Overwatch Mobile has never been officially confirmed, but it's safe to say that it is indeed in development. It was first referenced in 2020, apparently intended to drop at the same time as Overwatch 2. This was then said to have been delayed, but was referenced again by journalist Jason Schreier in his book Play Nice: The Rise, Fall, and Future of Blizzard Entertainment.
Now, we have another report referring to its existence, and it could be bigger in scope than we thought. According to the Korean news outlet MTN (as spotted by VGC), the Overwatch mobile game is being referred to as Overwatch 3 internally.
According to the report, the mobile game was referred to as Overwatch 3 by publishers seeking to get the rights to the title. It's claimed that Nexon won the bidding war and will now publish this Overwatch game in Korea and Japan.
Overwatch Mobile is also described as a MOBA in the report. So, even if this is internally being referred to as Overwatch 3, it probably won't replace Overwatch 2 in that way that Overwatch 2 replaced the original release.
The Overwatch deal is apparently just for regional distribution rights, but this wasn't...