Overwatch League future in limbo as franchises are offered $6 million to leave

Overwatch League future in limbo as franchises are offered $6 million to leave
Blizzard Entertainment

Written by 

Sascha Heinisch

Published 

19th Jul 2023 15:48

In its quarterly earnings press release, Activision Blizzard announced that it’s offering $6 million USD to franchises looking to exit the Overwatch League, amounting to a potential $114 million USD buyout for the remaining 19 teams.

The report outlines that the future of the Overwatch League will be put up for a vote between the remaining franchises after the conclusion of OWL’s sixth season in October.

"During the second quarter, we amended certain terms of our collaborative arrangements with team entities participating in the Overwatch League. According to the amended terms, following the conclusion of the current Overwatch League season, the teams will vote on an updated operating agreement," it reads.

"If the teams do not vote to continue under an updated operating agreement, a termination fee of $6 million will be payable to each participating team entity (total fee of approximately $114 million). As of June 30, 2023, a termination liability has not been accrued."

A report provides some daunting clarity

Overwatch League Midseason madness
Click to enlarge

According to a report by The Verge, the news arrived shortly after around 50 employees in Activision Blizzard’s esports division had been laid off yesterday.

Both the commissioner of the Overwatch League, Sean Miller and senior director of global communications at Activision Blizzard, Brad Crawford stated that the company remained committed to the future of Overwatch esports. Given the pending vote, the ball is now in the court of the franchise owners.

According to The Verge’s sources, the operational side of both the Call of Duty and Overwatch League is deemed “completely unequipped to internally support anything esports” due to the lay-offs, though enough to finish out the season with a skeleton crew.

As recently as May this year, the Overwatch League had negotiated a termination of the remaining fees for its franchise slots, easing the financial burden on franchise holders.

Earlier this month, the Overwatch League announced that the Chengdu Hunters had exited the league. However, the report mentions that so far no termination liabilities had been accrued, which may imply that the Hunters did not receive the aforementioned $6 million USD termination fee.

The Overwatch League had been subject to continuous downsizing over the years as it had been unable to meet its ambitious goals to become a global league with weekly so-called homestand events. Since season 1, it significantly decreased the number of matches played offline, with only two LAN events in the Midseason Madness and the season playoffs being organised during this year's season.

Sascha "Yiska" Heinisch is a Senior Esports Journalist at GGRecon. He's been creating content in esports for over 10 years, starting with Warcraft 3.

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