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Blizzard’s new Overwatch League has seven teams, with homegrown esports team Immortals in Los Angeles on on side and another from the Boston’s Robert Kraft, the owner of the five-time Super Bowl champion New England Patriots.
The competition will pit young executives like Noah Whinston, CEO of the Immortals, against owners from established sports teams. And Whinston said in an interview with GamesBeat that he relishes the chance to kick the ass of Kraft’s team. Each group had to come up with an estimated $20 million to join Activision Blizzard’s official esports league for its hit team-based shooter Overwatch, which has more than 30 million users. Other rivals include Kevin Chou and Kent Wakeford, owners of KSV eSports International, which bought the Overwatch franchise for Seoul, South Korea.
The odds don’t look like they’re in anyone’s favor, as each group has a lot of heft and had to come up with an estimated $20 million to buy a franchise. I talked with Whinston as well as Clinton Foy, chairman of the Immortals and managing director of Crosscut Ventures, about the opportunity. The esports economy will grow 41.3 percent to $696 million in 2017, and it could hit $1.5 billion by 2020, according to market researcher Newzoo.
There’s a big contrast betweeen Kraft and upstarts like Whinston, a 22-year-old who founded the Immortals in 2015. But Foy said the Immortals have important allies among Los Angeles heavyweights like Peter Levin, president of Lionsgate Interactive Ventures; investors Michael and Gregory Milken; and AEG, the owner of the LA. Live entertainment venue that includes Staples Center, where the Los Angeles Lakers play. That collection of allies will make the Los Angeles franchise a formidable force in the league, Foy said. Beyond the Overwatch team, the Immortals also have teams playing League of Legends, Counter-Strike: Global Offensive, Smash Bros., and Vainglory.
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Here’s an edited transcript of our interview with Whinston.
GamesBeat: Why you are joining the Overwatch league?
Noah Whinston: For us, the crucial part of it overall was the localization aspect — being able to have a local territory that we have control over and build deeper ties with a fan base than the current model really allows us to do. Even though digital platforms give us a really wide access to fans — all over the world — it doesn’t allow you to build as deep a connection as you can between a local sports team and their fan base.
That localization element, in addition the revenue sharing elements, and the stability and the strong competitive future of the game, all of those were important aspects for us when it came to making the decision.
GamesBeat: When you formed as an esports organization, it seems like you ran into a lot of pain points that made it obvious you needed a better model.
Whinston: Every esports team has kind of been waiting for the day when these large, top-down structures would come into play and provide the kind of stability that hasn’t really existed before. When those structures come in, they can provide the growth structure that we need for esports to really explode — to not just keep Overwatch at the same level we’re at right now. We need to keep growing the fan base in order to support the overall ecosystem.
GamesBeat: How are you going to run Immortals now? Do you still have a lot of other teams that you’re going to keep supporting on other leagues? How much focus do you put on the Overwatch League relative to other games?
Whinston: Oh, a huge amount of focus, obviously. Those teams represent a huge investment of resources and energy on our part. It’s not as if we’re planning to drop any of our other teams. We’re still very dedicated to our participation in League of Legends, Counter-Strike, Smash, and Vainglory. These are all great games and we have great players involved with them. But of course now that there’s more of a structure around Overwatch, that’s going to take higher precedence on our list of priorities.
GamesBeat: Have you been working on this for a long time now, or was it a relatively quick deal to put together?
Whinston: No, it’s been tough to get done. It always is, building something like this from the ground up. We’ve been talking to Blizzard for a while now, almost a year. What we’re looking at today is different from what we’d planned originally, which was different from the first ideas that were floated to us by the Overwatch team. It’s been a long process on our end, but even more so at Blizzard. We’ve been fortunate that the process was so open and we got so much help from their side that made our job easier when it comes to expressing what we need, what’s essential to us.
GamesBeat: As far as where you guys were in making the deal, did you have to amass more capital from investors to make this happen, or were you already set up for this kind of thing?
Whinston: There’s certainly a significant capital requirement, but part of that was covered by AEG just a few weeks ago, an additional investor in Immortals. AEG also provides additional structure that’s very important to eventually running our own Overwatch events. As far as additional investment in Immortals, we may have some announcements around that in the future.
GamesBeat: Is it the Los Angeles territory that you’re setting up?
Whinston: Right. Our territory encompasses Los Angeles and San Diego.
GamesBeat: It seems nice that you have Blizzard’s home turf in your area.
Whinston: Absolutely. That was almost non-negotiable for us. Los Angeles is an incredibly important market for both myself and our investors.
GamesBeat: What’s it going to be like building around a physical territory? That’s something new in esports.
Whinston: Like I said earlier, being able to have that marketing territory, what that allows you to do is just crucial for developing a local fan base that’s harder for other teams to access. Being able to get people out to your live events and get them to fall in love with the team, whether they’re eight years old or 80—I think it’s something that Blizzard understands is very important.
GamesBeat: Do you think developing the territory means you’ll have to invest more capital? Do you have to get to a point where you have your own venue?
Whinston: Yeah, an esports venue is going to be an important part of this. Eventually Immortals is going to be running and hosting our own Overwatch events, and when we get to that point the requirements for operating are going to be significant. We’ll need to build out that aspect of our business, and the league is going to provide us with the opportunity to do that.
GamesBeat: It seems like the league needs more teams before it will really get going. Is that your perception as well, that you can’t necessarily function with the current roster of teams?
Whinston: Yeah, the recent announcement is only the beginning of that process. I wouldn’t say a particular number is required, but we anticipate there will be more teams announced soon.
GamesBeat: Your $20 million is a pretty big investment. What does that go toward? How is that money being used to build the league?
Whinston: Obviously I can’t confirm or deny any particular amount of money involved here. You have your sources, I’m sure. But from our perspective, the significant up-front investment by Blizzard is necessary not only for the development of the game, but also the creation of the structure needed to keep and run an esports league. If it wasn’t, then a lot more people would be doing this kind of thing. If you want to know about the specific use of resources in different parts of the Overwatch league, Blizzard is probably a better party to ask, but from our perspective, that’s the biggest thing.
GamesBeat: How do you feel about competing against some of the other organizations involved, like the traditional sports teams coming into the league?
Whinston: Oh, we’re relishing the opportunity to kick some ass on Robert Kraft. [Laughs] But for real, I’m a huge Patriots fan, so it’ll be really cool to work alongside him. From my perspective, it’s great that there’s a level of expertise from traditional sports when it comes to merchandising and marketing that esports didn’t really have access to before. But I also think that we have a great advantage when it comes to building competitive teams that know what it takes to win in the field of esports. I’m sure they’ll catch up eventually, but at least in the early phases, I’m hoping we deal out some tough blows to the traditional sports owners.
GamesBeat: As far as recruiting the team, how are you going to go about that?
Whinston: We’re fortunate to already have a team signed that’s already active in Overwatch esports, just in last September. The team we have now is the best North American team out there, and we’re looking forward to helping them improve and perform better and better in the Overwatch league. Our roster may not be exactly the same. It’s obviously hard to determine exactly what will happen between now and the launch of the league. But we’re not looking to do a complete rebuild, any kind of tear-it-all-down approach. We’re very happy with where the team is at right now.
GamesBeat: As far as the management in place, do you have that side of the operation ready to go?
Whinston: We’re ready from day one to launch a competitive esports team. That’s what we’re already doing across many different games. Supporting a team in the Overwatch league is going to call for a lot more than that, but we’re looking forward to taking on the new challenge.
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