On February 9, 2021, Ubisoft held its quarterly earnings call. During this call, Ubisoft discussed its business plans for the future. According to Ubisoft’s CFO Frederick Duguet, Ubisoft wants to transition from relying on AAA game releases and instead rely on free-to-play games and its back catalog (previously released games) to turn a profit. Duguet stated, “We [have] said for a number of years that our normal template is to come [up] with either three or four AAA games, so we’ll stick to that plan for fiscal 2022. But we see that we are progressively, continuously moving from a model that used to be only focused on AAA releases to a model where we have a combination of strong releases from AAA and strong back catalog dynamics, but also complementing our program of new releases with free-to-play and other premium experiences.”
Duguet explained that Ubisoft has a number of games in the works. He mentioned Far Cry 6, Rainbow Six Quarantine, Skull & Bones, Riders Republic, the Prince of Persia: Sands of Time remake, and Roller Champions. Duguet also mentioned the Assassin’s Creed mobile game that is in development. Along with Tencent, Ubisoft is developing the game for a Chinese audience.
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Later in the call, Ubisoft’s CEO Yves Guillemot explained that Ubisoft’s back catalog is still bringing in revenue. “We are continuing to move toward an increasingly pronounced recurrence of our revenues on the back of growing audiences. Therefore, we expect our highly-profitable back catalog to account for an even larger share of our business going forward.” The back catalog accounts for 18% of Ubisoft’s sales. Gillemot also stated that Rainbow Six Siege added 15 million new players in the last 12 months, reaching a total of 70 million players since launch.
Prior to announcing their partnership on the Assassin’s Creed mobile game, Ubisoft and Tencent had worked together to produce Might & Magic: Era of Chaos. Later, Tencent purchased a small stake in Ubisoft. This was done to further collaboration between the two companies. Duguet stated the decision to produce an Assassin’s Creed mobile game was due in part to Ubisoft’s interest in producing more free-to-play games, especially for mobile devices. Ubisoft’s mobile strategy is to bring AAA quality games to a mobile audience. At the moment, mobile games account for only a small percentage of Ubisoft’s business.
This transition in Ubisoft’s business model from a AAA games focus to free-to-play games is certainly interesting to consider. Ubisoft has experimented in the past with a games-as-a-service business model. Rainbow Six Siege, For Honor, and The Division are examples of said model. Ubisoft has also produced several free-to-play games such as Brawlhalla and Hyper Scape. Ubisoft’s interest in bringing AAA quality games to mobile devices shows that mobile games is a field that continues to gain the attention of game developers.