OWL/CDL Teams, Activision Blizzard Discussing Reducing Amount Owed for Franchises – The Esports Observer

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Overwatch League and Call of Duty League team owners are continuing to discuss with Activision Blizzard ways to improve their business model, and one idea that is being weighed is reducing the amount of money they owe to the video game maker, according to people familiar with the discussions.

Activision Blizzard CEO Bobby Kotick installed former MLB executive Tony Petitti into a senior role at the Activision Blizzard Esports division in late summer, and sources say Petitti has been immersed in frequent discussions with team owners about how to make their businesses work long term.

The talks are occurring because most teams remain unprofitable, the league’s original event format has been greatly disrupted by the coronavirus pandemic, and some feel that Overwatch is proving to be not as culturally relevant a game in America as fellow Activision Blizzard title Call of Duty.

OWL is a 20-team league, and the original 12 organizations reportedly bought in at a $20M price for the inaugural season in 2018, while the eight expansion franchises that came in a year later reportedly did so at an even higher number. CDL is a 12-team league currently that just finished its first season, and teams bought in at a $25M rate.

Activision Blizzard – one of the biggest video game makers in the world — wants to find solutions, sources say, but talks are continuing and not yet complete. It was unclear whether the reductions would only apply to OWL franchises, how much the reduction would be and whether all teams would be involved or only those who paid a higher expansion fee number. One of the sources said that the talks are just part of what might turn into a wider package of moves that the sides make to move teams toward profitability.

There was recently a sale of a Call of Duty League franchise, from Immortals Gaming Club to 100 Thieves, and IGC is also reportedly weighing selling its OWL franchise – and those sales will help organizations across the leagues re-assess how much their properties are worth.

Reducing the amount of money that teams owe Activision Blizzard for their franchise fees would be a big help to franchises because currently, that money is one of their more significant costs. Activision Blizzard has incentive to find solutions because its esports leagues are, in certain regards, high-profile marketing platforms for its video games, so any failures by the properties would be unwelcomed attention.

Activision Blizzard declined to comment.


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