Activision Moves ‘Call of Duty’ Into Digital Subscriptions

Activision Blizzard Inc. (ATVI), the world’s largest video-game maker, is extending its popular “Call of Duty” console-based shooter series into the broader online subscription market.

The game will be introduced Nov. 8 for play on computers, smartphones and consoles, the Santa Monica, California-based company said today in a statement. Consumers can use a free version and purchase premium material.

“Call of Duty Elite” may become a new source of recurring revenue for Activision, which already derives monthly subscription sales from the “World of Warcraft” online series. The online offering will coincide with the release of “Call of Duty: Modern Warfare 3,” a disc-based version sold at retail, the company said.

With the free version, “Call of Duty Elite” players can compete against friends, join groups and play in tournaments while tracking their statistics and performance. A premium membership, to be offered at an unspecified price, will include exclusive entertainment and game content, the company said.

The company likely will offer an $8-a-month subscription to compete with other multiplayer online services, which charge between $5 and $15, Atul Bagga, an analyst with Think Equity LLC in San Francisco, said today in a research note.

The new game could add as much as 6 cents a share to the company’s full-year earnings, Bagga said.

Activision raised its full-year profit forecast earlier this month as it pursues revenue from games sold online.

Profit Forecast

Earnings excluding some items will be 73 cents a share on revenue of $3.95 billion, up from the 70 cents and $3.9 billion estimated previously, the company said.

“Elite” may also boost sales of “Call of Duty: Modern Warfare 3” scheduled for November, said Bagga, who has a “buy” rating on the shares. Choices and decisions players make in the social game will affect the in-game experience for people who buy the retail title.

Activision rose 54 cents, or 4.7 percent, to $11.99 in Nasdaq Stock Market trading. The shares have fallen 3.6 percent this year.

To contact the reporter on this story: Cliff Edwards in San Francisco at cedwards28@bloomberg.net

To contact the editor responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net

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