“Marvel’s Avengers” is running out of time to stage a comeback.

Why it matters: Launched last September with high expectations, “Avengers” was the stuff of game execs’ dreams — globally popular franchise + top development studio + live-service business model focused on players remaining engaged long-term. So its failure is all the more cautionary.

• Sales figures aren’t public, but publisher Square Enix reported losses of tens of millions of dollars in its gaming division in the quarters following “Avengers’” release.
• The game isn’t popular. On PC service Steam, for example, its low average player count can’t get it into the platform’s top 100 games.

State of play: Today, the game is getting a new free downloadable expansion called “War for Wakanda” that adds Black Panther, a new region and new missions, all as a hope to revive interest. (Disclosure: A close friend helped write the expansion, but we haven’t discussed it.)

• These kinds of post-release additions are usually meant to make a hit game more popular.
• For “Avengers,” which industry analyst David Gibson estimates cost its publisher around $200 million, the needed boost is more dire.

Between the lines: The game’s problems are myriad, according to Forbes gaming reporter Paul Tassi, who tells Axios he’s logged 300 hours in it.

• There are the disappointing post-release offerings, which have trickled out modes and characters on a schedule impacted by the pandemic and California wildfires near lead studio Crystal Dynamics.
• But there are more fundamental problems, Tassi said: A good story mode and enjoyable combat system are undermined by an “interminable grind” in the so-called endgame.
• Games like “Avengers” often hook players with the chance to unlock “loot,” or gear, that makes their character better and cooler to look at. But Tassi notes the loot in "Avengers" doesn’t appear on your character, reducing the appeal of the hunt.

What’s next: Square Enix was able to at least briefly boost player counts by offering the game for free last month, suggesting a shift in business models that focuses on paid add-ons could entice more players.

The newest version of legendary gaming company Atari is in the red for the year, reporting a loss of €5.2 million ($6 million) for the past year.

Why it matters: The current Atari announced an eyebrow-raising restructuring this spring, and signs of success are still a long way off.

• The company says its drop in annual revenues came in part from a 45% decline in licensing revenue blamed on the COVID-19 pandemic as well as a “slowdown in the video game division.”

Between the lines: As of April, Atari said it’s focusing on two approaches: a gaming division and a division to sell Atari goods via blockchain.

• On the gaming front, it now sells a new version of the Atari VCS system, is planning an early 2022 release of a new version of the classic Atari game “Food Fight” and says it will release more of its classics on major game consoles.
• Its blockchain business involves support for an Atari Token cryptocurrency and the sale of NFTs, which it says have grossed $1 million.
• Defending the Atari trademark is its own viable revenue stream, netting the company $2.8 million in cash settlements over the past three years, the company notes.

The Atari that is doing all this is a distant relation from the classic American company of the 1970s and '80s that produced “Pong,” “Asteroids” and “Missile Command.”

• Numerous buyouts, bankruptcies and brand handovers have led to the current Atari, headquartered in France.

What’s next: Atari turns 50 next year.

A government watchdog group in Singapore is investigating “claims of sexual harassment and workplace discrimination” at Ubisoft’s studio in that country, The Straits Times reports.

Why it matters: It's another flashpoint in a yearlong reckoning underway at the global studios of Paris-headquartered Ubisoft.

• The Tripartite Alliance for Fair and Progressive Employment Practices received an anonymous report about issues at the studio July 23, according to the report.
• That followed a two-part Kotaku investigation into problems at the studio, including the mistreatment of workers and pay gaps between local developers and those from abroad.
• Since July 28, around 1,000 current and former Ubisoft workers, including from Ubisoft Singapore, have signed an open letter calling on company management to take more effective action against misconduct.

What they're saying: "We are aware of the feedback sent to TAFEP," a Ubisoft rep told Axios. "As our discussions with them are ongoing, we do not have anything we can share at this stage."

• "Every Ubisoft studio, including Ubisoft Singapore, strives to create and foster a culture that team members and partners can be proud of," they added.

Today in Reporter's Notebook, a segment in which we share previously unpublished interview excerpts, I get into game software sizes.

In the future, Xbox players may be able to switch seamlessly from playing a game off a console hard drive to the cloud, if they need to clear up storage space, Xbox executive Sarah Bond recently told Axios.

Why it matters: File sizes for games are exploding, exceeding 100GB on consoles that may only have about nine times that much space.

• That leaves avid gamers — or those who want to download and play lots of the titles offered on Xbox Game Pass —spending a lot of time deleting games to make room for others.

What she’s saying: “We are not having conversations with partners about file size,” Bond said, when we asked if Microsoft is asking partners to not overstuff players' hard drives.

• “What we are thinking about is how we use the power of the cloud integrated with local devices in order to take that problem away from you.”
• Microsoft is working on “cloud-aware APIs” to support the transition from playing a game locally to playing it through streaming, a trade-off of resolution or other performance factors with clearing up some space.
• “The games are just going to get bigger and bigger and bigger,” Bond said. The cloud — Microsoft’s tech of choice — could be the answer.

💰Roblox is growing, but not growing enough, according to investors. It reported 46.6 million daily active users in July, up 28% from July 2020. But with the stock price dropping, capitalism says that is insufficient.

🎮“Rainbow Six Siege” has a new operator, or special forces character, who has a bulletproof shield. One line of her bio indicates she is trans, PC Gamer notes. Ubisoft’s popular multiplayer shooter game has been assembling an increasingly diverse cast.

🤷‍♂️The makers of "Outriders" say they've received no royalties for the game, despite it posting big player numbers this spring and earning praise from publisher Square Enix. They're inferring it hasn't made a profit, but say they don't know the game's actual sales figures.

🕵🏾‍♀️"Fortnite" has introduced a new mode called Impostors that involves players trying to complete assigned tasks while also trying to figure out — and vote out — those among them who are actually impostors. In other words: they've copied Innersloth's hit game "Among Us." A rep for Innersloth tells Axios "we would have loved to collab and found out about it the same time as everyone else. "

"Dev Reveals Exploitative Nature of Most Game Contracts" [John Walker, Kotaku]

"But perhaps most surprising was a section declaring that should the developer be found in breach of the contract — something Jake explains is too ambiguously defined — then they would lose all rights to their game, receive no revenue from its sales, have to repay all the money they received, and pay for all further development costs to see the game completed. And here again there was no upper limit on what those costs could be."

A new version of classic puzzle game “Myst” will be out Aug. 26 for Xbox, PC and Mac (with support for VR).

• The developers at Cyan Worlds promise “new art, new sound, reimagined interactions and even optional puzzle randomization."