The Future Of Overwatch League Is In Question

By Tit Krajnik

20 Jul 2023

Tit Krajnik 20 Jul 2023

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The future of the Overwatch League is up in the air
OWL teams are offered $6 million if they decide to leave the league
Activision Blizzard is supposedly looking to get out of the esports scene

Overwatch League (Getty Images)

Overwatch League’s future was put under a big question mark earlier this week with strong indications that the Overwatch League we know could end. The concerning news came up on Wednesday, July 19, when Activision Blizzard effectively offered franchise owners $6 million if they decided to get out of the league.

As revealed by several Blizzard employees, major layoffs are currently happening among employees of the Overwatch League, which, combined with the recent announcement by Blizzard, suggests that the Overwatch League is on its last legs.

In Blizzard’s second-quarter financial results for 2023, the company addressed the problems regarding the Overwatch League. It revealed that after the conclusion of the current OWL season, the teams will get to vote on the future of the competition.

"As previously disclosed, our collaborative arrangements for our professional esports leagues continue to face headwinds. 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."

In addition, Blizzard stated that those franchise owners who decide not to compete in the OWL next season will get paid a termination fee of $6 million. This effectively gives all OWL team owners an easy way out of the league, suggesting that Blizzard has no intentions of keeping the OWL alive.

At the start of the 2023 OWL, the majority of team owners hired a law firm to represent them in the bargaining process, with some looking for economic relief after spending vast sums of money on players over the last few years, yet failed to get anything in return due to the dipping revenue, which came as a result of the exodus of many sponsors and expiring media deals.

In response, Blizzard waived all the remaining franchise fees in June and now put another compensation on the table for those who want an easy way out of the OWL.

"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. Total revenues from the Overwatch League comprise less than 1% of our consolidated net revenues."

The future of OWL is currently shrouded in mystery, as there are conflicting statements from Blizzard employees. While Brad Crawford, Blizzard’s senior director of global communications, stated that Blizzard is committed to the future of esports, former employees speculate that Blizzard is looking to step away from its attempts to keep running an esports league.