which is how many such games are structured. The use of Internet cafés bottomed out in 2013, and in 2014 and 2015 we saw an increase in the use of Internet cafés for competitive gaming and viewing eSports.
The most lucrative event in the eSports world is Dota 2 – The International, with a purse of $18 million in 2015. Compare that to purses from other sporting events, and the rise of eSports plus the impact of games like Dota 2 becomes clear:
- The Masters: $10 million
- Tour de France: $2.6 million
- Wimbledon Mens/Womens Singles: $14.86 million
A key point to keep in mind when defining eSports is that it’s not just about playing the games — watching eSports competitions is a world onto its own. According to ESPN, more people watched the 2014 League of Legends world championship finals than Game 7 of the World Series or the clinching game of the NBA Finals. There are more than 100 million eSports fans in China alone, watching professional gamers and tournaments online, live or on TV.
ESPN and Tencent, the largest online games company in China, and one of the largest Internet companies in the world by market cap, have recently teamed up to cover sports in China. ESPN aired the Heroes of the Dorm tournament, in which college teams competed while playing Blizzard’s Heroes of the Storm in order to be awarded $500,000 and college tuitions for the winners – in 2016 the winner was Arizona State.
Market estimates are that the total global market for eSports was nearly $750 million in 2015, nearly half of that from Asia led by China and South Korea. Some analysts predict eSports will generate nearly $2 billion by 2018.
Recently, the U.S. government even starting issuingvisas for professional eSports gamers to enter the U.S. for tournaments! There is tremendous potential in eSports; some even speculate that it could become an official part of the Olympic Games by 2020.
Whether it’s Olympic glory or millions of dollars you’re after, there’s no denying eSports is a world with huge potential for gamers. With gamers and viewers flocking in record numbers, eSports represents a huge market opportunity for companies in terms of sponsorships, advertising, merchandise, and much more.
“Be Like Mike?” Who knows… maybe one day Gatorade will be telling us to “Be like Wu.”