Wedbush analyst Michael Pachter has stated his belief that Activision could very well offer its planned Call of Duty premium content for free, in an attempt to make it harder for its competitors to muscle in on the franchise’s success.
While he acknowledges that not all of the content delivered by the mysterious Project Beachhead “will be offered for free”, it’s entirely posible that it could act as a “loss leader” to “drive ever-increasing sales of each annual Call of Duty instalment” thus creating “a more formidable barrier to entry by its competitors”.
Project Beachhead was announced in Activision’s recent 2010 fourth-quarter earnings report with plans to deliver “a best-in-class online community, exclusive content and a suite of services for our Call of Duty fans to supercharge the online gaming experience like never before”.
“We have long believed that Activision would begin to offer a premium multiplayer experience for its Call of Duty brand, beginning early in 2011,” Pachter said. “With the company’s recent announcement of Project Beachhead, it acknowledged that such a premium service is in the works, but details about pricing were not provided.
“Given the surprising strength of each successive version of Call of Duty over the last few years, we now think it is possible that Activision will use its premium service as a loss leader, providing the service for free to create a more formidable barrier to entry by its competitors; we think it is possible that Project Beachhead will incorporate ‘must have’ features that will serve to drive ever-increasing sales of each annual Call of Duty instalment, encouraging all of the multiplayer consumers to purchase the next version on launch date.”
“As such,” Pachter added, “we think it is possible that Activision will not charge for multiplayer, provided that the company believes it can sustain sales of Call of Duty at the 20 million unit level annually.”
“We do not believe that every feature of Project Beachhead will be offered for free, but it is clear to us from the company’s statements early in February that it considers Call of Duty a crown jewel in the Activision portfolio that is to be protected at all costs, and equally clear that competitor Electronic Arts intends to capture some market share with this year’s version of Battlefield Bad Company.”
In short, it seems that nobody still has idea any idea as to what Project Beachhead is.
