It’s been revealed that participated in the Overwatch and Call of Duty Leagues owe Activision Blizzard between $390 to $420 million in franchise payments. The debt is due to the company deferring payments for two years because of the pandemic.
The Overwatch league includes twenty franchises, each of which owes Activision Blizzard $6 to $7.5 million. According to The Jacob Wolf Report, teams that participated in the Call of Duty League owe an average of $22.5 each.
Esports boom during the pandemic
Esports rose substantially in popularity during the pandemic, with the F1 Esports breaking viewing engagement records in 2021. An esports mockumentary, Players, is set to launch on Paramount+ on June 16th. The comedy follows the fictional League of Legends esports team, Team Fugitive, as they attempt to win the world championship.
Additionally, Capcom recently altered the Esports rules for Street Fighter V after receiving backlash from the gaming community. Lamborghini even launched its own esports team earlier this year. Likewise, NBCUniversal partnered with Anzu to expand its games and esports.
Activision Blizzard began deferring payments in fall 2020 as a Covid relief effort, with participants due to pay this autumn. However, there is a chance that the payments will be pushed back to 2024, according to sources.
Ex-head of eSports at Activision Blizzard, Brandon Snow, suggested forgiving all team debt before leaving the company in February to join Formula 1. However, his proposal was never put in place.
Additionally, the Overwatch league chose to reduce the debt teams owed during the pandemic. Currently, the two leagues are the most expensive in the eSports industry, with the Overwatch league charging teams upward of $20 million.
It’s not known as to whether Activision Blizzard will make any alterations to its payment terms before Microsoft finalizes its acquisition of the gaming company in 2023. Microsoft is purchasing Activision Blizzard for $68.7 billion in cash.