The reality is, (like it or not) franchised esports leagues are going to dominate the industry and eventually push open systems into irrelevance.

Simply, franchising esports leagues makes the teams more valuable and makes the leagues more revenue. This combination is hard to overcome long-term. Games that continue on supported by open systems, operated by third parties will not participate in the incoming wave of ad dollars, just like they did not reap any of the investment capital placed into team organizations over the last two years. As a result, with vastly smaller share of the revenue boom and lacking an investment thesis for teams, they will slowly fall out of relevance.

It’s hard to take this position today, especially looking at a game like CSGO with a massive following, great game and viewer mechanics, a strong community and player base. However, long term, the open system just does not create enough value for partners. Advertisers and content distributors chase the biggest and strongest, not the most nuanced. Investors favor stability, predictability and explicit legal rights to IP and geographies to protect asset value that open systems can’t provide.

This will perpetuate a dynamic that has already begun - OWL gets a disproportionate take of the sponsor and media revenue available as compared to other leagues. Commercial success leads to reinvestment, making the league bigger and better and attracting even more partner dollars. It’s a cycle that is either virtuous or vicious, depending on which side of the debate you’re on.

I would love to hear your thoughts. It’s a topic that people are passionate about, so please debate, but be respectful!