Lack of live events leads to cutbacks at Activision Blizzard
COVID-19 continues to cut a swath through, well, everything
In what might very well be seen as a commentary on the direction esports is headed in, Activision Blizzard has announced layoffs in a significant number. The gaming developer cut 50 positions today, with layoffs taking place in different areas of the company. One of the big reasons cited was the ruinous effect that the COVID-19 pandemic has had on live events, not only in North America but around the world.
Activision Blizzard’s most popular games include Overwatch and Call of Duty. Part of its strategy for popularizing the titles has been esports leagues based around live events in bricks-and-mortar buildings with fans in the stands. That obviously went out the window last March, when in-person competition was stopped because of the pandemic.
Like traditional sports, esports was forced to pivot to online play. And having fans tune in online on Twitch and Facebook Live for Call of Duty League and Overwatch League is nowhere near as lucrative as having them sit in stands where, after paying admission, they load up at the concession stand after hitting the merchandise table.
In an interview with Bloomberg, Activision Blizzard said “Players are increasingly choosing to connect with our games digitally and the e-sports team, much like traditional sports, entertainment, and broadcasting industries, has had to adapt its business due to the impact the pandemic has had on live events.”
The news that Activision Blizzard has announced layoffs at least has some good news. Reports are that all those let go will get a package that includes three months severance and health benefits for the next year.
While live-audience stadium action hasn’t exactly been the cash cow that Activision Blizzard was hoping for, the success of games including Call of Duty has helped the bottom line in a big way. Earning from the last quarter of 2020 exceeded all expectations to the tune of US$8.09 billion GAAP, up from US$6.49 billion the previous year.