WATCH | eSports payouts are higher than ever before. So, how come tournaments are able to give out this much money?
Between 2015 and 2016, payouts from gaming tournaments have increased by 39 percent. Meanwhile, the number of tournaments has actually decreased by 30%. This means that these are essentially becoming more efficient in terms of how much is awarded each time.
Smaller tournaments are typically organized by independent gaming leagues. These payouts usually range between $100,000 to $1,000,000. They are limited due to the fact that revenue is driven by sponsors, ads and ticket sales at events.
However, when game developers come into play, more money is able to be added. Large events like Blizzard's Blizzcon or 343 Industries' Halo World Championships not only see attendance increase but available prize money as well.
More importantly, developer support also allows the use of crowdfunding for those that choose. In-game sales of items or perks drive revenue for the company, and in some cases, a portion is allocated solely to these championship events.
Riot does so for the LoL World Championship (increased from $2.5 to over $5 million) and Valve does so for The International for Dota 2 (a massive jump from $1.6 million to nearly $21 million).
As eSports continues its growth, it's no surprise that these numbers will increase.