Activision’s Landmark Deal Boosts Esports Team Revenue
Vancouver, BC
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April 18, 2024 08:00 AM Eastern Daylight Time
Microsoft’s Activision Blizzard just unveiled a landmark revenue deal for the Call of Duty League (CDL),1 creating a buzz across the entire esports landscape.
The updated agreement promises a dynamic shift in the esports landscape, starting with the elimination of outstanding entry fees. This bold move not only returns previously collected fees to teams in full but also permanently removes this financial obligation, injecting much-needed capital back into the League.
Teams are set to experience a significant boost in revenue streams with increased earnings from sales of in-game merchandise, including Team bundles and the highly coveted Champs bundle.
Activision Blizzard is also increasing the existing event subsidy amounts for teams organizing live in-person events, such as majors, opens and champs.
On top of that, teams will now benefit from a two-year minimum revenue guarantee, “so they can continue investing into the Call of Duty League with more peace of mind” according to Daniel Tsay, General Manager of Call of Duty Esports at Activision Blizzard.
Activision Blizzard isn’t the only game developer making much-needed adjustments to its profit-sharing model.
Riot Games recently unveiled a new partnership model for professional teams in the LCS, LEC, and LCK leagues, inspired by the successful VALORANT Champions Tour. This model aims to provide teams with more predictable revenues and greater financial upside through in-game digital content sales.
Under the new model, teams will receive a fixed stipend and share in revenue generated from LoL Esports digital content sales, facilitated by a Global Revenue Pool (GRP). Riot Games intends to increase the standard esports revenue share percentage and expand the variety of LoL Esports digital content offerings to further support the GRP and incentivize team success.
For premier esports and entertainment company OverActive Media (TSXV:OAM) (OTC:OAMCF), these changes provide a long-term horizon for growth and a clear path to profitability.
OverActive Media Signs Transformative Esports Deal
Canadian-based OverActive Media is one of the world’s largest esports ownership groups with a roster of widely popular professional esports teams, including the Toronto Ultra in Call of Duty League, MAD Lions KOI in the League of Legends EMEA Championship and Movistar KOI in the VALORANT Champions Tour.
On April 16, OverActive Media (TSXV:OAM) (OTC:OAMCF) entered into a new team license agreement with the Call of Duty League (CDL), building on the company’s strategic realignment and long term vision for esports.
The renewed commitment eliminates approximately C$35.1 million in outstanding entry fees. It also includes a one-time restructuring payment of C$2.8 million (US $2 million) to OverActive Media in Q2 2024.
Riot Games’ proposed changes also stand to benefit OverActive Media and its League of Legends franchise MAD Lions KOI, which has consistently been a top performer in the LEC, securing multiple championships, making regular appearances at the Mid-Season Invitational (MSI), and never missing a World Championship since joining in 2019.
OverActive Media (TSXV:OAM) (OTC:OAMCF) received the green light from Riot Games to compete in the VALORANT Champions Tour EMEA 2024 season following the blockbuster acquisition of KOI and Movistar Riders.
The newly formed MAD Lions KOI team has already seen record crowds, drawing 741,000 peak viewers in a regular season match during the League of Legends EMEA Championship (LEC) Winter Split in January. This was the highest viewership since summer 2021. Co-founder Ibai also contributed to this momentum, attracting over 4.7 million Twitch views, surpassing the 2.93 million viewers of the Succession series premiere.
Another milestone was achieved on February 18 during the LEC, with a record 830,816 viewers, the highest ever for a regular season match.
Click here for more information about OverActive Media (TSXV:OAM) (OTC:OAMCF).
[1] https://www.callofdutyleague.com/en-us/news/the-future-of-the-call-of-duty-league
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