This is a huge step forward for the monetization of esports. In-game content is monetized in other ecosystems, most notably by Valve. In CSGO, Valve sells team stickers and player signatures (that can be tagged on weapons in the game) in advance of its “Majors,” and then shares a portion of the revenues with the participating teams and players. In Dota 2, Valve creates a set of in-game content known as the Compendium, 25% of the proceeds from which are put into the prize pool of the International, Dota’s premier annual event. Riot also does some in-game content revenue sharing for esports, though to a lesser extent—it sells team icons and shares this revenue with each applicable team, and contributes a portion of the proceeds from a single skin to its World Championship prize pool.

With that said, Blizzard taking the step to create skins for each team in its league and then sharing the revenue from such sales with the teams is an evolution beyond what we’ve seen to date. Unlike the icons sold by Riot, the development of a hero skin requires more time and money, and is also a much more significant revenue driver. These sales will also not be limited to major events, but will occur year-round.

It’s important to remember that while the esports industry is still relatively small and esports revenues are expected to reach around $700M in 2017, these estimates exclude game revenues (including in-game content sales). For many games, the sale of such content is the primary revenue driver—for instance, League of Legends is an entirely free-to-play game that will do close to $2B in revenue from in micro transactions this year alone. Remember the Compendium I mentioned early? 25% of the sales from that set of in-game content totaled $23,187,916 in 2017. Blizzard’s willingness to invest its resources to create and sell marquee in-game content that features esports team brands on an ongoing basis is a major step forward for the potential to monetize esports, and augurs well for the future of the Overwatch League and esports more generally.

$20 million but no visas? YIKES!

The Philadelphia Fusion, owned by Comcast Spectacor, took a lot of heat on social media following the announcement. One fan on Twitter wrote “massive, colossal fail. Glad I chose to support Outlaws over you”

The Outlaws are a competing team based in Texas.

From a professional perspective this is an unfortunate fail in the days leading up to the launch of the league.

There are few worse scenarios than having one of your opening day teams miss their matches. But to compound matters, this mistake has already been made in esports. In early 2016, ahead of the Spring Split of NALCS, Froggen – the mid laner for team Echo Fox – was not allowed to play due to visa issues and Echo Fox was forced to forfeit a league game. Bilzzard should have planned better for such legal hurdles, and enforced a strict timeline for its team partners in order to avoid this type of result.

Visa issues are not new in this space and the failure of one team to properly handle these types of legal matters in a timely manner is the failure of the league as a whole. This is an embarrassing event for the Philadelphia Fusion, Comcast Spectacor, and the Overwatch League but if the team sorts out their immigration problems ahead of the official launch of the league, this will be looked at as a minor hiccup in the grand scheme of things.

In my decade of being in esports, I’ve never seen a team have a worst introduction to the space than the Philadelphia Fusion

The worst thing is I actually think they have a good team with a lot of good guys on the roster. I really hope Comcast can salvage the sinking ship pic.twitter.com/lYJEcJems9

— The Esports Writer (@FionnOnFire) December 5, 2017