It’s amazing how much of that optimistic, innocent charm has worn off over time.

"And yet, if you talk to long-time players, the same complaints seem to crop up as much now as they did a year ago. Balance patches are considered poorly handled."

Fast forward to 2018. Overwatch is more than just a pretty cinematic trailer or closed beta test. It’s played by tens of million of people. The game forms the foundation of a successful e-Sports league, one that’s relatively young but viewed by a myriad of people on Twitch, Disney, ESPN, YouTube, and so on. In fact, that same league has expanded to include eight new teams, each buying in for millions of dollars. It’s not enough to say that Overwatch has changed – Blizzard’s handling of it has also undergone changes in line with the game’s growth.

And yet, if you talk to long-time players, the same complaints seem to crop up as much now as they did a year ago. Balance patches are considered poorly handled. Players point to the dominance of heroes like Mercy, Sombra, Hanzo, Brigitte and many more as prime examples of how some balance passes overwhelmingly render a hero “meta” as soon as they go live. Certain metas have also become the bane of players’ existence with triple-support and triple-tank being the most recent.

When director Jeff Kaplan and his team do implement changes, they’re met with some range of skepticism at to the overall goal. Look no further than the recent Public Test Realm patch which nerfs armour (crucial to all tanks), D.Va (the bane of hitscan players) and Brigitte (a steady armour supplier) while simultaneously buffing Reaper to have more life sustain. It’s not all that different from when Tracer’s Pulse Bomb was nerfed at the same time Brigitte was first introduced, the latter serving as a hard counter for the former.

"However, there’s still no denying that in terms of monetization, Overwatch is a bit of an anomaly."

This isn’t even taking into account all the problem with Competitive Play. Overwatch League may represent the game’s pinnacle form in terms of team play, strategy and meta comps but the actual ranked ladder mode is a mess. Leavers, throwers, one-tricks, lack of role-queue, skewed matchmaking, abusive players, private profiles – you name it and Competitive Play has developed a reputation for the same. Toxicity in online games is nothing new but when the key gateway to how the game should be played at the highest level is plagued with these issues for such a long period of time, something’s gotta give.

It’s not like Overwatch is dying or anything. Sure, Blizzard hasn’t really delivered much in the way of new content for its seasonal events (aside from new cosmetics in loot boxes). But it’s still offered new heroes and maps, completely free of charge. With loot boxes seemingly being clamped down on throughout the industry, where does Overwatch go from here in terms of monetization? Blizzard itself is looking at costing costs, as recent reports by Kotaku’s Jason Schreier have indicated, and it may not be long before an Overwatch mobile game releases to rake in some more cash. Then there’s the Overwatch League skins which require direct purchasing for league skins.

However, there’s still no denying that in terms of monetization, Overwatch is a bit of an anomaly. One could look at its loot box system and criticize it as a sham or borderline gambling. Compared to games like Call of Duty: Black Ops 4, published by Blizzard’s partner Activision, Overwatch still seems fairly tame. While Treyarch does quite a bit to update Black Ops 4, making its latest Specialist free, adding map new sections to Blackout and offering numerous fixes, weapon balance changes and so on, it’s interesting to look at the content created and the amount of monetization avenues present in the game. There’s the base game price, Call of Duty Points (purchasable with real money), Special Orders (purchasable with COD Points), Tier Skips (though free skips are offered on a daily basis) and a Season Pass with additional content.

"Where does it go from here? How can it grow further, at least from an investor’s point of view?"

In comparison, Overwatch has two sources of on-going monetization: Loot boxes and League skins. You may see the odd Pink Mercy skin which can be purchased directly with real money but those proceeds went towards cancer research.

The point of all this is that Overwatch, judging by the current state of several core features, the growing demands of its e-Sports league and the limited number of monetization sources, seems to be in somewhat of a stagnant position. Where does it go from here? How can it grow further, at least from an investor’s point of view?

As Wedbush Securities analyst Michael Pachter predicted in a recent GamesIndustry.biz feature, free to play might be the answer. This comes in the wake of the Overwatch League expanding to include eight new teams for a total of 20 in Season 2. Pachter feels that team owners “have been assured by Blizzard that it will expand the audience for Overwatch. The most expedient way to do this is to make the core game free-to-play in order to attract tens of millions of new users, who ostensibly will convert to OWL viewers.”

Pachter expects this change to go live in mid-June. Those who put down money for the game are likely to be consoled with exclusive skins and other cosmetics, as per the analyst. Now, Pachter does get two key details wrong in his prediction – the current number of OWL teams and the anniversary date of the original game which was in May 2016, not mid-June. There’s also no guarantee that this happens – in a separate prediction, Pachter talks about The Elder Scrolls 6 launching in 2019 while simultaneously pointing out that he predicted a release in 2016 and 2017.

"So from an investor point of view, why not make the game free-to-play? It would inject a ton of new blood into the experience."

Still, the reasoning behind Overwatch going free to play seems sound. If not in the coming months, then at some point in the long-term.

Think about it – the development team at Blizzard is currently working on new maps, new heroes, new features (like a match viewer within the game client), balance patches, bug fixes, new modes, seasonal events (even if 2018’s events supplied largely the same content we’ve seen before), map changes and adjustments, hero reworks, cinematics, comics, new cosmetics, new voicelines, new Overwatch League cosmetics and much, much more. It’s also doing a lot behind the scenes, managing the production of Overwatch League and ensuring the game’s continued smooth running. When servers face issues, Blizzard is very quick to answer. Game-breaking bugs are hit or miss but some of the worst offending bugs – like the recent spawn issues in Blizzard World – were addressed very quickly.

So from an investor point of view, why not make the game free-to-play? It would inject a ton of new blood into the experience. The promise of rewards for veteran players would entice them to come back as well. The real obstacle is monetization. Yes, this provides a pretty good incentive to remove loot boxes and their random RNG in favour of direct purchases. It also probably incentivizes the current hot trend of Battle Passes, allowing players to pay some money each season and earn a range of new cosmetics with each tier gained. Heck, Blizzard could pull an Activision and have both – a Battle Pass that provides guaranteed cosmetics upon leveling up and RNG drops from loot boxes. Double the leveling, double the fun?

"If Overwatch went free to play and adopted new monetization models for a more consistent stream of revenue, it seems a given that more resources would be required for its development."

In a way, this would also solve the issue of how to add new heroes. Said heroes could be tied to the Battle Pass and earned at level 1, much like Zero from Black Ops 4. The key issue to keep in mind is that the Battle Pass for Black Ops 4 is free and so was Zero by extension. Will players, especially those who have already paid $40 to $60 for Overwatch besides some cash on cosmetics per seasonal event, put down money on a regular basis for new heroes? Free to play players might not mind all that much but it does raise balance and competitive concerns for the future. Imagine a purchasable hero that gets buffed and only those who own it can benefit. This could lead to accusations of Blizzard trying to buff certain heroes to incentivize spending on them.

There are a number of different ways for Blizzard to handle the monetization of new heroes. Current owners could continue receiving them for free but must pay for Battle Passes to obtain new content (and of course the potential in-game store would have cosmetics that can only be directly purchased). New players would have the base roster as it currently exists but can pay to receive all future heroes (similar to how Paladins handles its roster) while plonking down money for new Battle Passes.

If Overwatch went free to play and adopted new monetization models for a more consistent stream of revenue, it seems a given that more resources would be required for its development. At the very least, we’d have to see more new content during seasonal events to entice players to spend. We’d need to see more cosmetics being produced. There will be more cross-promotion with Overwatch League, though such an approach hasn’t seemingly harmed Valve’s Dota 2 as the success of The International shows.

"There’s no doubt that some executives at Activision-Blizzard would love to see Overwatch grow even further. However, what about the player base?"

All in all, Blizzard will be investing money to make more money. Or it could only slightly adjust its current development schedule at the outset. Balance patches could remain as spaced out as they are now. Key features like role-queue and hero-banning may continue to be ignored. The development team may catch some flak initially but it’s all part of adjusting things around while profits increase.

There’s no doubt that some executives at Activision-Blizzard would love to see Overwatch grow even further with regards to revenue and profits. Free to play would be a pretty good change in that regard. But how would the player base feel? Many players since launch have lauded Blizzard’s approach to content and providing free heroes, maps and modes at no additional cost. These aren’t players who are hyper-competitive and obsess over balance changes but those who hop on for a quick few matches per day (if not per week). Would they be comfortable with this approach? Would they like to see Overwatch pursue a Fortnite-esque model, offering more avenues to directly purchase cosmetics that they want? It’s hard to say. If anything, they may continue plugging away at the game, taking their free cosmetics here and there while continuing to enjoy the gameplay.

If Overwatch ever does go free to play, Blizzard has the unenviable task of drawing in new players with its development model and new progression systems while catering to older players who simply want to continue enjoying what they love. It’s a tight rope to walk but there’s also no denying that something has to change, sooner or later. Blizzard can continue chugging along with its current content delivery model and remain as popular as ever with its current fan base.

It could also take a number of risks that may not even pan out in the long run. Something’s gotta give though because in today’s games-as-a-service obsessed industry, Overwatch may quickly find itself struggling to remain relevant outside of its e-Sports ambitions.

Note: The views expressed in this article are those of the author and do not necessarily represent the views of, and should not be attributed to, GamingBolt as an organization.

Whenever the Electronic Entertainment Expo ends, we often wonder what next year could hold purely based on the absences of the current year. When Sony revealed that it wouldn’t have a PlayStation Experience to round out 2018, all eyes were on their E3 2019 presser to answer any lingering doubts. However, the company recently announced that it wouldn’t hold an E3 presser next year, making it the first time it’s ever skipped the expo in 24 years.

Not only that, but it wouldn’t hold an off-site event similar to Electronic Arts’ EA Play either. In an official statement to Game Informer, Sony said it wanted to “innovate, think differently and experiment with new ways to delight gamers”. It further added that it was “exploring new and familiar ways to engage our community in 2019”, which it couldn’t wait to share (in due time, we imagine).

What other reason could there be for Sony’s absence though? According to Wedbush Securities analyst Michael Pachter, it may simply boil down to the lack of new things to announce. “It is because of the timing of new games. They just don’t have a lot of new things to announce in June. I think it’s a mistake to skip the show. They will probably be there without a big booth. It was a surprise to me,” he said to GamingBolt.

Sony still has a decent slate of PS4 exclusives to talk about, including Ghost of Tsushima, Dreams, Death Stranding and The Last of Us: Part 2. It wouldn’t be impossible that a different event is held at some other time of the year, not unlike its post-E3 presentation where it revealed the PS4 Pro. Still, we’ll have to wait and see what “new and familiar” ways Sony has in mind when it comes to showcasing its wares.

Rockstar Games’ Red Dead Online, the multiplayer component for Red Dead Redemption 2, has big shoes to fill. With the success that the developer has had with Grand Theft Auto Online, it’s a given that it wants Red Dead Online to repeat the same success. But how much revenue does it potentially stand to gain?

Though predicting how many monthly active users it could have is tough, Wedbush Securities analyst Michael Pachter expects at least $10 per yearly active user in terms of revenue. Speaking to GameSpot, he said, “I think RDR Online will certainly be successful. Revenues from GTA Online peaked at around $125 million in the December quarter, and are still around $100 million per quarter through three quarters this year, so GTA Online is annualizing around $400 – 500 million per year five years after it initially launched.”

“I doubt that RDR Online will generate [as much revenue per user as GTA Online], but think that $10 per user per year is likely (similar to what we see from Hearthstone, Overwatch, League of Legends and Fortnite).”

If Red Dead Redemption 2 sells 20-25 million copies in its first few months with a good 10-15 million users engaged with Red Dead Online, that could work out to $150 million per year. But considering how much Grand Theft Auto Online brings in, shouldn’t Pachter’s own estimate for yearly active user spending be slightly higher?

He notes, “My skepticism is clearly uninformed, as they may make this the best online experience of all, but I think that the setting makes success at that level less likely. Nothing wrong with the old West, but it isn’t as compelling as riding your helicopter to your nuclear bomb facility that was funded from your meth lab.”

Regardless of whether players find Red Dead Online more appealing than GTA Online or not, there’s tons of hype for it (and, of course, for Red Dead Redemption 2). Rockstar hasn’t revealed its monetization model just yet, but the assumption is that Red Dead Online will adopt the same model is GTA Online. It could end up completely different though, for all we know.

Red Dead Redemption 2 is out on October 26th for Xbox One and PS4. Red Dead Online will launch as a public beta for those who own the base game in November.

If you haven’t heard, the PS4 has been dominating the global console market. It’s sold more than 70 million consoles worldwide, had perhaps the best exclusives line-up this year next to Nintendo and is poised to have an even bigger 2018 with titles like God of War, Days Gone, Spider-Man and Detroit: Become Human. And those are just the games we know of.

However, what about the Xbox One which has a number of titles like State of Decay, Crackdown 3 and Sea of Thieves? Will that be enough against the mighty Nintendo and Sony? GamingBolt spoke to Wedbush Securities analyst Michael Pachter about the same and he believes that there’s “too much emphasis on exclusives” sometimes.

“I think this late in the console cycle, I mean, the consoles launched in 2013, who doesn’t own one of them yet? Sony is something like 70 million, and Microsoft is 35 million, so I guess they are two thirds of the way through. The only people who haven’t bought a console yet who will buy one are working people, or very young kid whose parents will get one for them. And, I guess, exclusives will bring some people back in who haven’t played Mario in a while, to the Switch, which is still new. But not something like Halo 6 – if you like Halo, you got an Xbox One for Halo 5.

“Halo 6 will definitely sell a lot to its fan base who already own an Xbox One, but it’s not gonna drive new hardware sales, it’s very different this late in the console cycle. So the reason I think the Switch is so popular is that they launched two giant games with Zelda and Mario, plus two really good games with Mario Kart and Splatoon. And that’s enough for Nintendo fans to say ‘I have to have this device,’ which is why the Switch is sold out…”

That being said, Pachter didn’t underestimate the importance of an exclusive like Halo to Microsoft’s roster. “To answer your question, yes, any Microsoft lineup with Halo in it is better than any Microsoft lineup without Halo. But, for example, if they had had Halo this year, I would still have said Nintendo wins by a mile. Mario and Zelda in the same year? I can’t remember that happening, ever. This year Nintendo won by a mile, but I can’t expect them to to do that next year.

“Next year, Microsoft with Halo coming out, I think it’s coming out, looks strong. And, Sony’s lineup looks fine, I mean their lineup over the next several years looks good. But I don’t think either their line-up or Microsoft’s makes a difference anymore, people have already made their minds up, and it was probably driven by, ‘If I want early access to Call of Duty DLC, I’ll buy a PlayStation.'”

Pachter raises a good point – the majority of consumers who purchased a PS4 did so on the basis of third party timed exclusive DLC like Call of Duty and Destiny, exclusive access to franchises like God of War, and the Sony brand as a whole (especially considering how badly Microsoft damaged the Xbox One out of the gate in 2013). While Nintendo will make its mark in the long run, it’s going to come down to what’s special about the Switch along with the games it has rather than either factor alone, at least in my opinion.

What are your thoughts on the matter though? Let us know in the comments.

Microsoft’s Xbox Game Pass is currently available for Xbox Insider members and will be out this Spring, allowing Xbox One players to access over 100 games at the monthly price of $10.

However, this doesn’t mean it will hit Netflix levels of success anytime soon. Or ever, according to Wedbush Securities analyst Michael Pachter on the latest episode of the Pachter Factor.

“Netflix has 93 million users as of the last earnings report, they’re probably going to be at 100 million by mid-year, there’s no chance Microsoft get anywhere near that. This isn’t the beginning of Netflix style programs, Gamefly was the beginning of Netflix style programs.

“Gamefly was exactly what Netflix was in 2006, DVD’s by mail. The price was a lot higher, twenty bucks and I don’t know their numbers today, but the last published thing I saw they had not got to 1 million customers paying twenty bucks a month. It’s a hard model to make work, and Gamefly had every game. The point is they had new games and even they can’t get a lot of traction at $20 a month.”

We’ll have to wait and see how it ultimately pans out but what are your thoughts on Pachter’s opinions? Let us know below.

If there’s one thing that most gamers can agree on it, it’s the universal hype for Half Life 3. It currently exists in a flux state of existing and not existing, as Valve Software itself is unsure what to do with the game. So what is Managing Director of Equity Research at Wedbush Securities Michael Pachter’s opinion on the game’s delay? Is it too focused on free to play titles like Dota 2 and its digital service Steam to care about crafting another single-player epic like Half Life 3?

According to Pachter, “I think Valve is a brilliant company, and I think – they won’t do this, but I think it would be brilliant of them – that they release Half Life 3, and they make it exclusive to Steam Machine, because that would sell 10 million Steam Machines right there. So, I don’t know what they’re doing, but it’s possible they’re doing something just like that. I mean, they could put it out on PC and sell 15 million copies just like that, but I do wonder if part of the delay involved is somehow tying it in with the Steam Machine.”

As for the current direction of the Steam Machines, especially since Valve hasn’t been able to deliver a concise message thus far, Pachter said, “It’s very expensive. And there’s really not any justification to buy one, unless you’re an uber hardcore PC gamer, and you have a very strong desire to play in your living room, and you’re somehow not technologically capable or inclined to connect your PC to your TV, because if anyone really wants to, they can just use their TV as a monitor, and just play their PC games on the TV that way. But I will say, the way that Steam Machine sells and gets content is for Valve to create that content, and the best content they have is Half Life 3, I think.”

Valve has said time and time again that it won’t be creating exclusive titles for the Steam Machine/SteamOS. Could that change down the line? Let us know what you think in the comments.

The Xbox One may have had a troubled history before its launch – with DRM issues, criticism of its indie development policy and so much more – but the console has slowly come in to its own since then. The removal of Don Mattrick and appointment of Microsoft Games Studios head Phil Spencer as boss of the Xbox division has indicated as much and the company is touting some major announcements for E3. But will that be enough considering the lead the PS4 has?

GamingBolt spoke to Managing Director of Equity Research at Wedbush Securities Michael Pachter about the same, and barring a price cut and Kinect, would Microsoft be able to bounce back considering the weak first party content it had near the end of the Xbox 360’s run (especially compared to the PS3 which had The Last of Us, Puppeteer, etc.)?

Pachter stated that, “Well, I mean, it’s funny when you say they have the weakest first party, because Uncharted, and inFamous, and The Last of Us, I would bet you if you took a single version of those three games, they don’t add up to Halo. And I would say if you take the next three games made by Sony’s first party studios, they won’t add up to Gears of War. So, I agree with you in the sense that the number of titles Sony has is more, but I think in terms of sales, it’s much closer, and might actually tilt in Microsoft’s favor.

“So, I don’t think you should make too much of an argument about how weak Microsoft’s first party content is, because most of Sony’s first party games that are successful are not gigantic sellers. I think that ultimately, for the Xbox One to be successful, the Kinect has to be decoupled from it, and I think that might be hard, because there’s a lot of stuff going on with the hardware where it’s all integrated, and it might not work.

“But I think that you will probably get in 2015 a redesigned Xbox One that has no Kinect, and I think what will accelerate that process is if Sony cuts the PS4’s price: if there is a $349 PS4 on the market, Microsoft has a real problem. They’re gonna have to do something, and they’ll have to do it really quickly. I think that in 2015, you might see a $349 PS4, and an uncoupled Xbox One, and if you see both of those for $349, the consumer wins, and they will both sell very well. Microsoft is not looking to lose this cycle.”

There have been rumours about Microsoft considering an Xbox One without Kinect, but a price drop for the PS4 a little more than a year after its launch? There’s no denying it’d be a big enough threat for Microsoft, but will it actually? Let us know what you think of Pachter’s views in the comments.

While Managing Director of Equity Research at Wedbush Securities Michael Pachter is known for his numerous views, one of his more well known gripes in the best few months has been with PlayStation Now. Then again, remember the so-called “power of the Cloud” that Microsoft touted with the Xbox One?

Following his criticisms of PlayStation Now, which is Cloud based, what are Pachter’s thoughts on the Xbox One’s Azure servers which were touted as being able to enhance the console’s games? Will the Xbox One’s Cloud help the system stand on even footing with the PS4 in terms of power and visuals?

Pachter stated that, “I don’t know. I think it’s funny, I think the distinction between these two consoles in terms of power is really a headline than it is a practical matter. It’s not like anybody says ‘oh, I can play the game side by side, and the PS4 game plays better.’

“I mean, maybe it looks better, or that’s what some people say, but they generally run at the same speed, so I don’t really understand how people say one looks better than the other, I don’t believe them, and I know everybody loves to say that they can tell, but I am sure that the average customer can’t. So I don’t think it will make any difference at all, and I don’t think Microsoft is going to try to bring in the ‘power of the cloud’ to make up for anything.

“It’s an interesting issue, really, once you move to the cloud, and it’s going to be one with PS Now as well. Once you move to the cloud, all that you need is a file, a client, in your disc drive or resident on your console…but you don’t need the console at all. So, why can’t you just put the client on your FireTV from Amazon, and just play the games there?

“So, I think the console manufacturers are going to have to tread very carefully with cloud computing, because it kind of makes their machines obsolete. I mean, if we’re just working in the cloud and streaming a file, we don’t care what box it’s on, it’s just a file that’s operating on a server somewhere.

“So as you go in that direction, can’t you see Activision getting all excited, you know saying, let’s just get rid of consoles and quit paying margin to Microsoft or Sony or Gamestop, and have you play Call of Duty in the cloud? So I think that’s one of the risks with this overarching strategy of cloud gaming, it’s an issue with Microsoft’s emphasis on the cloud, and with Sony’s PS Now. They run the risk of making their consoles obsolete.”

But this seems to be direction that most consoles are going, what with talk about the last generation of consoles and what not. Wouldn’t it make sense to achieve this with Cloud gaming?

Pachter replied, “But why would you need Microsoft for that? Why would you need Sony? Maybe you need Google, or Yahoo, or Amazon. I mean, I think that part of the thought process behind FireTV and potentially an Amazon smartphone, is that Amazon has invested tens of billions in Amazon Web Services, and they would love to be the cloud solution for everyone for everything, and then Microsoft loses. And Microsoft won’t like that. So, I think it’s in Microsoft and Sony’s best interest to try to keep consoles alive.”

Do you agree with Pachter’s views? Let us know in the comments below.

This is just a snippet of our interview with Michael Pachter and we will have more soon.

“EA presents a different challenge from Zynga, with over 4x the revenue and significantly higher profitability, and we think that the company is largely on the right track already. We were surprised that Mr. Mattrick took the Zynga job. We believed that the larger company presented a more prestigious opportunity.

“Now that Mr. Mattrick has taken the job at Zynga, EA is back to square one in its search. We believe that the company will find few qualified candidates outside the company, and will ultimately choose between the top two internal candidates, COO Peter Moore and EVP Frank Gibeau. Both men are capable of running EA, in our opinion, and investors would respond favorably to either being appointed.”

As for how Mattrick will fit in at Zynga, Pachter stated that, “Mr. Mattrick has the skills and experience required to manage a large organization, and we believe he will right-size Zynga staffing levels in order to allow the company to become profitable almost immediately.”