Overwatch League expands en masse in China; Europe eyed next
The Overwatch League announced a major push into Asia with its latest round of expansion and Europe will be the focal point for its next wave, planned to take place ahead of the 2020 season, according to CEO of Activision Blizzard’s esports leagues Pete Vlastelica. The upstart esports league announced Friday morning its official growth from 12 to 20 teams for its upcoming 2019 season – including new franchises in the Chinese cities of Guangzhou, Chengdu and Hangzhou. The remaining five teams will be based in Paris, Toronto, Vancouver, Atlanta and Washington, D.C.
The rapid growth comes on the heels of a very successful first season for the Overwatch League (OWL), which held its inaugural championship over two days at Brooklyn’s Barclays Center, home of the NBA’s Brooklyn Nets. The league’s debut was bolstered in part by an ownership group for its first franchises that featured owners of traditional sports teams – like the New England Patriots, New York Mets and Philadelphia Flyers – alongside endemic esports groups.
The new class of owners includes the Aquillini Group, owners of the NHL’s Vancouver Canucks, the Nenking Group, which owns the Guangzhou Lions of the Chinese Basketball Association, and a group led by Mark Ein, owner of World Team Tennis’s Washington Kastles. That group will grow bigger still as the Overwatch League continues to grow toward its goal of 28 teams next summer.
The target area is clear, according to Vlastelica.
“Europe is a priority for us,” he said.
In addition to containing ripe markets that have already proven receptive to esports, emphasizing Europe makes sense for reasons unique to the OWL. While regular season matches for the Overwatch League are all currently held at Blizzard Arena in Burbank, Calif., the league’s teams will disperse to their assigned homes to hold local matches for the 2020 season, according to earlier comments from league officials.
That geo-located franchise approach is meant to help forge partnerships with businesses and sponsors on a local level, as well as generate ticket revenue by building regional fan bases. This is a new approach for the world of esports, and it’s already helped buoy franchise values. However, it also raises logistical concerns regarding travel for a league whose footprint now spans from China across North America to continental Europe.
To counteract those issues, the league has made a point of adding franchises around the first-season teams that would face the most daunting travel, in this case the new China-based teams joining existing franchises in Seoul and Shanghai. Meanwhile, the league has only two franchises in Europe, with Paris now joining London, winners of the first-ever Overwatch League Grand Finals in June.
Reported buy-in figures for the new ownership groups have been varied, ranging from $35- to $60 million. The original 12 franchises were purchased for a reported $20 million apiece. The increase has been attributable to the notable metrics that marked the league’s first season, particularly with a young, highly-engaged core audience watching matches live over streaming networks like Twitch, which registered anywhere between 80,000 and 170,000 concurrent viewers for OWL matches. [Note: Twitch is owned by Amazon, whose CEO, Jeffrey P. Bezos, owns The Washington Post.] The league sold its streaming rights to Twitch ahead of the first season’s start for a reported $90 million, and it partnered with ESPN and its parent company Disney to bring broadcasts of the playoffs and finals to linear television. That agreement will continue into the league’s second season as well.
“We know we’ve been ambitious from the start,” Vlastelica said, adding, “We didn’t expect it to kind of get as much traction as quickly as it has. We’re really starting to see real fan bases pop up, starting to see a partnership ecosystem emerge with sponsors and media rights partners and licensees and great owners. There’s a lot of excitement around the league.”