The future of eSports

The future of business isn't what you think: Competitive video gaming is the next big thing.

Over the next several weeks, the Money in Action series on XGames.com will explore the economics of action sports from the perspective of the athletes, filmmakers, companies and those working in and outside the industry. This story looks at how new innovations are changing the fast-growing landscape of eSports.

There has never been a better time to be an eSports fan.

The latest "Call of Duty" game features actor Kevin Spacey as a lead character, and the franchise just passed $10 billion in total revenue. In July, The International, game publisher Valve's annual flagship tournament for its hit team-strategy game "DOTA 2," featured a $10.9 million prize pool -- a figure higher than the 2014 PGA Championship purse. Riot Games' "League of Legends" Season 4 World Championship sold out a World Cup stadium in South Korea in October. ESPN has broadcast competitive matches from all three franchises over the past year on ESPN3, and pro gaming is now a medaled event at X Games.

AP Photo/Mark J. Terrill Fans watch the opening ceremony at the League of Legends Season 3 World Championship final between South Korea's SK Telecom T1 and China's Royal Club in October 2013 at the Staples Center in Los Angeles. The event sold out in less than a day. While video game tournaments have been sellouts in other countries, most notably South Korea, the Staples Center event last year brought professional gaming more into the American mainstream.

As recently as a few years ago, eSports were considered a mere curiosity in mainstream circles. The notion that teenagers and 20-somethings playing video games professionally could sell out the Staples Center faster than a Lakers game or be recognized as athletes by the U.S. government for immigration purposes seemed like a sci-fi fantasy. Both happened in 2013 -- old news, as far as eSports goes.

Such accomplishments seem a bit surreal for a scene that was born into humble beginnings and still values authenticity as a core ideal. It's easy to marvel at the meteoric growth of eSports and ask how it happened, but a more difficult question is, if the current state of eSports seems futuristic, what will it look like in the coming years?

Using a webcam to live stream oneself is nothing new for anyone who regularly uses Skype or FaceTime. However, live streaming by entertainers is still a rarity in the sports world. Kevin Durant doesn't regularly strap a GoPro to his chest and live stream his pickup games with friends, nor does Peyton Manning chat with his fans over webcam on his days off, joking about pop culture and giving quarterbacking tips to viewers.

"It's one thing to hear commentators speaking about what they 'think' is going on during a competitive match, and a totally different thing to hear it coming directly from the player's mouth as they perform." Twitch's Mark "Garvey" Candella

But such interaction with fans is commonplace if not the norm in eSports circles. Many of the biggest names in premier eSports like "Call of Duty," "League of Legends," "DOTA 2" and "Hearthstone" regularly stream themselves practicing their game of choice while interacting with viewers via a chat room connected to their live stream. Viewers can get their gameplay questions answered by top players in real time, while eSports pros can joke or share details about their personal life with no intermediary, building a personal connection with fans while also getting much-needed practice to keep their in-game skills honed.

Much of the market for video game streams is part of a generation that ditched cable for video on demand, came of age in a world saturated with reality TV and found sharing the minute details of everyday life on social media to be perfectly normal.

Seth "Scumpii" Abner, widely regarded as one of the top "Call of Duty" players in the world, considers playing while streaming on the MLG platform a shared experience. "Streaming is revolutionizing 'Call of Duty' and eSports everywhere. We really don't think of ourselves as celebrities at all. We're so lucky to have this opportunity where people enjoy watching us do what we love," Abner said.

Increasingly, tech giants and entertainment moguls are turning their attention to this remarkable platform that eSports fans and organizers enjoyed for years. Amazon recently purchased a flagship video game streaming platform, Twitch, for nearly $1 billion as part of a big bet on the future of content delivery and entertainment consumption.

Enrique Espinoza/MLG A capacity crowd watches Seth "Scumpii" Abner, member of Team OpTic, play "Call of Duty" at the 2014 Major League Gaming Championship in June in Anaheim, California.



More than 18,000 fans watched three days of video game tournaments such as "COD," "Super Smash Brothers" and "StarCraft." Many fans also participated via play-in tournaments. In all, more than 1,000 video game players competed for money and prizes.

While the technical polish around live streaming will undoubtedly advance in coming years, the emotional resonance of connecting to idols by having what amounts to a conference call into their lives doesn't seem like it's budging as a cornerstone of eSports' success anytime soon.

It's a level of intimacy, notes Mark "Garvey" Candella, director of strategic partnerships at Twitch, that "traditional sports will have a hard time replicating. It is one thing to hear commentators speaking about what they 'think' is going on during a competitive match, and a totally different thing to hear it coming directly from the player's mouth as they perform."

Stephen "Snoopeh" Ellis, a highly successful 24-year-old professional "League of Legends" pro, agrees. "The intimacy that the community and fans get from watching and interacting live with eSports pros is one of the secret sauces. It's why eSports has seen such explosive growth and why fans engage with so much enthusiasm," he said.

Ellis' "Getting Fit with Snoopeh" streaming campaign has encouraged thousands of his fans to do push-ups while gaming. "If someone like [Lionel] Messi were to try streaming, it would also be wildly popular, though different, because of the physical demands of traditional sports. It would be harder to engage with fans while running full speed down the soccer pitch," he said.

If streaming is the cart racing of eSports, virtual reality is its Formula One.

Much ink has been spilled about the potential of Oculus Rift, a VR headset originally designed for video games that made a $2.5 million splash on Kickstarter in 2012 and was acquired by Facebook for $2 billion in March.

Chesnot/Getty Images A gamer uses the virtual reality head-mounted display Oculus Rift to play a game during International Games Week last month in Paris, France. The display transfers eye movements to the game in real time. Oculus Rift was purchased by Facebook for $2 billion before the VR company had developed a consumer model. Big companies are making big bets on the future of gaming.

It's not just that Oculus Rift offers some of the most realistic and immersive virtual reality technology ever showcased; Facebook CEO Mark Zuckerberg has harped on the general potential of virtual reality becoming the computing platform of the future. But the potential impact of Oculus Rift on gaming, and by extension eSports, is difficult to overstate.

In a statement on Facebook, Zuckerberg promised immediately after the acquisition that with regard to immersive gaming, "Oculus already has big plans that won't be changing and we hope to accelerate."

Competition at the peak level of eSports demands hummingbird reflexes and deep strategic thinking, but physical exertion has traditionally not been a central element. All this might well change, however, if a competitive game gave players visual immersion via a VR headset and placed them on a large, omnidirectional treadmill that was linked to the game. At that level, would the competition between eSports and traditional sports begin to blur?

Not everyone sees the potential through rose-colored VR goggles. "Fans love streaming and eSports because pros are doing what they want to mimic. Pros have the same general equipment and are playing the same game as them. The more you move to really expensive equipment like VR headsets and custom treadmills, the less accessible you get, the less you resonate with fans. It's something to be cautious of," Ellis said.

Abner and his teammates on the acclaimed "Call of Duty" team OpTic Gaming recently attended a training camp straight out of a sci-fi novel while at Red Bull's headquarters in Santa Monica, California. While there, they engaged in weeks of advanced training techniques including brain mapping and having their blood drawn and analyzed, all in the interest of further optimizing their gameplay.

AP Photo/David Goldman Choi "Bomber" Ji Sung, raises the championship trophy after defeating Choi "PoLt" Seong Hun, both of South Korea, to win the Red Bull Battle Grounds "StarCraft II" video game tournament in Atlanta last summer. With increased interest from big tech companies and a fast-growing audience, there may have never been a better time to be a gamer.

OpTic's Abner takes these developments in stride. He admits that training at Red Bull's facility was "awesome" and he found the high-tech study the team did to be an incredible experience. But he was cautious about predicting that the near future of eSports competition is going to be an arms race of brain mapping and high-tech training.

"It'd be really cool, [but] I don't think we're at that level yet. Training is more on the teams, [the team captain] and how much we practice. With traditional sports you get a set time to practice, like 6 to 8 after school, but with video games it's more like 'we're going to get on and play 'til we can't play anymore.' How far can you go? It's very different from traditional sports."

When speculating about what the future of eSports would look like, even only five years from now, Abner grew thoughtful. "You know, I've come from playing for $250 or $500 for first place to playing for $100,000 for first place just in a few years. I've seen the start of it, the growth of eSports. In five years? It's hard to imagine. Games come and go, but eSports is always evolving. That's what keeps it entertaining."