BURBANK, Calif. —The Overwatch Leaguechristened its inaugural season this month in largely the same ways as any professional sports league’s opening day. The very best players in the world donned uniforms representing their teams. Fans packed an arena, purchasing licensed merchandise in addition to concessions. And announcers broadcast the action for hundreds of thousands more watching at home.
The setting was consistent with a big league pro football, basketball, baseball, soccer or hockey event, but the competition here was a team-based video game, and the new league is the latest development bringing competitive gaming, familiarly known as eSports, closer to the mainstream.
The audience for eSports has surged in recent years and major investors have followed, including owners of traditional sports franchises seeking to reach a young audience traditional sports increasingly miss. Annual revenue has grown more than 40 percent over the past two years and is quickly approaching $1 billion, according to market research firm Newzoo. The International, the major tournament for the game Dota 2, featured a total prize pool of $24 million, with the tournament winners landing $10.8 million. Newzoo projects the total audience for eSports will approach 590 million worldwide by the year 2020.
So when a new league was being formed around Overwatch, a first-person shooter game, many investors couldn’t wait to pay $20 million apiece to buy a franchise. Those included New England Patriots owner Robert Kraft, Stan Kroenke (Los Angeles Rams), Jeff Wilpon (New York Mets), Andy Miller (Sacramento Kings) and Comcast Spectacor (Philadelphia Flyers).
“It was one of the few times that we committed at the first meeting,” said Kraft, who, along with his son Jonathan, owns the OWL’s Boston Uprising. The Krafts, like other pro team owners, had been waiting to find a way into the eSports phenomenon. Not having found the right play, they decided to help build a new league. It was the same path they had taken with Major League Soccer as owners of the New England Revolution.
Sports teams, such as the Golden State Warriors and Cleveland Cavaliers of the National Basketball Association, the New York Yankees of Major League Baseball and European soccer club Paris Saint-Germain have all sunk money into League of Legends eSports franchises and other popular gaming titles. Ted Leonsis, owner of the Washington Wizards in the NBA and Washington Capitals in the National Hockey League, also owns Team Liquid, one of the most prominent franchises in the eSports world.
Major League Soccer announced last week that it will launch an eSports league centered on the popular FIFA soccer video game, a similar undertaking to the NBA’s upcoming league based on the NBA 2K franchise.
ESports has been something of a siren call to investors with its tantalizing metrics, but it also came with nascent, messy competition and business structures. That’s something the OWL sought to correct. Like other major sports, the league has city-based franchises, salaried players and shows its video game characters in “jerseys,” called skins by gamers, during league play.
“The city-based part is about capitalizing on a lot of those great rivalries in traditional sports between cities,” the league’s commissioner, Nate Nanzer, said.
The league has 12 franchises based around the world in cities such as New York, Dallas, London, Seoul and Los Angeles. The hope among Activision Blizzard, which operates the OWL, league owners and players is that these new concepts will help broaden the audience by allowing new fans to more easily follow game play and identify with teams.
“People like being part of something where they have local affiliation,” said Steve Kaplan, co-owner of the NBA’s Memphis Grizzlies,the English Premier League’s Swansea City club and the OWL’s Los Angeles Valiant.
A rising tide
The demographics hold great appeal to investors outside the sports world as well with the OWL featuring several owners with Hollywood ties.
“It’s one of the issues the movie business struggles with the most: ‘How do we reach people under 30?’ This is a business built on people under 30,” said Rob Moore, a former vice chairman of Paramount Pictures and current general manager and president of the OWL’s Los Angeles Gladiators.
The OWL requires players to engage with fans for a specified amount of time by streaming their game play on outlets such as Twitch, which is owned by Amazon. (Amazon’s founder and chief executive, Jeffrey P. Bezos, also owns The Washington Post.) Many players first achieved fame playing the game on Twitch or YouTube, and the interaction is one reason for eSports’ success.
And while the long-term viability of the OWL remains an open question, the owners are optimistic.
“League of Legends Championship Series has a bigger player base, a proven track record, massive viewership and is selling out stadiums,” said Bryce Blum,executive vice president of Catalyst Sports & Media, an advisory firm in the eSports space. He also represents some franchises and broadcasters in the Overwatch League as a lawyer. “But Overwatch is a new game, so it’s nowhere near its full potential as far as tactics, player base and game development.”
Blum cites various metrics when he says the “inevitable” mainstreaming of eSports has already arrived.
“Traditional sports will learn a heck of a lot more from eSports,” he said, considering how many teens and people in their 20s are digital natives and prefer streaming to traditional cable packages.
The live stream of the OWL’s opening day averaged 408,000 viewers per minute on Twitch and the Activision Blizzard-owned MLG.tv, according to the league. The first NFL Thursday night game streamed on Twitter in 2016 averaged 243,000 viewers per minute, while the first NFL game streamed on Amazon this past September averaged 372,000. NHL games available via Yahoo averaged a per-minute audience of 336,000. While the streamed NFL and NHL games are also available via traditional TV broadcasts, OWL’s games were not available on linear television in Western markets.
A day before the league opened, Twitch announced that it had secured streaming rights to the OWL. The deal is for two years at a reported $90 million.
“The revenue streams are the same as in any major sport. There is clearly tremendous interest in a very valuable demographic, with relatively young people who have relatively high incomes,” Kaplan said.
Peter Levin, the president of interactive ventures, games and digital strategy for Lionsgate Entertainment, pointed to the ability of the co-investors of his franchise, the Los Angeles Valiant, to promote their product at traditional sports venues, which his investing partners own.
Robert Kraft, chairman of the NFL’s broadcast committee, as well as Jonathan Kraft, chairman of the league’s digital media committee, are equally bullish on future TV and streaming rights, seeing the recent Twitch deal as only the beginning.
“For the first time, this is a league that’s globally based,” Jonathan Kraft said.
Moving to the mainstream
As strange as filling a stadium to watch people play video games might be to older generations, Moore quickly found it to be on par with watching any other competition, after his college-age son introduced him to the culture.
“You play basketball, you like to watch basketball, you like to talk about basketball,” Moore said. “You play Overwatch, you like to watch Overwatch and see the best people play. It’s the same dynamic.” There are more than 35 million Overwatch players worldwide, according to Blizzard, the game’s producer.
Jeff Kaplan, the game’s lead designer and vice president of Blizzard Entertainment, said Overwatch was intended to be as watchable and understandable as possible, while also making sure it offered sufficient challenges to players.
“People don’t give video games the benefit of the doubt,” Kaplan said. “All pro sports require some level of buy in. When I take people to hockey games, I have to explain icing and offside 20 times before they get it.”
All matches during the inaugural season of the OWL will be played in Burbank at a location that was previously the soundstage for NBC’s “The Tonight Show Starring Johnny Carson.” On opening day, the setup was akin to a slick TV game show, but the sellout crowd, numbering 530 according to the league, gave off a feel similar to a small, but anticipated, college basketball game. Other eSports events — such as the League of Legends World Championship, draw spectators numbering in the tens of thousands. That event has sold out Madison Square Garden, Staples Center and, most recently, Beijing’s Olympic Stadium, a facility that seats 80,000.
The scene Wednesday in Burbank included play-by-play and color commentators, called casters. Outside, fans bought up the merchandise that included OWL-branded jackets selling for $99, jerseys ($60) and hats ($35).
“It’s my first time in an arena like this, and it’s super polished,” William Bao, a 21-year-old video game designer, said as he looked over the jackets. “I was like,‘Wow, it’s super legit.’ It just feels fresh. It feels like watching sports.”
Ashwin Bhandari, 19, enjoyed seeing star players he knew from Twitch and YouTube. Although he is from San Francisco, he was buying Seoul Dynasty gear, owing to his support of Seoul’s players.
The Krafts are realistic about where the league stands and perhaps where it could go.
“When you’ve grown up in this country with ball-and-stick sports, it’s hard to fathom it at first,” Jonathan Kraft said. “While they might not need the cardio and physical strength of an NFL player, they need hand-eye coordination and fast-twitch hand reflexes. You have to develop an appreciation for what the game is.
“They are athletes, it’s just a different definition,” he said, adding that the same level of teamwork and checked egos that has driven the success of the Patriots will be needed to secure wins in the OWL as well.
“Culturally, it’s hard at this point to put [eSports players] in that [celebrity] category, but I do believe, five, 10 years from now, that’s the way it will be,” Robert Kraft said. “They will be personalities that will be revered the same way. . . . If they are good.”
Correction: An earlier version of this story incorrectly stated that the Overwatch League has a franchise in Paris. The franchise is based in London.
Noah Smith is a multimedia journalist and TV docuseries producer based in Los Angeles. His work is online at noahble.com.