Activision Blizzard has announced the corporate restructuring of the esports section in the coming weeks: 50 planned layoffs.
The live events for Activision Blizzard esports, or the Overwatch League and the Call of Duty League, are undoubtedly among the most expensive to create but at the same time they represent the backbone of the business model designed by the Santa Monica company to make the competitive scene sustainable, both for themselves and for teams, players and all the main players.
Revenues, in the first two years of the Overwatch League, came largely from live events, divided between TV and streaming rights, merchandising and stadium entrances. Furthermore, both leagues had envisioned a future in which the teams each had their own stadium, or arena esports, in which to play championship matches, as in the most classic of sports. The Covid-19 pandemic has undeniably disrupted the ambitious project, forcing the organizers to review the competition model, moving it more online. Just like other competitions from League of Legends to CS: GO have done.
The Overwatch League season 1 final in 2018
Despite the arrival of the vaccine and the consequent mass immunization, it is still difficult and complicated to see the recovery of normalcy on the horizon prior to the appearance of the coronovirus. The uncertainty about the future has therefore prompted Activision Blizzard to review its plans for esports, including a corporate restructuring of people and skills. Roughly translated: layoffs. Already in 2019 the company made a real revolution, firing 800 employees from various locations around the world, including the scheduled closure, apparently next spring, of the Versailles office in France.
This time Activision Blizzard aims to lay off 50 people, as confirmed by Tony Petitti, the company’s President of Sports and Entertainment, during an interview with Sport Business Journal and The Esports Observer. It is not clear which areas will be affected by the layoffs but what transpires is that it will not strictly concern the esports section but everything that gravitates around it.
Petitti arrived in Activision Blizzard in August 2020 after working for years in MLB, the American professional league of baseball: “We have learned a lot in recent years in terms of how leagues should be organized to play them online. Now we are ready to put into practice what has been acquired. In terms of timing it is a reaction to external reality and how to best allocate resources to create a league that is sustainable for all: us, the owners, the teams and the fans.“
Call of Duty League Live Match – Sold Out
Petitti also wanted to point out that Activision Blizzard has no plans to eliminate online events altogether on the contrary, it will go back to pushing them as soon as possible. At this time, however, and in the long term to come, online will represent an increasing component of ABE esports, both for the Overwatch League and the Call of Duty League. However, these changes also affect the number of employees: when Petitti talks about changing the allocation of resources, he addresses, albeit in an aseptic way, precisely the people who work in the company every day.
Employees who do not appear to be treated in the best way, however. According to Jason Schreier on Bloomberg, US employees will continue to receive 90 days of pay and health benefits for one year as compensation and support for the transition to a new job But there will also be a bonus: a $ 200 gift card to spend on Battle.net, Blizzard’s digital store.
All while Activision Blizzard financially has achieved excellent results with an increase in the share price on the stock exchange compared to last year. Results that, as always happens in these cases, trigger a bonus for the company’s CEO: Bobby Kotick has in fact received an extra 200 million dollars. Despite it being the practice, the same shareholders of Activision Blizzard have considered this figure excessive, especially in conjunction with the dismissal of 50 employees.
“Although the increase in share value is something undeniable and positive, this single goal achieved cannot justify a bonus of this magnitude for our CEO”Said the spokesperson for CtW Investment Group, one of the group’s investors. “There were several factors that contributed to this growth and not necessarily and directly attributable to Kotick’s decisions. An example is the same pandemic that has prompted many companies to look for a new communication channel in the gaming world, and therefore also in Activision Blizzard, regardless of the strategic choices of our executive board.“