The Overwatch League – Is the Buy-In too High?

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As many of us already know, gaming giant Blizzard announced the Overwatch League last November. Traditionally, tournaments for popular games like DOTA 2 and Counter-Strike: Global Offensive were either held by eSports organizers such as DreamHack in the case of Counter Strike, or in the case of DOTA 2, Valve themselves with The International. Pro teams with gaming sponsors such as, Team SoloMid and Evil Geniuses were, and still are the traditional competitors in these types of tournaments. Blizzard plans to flip this model on its head with their ambitious new league.

Their approach to the league is completely non-traditional in the history of eSports as we know it. Instead, Blizzard is opting for a more familiar structure similar to traditional sports like football and basketball. Instead of teams representing gaming organizations like those mentioned above, Blizzard plans for teams to represent cities across the world. This means that we could see teams ranging from Los Angeles to Berlin. Blizzard also plans to host a combine where players can tryout; however, instead of running 40-yard dashes, players will be traversing a gamut of accuracy drills and a range of other tests. Players chosen to participate in the combine will be those who have proven themselves on the competitive scene. Those players then signed will be compensated with a minimum salary and benefits package, guarantees exclusive to the Overwatch League.

All of this sounds like a grand, and wonderful experiment that has the potential to open a whole new realm of opportunity for professional gamer’s, but some organizations are balking at the projected buy-in prices for a spot in the league. According to an ESPN article by Jacob Wolf, Blizzard is asking $20 million for a franchise, with these numbers rising substantially for larger markets such as New York. Accompanying the staggeringly high buy-in is a deal doesn’t seem very favorable for owners once they have signed the dotted line.

However, following the $20 million buy-in, teams are not guaranteed revenue sharing until after 2021 and only if Blizzard meets certain criteria that sources did not disclose to ESPN. Additionally, sources said if a team sells its spot to another party, the league would receive 25 percent of the proceeds.

 

 

 

 

 

The high price point and subsequent deal upon admission appear to be the major issues for many eSports organizations, so much so, that organizations such as Team SoloMid recently dropped six of their players according to a recent TwitLonger update from former member b1am. In contrast, the buy-in for a spot in the League of Legends, League Championship Series, the pound for pound king on the eSports scene, was sold for $1.8 million dollars back in December. $1.8 million for a spot in arguably the most popular eSports league in the world when compared to a lofty $20-million buy-in for a spot in the Overwatch League seems unjustified. However, in the end it may be irrelevant whether popular eSports organizations purchase spots in the league, because Blizzard seems to be targeting buyers who already own traditional popular sports teams in organizations such as the NFL and NBA.

Referring back to Wolf’s article for ESPN, it seems that Kraft Sports Group, owner of the NFL’s New England Patriots and MLS’s New England Revolution is already closing in on a deal for a spot.

One source close to that negotiation told ESPN it was a handshake deal and includes a most favored nation agreement that allows the Kraft Group to buy in at the most favorable price given to another organization.

 

 

 

 

While it appears the deal hasn’t been finalized, with giants like the Kraft Sports Group eyeing a spot, the Overwatch League just may be able to pull offers meeting their asking price, or at least come close to doing so. With a player base that recently reached 30 million, the market for a successful and lucrative league already exists. Only time will tell what spots in the league actually sell for. Personally, I hope the league launches without a hitch. If an eSport can finally break into the arena of traditional sports in terms of earning power and viewership, it will be a monumental event for professional gamers. I’d certainly be rooting for my city’s team, and you would definitely see me in the crowd covered in merch, screaming my head off.

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