One month ago during a fourth-quarter earnings call, Activision confirmed that a city-based franchising model would come to Call of Duty Esports next year. New information has now surfaced on just how much the franchise buy-in will cost organizations.
Sources told ESPN staff writer Jacob Wolf that Activision Blizzard has begun shopping next year’s Call of Duty franchise spots at $25 million per team. According to Wolf, this past week's negotiations between Activision and prospective buyers are heating up. Wolf states that Activision “has asked potential buyers for a non-binding indication of interest within the next 14 days.”
Call of Duty League + Overwatch League
Activision also appears to be fully behind the geolocation model of franchising. Activision is offering current Overwatch League Franchise owners priority to maintain their home market across both sports. It is unclear if Activision intends to keep or merge the branding of Overwatch teams with future Call of Duty teams.
Activision derived their $25 million price tag from their highly successful Overwatch League, where founding members had to pay a $20 million buy-in, and new franchises were rumored to have spent between 30 million and 60 million dollars. The $25 million figure for Call of Duty already dwarfs the current buy-in for the world’s most popular esport. League of Legend's LEC team prices are around $10 million. The franchising model will also ensure a new revenue-sharing model independent of prize pool distribution, as well as continue the current amateur competitive scene.
This signifies a massive step up in Activision’s valuation of Call of Duty as an Esport. $25 million represents almost the entire cumulative Call of Duty competitive prize pools to date. Hopefully, this commitment from Activision and owners will place Call of Duty in a good place for future growth with a mass-audience appeal. After all, it will have to be, or else this lofty valuation will not be able to sustain business investment over the long term.
Image via: CallofDuty.com