Tuesday, February 13th 2018

Activision Blizzard's Best Source of Income Comes from Microtransactions

Activision Blizzard held their earnings call a couple of days ago where the company recorded a record-breaking year with $7.16 billion in revenue. According to the video game publisher's breakdown of their sources of income, player investment contributed to more than half of their annual revenue. Activision specifically used the term "in-game net bookings", which is nothing more than fancy jargon for microtransactions. The financial report revealed that Activision raked in $4 billion from microtransactions alone. Popular titles like Call of Duty: WWII, Overwatch, Destiny 2, Hearthstone, and World of Warcraft contain microtransactions where players can spend money on different cosmetic and other in-game items. However, Candy Crush maker King Digital Entertainment, acquired by Activision in 2015, was the strongest performer of 2017 contributing with a little over $2 billion through microtransactions.
Source: Activision Blizzard
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24 Comments on Activision Blizzard's Best Source of Income Comes from Microtransactions

#1
RejZoR
Great, the king of ridiculously overpriced games that never drop in price are now gonna be even more lame because why bother making extraordinary games when all you have to do is to stuff tons of microtransactions crap and you're done. I hope this will backfire on all of companies who shove this garbage into games en mass because idiots buy this virtual nonsense in such huge quantities.
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#2
FreedomEclipse
~Technological Technocrat~
well... As Jim Sterling called it 2017 was the 'Year Of The LootBox'

<div class="youtube-embed" data-id="NLDid1UNyg8"><img src="https://i.ytimg.com/vi/NLDid1UNyg8/hqdefault.jpg" /><div class="youtube-play"></div><a href="https://www.youtube.com/watch?v=NLDid1UNyg8" target="_blank" class="youtube-title"></a></div>

and he mentioned it again just recently when talking about publishers and developers wanting a 'games as a service' kind of product. The truth is they dont care to make games anymore so long as they can throw in a microtransactions into any shoddy half arsed game and get fat off it that way instead.

Thats how the industry has turned into this cesspool, because companies like EA and Activision etc etc etc went unchallenged.

Think of it this way...

If an opportunistic thief stumbled across a way to steal thousands of dollars from a bank with 0% risk of being caught. He or she will attempt to get through the same loophole again and again and again till they either get too greedy and get caught or the loophole gets patched or made riskier by more security staff patrolling the area.

EA and Activision have exploited their customers for far too long
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#3
R0H1T
Oh wow, what a surprise :rolleyes:

It's a good thing EU is cracking down on these microtransactions, aren't they?
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#4
ZoneDymo
"R0H1T said:
Oh wow, what a surprise :rolleyes:

It's a good thing EU is cracking down on these microtransactions, aren't they?
ikr shocking
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#5
jmcslob
At least in most games from Activision you're not paying to win.. You're just paying for extra maps and "digital bling".
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#6
dj-electric
"RejZoR said:
Great, the king of ridiculously overpriced games that never drop in price
That is incredibly, objectively wrong
D3 + RoS exp full price was 40 EUR, discounts just last holiday brought the whole deal to 20. What a horrendously high price, a crime i tell ya!
WoW now indluces all its EXP packs up to Legion, witch was also 50% off just this holiday.
Overwatch base game price is 40 EUR, was 20
SC2 became F2P and includes its first and second EXP packs in

This company needs to shut down
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#7
TheDeeGee
"R0H1T said:
Oh wow, what a surprise :rolleyes:

It's a good thing EU is cracking down on these microtransactions, aren't they?
On Lootboxes, not Microtransactions.
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#8
Eric3988
"Popular titles like Call of Duty: WWII, Overwatch, Destiny 2, Hearthstone, and World of Warcraft", I think I've only purchased on Activision product in the past two years and that was the Necromancer DLC for Diablo 3. Even then I waited until it had a price drop. Activision might get money like crazy from suckers but it won't be from my family.
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#9
CrAsHnBuRnXp
"RejZoR said:
Great, the king of ridiculously overpriced games that never drop in price are now gonna be even more lame because why bother making extraordinary games when all you have to do is to stuff tons of microtransactions crap and you're done. I hope this will backfire on all of companies who shove this garbage into games en mass because idiots buy this virtual nonsense in such huge quantities.
Never drop in price? Maybe on the console side but I always see sales especially from blizz around holidays. I just bought overwatch for $20 around christmas. WoW goes on sale close to around the launch of a new expansion. I see CoD in steam go on sale during Steam holiday sales.
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#11
dozenfury
The keys with microtransactions are that the game itself has to be good, and the transactions should not be of the P2W variety. Make a good game, put cosmetic/fun microtransactions in and people can't get enough of them. And I have no doubts that they are highly profitable. The dev time to make a new armor skin or pet is almost nothing compared to the profit.

But the catch is that you can't take a broken/bad game, put microtransactions in it, and expect it to not get the full wrath it deserves from fans. EA and the broken, laggy, buggy SW BF2 learned these lessons the hard way. Too often companies see dollar signs and forget that they have to cross the hurdle of making a good game that people want to play first. When that happens, a game ends up feeling like an expensive restaurant with terrible food (which btw, also wants you to pay for valet parking). It may be a nice place, but if the food isn't good don't be surprised when no one shows up.
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#12
AsRock
TPU addict
"R0H1T said:
Oh wow, what a surprise :rolleyes:

It's a good thing EU is cracking down on these microtransactions, aren't they?
Thought that was just loot boxes, i know that a bunch of US states are cracking down on loot boxes. How ever as i under stand it is that they will be allowed although they will have to be clearly printed on the box if they contain loot boxes in game. although to me this is far from perfect as most sales are digital and some company's are said to plan to release their games without loot boxes but later add them at a later time. i guess time will tell.
Candy Crush maker King Digital Entertainment, acquired by Activision in 2015, was the strongest performer of 2017 contributing with a little over $2 billion through microtransactions.Candy Crush maker King Digital Entertainment, acquired by Activision in 2015, was the strongest performer of 2017 contributing with a little over $2 billion through microtransactions.Candy Crush maker King Digital Entertainment, acquired by Activision in 2015, was the strongest performer of 2017 contributing with a little over $2 billion through microtransactions.
I wounder if MS got a big Thank You check from them.
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#13
RejZoR
"CrAsHnBuRnXp said:
Never drop in price? Maybe on the console side but I always see sales especially from blizz around holidays. I just bought overwatch for $20 around christmas. WoW goes on sale close to around the launch of a new expansion. I see CoD in steam go on sale during Steam holiday sales.
Call of Duty games are freaking 40 to even 60€ years after they launched (CoD:GHOSTS is still 60€ and it was released in 2013!). Come on. They are still selling Call of Duty 1 and 2 for 20€. That's insanity.

Don't bring in Christmas discounts, those were stupid level discounts for a very limited time. And then they sell it 2x-3x what's really worth through the rest of the year.
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#14
Fourstaff
Easier to justify spending $5 10 times than to justify spending $50 once.
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#15
TheinsanegamerN
"dozenfury said:
The keys with microtransactions are that the game itself has to be good, and the transactions should not be of the P2W variety. Make a good game, put cosmetic/fun microtransactions in and people can't get enough of them. And I have no doubts that they are highly profitable. The dev time to make a new armor skin or pet is almost nothing compared to the profit.

But the catch is that you can't take a broken/bad game, put microtransactions in it, and expect it to not get the full wrath it deserves from fans. EA and the broken, laggy, buggy SW BF2 learned these lessons the hard way. Too often companies see dollar signs and forget that they have to cross the hurdle of making a good game that people want to play first. When that happens, a game ends up feeling like an expensive restaurant with terrible food (which btw, also wants you to pay for valet parking). It may be a nice place, but if the food isn't good don't be surprised when no one shows up.
DID EA learn though? BF2 was still profitable, still sold many millions of copies, even with half baked assets and the micro transaction system abruptly pulled out. UFC came out the same year from EA, chock full of arguably WORSE lootboxes, and nobody made a peep.

EA learned a lesson, but it wasnt that lootboxes need to go away, its that they need to double down on them in slightly less obvious ways, or release a profitable sacrificial lamb (BFII) before releasing additional cash cows into the market.

The lesson game makers are learning is that there are enough suckers willing to pay $120+ for a game for its DLC and pre orders, then pa another 60-80 in microtransactions to make the game not boring. Until that stops, count on more and more lootbox shenanigans, because there are a lot of people out there willing to just throw their wallet at the screen, and it has long been established that your typical person has horrible financial responsibility and will do just about anything for that little rush of dopamine.
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#16
CrAsHnBuRnXp
"RejZoR said:
Call of Duty games are freaking 40 to even 60€ years after they launched (CoD:GHOSTS is still 60€ and it was released in 2013!). Come on. They are still selling Call of Duty 1 and 2 for 20€. That's insanity.

Don't bring in Christmas discounts, those were stupid level discounts for a very limited time. And then they sell it 2x-3x what's really worth through the rest of the year.
Rockstar does the same thing. Most companies do.
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#17
Prince Valiant
"RejZoR said:
Call of Duty games are freaking 40 to even 60€ years after they launched (CoD:GHOSTS is still 60€ and it was released in 2013!). Come on. They are still selling Call of Duty 1 and 2 for 20€. That's insanity.

Don't bring in Christmas discounts, those were stupid level discounts for a very limited time. And then they sell it 2x-3x what's really worth through the rest of the year.
That's what happens when they don't have cost sunk into it.
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#18
RejZoR
"CrAsHnBuRnXp said:
Rockstar does the same thing. Most companies do.
No they don't. It's literally only Activision and Rockstar. I'm not even expecting them to sell their games 90% off 1 year after release, but selling CoD1 for 20€ after 15 years since release date is absolute greedy robbery.
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#19
CrAsHnBuRnXp
"RejZoR said:
No they don't. It's literally only Activision and Rockstar. I'm not even expecting them to sell their games 90% off 1 year after release, but selling CoD1 for 20€ after 15 years since release date is absolute greedy robbery.
Mass Effect came out 10 years ago. It's still $20. ME2 8 years ago, $20. Assassin's Creed 1 and 2, 10 years ago and <10 years ago, both $20.

You obviously dont look at other companies hard enough.
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#20
RejZoR
I don't know, I don't buy or play Ubisoft or EA games.
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#21
CrAsHnBuRnXp
"RejZoR said:
I don't know, I don't buy or play Ubisoft or EA games.
I know you dont. That's why I was proving a point :)
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#23
RejZoR
"CrAsHnBuRnXp said:
I know you dont. That's why I was proving a point :)
Because they are almost universally shit. That's why.
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