In offering further evidence to the fact that corporate greed has absolutely ruined the Western video game industry, Warner Bros. Discovery has sadly confirmed that four of the most beloved franchises under their control – Game of Thrones, Harry Potter, Mortal Kombat, and the entirety of the DC multiverse – will be used to carry the company’s previously announced plans to pivot their operations away from single-player experiences and towards microtransaction-heavy live-service and free-to-play releases.
This tacit confirmation that the chances for each respective IP to receive another (or in the case of Game of Thrones its first) quality video game entry had been reduced to near zero was provided by WBD gaming division boss J.B. Perrette during a March 4th conference call appearance made as part of the 2024 Morgan Stanley Technology, Media and Telecom Conference.
Amidst a larger discussion regarding WBD’s overall streaming and gaming operations, Perrette was eventually asked by Morgan Stanley stock analyst Benjamin Swinburne if he could “talk a little bit about how you guys leverage that business into growing the company?”, to which the executive replied by providing a lengthy insight into his company’s upcoming video game-related plans.
“We think it’s a meaningful differentiator for us,” began Perrette. “We see the world, and whether it be VR devices, the Vision Pro, the virtual world – look, who knows exactly how it evolves, but those types of platform are only going to increase in scale and adoption, and having 11 owned studios, where we’re obviously not just a publisher of games, but we’re actually a developer of games, is a differentiated asset for us.”
Turning to the business side of their digital operations, the executive then asserted, “Today, the majority of our business revolves around four main forms of IP and games, which are all billion dollar plus businesses themselves, which are Mortal Kombat, Game of Thrones, Harry Potter – obviously with our success of Hogwarts Legacy last year, it was the best selling game in the world last year – and the DC world – and DC obviously has sub-segments underneath there, with Batman being one of the biggest.”
“Those are the four that make up the majority of our business,” he continued. “The challenge we’ve had is our business there historically, has been very Triple-AAA console based.”
“That’s a great business when you have a hit like [Hogwarts Legacy] it makes the year look amazing,” said Perrette, “and when you don’t have a release or when we unfortunately have disappointments – we released Suicide Squad [Kill the Jusice League] this quarter which was not as strong – it just makes it very volatile.”
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Returning to the original question’s topic of just how his division could help grow WBD as a whole, the executive declared, “We think the opportunity for us – again, this is a multi-year because games are a long-cycle business too – but the opportunity is to take those four franchises and be able to develop a much more holistic approach, particularly around expanding into the mobile and multi platform free-to-play space, which could give us a better and more consistent set of revenue.”
“You’ll see us launching later this year some mobile free to play games which we hope will start building that,” he detailed.
In addition to this pivot away from the traditional video game release model, Perrette also affirmed that the second part of WBD’s video-game-growth-plan involved a greater emphasis on “live-service” titles.
“So rather than just launching a one-and done console game, how do we develop a game around, for example, Hogwarts Legacy or Harry Potter that is live-service, where people can kind of come and work and live and build and play in that world in an ongoing basis,” explained Perrette of this aspect of their plan. “We think we’ve got the franchises, we’ve got some of the greatest studio capabilities, and we have a roadmap and strategic business plan to try and build out that business and we think there is meaningful growth in the course of the next couple years.”
As noted above, this is not the first time WBD has made clear their intent to shift away from providing players with quality experiences in favor of nickel-and-diming them.
Speaking to attendees of the company’s Q3 2023 earnings call, CEO David Zaslav informed investors that the focus of their video game operations was “on transforming our biggest franchises from largely console and PC based with three-four year release schedules to include more always on gameplay through live services, multiplatform and free-to-play extensions with the goal to have more players spending more time on more platforms.”
“Ultimately we want to drive engagement and monetization of longer cycles and at higher levels,” said Zaslav. “We have put specific capabilities. We are currently under scale and see significant opportunity to generate greater post purchase revenue.”
