It doesn’t take an economics degree to see the current state of the worldwide economy. With record high inflation surrounding goods and services, the giant esports bubble is at risk of bursting. The Guard, in a shocking move (and without warning), has laid off its social media, talent, content and creative, and most of the headquarters staff according to numerous tweets from former employees and esport news outlets.
The Guard is the parent company to several major esport franchises, including LA Gladiators (Overwatch), LA Guerrillas (Call of Duty), The Guard (Valorant), along with teams in Halo and Apex Legends. Rumors have started to swirl that with the ongoing economic issues and Overwatch League and Call of Duty League hurting to attract sponsors and viewers (also in part due to Activision-Blizzard’s workplace misconduct and sexual harassment lawsuits), The Guard may be looking to sell off their franchised spots in both leagues, or even worse, dissolve the teams at the end of their respective seasons if no buyer is found.
The layoffs at The Guard caught the esports world by shock, mainly because of who backs the organization. Stan Kroenke, owner of Kroenke Sports & Entertainment, who also owns the NFL’s LA Rams, English Premier League side Arsenal FC, MLS side Colorado Rapids, and NHL’s Colorado Avalanche. Factor in that Kroenke’s wife is the heir to the Walton Family (owners of Walmart) and you would be hard pressed to see that a lack of funds would be the reason for the layoffs. Instead, the move seems more like someone who is worth $12.9 billion trying to cut his losses after buying into esports.
The Guard isn’t the first (nor will it be the last) esport organization to go through layoffs. OpTic Gaming, 100 Thieves, eUnited, FaZe Clan, and Team Liquid are just a few other organizations that have started to layoff employees due to ongoing economic struggles and declining viewership. Teams in the Overwatch League (which paid an approximate $20-$35 million franchise tag to join the league) have attained a law firm to start the collective bargaining process against the league after years of missed promises on revenue and higher operating costs, in an effort to recuperate funds or reduce the amount they owe to Activision-Blizzard.
As of the writing of this story, the teams backed by The Guard are still planning on competing in their respective leagues, but with near certainty of increasing inflation rates mixed with low viewership numbers and the loss of sponsors, many have marked this moment as another sign that the esports bubble may be bursting…and bursting hard in the future.
Image from: The Guard
