Activision Blizzard Made $4 Billion in 2017 Through Microtransactions Alone
Video game publisher Activision Blizzard made around $7 billion in revenue over the year 2017. While that is a lot of money, and definitely a leg up from last year's numbers, the most impressive thing about all this is that more than half of its income came straight from microtransactions.
According to the company's financial results for the year of 2017, it earned $7.16 billion during the year of 2017, a financial gain from 2016's $6.60 billion. In addition to that, over $1 billion of those earnings came from microtransactions over the last quarter, while 2017 as a whole generated $4 billion from microtransactions.
"Activision Blizzard delivered a fourth-quarter record of over $1 billion of in-game net bookings, and an annual record of over $4 billion of in-game net bookings," they wrote in the report.
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Industry analyst Daniel Ahmad also had some input on the matter saying that, out of the reported $4 billion, only about half of those came from mobile game developer King, which Activision acquired in 2016, and its popular "Candy Crush" series of puzzle games for the platform.
"It's worth noting that around $2 billion of that is indeed from King's mobile games such as Candy Crush," Ahmad Tweeted. "But that still leaves another $2 billion from console and PC games add on content."
As Ahmad pointed out, more than a quarter of Activision Blizzard's earnings for the past year came from in-game microtransactions for the PC and console market. This includes anything like downloadable content (DLC), loot boxes, and any other purchase that uses real world money. It should be noted that several of Blizzard's most popular games, such as "Overwatch," "Hearthstone," and "World of Warcraft," all contain some form of microtransactions that helped generate this number.
Despite how controversial the topic of loot boxes and microtransactions is, especially when you consider the whole fiasco with EA and "Battlefront II" that happened this past year, it is hard to argue at how effective they are. Even if only a small percentage of players openly engage and participate in the practice of microtransactions, they are still able to generate a hefty sum of income. Back in 2016, it was reported that 48 percent of the income in the mobile games industry was generated by less than one percent of all players, so even if the masses find it unsavory, it only takes a small portion of the crowd to turn a profit.
