6 figure purses at Game Tourneys... Who says it doesn't pay?

[Cynthetiq]

Wired.com
Part 1 of a two-part series.

High-stakes video-game tournaments may be all the rage, but the real fights occur behind the scenes, where companies spend millions trying to get their technology directly into the hands of gamers.

The $10 billion game industry continues to grow, fueled in large measure by new hardware sales. That expansion has created fierce competition among technology companies looking for new ways to market the latest high-powered graphics cards and processors.

Those battles are played out long before the tournaments begin, when companies offer to put up money for prizes, donate hardware and even sponsor individual gamers in exchange for exclusive promotion at these events.

"Gamers are the most loyal customers," said Hits Naik, Intel's European marketing manager. "They see the performance benefits of what we do. They are hungry for power, and they are the people who buy our products long before anyone else."

Hardly a weekend goes by these days without a major tournament occurring somewhere in the world. This August, thousands of gamers have been making the rounds. The Cyberathlete Professional League's Pentium 4 Summer 2003 Championship drew 3,000 people. The Nvidia Championships at QuakeCon 2003 had 5,500 gamers. Later this month, Los Angeles will host the U.S. regional finals for the World Cyber Games.

The tournament phenomenon grew out of games like Counter-Strike, Quake and Unreal Tournament, all first-person shooters in which players hunt each other down for points.

The first-person genre has exploded as players continually seek competition over the Internet. However, the real fun in those games came when players began hauling their computers around the country, connecting them and fighting it out in person.

These LAN parties caught the attention of companies like Intel and Nvidia, which realized they could reach more gamers by offering prize money and hardware at regional tournaments. As the prize money got bigger, so did the audience.

The phenomenon continues to grow, with dozens of game leagues thriving around the world, but the battle for top billing at the premiere events is rough-and-tumble. Many of the largest tournaments hold closed bidding where companies put together finance packages without knowing what competitors are doing.

The closed bidding and increased competition has forced companies to pour more money into these tournaments or face losing coveted sponsorships.

Nvidia, which makes graphics processors, ponied up $125,000 for QuakeCon, $30,000 for the Cyberathlete Professional League's Unreal Tournament competition and $350,000 for the winners of the Make Something Unreal game-design competition.

Advanced Micro Devices spent more than $300,000 on this year's QuakeCon.

Many companies have started looking overseas. Intel, for example, hosts the Intel Masters Gaming Championship in the United Kingdom, Europe's Electronic Sports League, Germany's Worldwide Championship of LAN Gaming and Turkey's LAN championships.

Tournaments, though, aren't the only way into the gaming community. For every huge tournament, hundreds of smaller LAN parties happen.

Nvidia receives 40 requests per week for sponsorships from these groups, and although the company reported $864.8 million in revenues for the first six months of the year, the staff dutifully sends out posters, T-shirts and other products.

"We get a tremendous insight into the heart of our customers and what it is that they need through these large and small sponsorships," said Bill Rehbock, Nvidia's director of developer relations. "If we weren't at all of these events, we'd feel the impact far quicker than you'd think, because we'd lose touch with the gamers."

While hardware companies can't always map a direct correlation between sponsorships and the bottom line, all agree that the give-and-take between the community and the companies benefits everyone.

Gamers, after all, are only loyal to the best product. Inferior technology won't last long, and companies look to hard-core players for feedback. In exchange, many now provide cash and hardware directly to the best players.

AMD sponsors the Gamepoint Return to Castle Wolfenstein clan, flying the six-member team around the world to compete in high-profile competitions and providing the squad with new computer hardware.

"The gamers need to be using our products, and we need them to be telling their friends about that," said AMD brand manager Mark de Frere. "Our research shows that these players make eight recommendations a year, and we want them to know about and use our equipment because of that."

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See.. when I played video games my parents said what a waste of time, blah blah blah... then I designed some games and worked for Disney Software in the late 80s, getting paid. They didn't know what to say....

jeez this is just for playing... like pro sports or something.

[breid]

Interesting I had no idea. "GAME ON"