June 18, 2024

With its new free-to-play business plan, Ubisoft is taking on some of gaming’s biggest billion-dollar earners. Can the French games-maker differentiate itself enough to win over players?

Ubisoft's fledgling free-to-play business plan is taking shape 232 | TweakTown.com


Ubisoft’s F2P plan is taking shape. Like competitors Activision-Blizzard, Take-Two, and Electronic Arts, Ubisoft sees the free-to-play market as a way to expand reach of its biggest franchises while monetizing over time. The idea is to diversify IPs with standalone and accessible experiences that can generate long-term revenues via microtransactions. The low-friction, wide availability of F2P means anyone can play, and in-game purchases off potential supplemental earnings to Ubisoft’s core premium titles.

So far the French publisher has four major F2P projects based on best-selling franchises:

  1. Ghost Recon Frontline – (Consoles + PC) Warzone competitor battle royale FPS with 100-player+ action
  2. xDefiant – (Consoles+PC) Class-based 6v6 arena shooter the merges Tom Clancy franchises together
  3. The Division Heartland – (Consoles + PC) Standalone game with a “new perspective on the universe in a new setting”. May possibly tie into The Division games at some point.
  4. The Division Mobile – (Mobile only) Not much is known about the game, but expect third-person shoot-and-loot multiplayer elements straight out of The Division/The Division 2

Read Also: Ubisoft’s new games may change forever, and here’s why

F2P isn’t entirely new for the publisher. Ubisoft has had moderate–if not fleeting–success with its battle royale Hyperscape at launch, but the community has fallen off.

Other F2P games have died off quietly, including 2019’s Tom Clancy’s Elite Squad, a mobile RPG that featured Sam Fisher and other characters.

Can Ubisoft re-capture the market with its established IPs? So far the fan sentiment surrounding games like xDefiant and Ghost Recon Frontline aren’t positive as gamers find these projects to be too similar to existing games on the market (Frontline has been likened to be a Warzone knock-off, for example).

This could be reflective of Ubisoft’s overall investment in F2P, which amounts to roughly 20% of its quarterly earnings. This mix–80% of spending on premium and 20% on F2P–is comparatively lower risk than big-budget games like Ghost Recon Breakpoint, which failed to live up to Ubisoft’s expectations.

Ubisoft CEO Yves Guillemot explains in a Q1’21 earnings call:

“80% of expenses are being used to substantially expand premium offerings in 3 ways,” Guillemot said, outlining the following:

  1. By growing our existing franchises
  2. Creating new IPs with emphasis on player engagement and social interactions
  3. By adding blockbuster entertainment brands to our portfolio

Around 20% of our current investments are targeted at free-to-play to expand our brands’ universes and bring them to a wider audience across all platforms including mobile. Each of these premium and free-to-play projects are built to maximize impact on each respective brands’ universe.”

“We are also convinced of the strategic value of re-investing a portion of our highly-profitable and cash-generating premium core business into free-to-play. This major segment indeed offers exciting growth and value creation opportunities for Ubisoft with an attractive risk-reward profile.”

Ubisoft's fledgling free-to-play business plan is taking shape 43 | TweakTown.com

Mobile gaming currently makes up less than 15% of Ubisoft’s total net bookings revenues (mobile made up 13% of Q1’21’s earnings, and 12% a year before). The company is clearly wanting to change this but not at the expense of its core money-makers like Rainbow Six: Siege, Assassin’s Creed, and The Division.

In summary, Ubisoft’s F2P business model is still new and will likely go through growing pains as it matures. Ubisoft also sees free-to-play as ancillary, supplemental, and secondary to its core premium games focus; F2P won’t overtake big franchises and buy-to-play mainline games, sequels, and releases will still be made and launched worldwide.