How Franchising is Reshaping Esports As We Know It
, Cover-Credits:
AFK Gaming
One of the biggest problems of esports throughout the past decade has been a lack of financial security for players as well as teams. With esports viewership expected to cross 474 million in 2021 according to Newzoo’s latest Global Esports & Live Streaming Market Report, it will be on par with some of the biggest traditional sports. Franchising looks like an attractive solution for the industry. Some of the most viewed sports, including American Football, Cricket, and Hockey (ice and field), generate revenue for multiple stakeholders through established leagues. Esports is heading in the same direction.
What is A Franchise League in Esports?
Franchising in many popular esports leagues works very similarly to professional sports leagues. Each franchise (team) has its own territorial rights and usually covers large metropolitan areas. Alternatively, they cater to existing audiences of esports organizations. For example, the Dallas Fuel in the Overwatch League was formed by Team EnvyUS. The NBA and the NFL are two of the biggest examples of franchising in traditional sports.
Teams are usually independent corporate entities who buy a slot to compete, in exchange for a share of the revenue generated by the league. There is no promotion or relegation in franchised leagues, and expansions are made in these leagues to accommodate new teams at the start of seasons. Franchises can be separate entities and/or direct shareholders in esports leagues.
