(Bloomberg) — Activision Blizzard Inc.’s sequel to the critically acclaimed Overwatch video game launches on Tuesday, providing the US game publisher a boost to an otherwise slow year of new releases.
The changes in Overwatch 2 are more about ways to monetize the free-to-play game rather than the gameplay itself. The original Overwatch, which was released six years ago, remains one of the most celebrated games of all-time — an obsession-worthy hero shooter for all skill levels set in a Utopian, multicultural vision for the future. In both games, two teams of diversely-designed heroes compete to claim objectives by eliminating opponents and team strategy.
For the 60 million people who purchased Overwatch for as much as $60, the new Overwatch 2 is a free upgrade that promises steadier content releases than its predecessor, addressing one of fans’ major complaints. To new players, Overwatch 2 is as charming as it is difficult to put down, and comes at a time when the previous title’s unique spin on the genre has lost its novelty.
“We wanted to broaden the reach of the franchise, and one way to do so is bring down financial barriers to accessing the game,” said Walter Kong, Overwatch general manager. “We also wanted to address the demands of existing players. We had heard for years that content flow is important to engagement. With Overwatch 2, one of our large goals was to make sure our organization could be sustained in the long-term to keep that going.”
Activision Blizzard is counting on Overwatch 2 to buoy dwindling excitement about subsidiary Blizzard Entertainment’s original games and an overall post-pandemic slump in gaming. Introduced in 2016, Overwatch was the developer’s last big release aside from 2022’s Diablo Immortal, a smartphone iteration of its horror role-playing franchise developed with NetEase Inc. Activision’s annual installation in the highly successful Call of Duty franchise comes out Oct. 28, but it will skip 2023, putting pressure on Overwatch 2 to breathe life into the publisher’s anemic calendar. Santa Monica, California-based Activision Blizzard also funds an expensive, international Overwatch League esports franchise that has lost mainstream interest over its four-year lifespan.
Overwatch became a $1 billion franchise within a year of its debut. Hardcore gamers were drawn to its innovative spin on shooter and strategy mechanics. The game’s cast of lovable heroes, ranging from a Swiss medic with angel wings to a Chinese climatologist with an ice blaster, appealed to people who had never touched a digital gun in their lives.
But a steady stream of new content was necessary to keep Overwatch relevant in an increasingly competitive multiplayer gaming space. Although its gameplay loop is uniquely satisfying, players in recent years have said Overwatch’s content release rate was too slow and unpurposeful. Some complained that Blizzard never really delivered a cohesive story for the game.
More of a continuation than a whole new game, Overwatch 2’s innovations include shrinking teams to five from six players and introducing a new competitive mode in the style of tug-of-war. Its most meaningful deviation from the original — cooperative game missions called player-versus-environment — was delayed until sometime next year. In Overwatch 2, some of the story falls by the wayside. Game Director Aaron Keller said it was too hard to to launch the new player-vs.-environment mode simultaneously with the updated competitive mode on top of a commitment to new content.
Overwatch 2 feels less like a sequel than an answer to fans’ requests for a fresher-smelling Overwatch. The original game discontinued service ahead of Overwatch 2’s release, rolling players’ cosmetics and stats into the new version. The new characters are winningly charismatic and riotously fun to play. The new game encourages more action and less standing behind a shield. Most of all, Blizzard says it will be more regularly updated, providing a steadier rate of hype-generating characters, outfits, maps, modes and stories. Players will experience the new content through the game’s “battle pass” — a monetization model popularized by Epic Games Inc.’s smash hit Fortnite in 2017.
The battle pass will allow players to forego paying for the game up front and instead opt into a system — either a free basic version or premium for $10 — that awards them predetermined content for playing a lot or completing challenges. The game launches with three additional characters, but new players will need to play 100 matches before unlocking old characters from the original game, a twist players have griped about online.
“The original game was released as one big box. The majority of the revenue came early on. We want to develop a model that caters to what our players are asking for, which is to continuously be developing new content for the game over a frequent and consistent and long lasting period of time,” said Keller, citing the fact that the team is now working on content that will release in 18 months.
Keeping cosmetic upgrades, such as character weapons or costumes, behind a battle pass could keep players hooked on Overwatch 2 while encouraging them to spend money within the game. It’s unlclear how Overwatch 2’s gameplay will stay balanced if not every player has access to every character from the beginning, however games like Riot Games Inc.’s League of Legends have managed it with more than four times the number of champions.
“If we do a good job with driving engagement, then we can look forward to sustained revenue with that,” Kong said. “It’s going to be our job to make sure that there is enough excitement and enough novelty of content and experience to keep players passionate and engaged.”
It worked for Fortnite. According to analytics firm NewZoo, every time Epic Games releases a new season of content with an accompanying battle pass, “there is a massive increase of (mostly returning) players. We also see an increase in the average daily playtime for the month following a new season release,” said NewZoo analyst Richard Hordijk.
Most top online competitive games are free with some form of paid, opt-in monetization system like a battle pass or loot boxes. It’s emblematic of games’ shift from completed products to “sales platforms,” said David Zendle, a University of York lecturer in computer science who studies video game monetization. Game publishers like Activision pursue predictable revenue. “It’s still possible to make huge amounts of cash from the sale of a game as a product, but you can see how newer approaches–typically associated with live service games–help manage risk and therefore appeal to people investing in the sector.”
Activision Blizzard is in the process of being acquired by Microsoft Corp. for $69 billion. Its latest quarterly earnings report showed sales declined 15% from a year earlier and adjusted earnings per share were almost 50% lower. The company’s main bread-winner, Call of Duty, disappointed fans with the latest release last fall, receiving negative reviews and facing stiff competition from new entries in the popular Halo and Battlefield series. Overwatch 2 has faced its share of hurdles too. Its launch was delayed, to give the team “the extra time they need to deliver the experiences that their communities deserve,” Activision said in its annual report.
There has also been turbulence within the creative team. In the last 18 months, Overwatch lost its previous game director, Jeff Kaplan, as well as a lead character artist, executive producer and lead hero designer. Now, Overwatch has 16 times the number of external developers working on the game than it had on the original development team, according to Keller.
Overwatch 2 gives players what they’ve been asking for: more lovable characters, faster gameplay, another mode, and more cosmetics to gawk over. Blizzard’s strategy to get there is what may prove controversial.
(Updates with release date for next Call of Duty in fifth paragraph)
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