ATVI
#So, you're right.
We don't typically provide sales guidance.
But what I can say is, we are extremely excited about Overwatch.
It's an important step for us into a new genre that we think has a ton of potential.
We have seen a very positive response from players.
Over 8 million players have signed up for the beta test.
Since beta, we have been very happy with the viewership interest on Twitch.
Overwatch is every bit a Blizzard game in terms of, I think it exemplifies the design values that we have, it's a ton of fun, it's excellent game play, art style, interface.
And so I think we're bringing a Blizzard take to an already very fun genre.
We're looking forward to launching on PC and consoles, a simultaneous launch this spring.
Like other Blizzard franchises, we have long-term plans to support Overwatch through ongoing content, world-building efforts outside of the game to build the franchise, the IP, and a robust eSports program.
So we have a lot of reasons to be very optimistic that Overwatch will be an important long-term addition to our collection of franchises.
Right.
And then to the second ---+ I guess maybe the first part of your question about China, and how China revenues have moved.
A lot of the growth came over the course of the year by having relatively more games in-market than we've had in the past.
But it was really broad-based performance across the portfolio.
Diablo obviously had a very strong year, HearthStone as well caught online, and the rest of the portfolio.
So it was really the breadth of the portfolio, but it was broad-based performance across the portfolio.
Thanks, <UNK>.
The game has been growing revenues month over month for the last six months in a row.
And we believe that the updates we have planned for 2016 will further improve the game play and the performance.
The updates to come this year are going to include enhancements to the user interface, to onboarding.
The addition of supply drops inspired by the success we've seen with that in our Western products.
eSports features, and social systems that will make our community engagement even stronger, and additional modes and maps and characters as well.
We also continue to work closely with Tencent to bring people into the game, which is critical.
So we remain optimistic about the game's opportunities.
And as we said when we launched the game into beta, it will take time to build the ramp.
And relative to the second part of your question, what's in the guidance, we have a very prudent, I'd say, ramp forward, even though we have great aspirations for the opportunities that we have inside the game.
Thanks.
I'll take the first one, <UNK>.
So as we said, there isn't a significant investment in the eSports individual operating unit initiative or in the other broader media areas.
What we step back and look at is ESPN.
And when you look at ESPN, with 80 million subscribers, and you see the flight of some of those subscribers, and the opportunities that we see there is roughly $5 billion of operating profit there, $4 billion of League payments for the broadcast rights.
And we have 80 million of our own players.
And over a long period of time, we think that watching a video game competition is going to be a tremendous opportunity.
It doesn't require a very big investment today.
It just requires us to have ---+ and in fact, most of the efforts we have are funded by things like organized competition ticket fees.
When you look at what the opportunity is for the future to enhance engagement, to build and strengthen our franchises, to celebrate our players, to provide rewards and recognition for our players, these initiatives are really important for the building of engagement and enhancing the value of our franchises.
I guess to build on that from the investment side, all of our investments start with great people.
We now have great leaders in those businesses to prudently invest behind.
But as we always are, we're being very choiceful in how we invest, and disciplined about the gated investments in those areas.
This year, it's really less than a couple pennies of investment that will go into our new divisions, from an overall company EPS perspective.
And most of that is against the media networks, which is our eSports division that <UNK> was referencing there.
We do have additional eSports investments in some of our business and franchise-level details, like <UNK> and <UNK> alluded to.
But we think those are more around demand generation than anything, and help support the franchises that they cover.
On your other question, <UNK>, around macro environment and competitive aspects, yes, you hit on the obviously Skylanders and Guitar Hero points, where, in the casual segment, on console, there was more competition.
That feels more category-specific.
When we look more across the broad base of our business, we haven't really felt many of the macro trends that are ---+ and volatility we've seen in the overall market really affecting our business.
In fact, many of the digital trends, when you look at our biggest franchises, are stronger than ever.
And in fact, in many regions, even regions that are experiencing some turmoil, like China, we've had a great growth in the past year.
So for us, it's more about delivering great content on cadence, that will be the most important thing for us.
Thanks, <UNK>.
Okay.
Regarding cadence, we definitely have plans for some great new content this year, but we're not quite ready to discuss the timing.
I can confirm that our next expansion will be out in the spring.
As for growth drivers, we've consistently seen strong engagement, pretty much universally globally.
And we plan to continue supporting that with new content for the foreseeable future.
Bringing HearthStone to mobile last year drove a lot of growth, as did releasing a good amount of new content.
We also plan to support the community around social events for the game, such as fireside gatherings and high-profile eSports experiences.
This also drives engagement.
In addition, we'll be looking at geographical expansion opportunities, like we did last year with Japan.
In general, spending does increase around new content.
So we're focusing on providing great experiences with new content, and making careful design decisions to make sure we protect the long-term health of the game.
<UNK>, thanks.
Obviously the digital transition's been a very nice tailwind for us over the past several years.
And really, front-line console games are the final part of that transition.
But it's only really part of the equation.
As we mentioned in the call, in <UNK>'s remarks and my remarks, the add-on content and services, which is purchases effectively after the initial sale, are really increasingly more important ---+ or as important, and are growing incredibly fast.
And is one of the fastest parts of our digital portfolio.
To your question, though, on front-line titles, it really varies by title.
So for games like Destiny, had in the high-20s in terms of digital downloads, in terms of overall volume.
For Call of Duty, just based on the size of the player base, full-game downloads were a lower share than that, although on an absolute basis, full-game downloads were up over 80% year over year.
So very nice progress over there.
We know, when we look at the Blizzard side of our portfolio on the PC, the vast majority of those front-line games are delivered digitally.
Obviously that brings margin benefits for us, as each new game gets delivered through digital channels brings us gross margin benefits.
And you'll see that in our overall corporate margin.
We were at 32% this year, and with currency effects, or excluding the currency effects, it would have been north of 34%.
So overall, we think that trend is going to continue on the console side, particularly on the front side.
And it will be a nice tailwind for us for 2016 and beyond.
It is, <UNK>.
The vast majority of what we create are zeros and ones.
And when you look out over 500 million people in the network, you're going to see, for the first time, we really have the opportunity to sell our products in virtually every country in the world, on every type of device, whether it's a mobile device or desktop device or a console.
So the most important thing for us is engagements across our communities.
And then the opportunities for delivering player investment follow from there.
All right, thank you.
Well, we appreciate the time today, and we look forward to talking to you on our Q1 conference call in the spring.
