Both Call of Duty League (CDL) and Overwatch League (OWL) organizations have been allowed by Activision Blizzard to dodge multimillion-dollar franchise fees in 2020.
In the midst of an extremely turbulent year, to say the least, both CDL and OWL competition has continued forward. The best Call of Duty players competed in an online postseason with $4.6 million on the line.
Meanwhile, the best Overwatch players are currently gearing up for the Grand Final Weekend which kicks off on October 8 in South Korea.
Despite the wrenches thrown in the gears for both leagues, Activision has pressed forward in 2020. However, the leagues haven’t quite operated how they were supposed to. Proper events with thousands of attendees came to a halt. Home Series and Homestands alike were both off the table due to the ongoing lockdown.
With a huge chunk of change supposed to come from these live events, organizations certainly took a hit. As a result, Activision Blizzard is foregoing the need to pay millions in franchise fees this calendar year.
Sponsorship deals, merchandise sales, and prize winnings are just a few of the ways in which these orgs make money. When factoring in player and staff salaries, content costs, and everything else along the way, however, these fees add up. One of the planned means of generating revenue across the CDL and OWL was through live events.
Just four LAN events were held during the inaugural CDL season before the switch to online. OWL had six LAN events across North America before the same pivot.
It’s during these events that orgs look to turn a profit through ticket sales and merch stands. With these opportunities coming to a halt, teams haven’t been able to make the amount they would have projected at the beginning of 2020.
As a result, Activision Blizzard is allowing them to defer multimillion-dollar franchise fees that were reportedly due this year, according to The Washington Post. As many paid upwards of $20 million to acquire franchise slots in either league, payments are expected on an annual basis.
Due to the lack of live events, these repayments have the option of being postponed. Some orgs may choose to continue paying back in 2020, but the choice is there to hold off until 2021 for the teams that need it.
There’s no currently no ETA on when live events will return.
Options to establish bubbles akin to the NBA have been in discussion for the 2021 CDL season, and the OWL Finals are indeed taking place in a safe South Korean hub, though the return of crowds could still be a ways off.