NCSoft talks about guild wars and business models

I think this is on topic enough to be in this forum, but if it's not, I apologize.

Anyhow, I ran across this article on /. some of you may find it interesting

http://www.next-gen.biz/index.php?op...1&limitstart=0

-Diomedes

People proclaiming Guild Wars a business failure?


http://www.grimwell.com/phpbb/viewtopic.php?t=2066&

I like how they all just throw out numbers without any theory or proof on how they got them...are they making these numbers up?

if you would've read the thread you would see a link to ncsoft's website:
http://www.ncsoft.com/eng/nccompany/..._data_list.asp
click on the link "Fair Disclosure"

I don't get it, the article I posted certainly doesn't call guild wars a business failure, can you put a little context into your link? I'm not following you.

-Diomedes

I find it amusing to think that they claim that they'd need 5 times the sales to remain competitive with profits. They aren't running a shared world really, the instancing should reduce costs substantially. Interesting stuff though, I'm hoping they can capture a market.

* Subject: World wide progress of Guild Wars

1. U.S and Europe:
- Date of official launch: April 28th, 2005
- Number of accounts activated to date: around 650,000

2. Korea:
- Date of official launch: May 25th, 2005
- Number of license sold to date: around 27,000

I find their choice of wording curious. "accounts activated" implies actual people who signed up, while "license sold to date" implies copies that were purchased but never activated.

I find that an interesting claim too, but if it's true, I think it probably speak to the fact that other MMORPGs are overpriced.

Here's the deal (as I see it). Firms can run on zero profit, that is, as long as all their costs (including worker salary) are covered, they can have no extra cash sitting around and be fine.

Investors on the other hand, do care about profit (since they typically extract a portion of the profit stream). Hence if after we pay everyone for the good job they did and pay the servers, we have $100 bucks left over, we give part of that to the investors.

Thus projects like WoW make investors happy since they see large profits while the firm itself is fine either way. Because investors help direct business patterns, I'm sure it took a lot of convincing that while the investors might get a smaller return, if the model caught on it would reshape the market and possibly nab more market share for NCsoft hence increasing profits.

Anyhow, I wish that they had gone into a bit more detail.

-Diomedes

I think this quote sums up Guild Wars pretty well.

I like the OP article link ... it definately shows the cutting edge profile that NCSOFT wants to portray. The sceond article shouldn't be open to discusion ... relatively you should compare last months figures to this months in Korea. Everywhere else had 1 month extra which ... as we know ... lets the ripple our word of mouth spread farther.

Another comparison may be to the initial sales of GW to the intial sales of WoW in the first 100 day period.

GW america & Europe are only at there 80 day period
GW Korea is only at their 53ish day marker

http://www.blizzard.com/press/031705-worldwide.shtml

Notice how they dont give numbers for Korea here either ... but they do for North America and Europe

Interesting stuff. Cheers to Anet and NCsoft for taking risks and I'll keep playing Guild Wars because I think they've made a great game.

Well it seems to me, a MMORPG can keep profitable for years with the same subscriber base as well as a steady influx of people. GW on the other hand doesn't have the monthy subscription fees coming in and many people who have bought the game while it's new and hot (having great reviews and such) have already played through the game. So you gotta wonder in the months ahead are they going to have decent sales figures as the initial rush.

I'm sure they will get another boost in sales right before they release the expansion.

I seriously hope Anet and NCsoft succeeds in their little "business model". Because, if it is found that this model is profitable, other companies will have to remain competetive and adopt something at least closer to the NCsoft business model. Thus creating less and less pay-to-play games and more games that are free per month. Because people won't pay for games monthly when they can get something similar for only the price on the box

Whenever businesses compete, comsumers win

Pay-to-Play MMOs will never be without a cost. Even MMOs without monthly fees have something in-game you can pay for. The money isn't going nowhere, it's going towards content, servers, and... More content.

More free games like GW doesn't mean direct competition with MMOs.

GW isn't an MMO. It's an online RPG.
WoW isn't an online RPG. It's an MMO.

You'll get more free games with public lobbies if other companies decide to follow suite but nothing with as much content, variety, and as many players as an MMO. Stop thinking GW is in the same league as the Pay-to-Play MMOs.

Also, I'm pretty sure those numbers aren't going to get too high before it starts to go down. Plus, I know a lot of people with multiple accounts.

As an online RPG, it's doing great but I doubt it's anything compared to an MMO and as such, it probably won't dissuade developers to switch from MMOs to a GW type game.

In the second post, whoever did those amazing calculations to figure out exactly how Arenanet intends to support Guild Wars and what aspirations they have, should seriously take back what they said.

Actually, the wording is different because accounts are handled differently in the US/Europe and Korea. In the US and Europe, you buy the box and then you get to create 4 characters. In Korea, what happens is NCsoft sells a license to an establishment, like an internet cafe. That cafe then allows players to create characters for a fee. That's also why it's inaccurate to call GW a flop in Korea, because 27,000 licenses translates to a heck of alot of subscribers.

I think we should all check out the sales of Dungeon Siege 2 next month. That will be a better comparision than Lineage 1/2, EQ 1/2, or WoW, since DS2 is also an online RPG and not an MMO. DS2 doesn't have the operating costs that GW has, but it's target audience is the same Diablo style fans.

As a side note, the networking structure ANet has created can be utilized in new IP's or perhaps even licensed out like a graphics engine to other dev studio's. Not exactly guranteed money, but ways to stretch the value of the dev dollars already spent.

Why did I know that it was SirBruce posting this crap in every forum he could find again...

I think he must be a disgruntled ex-Anet or current Blizzard employee, he certainly has no financial wits about him.

the numbers for korea is very very misleading! cause i read that second posters link and lineage sold 19,000 licenses and from that 900,000 accounts where created from that. And now you have guild wars with 27,000 licenses!?! that's a heck of alot of accounts that could be created! how else does everyone think korea can hold the HOH for half the time??? this game is very skill based i find once everyone makes it to endgame with the character they have.

Having read the article, all I can say is that CEO is probably so wrong on so many counts. His strategy in GW is as a counter to other MMORPGs, that is... he is saying outright, directly, yes, our GW is the free non monthly subscription equivalent of games like (insert your own list here).

In reality?

Plenty of nerf bats, screwed economy, inhibition of trade, yada yada... Plenty of players are 2 months into the game and probably about to call it quits.

It is a great game, but I doubt NCSoft's plans to hold this big user base they have captured might work out to fruitation ultimately...