The Elder Scrolls Online

[Paelos]

They can't insulate themselves from damage to the brand though, particularly because many gamers don't know that this is being made by some new studio and not the team that made Skyrim.

Meh, I disagree. This isn't going to stop me from buying the next real ES game. Nor will it deter people who watch these kinds of things. And after this whole crapfest fails, you can bet every dollar in your bank account that Besthesda and it's parent group will go well out of their way to market the next game as a completely different studio with that classic feel. Like Coke Classic instead of New Coke.

Elder Scrolls Classic.

EDIT: I'd start the rebranding now, and release the MMO as "Tamriel Online" to further distance myself from the project and the Elder Scrolls brand name.

[Venkman]

And after this whole crapfest fails, you can bet every dollar in your bank account that Besthesda and it's parent group will go well out of their way to market the next game as a completely different studio with that classic feel. Like Coke Classic instead of New Coke.

But that's the whole problem.

Nobody greenlit ESO as some side project to the ongoing ES world. The level of investment makes this the ES experience. Until they can't save the PR angle or they (miraculously) bring the game to a level that makes it worthy of being the ES experience, there is no other ES game, because that would dilute the brand messaging. They can't un-call this ESO without severely damaging the potential of something they're hoping to continually monetize.

Yes ES V can be marketed completely separately. But they can't avoid damage to the brand at this point.

None of this may matter to the end users. But I'm quite sure there's brand or marketing people sweating this point (assuming they understand the utter failure this leaked video and PAX coverage has delivered).

[UnSub]

Around studio damage: the real question is about how much money has been poured into TESO. Skyrim made buckets of cash, but video game history indicates that it can only take one flop to cripple a studio and a few flops to cripple a publisher.

[Venkman]

There's Bethesda, but then there's Zenimax. The latter stands to lose, but the former would be experience little more than a hiccup.

[Paelos]

None of this may matter to the end users.

I think the general consensus would be that it wouldn't matter. They would just have to show videos of the combat in a newer game and you'd immediately know the difference.

This isn't even like a situation with Bioware where they release several disappointing games in a row in addition to a vastly under performing MMO. They set up a silo specifically because they saw this as a gamble.

[Phred]

some beta forum leaks

http://www.abload.de/img/teso-leakscopyn4a5w.png

So where's the raging and dissatisfaction? Reading that it seems most beta testers actually like the game.

[Nebu]

So where's the raging and dissatisfaction? Reading that it seems most beta testers actually like the game.

Did you miss all the comments on linear quests that don't really make sense or being called a hero for killing crabs and rats?

There is an undertone of disappointment in quite a few posts. 

[Hoax]

some beta forum leaks

http://www.abload.de/img/teso-leakscopyn4a5w.png

So where's the raging and dissatisfaction? Reading that it seems most beta testers actually like the game.

Are you completely ignorant of how beta official forums work this early on? Usually its just a giant love fest of wanking about how great the special game that those special people are there to test. Those posts sounded like they were planning to attend a funeral compared to the usual dev-fellating you see from closed betas.

[Paelos]

"I'm disappointed, but I'm quite hopeful because it's still in beta"
"Overall, the game has a ways to go, and has potential"
"Questing is pretty dreadfully boring and linear...It felt soooooooo unimportant."
"I was using the same weapon and 1-2 skills for 4 hours when I started"
"The graphics were pretty sad...this feels like a single player game with bad graphics and lots of other people running around, getting in the way."
"Combat is not as in depth as many other MMOs I've played...everything here just fells underwhelming and lackluster. Combat seems to have noticeable input delay."
"Quests are not fun."
"How is this an MMO? An MMO is meant to encourage interaction with players. The only interaction I've even had was chatting in /zone about the beta."
"I can't state with any authority that characters are getting shoe-horned into a trinity system, but it seems that way early on...It feels like a typical class system from other MMOs, foreign to TES"
"Melee combat seems underpowered"
"I feel there is a lot of promise in the combat, and a lot I would change about how combat works."
"Voice work is very spotty right now, but I suspect that will get better with time."
"I played a Sorcerer and it just felt so much nicer having that slight lock on for ranged attacks."

[Lakov_Sanite]

The absolute best is that people still think a game will change in any meaningful way from beta to release.

[Paelos]

The only question in my mind is will this be a WAR type of failure where they bleed out 75% of their users in 6 months, or an APB level of failure where they crash and burn in the first 3 months and have to shut the thing down.

[Malakili]

The only question in my mind is will this be a WAR type of failure where they bleed out 75% of their users in 6 months, or an APB level of failure where they crash and burn in the first 3 months and have to shut the thing down.

Almost certainly the former if I had to put money on it.  That is practically *the* formula for MMOs post launch in the last say, 5-7 years, and I don't see anything here that leads me to believe this will be any different.

[Paelos]

The only reason I consider the APB route for this is because the Parent company may want to completely dump the project after a quarter of bad sales, press, and red ink. They have the power to shut down Zenimax Online without their consent, and without really any consequences. Zenimax Online doesn't control any other IP or development at all.

[Goreschach]

APB got shutdown because the creator folded. I doubt Zenimax would shut down TESO after 3 months just because of poor sales.

[Rendakor]

Poor sales is not the only concern; massive negative feedback damaging the ES brand is the other. If TESO isn't making them money hats and risks fucking things up for ES 5, I could see them shutting it down.

[Falconeer]

I think it's a great thing for them that this video leaked. Sure, they can't change enough to make it a great game, but they could have the reality check they have been fanatically avoiding and start putting band-aids where they are needed the most. I also think this thing could turn out fun, eventually, after the initial burning disappointment and a few months of corrective Hartsman-like big patches. But yes, the bad word-of-mouth has officially started and this is the kind of 'mark of infamy' that will probably never go away.

[Goreschach]

Poor sales is not the only concern; massive negative feedback damaging the ES brand is the other. If TESO isn't making them money hats and risks fucking things up for ES 5, I could see them shutting it down.

Maybe before launch, but three months later that damage is already done. Assuming the game has enough income to pay for operational expenses, the best thing to do at that point would be to just let it bumble along and recoup as much of the development expense as possible.

[Paelos]

They have 250 employees on payroll right now. Making some assumptions about their average salary, that's probably $15M a year in payroll before you get to other operating costs.

Assuming they get WAR like numbers and sustain an average subscriber base of 300,000 for 6 months, you generate $25M in revenue. Plus you generate the box revenue. At that point, you have to make a decision. Do you keep this thing rolling if your subs look like they are going to crater down to the 100-200k range? Or do you take your box/early sub windfall of $60M, realize that your cash flow will never match up to more than a few million in profit at best for running the thing, and walk away to avoid the PR hit?

[Goreschach]

They have 250 employees on payroll right now. Making some assumptions about their average salary, that's probably $15M a year in payroll before you get to other operating costs.

They aren't going to have 250 employees after launch. Most of those people will either be layed off or put on a new project.

[Paelos]

Note that we haven't even discussed stability issues or bugs at launch. We're going purely off the idea that the game is a bait-and-switch of the TES name alone.

[Ingmar]

Poor sales is not the only concern; massive negative feedback damaging the ES brand is the other. If TESO isn't making them money hats and risks fucking things up for ES 5, I could see them shutting it down.

How many bad FF games did it take for people to slow down buying FF games? This won't meaningfully affect the ES brand at all. If the next single player game is bad, then you have an issue.

[Ingmar]

They have 250 employees on payroll right now. Making some assumptions about their average salary, that's probably $15M a year in payroll before you get to other operating costs.

Assuming they get WAR like numbers and sustain an average subscriber base of 300,000 for 6 months, you generate $25M in revenue. Plus you generate the box revenue. At that point, you have to make a decision. Do you keep this thing rolling if your subs look like they are going to crater down to the 100-200k range? Or do you take your box/early sub windfall of $60M, realize that your cash flow will never match up to more than a few million in profit at best for running the thing, and walk away to avoid the PR hit?

Shutting the game down 3 months in would be a far worse PR hit than *anything* else that they could have happen. Far from avoiding the PR hit, they'd be worsening it. If they fail, they'll transition to F2P. The road map for success doing that is clearly there, with several examples.

[Paelos]

I think you could spin it both ways. You could see it as a completely meltdown disaster, or you could spin it as a company committed to excellence and having a product that didn't live up to that standard.

I believe that a slow burn into F2P creates more dissatisfaction than it solves, simply because it brings into question the amount of resources committed to a failing game that should be put on another iteration.

[Fabricated]

Technically SWTOR is actually rather profitable now as a F2P title.

[Paelos]

Technically SWTOR is actually rather profitable now as a F2P title.

I agree, but we have no idea if they've moved into the black after all the initial outlay, which many had estimated in the $300M territory.

[Dark_MadMax]

Money wise they could break even I dont know. Heck it could be that SWTOR is after all reasonably profitable.   If there is anything I ever learned about games is that good ones are often net losses (magic carpet, thief, TSW)  and  mediocre ones are becoming milking cows for big publishers (halo , COD,SWTOR)

[Ingmar]

Whenever I see insider people talking about SWTOR, they always say it is doing VERY WELL WINK WINK WINK which I take to mean they're raking it in with the new model.

[Malakili]

Whenever I see insider people talking about SWTOR, they always say it is doing VERY WELL WINK WINK WINK which I take to mean they're raking it in with the new model.

Its a great model for games with shrinking player bases because it is precisely the people who stick around in such a situation that are willing to spend far in excess of the 15 bucks a month they are/were paying.  Free to Play ends up meaning Free to Pay as much as you want for the hardcore of any particular game, which was a previously untapped revenue source. 

[Hoax]

So what will suck the most? TESO, NWN or DAOC2? I really can't decide they all seem to be developed so poorly.

Its a fucked up world where FFXIV might end up being the best game of that bunch.

[Goreschach]

Technically SWTOR is actually rather profitable now as a F2P title.

I agree, but we have no idea if they've moved into the black after all the initial outlay, which many had estimated in the $300M territory.

That's irrelevent in terms of sunken costs. All that money blown on SWTOR/TESO is already gone. Determining whether to can TESO is purely a comparison of expected costs beyond this point to expected profits.

[Paelos]

It's relevent in planning/estimating for the next title, which is the whole point of this exercise.

More to the point, EA operated SWTOR as part of the Bioware library. They couldn't just shut the thing down for PR reasons, and for reason that they could absorb the loss.

TESO has already been set apart from the parent and the brand developer. It's operating in a different set of circumstances.

[Goreschach]

The next Bethesda title? As many people have pointed out, it really isn't.

[Paelos]

There's tax positions and productivity positions to consider beyond just the sunk cost. Obviously if you put something in it's own subsidiary, you are making the actual P/L line easy to distinguish from the rest of your operations. Even if the game can turn a small profit yearly, there may not be a reason to keep it going. It depends on how many people it takes to keep that product turning a profit, and if those people could be used in Bethesda if they shut down the game.

Also, there could be a tax advantage to taking a loss on shutting down operations if you have any major capitalized assets involved in those sunk costs. That loss could then be used to offset income as the consolidated level.

[Merusk]

So what will suck the most? TESO, NWN or DAOC2? I really can't decide they all seem to be developed so poorly.

Its a fucked up world where FFXIV might end up being the best game of that bunch.

NWN isn't NWN.. it's just "Neverwinter."  I expect it's exactly where PWI wants it to be, it doesn't have the marketing or dev budget of a AAA title.  It's a fantasy game pushed out using the Champs engine with some (overly expensive) digital goods you can buy with their proprietary cash. 

It doesn't seem to be marketing itself as a WoW-killer or the next big thing.  "Just another fantasy game"

[Venkman]

There's tax positions and productivity positions to consider beyond just the sunk cost. Obviously if you put something in it's own subsidiary, you are making the actual P/L line easy to distinguish from the rest of your operations. Even if the game can turn a small profit yearly, there may not be a reason to keep it going. It depends on how many people it takes to keep that product turning a profit, and if those people could be used in Bethesda if they shut down the game.

This. EA is a public company, and it's not like they could pull a Chapter 7 or 11 on just one game. Doesn't work like that financially.

There is the various line items associated with purchasing Elevation Partners. There's the line items associated with the post-purchase capital investments made to support SWTOR (and ME, and DA, and Saboteur maybe), themselves probably split between one-time creative costs, one-time platform development costs, ongoing O&M, payments against guild rate cards, royalties in and out, etc. All of those might still be associated with SWTOR but I doubt it. Instead they probably roll up into however they organize such reporting against the balance sheet.

Because of this, whatever was put into building the thing is probably no longer associated with whatever it's costing to run it. Going from development to live is a lot  more involved than just switching to a smaller team.

More than likely, they've long since separated the sunk costs associated with the subs-based game from the ongoing costs of the live-F2P one. This way, the subs-based version of the game isn't a bookkeeping drag on the F2P one, with those prior costs rolled up under depreciation and amortization somewhere.

As such, my guess is there's an financial model somewhere that literally does present SWTOR as a revenue-positive, possibly even profitable business.

Which is good on them that they could keep it going.