Overwatch League Forgives Delinquent Franchise Fees of All Teams

Credit: OWL

The Esports Advocate has verified through several sources that Activision Blizzard is eliminating “outstanding entry fees” related to all 20 Overwatch League franchisees across the board in Europe, Asia, and North America. Sports Business Journal Esports Reporters Kevin Hitt and Hunter Cooke have also independently confirmed the news from multiple sources at teams in the league.

Further,  SBJ reports that “teams in the Call of Duty League may ask Activision Blizzard for the same deal as its Overwatch League counterparts,” adding that this may be an effort to clean up its balance sheet ahead of Microsoft’s acquisition of the company.

Publicly-traded esports company OverActive Media was the first company to announce an agreement on Monday morning with OWL that would eliminate any “outstanding entry fees,” in addition to a new sponsorship deal between the league and its team, Toronto Defiant.

An Activision spokesperson declined to comment on the record about its new agreement with teams, but did issue the following statement to TEA:

“The esports industry continues to evolve which is why we’re continually exploring changes in our competitive structure together with teams. We look forward to sharing more details with our passionate fans as we head towards [the] Grand Finals.”

It is unclear what the financial impact of this forgiveness of past fees will be to Activision Blizzard, but there’s no doubt that it will be disclosed—at least to some degree—in an upcoming quarterly report on earnings. It is also unclear if Activision Blizzard will extend this forgiveness to Call of Duty League teams that still reportedly owe back fees to the league.

Jacob Wolf reported last summer that both the CDL and OWL were owed millions in back franchising fees totaling somewhere between  $390M – $420M USD, according to his sources.

We will have more on this story as it develops.