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Maybe more money isn’t always a good thing.

Well, in the world of competitive e-sports, a larger prize pool could be a bit problematic. More and more companies are using crowdfunding to beef up their prizes. That’s how developer Valve was able to give out more than $10 million at The International, a large event for its game, Dota 2. Even the smaller multiplayer online battle arena (MOBA), Smite, was able to use crowdfunding to raise more than $1 million for the prize pool for the Smite World Championships.

Still, League of Legends by developer Riot Games is Dota 2’s main competitor, with the two similar games competing for hardcore player bases. Despite Dota 2’s growing popularity, LoL still has more players. So, why is it that the prize pool for LoL’s championships is $2 million, about a fifth of what Dota 2 is giving away?

Well, Riot Games simply doesn’t believe in crowdfunding for championship winnings. Speaking to Polygon, the LoL developer said that raising funds for the prize pool shouldn’t be the fans’ responsibility. Riot Games even equated crowdfunding with “begging.”


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However, Riot also has a more practical reason for avoiding crowdfunding: consistency. Dota 2’s prize pool runs the risk of shrinking from year to year, which would look like a sign that the game was losing popularity. While Dota 2 and LoL’s popularity seems unstoppable, everything eventually begins to come back to reality. Just look at World of Warcraft, the popular massively multplayer online game that once had over 12 million subscribers, but is now down to 6.8 million as of August. Eventually, Dota 2’s tournament will have a smaller and smaller prize pool each year if it keeps depending on crowdfunding, while League of Legends can stay consistent with its $2 million.

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Of course, players who help raise money for Dota 2 and Smite tournaments aren’t exactly giving away cash for nothing. Both use in-game items to encourage people. Well, it’s bit more complicated than that. Both titles launched sort of metagames; Dota 2 has the Compendium and Smite has Odyssey. Both have players buying points with real money, which then helps increase the respective prize pools. Players then get better rewards depending on how many points they have. If it sounds a little complicated, well … it kind of is. While its technically still crowdfunding, people are doing it as much for rewards as they are to help out the tournaments.

However, that’s similar to a lot of online crowdfunding. People who use sites like Kickstarter give out rewards to those who help fund their projects. The more you donate, the more rewards you get. So, the line between donation and purchase becomes a bit blurred.

But should these companies ask players for help with prize pools? Dota 2 is a free-to-play game that brings in a lot of money for developer Valve, which the developer could then use itself for the tournament winnings. In fact, without any crowdfunding, the total prize pool for Dota 2’s The International tournament started at $1.6 million, which all came from Valve. That’s much closer to the $2 million that LoL gives out. Is it ethical for a successful company to ask its players to help foot the bill?

Well, if they’re willing to, why not? “The ability to crowdfund prize money really comes down to the quality of the Compendium or Odyssey items and so on,” IDC’s research director and video game analyst Lewis Ward told GamesBeat. “If there’s no value there, the vast majority of gamers will be smart enough to stay away. From this perspective, it’s like an in-game item purchase that’s skinned differently. I suspect that hybrid models – a minimum stake from the developer/publisher that’s supplemented through crowdfunding – will become the MOBA norm within three years. If it ain’t broke, don’t fix it. And right now there’s no reason to think the Dota 2 model isn’t knocking it out of the park.”

And make no mistake, $10 million is a lot more than $2 million. And it’s not like players are giving the money to just the developer, right? It’s for professional gamers, who are really just other players. However, that isn’t completely the case. Valve uses 25 percent of the money spent on Compendium purchases on the prize pool, so it’s still using the system to make a nice profit.

One thing is for sure: these gigantic prize pools aren’t going to slow down any time too soon. E-sports are on the rise, with millions of viewers watching tournaments online. MOBAs also continue to grow, and it seems like just about every major publisher is working on their own LoL and Dota 2 competitor. They’ll have to each figure out how they’re going to handle raising money for tournament prizes.

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