E-sports has really taken off in terms of money-making in the last few years. For a long time, Starcraft and Counter strike had the highest payouts for their tournaments (maybe some others, can't remember). These tournaments were organized by independent third parties who put up the prize money themselves, and the biggest tournaments would see prize pools in the +$100k range.
Then DOTA (defender of the ancients) happened, where the owners of the game (Valve) started organizing tournaments and massively increased the prize pool to millions of dollars. This gave DOTA and other MOBA's (multi-player online battle arena) a massive influx of talent and popularity. The reason for giving away all this money was to promote DOTA, as DOTA is one of the free 'hook' games for Steam (1. download Steam 2. get DOTA free 3. Spend your entire gaming budget in Steam)
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