The International 2016 Prize Pool Surpasses $20 Million As The Championship Rounds Begin

Written By Robert DellaFave on August 8, 2016 - Last Updated on January 22, 2018

[toc]Beginning 10 a.m. PT on August 8 and continuing through August 13, Seattle’s Key Arena will play host to the biggest esports competition in industry history.

The International Dota 2 Championships will feature a prize pool of more than $20 million, making it the first esports event to eclipse the eight-figure barrier two times over.

The new record replaces the one set last year by the same event. In 2015, Valve’s annual crowdsourcing campaign, combined with the company’s own $1.6 million contribution, created a nearly $18.43 million prize fund.

Yet, now that a new benchmark has been set, the question remains: Will The International continue to set new high-water marks year after year, or have esports prize funds reached their apex?

Predictions vs. reality

Back in early June, we predicted that in a base case scenario, The International prize fund would come in at just under $20 million. With five days left in the campaign, the tournament has defied that expectation — but not by as much as we would have thought given the circumstances.

Data collected from International tracking site shows that this year’s campaign was only faring marginally better than last year’s at the 45-day mark. It was then that the 2016 campaign received a much needed boost via a cleverly timed Weekend Sale.

Over the sale’s four day duration, the prize pool spiked $2.4 million. For perspective, the campaign had generated under $600k the four days prior.

In our predictions, we mentioned that Valve would have to make at least one surprise announcement for the campaign’s prize fund to reach our bull case estimate of $21.4 million.  The Weekend Sale certainly qualified, and by the 50-day mark, we began to question whether or not the bull case estimate was too conservative.

That concern has since been put to rest, as since the the Weekend Sale’s conclusion the 2016 campaign has followed a similar trajectory to last year’s. If anything, the release of Immortal Treasures III in late July was less impactful than anticipated, resulting in only moderately heightened sales for the first three days post-release.

The announcement of the Lockless Luckvase and Trove Carafe Immortal Treasures last week barely moved the needle, firmly suggesting that most campaigners were already satisfied with the amount of their contribution.

That said, last year’s campaign picked up a bit of steam in its final days. Assuming the same happens this year, our internal analysis shows that the final prize pool for The International will settle in at approximately $20.8 million when the three month campaign concludes on August 13.

That figure is more than half-a-million less than expected, despite Valve running a more aggressive campaign than even the most bright-eyed optimist would have anticipated.

The International growth slows

Declining year-on-year growth rates support the theory that The International is reaching its boiling point:

While it’s worth noting that this year’s campaign was nearly two weeks shorter, it’s unlikely the extra padding would have resulted in significantly increased contributions.

Reason being that players would have been more apt to space their contributions out if the campaign spanned say three-and-a-half or four months instead of three.

Other variables that suggest The International prize fund will level off:

  • Dota 2 is a somewhat dated game. Although its official release date was in July 2013, the game was available in open beta for nearly two years prior.
  • The campaign’s High-Water Mark challenge incentivizes players to set a new record each and every year, but not by so much that the next year’s goal becomes unattainable.
  • Other multiplayer online battle arena (MOBA) games are popping up in abundance. Assuming just one of these breaks into the mainstream, it stands to put a dent in Dota 2’s popularity.
  • Along the same lines, Overwatch, although not technically a MOBA, is taking the esports world by storm, and threatens to pull both viewers and top competitors away from the big three (Dota 2, CS:GO and League of Legends).

Viewership for The International tells a different tale

Yet, despite all the variables working against future campaigns, it’s impossible to deny the popularity of The International broadcasts on Twitch and other live streaming services:

At of the time of this writing, more than 425,000 viewers are watching Dota 2 channels on Twitch. By comparison, the maximum concurrent Dota 2 viewers for the entire month of July was less than half that amount.

More striking still: According to Twitch tracking site gamoloco, last year’s grand finale on August 8 only generated maximum concurrent viewership of 558,671 — just 24 percent more than what we’re witnessing midday during the quarterfinals round.

Suffice it to say, as the quarterfinals give way to the later championship rounds, last year’s benchmark should be blown away.

And Twitch isn’t the only way to watch The International broadcasts:

  • YouTube, WatchESPN and Steam Broadcasting are all broadcasting the entire tournament live. The Steam broadcast alone is averaging hundreds of thousands of viewers.
  • This year, Valve has introduced the Dota VR Hub, which as the name suggests, allows viewers to watch games and replays in virtual reality. It’s unknown whether how popular this viewing vehicle will be, as the system requirements for running the hub are exceedingly high.
  • Players that purchased a Battle Pass this season have effectively booked a ticket to watch the tournament in-game. Watching in-game affords viewers complete control of their viewing angle. Battle Pass owners can also make predictions on matches, with winners receiving battle points and prizes.

Still, heightened viewership doesn’t necessarily equate to increased sales. Although the spike in popularity should have Valve feeling comfortable with that next year’s campaign will at least be on par with the 2016 effort.

First place prize stacks up with major sporting events

If there was ever a question as to the popularity of esports and esports betting, naysayers needn’t look much further than the first place prize of The International compared to other major sports and gaming events:

Considering that Dota 2 teams are comprised of five members each, winning team members will receive a larger sum than the winner of the Daytona 500, and nearly as much as the PGA Championship victor.

Only the WSOP Main Event champ will take home significantly more.

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