History of Video Games and Esports

Video games have become integrated into the everyday lives of people all around the world. It’s almost impossible to find a modern smartphone or computer today that does not ship with some preinstalled video games for users to play. While the study of video games has been active ever since the video game revolution took off in the early 1980s, most average video gamers today have never been taught how to “study” video games’ inner workings. To better understand the complex video games of today, it’s useful to draw on the rich history of video games for perspective.

The very first computer game ever made was called the Nimatron and it was released at the 1939 World’s Fair in Queens, New York. The inventor, Edward Condon, created the game based on an ancient mathematical strategy game called Nim. Nim is a game where two players, take turns removing sticks from a pile. The object of the game is to force the other player to remove the final piece. While early games like the Nimatron may seem basic in comparison to today’s latest multiple player online phenomenon, this is where it all started.

Another early video game was called OXO. OXO was created by A S Douglas in 1952 to simulate the popular tic-tac-toe game. In the early days of video game development, most games were created by large companies or universities. Spacewar! for example, was developed in 1962 at the Massachusetts Institute of Technology (MIT) in order to test out a new computer model called the DEC PDP-1. During the 1950s, video games were generally being created to demonstrate computing power. The games were created to research the modern limits of computer programming.

It wasn’t until the 1970’s that regular people started to buy video games made for the consumer market. The very first machine available for sale that was designed to play video games at home was called the Odyssey. The Odyssey gaming console was the first of its kind and the makers of the game decided to ship the device with physical items such as dice, fake money and playing cards to make customers feel more comfortable with the new idea of “video gaming.” Throughout the 1970’s and 1980’s arcade-style video games became more popular. In 1972, a video game company called Atari created the very first successful coin-operated arcade game called Pong. Pong broke new ground for the tiny video game industry because it was so much fun to play, it caught on quickly. Like most video games at the time, Pong was based on the concept of another game. In this case, Pong was based on table tennis. The game consisted of two paddles that would hit a ball back and forth. If a player lets the ball pass them, without successfully hitting it, the other player would score a point. Pong is considered to have such a significant impact on our culture that it has a permanent place at the Smithsonian Institute in Washington D.C (Paris, 2017).

In 1980, a company called Namco release an iconic game called Pacman. Pacman was a new kind of maze game that took the world by storm. At this time most video games were being developed for a predominantly male audience. The game developers wanted to break this stereotype and create a game that would appeal to both men and women. Therefore, the game characters were made with cute colorful colors and fun-loving names such as Pinky, Blinky, Inky and Clyde. While the layout of the game is simple, it is very difficult to master. In order to master Pacman, players must think strategically about each opponent (ghost) and learn their behaviors. Pacman is considered one of the most successful video games in the world and owes much of its success to its well thought out game design.

In 1989, a company called Sega introduced its first-ever gaming console called Sega Genesis. This was followed shortly by Nintendo’s first gaming console called Super NES or “SNES”. This time period was great for video gamers because graphics had greatly improved, and game developers had solid platforms they could create new games for. Consoles created a market where consumers could purchase gaming systems for their homes and slowly purchase collections of their favorite games. Competition in the market forced console manufacturers to innovate. New platforms from Nintendo, Sega and eventually Sony and Microsoft started to transform the video gaming landscape. By 1994, Sony reportedly sold 102 million PlayStation console units and by 2000, Sony had sold 155 million PlayStation 2 units (Paris, 2017).

More recently the video game industry has grown at an astounding rate over the past decade. The video gaming industry has surpassed both the movie and music industries in total value. In 2019, the movie industry’s estimated value was $136 billion, and the music industry was almost $20 billion. The video game industry is now about to pass $140 billion dollars, a total which has almost doubled over the past ten years. Some reports expect growth from cloud-based and mobile gaming to double the industry once again by 2025 to reach an astonishing $300 billion (Lanier, 2019). With so much growth in the industry, it’s worth reviewing a few key video games and companies that have helped shape this industry with its competitive products.

Few video games have transformed the industry like League of Legends has over the past decade. The first thing to understand about League of Legends is that it’s free to play and incredibly difficult to master. The game consists of two teams of five, who fight to destroy the opponent’s base by using dozens of skills, teamwork, communication, memory and mental agility. The game was originally released in 2009, at a time when most video games sold for upwards of $50 to $60 per copy. League of Legends was able to attract massive audiences with their free-to-play model but also maintain high levels of engagement with a game that difficult to master. While you would think a game that is so difficult would deter players, it’s League of Legends incredibly challenging aspects that have kept players coming back for years to work on their skills (Goslin, 2019).

To keep the game increasingly challenging, the game’s developer Riot Games has organized seasons for the game to be played with subsequent tournaments. Throughout each season of League of Legends, Riot Games releases a series of changes through a process called patch updates. These patches keep even the top gamers on their toes by changing the game and forcing players to rethink their strategies. Each season of the game includes massive tournaments and interesting changes to the game that high school and college-level esports teams follow closely. Riot Games has effectively changed the industry’s thinking about how to keep a game engaging over a long period of time by deciding to release series of game-changing patches as opposed to a sequel replacement for the game. This is a trend that almost all game developers have adapted to as the industry continues to grow and move toward a free to play model.

But how does League of Legends make money? League of Legends reportedly made $2.1 billion dollars in 2017 by selling aesthetic digital purchases to players online. It’s important to note that League of Legends is not a “pay to win” game. Pay to win games have received very bad reviews in the past from gamers upset by the developer’s intent to block essential game content with paid gateways. All purchases made in League of Legends are for non-essential game add-ons. These add-ons are purchased through a term known as “microtransactions.” Anything that is considered essential to the game is made readily available to all players. Nonessential gaming items include character skins, hats, special items, and holiday-themed content. Some of these items are considered rare and only available for short periods of time (Goslin, 2019).

As you can imagine, with games like League of Legends it’s very interesting to watch the top players execute their strategies. Because the game is so complex and ever-changing, viewers can easily save time learning by watching the top players’ strategies on a live stream. The learning required to become effective at League of Legends involves serious research into the complexities of the game. So many people around the world have been actively researching how to become better at LoL it has become the most-watched video game year after year on platforms such as YouTube, Facebook, and Twitch. It’s games like League of Legends that have helped grow the popular streaming service Twitch. Live-streamed video game content can be a powerful source of training that allows gamers to interact with online communities, learn how to use new vocabulary and gather the skills necessary to master a game.

On Twitch large crowds of casual gamers and fans get together to watch live video gaming and participate in an active chat room available to discuss the gameplay. Watching top League of Legends gamers explain their strategies is almost like attending an online webinar at times. Streamers on Twitch are compensated for engaging with live crowds and keeping viewers watching. Top Twitch streamers will actively answer questions from their chat rooms and give out the best advice they can in order to grow their channel and income. Viewers can learn directly from the best players in the world using Twitch through the inclusive streaming platform dedicated to video gaming. In 2019, Twitch reported that it has over 140 million monthly users. Live streaming in video games is a win-win for everyone involved. Gamers enjoy the content, streamers are able to monetize their passion, video game developers enjoy unprecedented exposure, and platforms like Twitch are able to create a lucrative business model as well.

While League of Legends transformed the multiplayer online battle arena (MOBA) genre of video games, Fortnite transformed first-person shooters (FPS) genre. Fortnite was launched in 2017 by Epic games. The game starts out by dropping 100 players onto an island where they will fight until only one winner is left. The game achieved phenomenal success in a short period of time with it’s free to play model and familiar first-person shooter style of gameplay. Fortnite set a new course for the “gaming as a service” market by offering new weapons, skins, and modes to keep gamers playing. Fortnite became incredibly popular with young generations of 12 to 13-year-old gamers who are attracted to the fast-paced gaming sessions.

Fortnite benefits from the first-person shooter genre because it’s familiar to a huge audience of established gamers. The almost overnight success of the game came down to a few basic elements. One the game was free and available on all major platforms, including most mobile phones. Second, the game features a strong social experience that allows gamers to play with friends they know from school or other online communities. Lastly, the game is enjoyable to watch as a spectator. Just like League of Legends, Fortnite is very popular on Twitch which in turn exposes even larger audiences of casual gamers to the game. Fortnite outgrew League of Legends in 2019, and through the process stole a significant amount of market share. In 2018, League of Legends reported that total revenue dropped from $2.1 billion a year earlier to just $1.4 billion. During this same time period, Fortnite became the world’s most popular video game and grew to a record $2.4 billion in sales via the all-mighty microtransaction. Fortnite has received a lot of press throughout its meteoric rise in the esports world. Parents from all corners of the world expressed concerns about the game being too addictive. Despite some negative press about the game’s addictive nature, Epic Games announced a record $15 million in prizes for the 2019 Winter Royale event. The Winter Royale event was hosted on three separate weekends each with a $5 million dollar prize. As you can imagine, with that much money at stake, the absolute best Fortnite players in the world battled for victory on an international stage with huge online audiences watching (Hitt, 2019).

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