The Esports Advocate
Esports business news: deals, legal, and governance.
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Overwatch League 2023 Season Won’t be Broadcast in China
The 2023 Overwatch League season will not be broadcast in China, marking a significant shift in the league’s regional accessibility.
- The Overwatch League (OWL) will not be broadcast in China for the 2023 season due to the termination of the partnership between Activision Blizzard and NetEase.
- The broadcast ban stems from the loss of official game approval for Overwatch in China, which prevents the streaming or co-streaming of related competitions.
- Chinese OWL teams—the Guangzhou Charge, Chengdu Hunters, Hangzhou Spark, and Shanghai Dragons—are currently considering relocating their operations to South Korea.
Activision Blizzard Pays $38M to Settle SEC Charges
Activision Blizzard has reached a $38 million settlement with the U.S. Securities and Exchange Commission (SEC) to resolve charges regarding internal control failures and violations of whistleblower protection rules.
- Activision Blizzard agreed to a $38 million settlement with the U.S. Securities and Exchange Commission (SEC) to resolve charges regarding workplace misconduct disclosures and whistleblower protections.
- The SEC found that between 2018 and 2021, the company lacked the necessary internal controls to properly collect and analyze employee complaints, preventing it from assessing the scale of workplace issues for public disclosure.
- Activision Blizzard violated SEC whistleblower rules by requiring departing employees to disclose whether they had communicated with the Commission regarding potential securities law violations.
Riot Reveals Capsule Collection for VCT LOCK//IN
Riot Games has introduced the VCT LOCK//IN Capsule, a limited-time collection of in-game digital items designed to provide direct financial support to partnered professional teams.
- Riot Games is launching the VCT LOCK//IN Capsule, an in-game item collection that provides 50% of its revenue directly to officially partnered teams.
- The in-game collection, which includes melee items, regional player cards, and a spray, will be available for purchase from February 8 to March 7, 2023.
- The VCT LOCK//IN tournament begins on February 13 in São Paulo, Brazil, featuring 32 teams competing for a $500,000 USD prize pool.
Content Creators Say X1 Entertainment Group Owes Them Thousands of Dollars
Content creators are publicly alleging that the British Columbia-based, publicly traded X1 Entertainment Group has failed to pay thousands of dollars owed for completed brand activations.
- Content creators represented by X1 Talent, a division of the publicly traded X1 Entertainment Group, report that the company has failed to pay them for completed brand activations.
- Streamer Brandon “iamBrandon” Stennis stated that he is owed approximately $14,600 for a year-long campaign, plus an additional $600 for work completed in January 2023.
- X1 Entertainment Group informed its talent agency staff that it would be shutting down X1 Talent at the start of February 2023, but subsequently held back scheduled payments to creators.
Nerd Street Gamers Weighing Options as it Struggles Financially
Nerd Street Gamers, a Philadelphia-based tournament organizer and operator of the Localhost LAN gaming center chain, is facing significant financial instability.
- Nerd Street Gamers is actively seeking an acquisition or additional investment to address significant financial liabilities and debt.
- The company has failed to pay various Valorant players and tournament talent for work dating back to the summer of 2022, despite public complaints from affected individuals.
- Nerd Street Gamers has approached several industry entities regarding potential deals, including Belong Gaming Arenas (owned by Vindex), eFuse, PlayFly, LeagueSpot, and investor SeventySix Capital.
European Union Will Deliver a Statement of Objections to Microsoft
The European Commission is preparing to issue a formal statement of objections to Microsoft regarding its proposed $69 billion acquisition of Activision Blizzard.
- The European Commission is preparing a formal 'statement of objections' regarding Microsoft's proposed $69 billion acquisition of Activision Blizzard.
- EU regulators will not consider any remedies from Microsoft until the formal statement of objections has been officially delivered.
- Microsoft aims to finalize the acquisition by July 18, 2023, to avoid either renegotiating the deal or paying a $3 billion separation fee to Activision Blizzard.
Motorsport Games Shares Jump Amidst Positive News
Motorsport Games experienced a significant, albeit likely speculative, surge in its stock price in early February 2023.
- Motorsport Games shares experienced a significant surge, rising from $2.54 on Monday to nearly $50 by Wednesday, leading to multiple trading halts by Nasdaq.
- The primary driver for the stock price increase was the announcement of a $3.9 million private placement investment agreement, with shares priced at $21.40 for the capital increase.
- The company secured a debt-for-equity exchange agreement with its majority stakeholder, Motorsport Network, to repay $1 million of an existing $12 million line of credit.
EA’s Respawn to Shut Down Apex Legends Mobile in May
Electronic Arts and Respawn Entertainment announced the discontinuation of Apex Legends Mobile, effective May 1, 2023. The decision to sunset the title came just one year after its global launch on May 17, 2022.
- Electronic Arts and Respawn Entertainment will shut down Apex Legends Mobile on May 1, 2023, at 4 p.m. PDT.
- Respawn cited a failure to maintain the necessary standards for content quality, quantity, and update cadence as the primary reason for the game's closure.
- The mobile title, which was co-developed with Tencent’s Lightspeed Studios, operated for only one year following its launch on May 17, 2022.
The Esports Club Raises $3M USD
The Esports Club (TEC), a Bengaluru-based tournament organizer and esports platform, successfully secured $3 million USD (approximately INR 24.5 crore) in a Pre-Series A funding round.
- Bengaluru-based tournament organizer The Esports Club (TEC) raised $3 million USD (INR 24.5 crore) in a Pre-Series A funding round.
- The investment round was led by the Komlay Group and the Sambavanath Group.
- TEC plans to use the capital to expand its operations into the Middle East and Southeast Asia markets.
Guild Esports FY 2022 Annual Results
Guild Esports, a London-based, publicly traded esports organization, reported significant revenue growth for the fiscal year ending September 30, 2022.
- Guild Esports reported FY 2022 revenue of £4.5M ($5.48M), representing a 134% increase over the previous year's £1.9M ($2.34M).
- The company maintained a pre-tax loss of £8.75M ($10.76M) for FY 2022, nearly identical to the £8.82M ($10.86M) loss recorded in 2021.
- Sponsorship income was the primary growth driver, rising 168% to £3.2M ($3.93M) behind new deals with partners including Sky UK, Coca-Cola, Samsung, and Bitstamp.
Chinese Overwatch League Teams Ponder Options as They Wait for Activision Blizzard
The dissolution of the partnership between NetEase and Activision Blizzard in early 2023 created significant instability for the four Chinese teams competing in the Overwatch League: the Guangzhou Charge, Hangzhou Spark, Chengdu Hunters, and Shanghai Dragons.
- The dissolution of the partnership between NetEase and Activision Blizzard has created significant uncertainty for China’s four Overwatch League (OWL) teams: the Shanghai Dragons, Guangzhou Charge, Hangzhou Spark, and Chengdu Hunters.
- Chinese OWL teams are operating on reduced budgets and delaying further investment until Activision Blizzard identifies an alternative Chinese distributor for its titles.
- Industry experts and internal sources anticipate potential widespread layoffs in the Chinese esports sector, affecting professional players, streamers, and talent due to the uncertain future of Blizzard games in the region.
BLAST Premier Spring Final Coming to Washington D.C.
The UK-based tournament organizer BLAST has announced that the BLAST Premier Spring Final will be held in Washington D.C. from June 7–11, 2023.
- BLAST will host its Counter-Strike: Global Offensive (CS:GO) Premier Spring Final in Washington D.C. from June 7–11, 2023, marking the organization's first U.S. event since July 2019.
- The tournament features an $450,000 USD prize pool and will be held at the Entertainment & Sports Arena, which has a capacity of approximately 4,000 seats.
- Eight teams will compete in the finals, with spots determined by the BLAST Premier Spring Groups in Copenhagen and two regional Spring Showdown events held April 12–16.