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Football, soccer and...Super Smash Bros? E-sports becoming a big business

Competitive gameplay in video games has gone from niche to near-mainstream sport in just a decade.

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Nintendo President Reggie Fils-Aime prepares to compete in his company's fighting game, Super Smash Bros., at the Nintendo World Championship in Los Angeles, Calif. on Sunday, June 14.Photo by Josh Miller/CNET

Would you believe more people watch people playing video games than they do basketball or baseball?

For proof, look no further than a recent competition in Los Angeles. Reggie Fils-Aime, the towering and affable president of the US division of Japanese game maker Nintendo, had been preparing for the past year to compete in a World Championship of the company's games.

The game was Super Smash Bros., one of Nintendo's most popular fighting tites. He was controlling Ryu, of the faces of the iconic Street Fighter franchise. The character, muscles bulging and forever wearing an intense expression, is equipped to fell opponents with his trademark hurricane kick.

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Nintendo president Reggie Fils-Aime saw defeat at the hands of the formidable Jigglypuff at the company's World Championship.Photo by Nintendo

Fils-Aime's challenger, competitive gamer Juan "Hungrybox" Debiedma, was controlling Jigglypuff, a cute pink animal from the popular Pokemon monster hunting video game. Imagine a stuffed animal, give it even cuter eyes, and you have Jigglypuff. It sings opponents to sleep.

Fils-Aime's character was knocked out in the first 4 seconds of the game. The crowd laughed, and then expressed support. But Fils-Aime didn't have a chance -- he died repeatedly in the following three minutes and 54 seconds.

This all played out in a theater full of fans. More than 200,000 more were watching live over the Internet.

If you were to construct a timeline of popular technologies in the video game industry, people being watched live by an audience as they play competitively over the Internet would be at the bleeding edge. The trend has spawned entire businesses, it's the subject of TV stations in South Korea and it's expected to attract an audience of 134 million people this year, up 91 percent from the year before, according to industry watcher SuperData Research.

Even sports channel ESPN has joined in, with its magazine publishing its first e-sports issue this month featuring US National Football League player Marshawn Lynch on the cover, accompanied by stories about video games, including a profile of a League of Legends superstar player from South Korea. The company also partners with game makers to stream the world's most popular tournaments online on its ESPN3 channel.

Meanwhile, some of the world's largest tech companies are jumping in. Both Microsoft's Xbox One and Sony's PlayStation 4 can stream games live to the Internet. Amazon-owned Twitch and Google-owned YouTube, which last week launched a dedicated gaming hub, dominate e-sports viewership. In 2012, Major League Gaming, a sports league launched in 2002, started its own streaming service as well.

"Our mission from day one was to turn e-sports into a top five professional sport," said Mike Sepso, a co-founder of Major League Gaming.

From niche to international sport

It began with games like Microsoft's Halo space-age shooting game, Activision Blizzard's strategy game StarCraft and battles in the online fantasy game World of Warcraft. But in the last decade, a new class of games -- such as League of Legends from Riot Games and Dota 2, shorthand for Defense of the Ancients, from Valve -- have become the bedrock of the industry.

You watch these games from a bird's-eye view of the battlefield, as opposed to Halo's first-person perspective, where players battle to eventually take control of their opponent's base. They're typically played on PCs, and their audience has become massive. The world championship for League of Legends in 2013 drew 32 million viewers, more than all the people who watched the final episodes of TV shows "The Sopranos," "24" and "Breaking Bad" combined.

Gamers are attracted to e-sports for the same reason baseball fans watch the World Series, and football fans tune in to the Super Bowl: They love to watch the world's best players compete at the games they love.

The tournaments themselves, which mostly serve as a form of marketing and a way to connect with players, have begun attracting massive prize pools. Valve's Dota 2 International, the biggest e-sports competition in the world, started in 2012 with a $1.6 million prize pool and more than 750,000 monthly active players. Two years later, the player base has grown by 1,200 percent, to more than 9.6 million monthly players. The 2014 prize pool was nearly $11 million.

E-sports is not without its growing pains, however.

For one, the top games played in competition changes every few years, forcing gamers to practice for a mind-numbing number of hours to become proficient enough to compete.

"That entire portfolio of games has turned over completely about three, four times in our 12 years," Sepso said.

The teams also work at different levels, e-sports fans say. In countries like South Korea, where e-sports is followed so closely there are TV channels devoted to it, professional gamers have a cadre for support. League of Legends, StarCraft and Dota 2 athletes have agents and trainers that oversee diets and injuries like wrist strain. In the US, where e-sports are not as mature, there isn't as much support, at least not yet.

Riot's League of Legends is among the most played video games on the planet, amassing a huge fanbase willing to watch professional players compete on a global stage.Photo by Getty Images

"Unfortunately right now, you have tens or even hundreds of people trying to pick at the bones of these e-sports athletes and there not a whole lot to go around," said Jeremy Monroe, the chief customer officer of game analytics firm Ninja Metrics. "Playing 14, 16 hours a day -- that's not sustainable, even for a teenager."

Of course, there is also the stigma around competitive game play, many years after the initial outrage over putting poker tournaments on TV and including extreme sports in the Olympics.

Even ESPN's own president, John Skipper, has expressed frustration that games are being shown next to football and basketball. "It's not a sport -- it's a competition. Chess is a competition. Checkers is a competition," he said at a media conference in New York last September.

The definition of a sport aside, these growing pains are expected. The next step is to create leagues of players like the US' National Basketball Association and NFL, both bodies that took decades to reach the level of success they have today.

"Developing a pro sports league doesn't happen in Internet time," Sepso said.

Update at 11:30 a.m. PT, Monday, June 22: A previous version of this story said Nintendo plans to hold its World Championship next year. This is incorrect; Nintendo has yet to say whether it plans to hold another World Championship in the future.

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