CLG Is Reportedly Shutting Down and Looking To Sell Their LCS Spot

One of the most storied organizations in esports might be saying goodbye soon.

Esports isn’t the only industry affected by the recent post-COVID downsizings and layoffs happening in various companies around the world, but there has been a lot of it happening in the industry. A lot of esports orgs like FaZe and 100 Thieves to publications such as Dot Esports and even Washington Post’s Launcher laid off multiple staff members just in the last month or two due to the unprofitability of esports or outside reasons like the collapse of Silicon Valley Bank.

The most recent victim of the circumstances is CLG, one of the most recognizable organizations in esports, especially among League of Legends fans. According to a report from the LCS reporter and content creator Travis Gafford, all CLG staff members were let go from the organization, and the CLG brand would no longer exist in the near future. The only exception to the layoffs is the LCS team and staff which Gafford said would be sold to NRG, though no exact details on the deal just yet.

Sources: CLG Sold, Mass Layoffs, Brand's Future Uncertainhttps://t.co/klnTuTxJqR pic.twitter.com/fchwHlkttY

— Travis Gafford (@TravisGafford) April 3, 2023

CLG ownership confirms there will be changes to the organization

Counter Logic Gaming was founded by George “HotshotGG” Georgallidis and Alexander “Vodoo” Beutel as a League of Legends team, although they branched out to other esports since their inception in 2010. The organization was eventually sold to The Madison Square Garden Company, an American sports holding company that also owns New York Knicks and New York Rangers.

While MSG has not made a public statement about the subject yet, Digiday’s Alexander Lee was able to get an official statement from the company. While the official MSG statement didn’t touch on whether the company would be shut down, nor did it touch on any layoffs, it said that “…[they] are streamlining CLG’s operations to better position the company for long-term success,” hinting some changes coming in the future.

Here's an official statement from MSG Sports regarding @clgaming: “While changes like this are always difficult, we are streamlining CLG’s operations to better position the company for long-term success, and are also currently exploring strategic alternatives for the business.”

— Alexander Lee (@alexleewastaken) April 4, 2023

What does CLG’s exit mean for the LCS?

While most of the online discourse around the news was focused on the layoffs as a lot of hardworking people lost their jobs, there are some questions about what the potential sale of CLG would mean for their main competition. Just last week a Sports Business Journal article reported TSM was also looking to make their exit from LCS and esports as a whole. LCS is already in a downward trajectory with the viewership numbers decreasing slightly but steadily and the league losing its broadcast days to VCT Americas.

High operating costs stemming from rising player salaries, having to operate from Los Angeles due to LCS’s location and probably the poor resource management from organizations themselves combined with the decreasing interest from fans due to unsuccessful international performances mean a lot of LCS teams are looking at a bleak financial future. Even if CLG and TSM sell their franchise spots for high price tags and make a good return on their investments, it doesn’t automatically mean good news for LCS itself.

These orgs are two of the oldest and most storied teams in the North American LoL scene, they have been the rivalry for a long time. Even if they lost some fans in the last couple of years without championships, a lot of people still tune in to watch CLG and TSM, not the LCS. It is possible LCS will bleed some more viewership with two of its flagship orgs leaving the league. And it will be critical to see who will replace them as the scene is in dire need of familiar orgs and teams to bring stability.

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