Blizzard Entertainment Reveals eSports Expansion Franchises

Blizzard Entertainment, which pioneered competitive eSports 20 years ago in South Korea, is busily turning eSports from a game into a genuine sport. This year, the company, which employs former NBA, NFL, ESPN and Fox Sports executives, launched the Overwatch League’s inaugural season with 12 teams. More than 20,000 spectators attended finals, held at Barclays Center in Brooklyn, with the matches broadcast on ESPN. Blizzard also plans expansion franchises in cities in the U.S., Canada and China.

The New York Times reports that, “Blizzard has announced expansion franchises in Atlanta, Washington, Paris, Toronto and Vancouver, British Columbia, as well as the Chinese cities of Guangzhou, Chengdu and Hangzhou,” and hopes to add eight more.

New England Patriots owner Robert Kraft and New York Mets chief operating officer Jeff Wilpon, who is also son of the team’s principal owner, bought the first franchises, the Boston Uprising and the New York Excelsior. Since then, “executives with the Los Angeles Rams, the Philadelphia Flyers and the Sacramento Kings soon joined the ownership ranks.”

“Basketball is not a sport,” said Activision Blizzard chief executive of eSports Pete Vlastelica. “Basketball is a game. The NBA makes it a sport by wrapping structure and fanfare around it.”

The Overwatch League entices sports and eSports executives by a structure that makes it “like a professional sports league,” with detailed statistics on teams and players, a regular broadcast schedule, a postseason, and player transactions. The teams all play in a 450-seat eSports arena in Burbank, California, which “allows Blizzard to focus on its online broadcast while team owners can develop reliable technological infrastructure, said the league’s commissioner, Nate Nanzer.” To engage local audiences, teams “could move to local arenas in the league’s third season, in 2020.”

Unlike Overwatch League, “Riot Games, which publishes ‘League of Legends’, the most popular eSport, has not yet found a city-franchise system it likes, said Chris Hopper, the company’s head of eSports for North America.” Hopper, who oversees a Los Angeles-based 10-team league, said there are “diminishing returns when expanding to other cities.”

The new NBA 2K League’s players “live in the cities of their team’s corresponding basketball franchise and travel to New York every weekend to compete,” said managing director Brendan Donohue, “because the NBA already has city franchises.”

Overwatch League is now promising revenue sharing, and Blizzard stated that, “franchises will eventually split the money made from broadcast deals and national advertisers — which have included HP, Sour Patch Kids, T-Mobile and Toyota — in addition to keeping all local revenue.” Currently, the players “receive minimum $50,000 salaries, and were allocated at least half of the inaugural season’s $3.5 million prize pool.”

Last year, according to market research, eSports “generated about $700 million in revenue and about 300 million unique viewers.”