There seems to be a severe knowledge gap in the United States when it comes to esports. Those in the know understand it’s a billion-dollar industry with thousands of games, millions of viewers, and a viable professional career path for those good enough to get in the door.
Those that don’t know may not even be aware of esports, let alone how dominant the competitive gaming industry is. If you fall into that second category, congrats—you are officially (pretty) late to the party.
Don’t sweat it, though. Consider this your formal invitation. We put together a brief timeline of esports, taking a closer look at its exponential growth and a few predictions on where it’s headed next.
The Early Days of Esports
You can basically align the birth of esports with the birth of video games.
As soon as crowds started to form around talented local arcade players, one thing became clear: There’s a market in video game spectatorship.
The first known esports event—which we’ll define as a competitive spectacle for athletes to prove their skills and fans to watch them do it—was held at Stanford University in 1972. Ten thousand gamers joined in to compete in a Space Invaders championship. It was the seventies, after all.
The top prize was a year-long subscription to Rolling Stone, but it really symbolized something far greater. Bragging rights, pride, glory—these weren’t just restricted to athletic sports.
With the first Space Invader champion, a new door opened up. Where it led, no one likely could have predicted, but less than a decade later, Atari itself was hosting tournaments.
Esports tournaments weren’t just niche hobby demonstrations. They were branded opportunities.
Record Scores and Home Gaming
These tournaments increased in number from the eighties.
Electronic gaming was booming, but with so many arcades and without the all-important internet, it was hard to tell who was doing the best. In 1982, businessman Walter Day came up with a solution.
Walter founded Twin Galaxies, a database that would essentially track and log top scores for over a hundred arcade video games. The database still exists today, and Walter became an international leader in the emerging world of esports.
The launch of Twin Galaxies also coincided with a new competitive TV show called STARCADE! in which contestants would compete in a variety of arcade games and answer video game-related trivia. The show ran for four seasons and proved there was a real audience for this type of sport.
Two more important milestones occurred in the eighties, too.
In 1985, Nintendo and SEGA released their at-home gaming consoles. You didn’t need to go to the arcade to play anymore. You could do it in your living room. Starting to sound familiar?
In 1988, the world saw its first rudimentary online game called Netrek. It was a multiplayer game and is widely considered the ancestor to League of Legends. Up to sixteen participants could play together at the same time. Within a few years, that number multiplied.
The Internet Age
Without a doubt, the most important milestone in the history of esports was the onset of the internet. Online gaming made esports accessible to millions. You may not have had a circle around you interested in gaming in your hometown, but with a dial-up connection, you could reach gamers anywhere.
A few big things happened around the same time.
First, massive video game giants like Nintendo continued to pursue the opportunity to host in-person events, and the financial incentives for winning a tournament started to increase.
From its meager beginnings with a Rolling Stone subscription prize, Nintendo’s 1990 World Championship gifted winners $10,000 saving bonds and limited-edition gold cartridges. Today, those gold cartridges go for $100,000.
Second, online multiplayer and PvP gaming blossomed. Games like Doom, Street Fighter II, and Mortal Kombat allowed for clear winners to be determined. It wasn’t just about getting the highest score; it was about beating an opponent.
All of this groundwork led up to 1997, when the esports tournaments that we know and love today started to take shape. To many, this is when the industry really began. Red Annihilation was a Quake tournament that started out virtually. Around two thousand competitors went head to head online to determine the top sixteen players.
These players were flown out to Atlanta, where they battled it out for the top prize. The winner, Dennis Fong, drove off with game developer John Carmack’s 1987 Ferrari.
It doesn’t take a genius to see how quickly money was trickling into the sport.
In that same year, the Cyberathlete Professional League was founded (primarily playing Quake) and the Professional Gamers League (which started with Starcraft).
With leagues established, esports was officially on.
From 0 to 100
Esports was off to the races at the turn of the 21st century. Massive international championships were established, including World Cyber Games and the Electronic Sports World Cup. Major League Gaming came around in 2002, which continues to be the biggest league in the sport, often distributing record-setting prize money.
New games start to earn die-hard followers and dedicated athletes. Half Life, World of Warcraft, Halo—you know the names.
While in-person events flourished, online streaming reached a new pinnacle with the advent of Twitch in 2011. Esports athletes weren’t just winning big money sums; they were also accumulating fanbases. With a platform came the sponsorship opportunity, which really brings us to the state of esports today.
Money, Money, Money
For the uninitiated, the sheer amount of money in esports may boggle the mind. By far, the biggest revenue driver for the gaming industry is sponsorship.
Brands like Mountain Dew, Red Bull, and Audi all contributed to nearly half a million dollars in sponsorship deals in 2019. In the same year, Fortnite raised $100,000,000 for its World Cup prize pool.
This year, it’s predicted that esports will generate an audience of 645 million people. Arenas are being built specifically to host gaming tournaments. More than a third of young gamers are considering going pro. It’s not a hobby anymore; it’s a viable career path. That is, if you can make the cut.
Competition has never been steeper for professional esports athletes, and to get to the top, you have to dedicate hours and hours of practice time. This has inspired the gaming gear industry, which has developed chairs, headphones, and even wrist and finger tape, similar to what many basketball players wear, to help support the physical strain of playing video games.
Make no mistake, the physical demands of modern esports are no joke.
The Stars of Today
With so many professional esports tournaments — and so much money on the line — it can be hard to determine which esports games are the most popular. Do we decide based on prize money or viewership? The most vocal fanbase or the most played games?
If it’s cold hard cash you’re looking for, Dota 2 cannot be beaten. Dota 2 is a 5v5 battle arena game with aspects of fantasy, role playing, and action. Its world championship, The International, has a nearly $47 million pot. This massive prize was largely raised by fans who love to watch heavy hitters like PSG.LGD, Team Secret, and surprise champs Team Spirit fight to the finish.
While Dota 2 certainly has fan power, the largest viewership in 2021 went to Mobile Legends: Bang Bang. Another 5v5 area title, Mobile Legends saw 3.1 million peak viewers in their M3 World Championship, and fans watched a cumulative 386.8 million hours throughout the year.
Of course, there are also household names that continue to hold their own in the ever-growing esports world, with competitions like League of Legends, Fortnite, and Overwatch receiving millions of monthly players and millions of dollars in prizes awarded.
The games themselves aren’t the only big stars. Teams like FaZe Clan, Team Liquid, and Cloud9 have dozens upon dozens of players who compete in the sport’s biggest tournaments for games like Counterstrike: Global Offensive, Fortnite, Call of Duty, and beyond. These teams win big in their fields, but they also win big on social media where they’ve amassed millions of followers.
The Future of Esports
So, where is the video game industry headed?
The truth is things have changed fast over the last twenty years, so the only thing we can really guarantee is that the reality will look unlike anything we’ve seen before.
Still, some exciting things are coming down the pipeline.
The Metaverse and VR technology, in general, has dramatically improved in the last five years. Games, shops, and even things like parties and weddings are now occurring in the virtual space. Fortnite has already established the popularity of live virtual gatherings, and we expect to see that feature appear in more and more games. While esports is about competition, it’s also about community.
On that note, we expect to see more companies looking for a piece of the gaming cake. Even in the golden age of television and the proliferation of online creator content, no other medium is getting as big an audience as gaming. TikTok is expected to try to break into the streaming space sometime this year to take on Twitch and YouTube.
All of this comes down to esports’ financial viability. In addition to outrageous in-person ticket sales and pay-per-view tournaments, in-game marketplaces are enjoying increased revenue as more and more players are willing to purchase virtual goods.
This behavior has perhaps ushered in the NFT age as we see it now, and it won’t be long before these worlds merge. Video game giant Ubisoft announced they’re launching a line of NFTs. These tokens are expected to actually appear in gameplay, a major milestone for the crypto marketplace.
Onward and Upward
We may not know what’s coming next, but one thing we do know for sure is that esports isn’t going anywhere. After two years of limited in-person activities, it’s quite likely that some of the best esports athletes of the next generation have spent much of the pandemic honing their skills.
Needless to say, we’re excited to stream what’s to come.