More NC's MMO based on GW business model says Richard Garriott !

[ynot]

Richard Garriott, the Executive Producer for Tabula Rasa at NCSoft, contacted GuildWarsGuru.com's Billiard tonight in order to clarify a small matter for Guild Wars players:

    A note to Guild Wars players from Richard Garriott

    Recently, I was surprised to see a quote attributed to me describing the Guild Wars episodic sales model as a "failed experiment." Obviously, that is not true. Guild Wars is NCsoft - North America's flagship product in terms of both number of customers and total profit and thus by any measure is a resounding success. I personally am a big fan of the game and an admirer of the ArenaNet team that has taken many risks in creating an innovative product and a successful new business model for MMOs. In fact, the Guild Wars business model has been so successful that we are pursuing more products with this same model.

[schild]

It doesn't actually say it made money... "Successful" is such a fuzzy term.

[MahrinSkel]

Did you miss the part in there where it said "total profit"?  I'm leary of the GuildWars business model for a couple of reasons (it requires the kind of access to the retail channel that an independant can't hope to get, and it's always only one failed expansion away from going into the red), but what's interesting here is that Lord British had to do damage control on this one personally.

--Dave

[Nebu]

I apparently know nothing.  I thought that Lineage 2 or CoH/CoV was their flagship product. I would have never guessed GW.

[ynot]

In 2006 we cant really say that CoX was so much of a flag ship GW generated about twice CoX income.
GW as flagship for europe is not an non sens imo.

As far ar GW is concerned they are not that far from being "profitable" but  imo delays and dev strats in 2005 crippled them.

[Secundo]

Did you miss the part in there where it said "total profit"? ...snip

--Dave

I take it you are neither involved in marketing or financial decisions then?  "Total profit" is fuzzy enough to mean whatever they want it to mean.. basically to us it means it is a useless statement.

I don't claim to have any valid figures regarding NCSoft or any of their games but as a consumer with a somewhat functioning brain I chose to draw my own conclusions. GW was certainly successful game but for it to superceed CoX in "total" profit I would have to assume an accounting error of some kind.

edit: I love the fud about access to retail channels etc. we need more of that shit to create drama.

[Trippy]

I apparently know nothing.  I thought that Lineage 2 or CoH/CoV was their flagship product. I would have never guessed GW.

He said North America so that's correct. For the US and Europe combined Lineage II has 105K subscribers, CoX has around 154K, and GW has 3 million+ accounts activated. In terms of sales revenue GW did about double that of CoX in 2006.

[Trippy]

Did you miss the part in there where it said "total profit"? ...snip

I take it you are neither involved in marketing or financial decisions then?  "Total profit" is fuzzy enough to mean whatever they want it to mean.. basically to us it means it is a useless statement.

I don't claim to have any valid figures regarding NCSoft or any of their games but as a consumer with a somewhat functioning brain I chose to draw my own conclusions. GW was certainly successful game but for it to superceed CoX in "total" profit I would have to assume an accounting error of some kind.

edit: I love the fud about access to retail channels etc. we need more of that shit to create drama.

NCsoft puts out detailed information about its games on a quarterly basis. You can find the latest one here:

http://www.ncsoft.com/fileupdown/upload/EN_NCIREarningRelease/064Qearnigs(ENG).zip

Unfortunately it's not quite detailed enough to verify Garriott's claim that GW is NCsoft Interactive's (NCsoft's NA division) most profitable game. Cryptic Studios, the developer of CoX, is not owned by NCsoft, unlike ArenaNet which is 100% owned. So the money CoX makes is split between Cryptic and NCsoft and NCsoft doesn't specify what that split is in their quarterly report. GW did have roughly double the sales of CoX in 2006 so it would make sense that it was NCsoft Interactive's most profitable game. On the other hand both NC Interactive and ArenaNet reported net losses for 2006 and they don't break out profit/loss by game so by "total profit" he could really be saying "lost less money than Auto Assault".

Edit: typos

[Secundo]

Trippy, I see your point. Yes it is very hard to draw any conclusions on how exactly NCSoft makes their money, especially if you are only interested in the north american/European market section. But I still believe there is a big difference between a succesful monthly subscription based game like CoX and a game that gets it's revenue solely from box sales like GW. Yes I know this doesnt add much except that it is my belief that CoX plays much more of a cornerstone role in NCSofts finances than GW ever will. Or does. It's just my opinion.

That said, long live CoX! (except it's grind).

[pxib]

So does this mean all the money Guild Wars is supposed to be losing is just accounting funny business so that NCSoft can claim a loss and lower their taxes?

[Trippy]

So does this mean all the money Guild Wars is supposed to be losing is just accounting funny business so that NCSoft can claim a loss and lower their taxes?

Yes it could be. We don't know how they split up the money GW makes between NCsoft Interactive, ArenaNet and the parent NCsoft.

[ynot]

"it could be" but When do you assess an eventuality you have to evaluate its plausibility, would it make sens to search loss claim on nearly all there international branches at the moment ? Don't you think that the main concern for NC atm is to show that the can control there expense and restore there profit margin (margin that was divided by more than 2 in 3 years).


edit: I mean I understand that you can pretty much change the way benefice or loss are share between dev and distrib (Anet / NCi & NCuk) but I this that this would make sens if you actually had some branches making good money and you wanted to dilute that a bit, wouldn't it? The cost of A.net has been consistent over the last 3 years.
I agree that It "could be" but I'm so far convinced that it is not the case.

[eldaec]

Guild Wars, in one form or another, has had shelf space in the retail stores around here since launch.

So it certainly has a regular income.

I suspect Guild Wars is also much cheaper to support and develop than most MMOGs. How many genuinely new systems have ever been added to GW? The game needs a few artists for new zones and designers for new combat abilties, but very little programming talent.

They aren't running about adding crafting, or housing, or entirely new advancement systems every 12 months.

I can certainly imagine more games with business models based on...

1) Develop functionality once and then add content almost entirely in the art and design layers.
2) Keep the box on the retail shelves 11 months of the year.

[Trippy]

Guild Wars, in one form or another, has had shelf space in the retail stores around here since launch.

So it certainly has a regular income.

I suspect Guild Wars is also much cheaper to support and develop than most MMOGs. How many genuinely new systems have ever been added to GW? The game needs a few artists for new zones and designers for new combat abilties, but very little programming talent.

They aren't running about adding crafting, or housing, or entirely new advancement systems every 12 months.

I can certainly imagine more games with business models based on...

1) Develop functionality once and then add content almost entirely in the art and design layers.
2) Keep the box on the retail shelves 11 months of the year.

Content creation is what is really expensive. Having one or two programmers create a new system is cheap in comparison as long as there isn't a dependency on lots of art assets and other such game content which gets back to the point that it's the content that's the budget killer.

[ynot]

off topic:
It's a bit scary that NC is delocalising the content creation teams to china, do you think that is will be a general trend in the years to come for other major players?

[Trippy]

off topic:
It's a bit scary that NC is delocalising the content creation teams to china, do you think that is will be a general trend in the years to come for other major players?

Yes it will. Many are already there and the rest will be following in time.

[Jayce]

Let us not forget that GW is essentially the same business model as Diablo, or even Battle.Net in general.  The only difference is that you can't play GW offline (can you?)

Blizzard seemed to like that model just fine for many years.

[eldaec]

Let us not forget that GW is essentially the same business model as Diablo, or even Battle.Net in general.  The only difference is that you can't play GW offline (can you?)

The key difference was, for whatever reason, Diablo didn't keep it's shelf space.

I suspect retail shelf space is the real reason expansions exist for any MMOG.

This is also a big part of why MMOG publishers are more willing to give away the base game with expansions, selling CoV, or recent GW expansions as a stand alone box makes it easier to hold on to shelf space.

[Trippy]

Let us not forget that GW is essentially the same business model as Diablo, or even Battle.Net in general.  The only difference is that you can't play GW offline (can you?)

The key difference was, for whatever reason, Diablo didn't keep it's shelf space.

That's cause Diable II came out which is still on store shelves.

[Simond]

...and once Diablo 3 is released, Arena.net had better have GW2 nearly ready to go otherwise their playerbase will shrink quite drastically.

Hmm, I wonder how many ex-Blizzard North people wish they'd stuck with Blizz nowadays?

[MrHat]

Let us not forget that GW is essentially the same business model as Diablo, or even Battle.Net in general.  The only difference is that you can't play GW offline (can you?)

The key difference was, for whatever reason, Diablo didn't keep it's shelf space.

That's cause Diable II came out which is still on store shelves.

Also, the Diablo Battlechest takes enough space for 3!

Didn't Garriott get robbed or something this week?

Edit: They took all his liquor.

[WindupAtheist]

I mugged Lord British and looted his crown.  He kept yelling for "gaurds" instead of "guards" so the cop walking by didn't do anything.  What a newb.

[ynot]

Idk about getting robbed but the same Richard did say "Business approaches should vary depending on the game, but a subscription model is still well suited for vast, long-lasting games that require significant resources to produce and maintain." to the palmbeachpost on an article posted this weekend

[Modern Angel]

I'm more interested in this original quote. It strikes me that he said something he shouldn't have and then the suits told his ass to run some damage control. The retards at gwonline are already screaming bloody murder over GW2 possibly being a sub model. I like GW in small spurts but if GW2 goes sub I think there's going to be nerd rage of a level seldom seen. Guild Wars has morphed from "that balanced PvP-centric" game to "that free" game. That's why people play it now.

[ynot]

As far at the first quote is concerned I was told that we will be able to fully gets its meaning after and announcement coming out this week...

So I'm now relatively convinced that GW2 will not be using a sub model (although several investor have been crying for some change in the model almost ever since GW was released).

[DataGod]

off topic:
It's a bit scary that NC is delocalising the content creation teams to china, do you think that is will be a general trend in the years to come for other major players?

Hmmm lets see:
You have a country producing about 4-6x our number of comp sci, digital media graduates per year than the US, significantly more skilled, and oftentimes with a better work ethic. The rate of pay (including benifits, wages, taxes, healthcare) is about 1/15th of the US.

This large pool is the creame of the employable crop, supply outstrips demand, in 5-10 years China will be innovating new SW programs as well as offshore development teams.

Add to this that assets are not required to be localized, no in fact at GDC I saw like 4-5 asset aggregation services on the expo floor. So you have:
1) Faster
2) Easier
3) Cheaper
4) Aggregated Services
5) Not bound by geography

Its not a matter of IF but WHEN, China is currently ramping up, what they have a problem with now (according to a friend who is a PM in Shanghai) is thier CS/Digital Media students thinking "creatively outside the box", they are graduating students with skills equal or superior to US grads. But it takes them 2-3 years of additional OJT  to "apply the thoerems in creative ways" as it were. This is not different than the US, but apply 1-5 listed above and you can see the value of spending 1m on 10 US hires or 1m on 75 Hires in China.

If your worried about job displacement I'd recommend Project Management Certifacation and 2-3 courses in Mandarin at your local College.

[waylander]

I dumped WoW because I couldn't keep the sort of hours my friends were, and have gone back to GW because:

1. Its Free
2. I can play solo when I want to
3. I can feel like I'm progressing playing casually

That said, I dislike the linear plotline and being channel fucked through the game. Its like MMO dungeon siege, and you have limited freedom.

That said, maybe they can make GW2 and actually have more ranked forms of PVP and not make PVE so predictable. They have sold a few million copies of the game, so that's success in my book.

[Venkman]

I was surprised to learn here that ArenaNet hadn't been outsourcing to China all this time. To Trippy's point, content creation can be the most expensive part of a game. However, if the game system is already done, and the rules for creating new content for that system established, then that's the perfect recipe to outsourcing to a land with much lower wages. I had thought that was the only way they were still afloat: Western revenue with Southeast Asian expenses.

[Trippy]

I was surprised to learn here that ArenaNet hadn't been outsourcing to China all this time. To Trippy's point, content creation can be the most expensive part of a game. However, if the game system is already done, and the rules for creating new content for that system established, then that's the perfect recipe to outsourcing to a land with much lower wages. I had thought that was the only way they were still afloat: Western revenue with Southeast Asian expenses.

That's actually the wrong way to do it since the quality will drop precipitously. Better to get the China people involved from the start. If you've seen the quality of content in Chinese online games you know that overall it's much lower than Korean or the top US standards. That's not because the artists are crap but because they work in an environment that focuses on getting content made as quickly and as cheaply as possible, stifling whatever creativity these people may have. It's basically a sweatshop environment for cranking out game content. If you have a team of them, removed from the sweatshop environment, working on content from the beginning you can train them up to produce content at the quality you need.

[Trippy]

I had thought that was the only way they were still afloat: Western revenue with Southeast Asian expenses.

One small correction: Shanghai and Beijing are the centers for game development in China, neither of which are considered "Southeast Asia".

[Lum]

Arena.net has their own art team run by this guy.

[ynot]

I would imagine that if you were to out source your content creation team you probably the conceptual desing home made and subwork texturing 3dmodeling animation etc

[Trippy]

Arena.net has their own art team run by this guy.

What was wrong with your original reply?

[Lum]

Arena.net has their own art team run by this guy.

What was wrong with your original reply?

I didn't want to be mistaken for an NCsoft spokesperson.

[DataGod]

Arena.net has their own art team run by this guy.

What was wrong with your original reply?

I didn't want to be mistaken for an NCsoft spokesperson.

Wow thats really good work.

Also note I wasnt promoting outsoursing, just presenting the business case scenario for the reasons WHY someone would outsource.

I've also heard nightmare stories in everything from Engineering to Creative Content (not necessarily in games) to Database/Programming  where outsourced teams cost MORE money, because of either bad/sloppy/incorrect work, or having to go through and correct the work that was done, or what was delivered was not what was specified, or they just didnt bother delivering at all.

So this goes to understanding that outsourced work can save money, if its good, solid, reliable teams, or cost you money a lot more money where even one of those criteria are missing.