Posts Tagged ‘Blizzard’

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Blizzard announces AH services – hints at Premium Accounts

Wednesday, February 3rd, 2010

Blizzard announced a new service yesterday that will allow World of Warcraft users to access and manage their Auction House items while outside the game. The interaction builds upon the success of Blizz’s Armory and associated iPhone and iPod Touch apps. Blizzard official forum moderator Bornakk posted the initial details to the North American forum:

…This is a fairly complex service to develop, due in large part to its unprecedented integration with the game, so we don’t have an exact release date yet. It’s important to note here that certain elements of the service will be premium-based, which we’ll go into more detail on once the service functionality is finalized. As with all of the services we offer, we plan to integrate the Auction House and Armory in a way that won’t disrupt the gameplay experience, and we won’t release it until it meets the quality standards that we’ve set for our other features and services. You may be seeing bits and pieces of the Auction House service pop up in the test builds we use for the public test realms as we go through the process of internal testing. …

blizzard-logo-whiteOutside of virtual currency earned in-game through quest or dungeon run rewards, Blizzard’s in-game Auction House is widely regarded as one of the best ways to make money within the game. By opening up this service to external use, Blizzard is giving users tools not unlike what daily traders on Wall Street have access to. With this external management tool, I wouldn’t be surprised to see a number of enterprising players buying and selling around the clock.

There are two things to highlight about this feature.

  1. How will this external access to virtual currency trading, buying, and selling effect the overall in-game economy?
  2. What’s this about the service being ‘premium-based’

Granted, allowing external access to the virtual market is nothing new, and browser based management of sales can be found in a number of online game, but none that compare in size, scale, and overall numbers as World of Warcraft. And again, external access is nothing more than a whole lot of players all hitting the auction house all at the same time. However, giving players around the world a method to constantly monitor their auctions around the clock could result in some very interesting results. Will this buy/sell/trade effect price rates? There are already a number of players that apply real-world financial practices in place in the in-game auction house, and now they’ll have access to even more real-life tools, with which they may further apply out-of-game financial principles.

And now for that interesting pig in a blanket. If this is Blizzard’s attempt to subtly introduce the community to the idea of a Premium Service; it hasn’t gone unnoticed. To my knowledge, this is the first appearance of the idea. Blizzard has long been one of the last remaining stalwarts of the ‘subscription’ based model. However the company hasn’t ruled out microtransactions completely, and have already implemented a few via in-game special pets. And while it’s too early to clearly know what Blizzard has up their sleeve(s), the ‘Premium Based’ service might be an early foray into expanding the ‘subscription’ model. I.e. those with ‘premium’ features may have the option to simply buy an item that they’re after with RMT’s. Alternatively, Blizzard could play the option that Premium players would have access to all game features, areas, etc., while others might have to make microtransaction payments to access the same services. Again, at this point this is only conjecture.

Blizzard released it’s newest expansion pack, “Wrath of the Lich King” back in November of 2008, and have started to tease their upcoming expansion pack, “Cataclysm”, which currently has no release date. It should be quite interesting to see if, how, where, and with what Blizzard may or may not option in some form of microtransactions.

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The 9 reports a 94% drop in revenues post WoW

Thursday, November 26th, 2009

Shanghai, China based MMO operator and developer The 9, formerly holders of the Chinese license to operate World of Warcraft recently reported a whopping 94 percent drop in third quarter revenues YOY.

intro_03Third quarter revenues for the 9 came in at $3.7 million, a 91 percent drop from from second quarter revenues, $42.2 million. At the same time, only one year prior, The 9 was posting a revenue take of $59.8 million. If there’s any question not only about Activision/Blizzard’s dominance with World of Warcraft, but also how much revenue the Chinese market is generating, not only with WoW, but online gaming in general – this report from The 9 should put things into perspective.

Having lost out on the regional contract back in June to competitor NetEase, The 9 executives are still optimistic about future prospects, as their games catalogue contains a healthy mix of decent titles including FIFA Online 2, Soul of the Ultimate Nation, and Granado Espada. Since the loss of World of Warcraft, this catalogue has seen a 55 percent increase in activity in Q3 when compared to the numbers one year prior.

The 9 is quick to point out that these titles attracted around 3.4 million active users in Q3, up from 3.2 million active users in Q2. The leader in this increase has been Soul of the Ultimate Nation. This increase in activity was spurred on by a new content upgrade, as well as a theft-proof security system. FIFA Online 2 and Atlantica both saw increases in activity, as well as a web based card game Jiu Zhou Zhan Ji.

“Although our revenue loss cannot be recovered within a short period of time, we are glad to see that our research and development capabilities continue to strengthen as a result of our investments,” said The9’s CEO and chairman Jun Zhu. “Our proprietary games have shown substantive progress and a strong potential to be well received by Chinese game players.”

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Blizzard moves one step closer to microtransactions

Thursday, November 5th, 2009

Blizzard’s worldwide leader in the MMORPG genre, World of Warcraft took one step closer to microtransactions yesterday when they announced the availability of two unique pet companions. These two companions are available for real world money purchase exclusively at the Blizzard World of Warcraft Pet Store.

wow-pets

This new move however isn’t the first real money transaction service we’ve seen been made available by Blizzard. Prior to yesterday’s announcement, the franchise had offered paid realm (server) transfers, name changes, character re-customization, and the newly implemented race and faction change, as well as hinted at ’some type’ of microtransactions. Add purchasable in-game pets to the roster, and we’re now one step closer to a fully fledged microtransaction revenue generating title. Note, not a free-to-play, microtransaction supported model, but one that utilizes microtransactions as an additional form of income.

As noted with the previous paid services available, and Blizzard’s increasing amount of awarded in-game pets (it seems as though every special holiday event has some type of awarded companion), this move to offering a special paid companion seems like a logical step – but how will the community react? Traditionally, World of Warcraft (WoW) has been the last bastion of the traditional subscription based form of online gaming.

Perhaps anticipating a backlash, and surely studying what others in the free-to-play field are doing and have learned, the official FAQ highlights that the pets will not offer any battle or gameplay benefits, as they are strictly cosmetic enhancements, therein combating the pay-to-pwn theory.

The new introduction is in part a piece from a much larger project Blizzard is working on – converting all accounts to a one singular account; one at battle.net. This conversion to a ‘one account management center’ can only be seen as a way for Blizzard to cross promote it’s products. The deadline for converting accounts is November 12th, and if players convert before this deadline, they receive a special companion pet – for free. Seeding this idea of various pets, again awarded from special holiday events and/or an account conversion has been a brilliant pre-release strategy, getting users into a cosmetic status mindset, and then releasing additional companions available only via a microtransaction purchase. With that said, players that do want to purchase these two new pets may do so only after their WoW account has been converted to a Battle.net account.

At $10 a piece, these exclusive pets may not be viewed as a “micro”transaction, but they do introduce RMT’s into a game that has long stayed away from anything outside server, name, and gender, race and looks options.

The two new pets available are the “Pandaren Monk”, a panda vaguely resembling a Kung Fu Panda character. All Monks purchased between now and years end will have half of the purchase price donated to the Make-a-Wish foundation.

The other (and in my opinion, the one that most players will opt for) is “Lil’ K.T., the Littlest Lich,” a miniature version of the Naxxramas dungeon boss Kel’Thuzad which Blizzard states “has a diabolical laugh” and shoots ice.

So while this move to purchasable in-game pets certainly doesn’t signal a move on Blizzard’s part to make their successful World of Warcraft a free-to-play game anytime soon, it does put them one step closer to incorporating more and more Real Money Transaction based purchases into a traditionally, pay for your play time and you’re done, style play.

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China says ‘No Way José’ to foreign investment in online games industry

Tuesday, October 13th, 2009

It’s quite possible that the Chinese government would like to keep this one on the down low, it’s been revealed that they’ve officially cut off foreign investments in their lucrative online gaming industry. Apparently, the move is to strengthen the governments’ control and oversight of virtual worlds.

g228586_chinese-flag-640The General Administration of Press and Publication (GAPP), China’s video game industry regulator and overseer, released a paper on Saturday stating that the government will now prohibit the investment of foreign funds and interest in domestic online gaming operations. This ban is includes joint ventures, wholly owned enterprises and cooperatives.

If the phrase ‘joint venture’ and China rings a recent bell, you’ll recall that the holdup for millions of Chinese World of Warcraft players was due in part to Chinese regulators that were concerned over publisher Blizzard’s provisions of technical support to NetEase, the Chinese game developer that earlier this year won the lincense to operate the title within China. This new directive seeks to cover this issue but also stating that foreign firms will no longer be allowed to “influence Chinese gaming firms through agreements or technology support.”

With China having one of the world’s fastest growing online gaming markets, with, according to the GAPP, growth estimates projected at anywhere between 30 and 50 percent this year to a whopping 24 – 27 billion yuan ($3.5 – 4 billion), it’s easy to see why investors would want to get involved.

What’s important to keep in mind here is that the timing of this announcement couldn’t be better for the Chinese government. With the GDC: China taking place in Shanghai, China is currently playing host to some of the most important and influential decision makers in the industry. A coincidence that they chose the day prior to the official opening day of the GDC to make the announcement? Highly suspect.

Ultimately, as the decree states, foreign investment has been cut off to games and publishers that operate in the Chinese domestic market.  It’ll be interesting to see how this effects gaming powerhouses such as Shanda, which have a number of partnerships and joint ventures currently in operation.

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SOE Prez John Smedley to deliver keynote at GDC Austin

Friday, August 7th, 2009

If you were in search of this years “The One” gaming convention, look no further. It seems like the gathering in the Lone Star State is shaping up to be a veritable industry ‘who’s who’. Yesterday, GDC Austin officials announced the SOE President John Smedley will deliver a keynote speech detailing the success and lessons learned regarding the recently launched runaway tween success, Free Realms.

john-smedleyHis address, “From Dragons and Daggers to Kart Racing, Cooking and Concerts … It’s a Whole New MMO World,” will detail how Free Realms has worked well for SOE, expanding the title’s base of players and how they engage with each other in online worlds. Smedley is also expected to “inform attendees about the challenges and lessons learned when creating a full-blown MMO for younger audiences,” and complete with research and insights. Ooo…pie charts?

This keynote is a so-to-speak homecoming for Free Realms, as the title was first officially announced at the GDC Austin in 2007. Fast forward to an April 2009 launch, and SOE has seen over 1 million registered users pass through their doors in only 10 days. According to a recent Comic-Con panel, Sony has recently past the 5 million user mark, with no signs of slowing anytime soon in sight.

If a keynote by the man behind EverQuest I and II and Free Realms wasn’t enough to get your feet moving in the right direction, remember, GDC Austin has also confirmed Blizzard co-founder Frank Pearce and World of Warcraft production director J. Allen Brack to discuss the operating challenges and lessons in the talk “The Universe of World of Warcraft.” An naturally, one of our personal favorites, Rebel Monkey CTO Jeffery Kesselman will be on hand and discussing how CampFu “combined open source technologies to build an industrial strength platform for unified multi-player casual game-play and social web experiences” in his talk, “The Monkey Wrench: Design and Architecture of an Online Environment.”

The GDC Austin event takes place at the Austin Convention Center in Austin, Texas September 15-18. This conference is the major focus of a larger gathering also featuring four two-day summits including the Game Writers, Game Audio, iPhone Games and Independent Games Summits. To find out more, visit the official GDC Austin website.

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South Korean gaming market grew 20 percent in 2008

Thursday, July 16th, 2009

kimjongilKorea: An isolated nation suffering from an oppressive government and dictator, virtually cut off from the rest of the world (and the 21st century). Oh no no no. Sorry. That’s NORTH Korea. Although this picture may be shockingly correct, perhaps in not as many words, North Korean’s cousins to the South couldn’t get any closer to the opposite side of the spectrum.

South Korea is one of the most wired countries in the world, with 80 percent of the South Korean population owning a PC. Based on rough population estimates, that puts a computer in the hands of 38 million South Koreans. Given the relatively small land mass that South Korea covers, including extremely densely populated areas such as Seoul, as well as being (more or less) the birthplace of the free-to-play business model, it’s easy to see why and how gaming has integrated itself so rapidly in the everyday culture. Don’t forget, this is the country that has professional Starcraft leagues that often receive national television coverage.

According to Pearl Research, the South Korean appetite for video game consumption is showing no signs of slowing, as they estimate the online games market in South Korea grew an impressive 20 percent in 2008. The data comes via Pearl’s new study, “Online Games Market in Korea.”

The top five game operators in South Korea in 2008 were:

  • NHN – a 51 percent revenue increase YOY
  • Nexon
  • NCSoft – a 5 percent YOY revenues gain
  • Neowiz – up 29 percent with revenue gains YOY
  • CJ Internet – a 21 percent YOY gain in revenues

The Top online games in the South Korean market include:

  • Activision/Blizzard – World of Warcraft
  • NCSoft – Aion and Lineage series
  • CJ Internet – Sudden Attack (free-to-play)
  • EA – FIFA Online 2 (free-to-play)
  • Nexon – Dungeon Fighter (free-to-play)

Naturally, the vast majority of games available to South Koreans come in the free-to-play format, and according to the Pearl Research study, the global economic downturn has had little to no effect on microtransactions purchases. Pearl points to the low cost of these individual items as a potential reason.

The report also goes on to conclude that while these numbers are exciting, and a good indicator of the current state of affairs, not all is rosy in the South Korean gaming market. They point to intense domestic competition, a government crackdown on web board games, and increasing development costs is important challenges to be met.  However, the study also cites lack of capital for smaller publishers even though the South Korean government is pumping money into the industry.  I guess these small(er) publishers are flying below the government investment radar?

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Gamers hang on one man’s words: microtransactions in WoW?

Monday, July 6th, 2009

Proving that the world’s insatiable desire for more and more WoW is still alive and thriving, Blizzard’s WoW Game Director Tom Chilton’s words regarding the possible inclusion in the world’s most popular MMO certainly lit up the blogosphere in less time than it takes to reach level 2.

blizzard-logoThe microtransactions comment aside, VideoGamer.com’s interview with Chilton provides a treasure chest of asides and tid-bits about the possibility of new races and classes that could make their way into future expansion, those areas of the map that you just can’t seem to find access to, and even alien visitors to Azeroth. Pretty much your standard fair when interviewing someone of Chilton’s caliber and position within the Blizzard world.

However, there’s one question asked towards the end of the interview that’s got just about everyone AND their grandmother a-buzzin’: Will WoW always be subscription based? Could it ever have a microtransaction/free-to-play model?

I certainly think it’s possible that we could do some kind of micro-transaction stuff. Whether or not World of Warcraft ever goes the direction of, I guess like Anarchy Online has gone the direction of going free-to-play with micro-transactions. Whether we ever shift to a free-to-play model is really too hard to say at this point. Anything I say now could easily five years from now end up seeming like, oh my gosh, that was an incredibly dumb thing to say, how naive!

Ok, now before the OMGWTF? comments start spewing forth, let’s take a look at that again. Chilton is merely saying that Blizzard COULD do SOME KIND of microtransaction stuff. He’s clearly not committing to anything here, but also not crossing the theory off completely. Personally, I don’t see Blizzard ever abandoning the subscription model with WoW, as it’s become a mega-industry in it’s own right. Every time you purchase a time card, there’s someone that’s contracted to make those cards. There’s a data and security department dedicated solely to making sure that those ‘one time use only’ chains of numbers are/were actually paid for, and are used for legitimate purposes. I also don’t believe that WoW will be headed towards a free-to-play business model any time before the long awaited, and highly sought after ‘WoW Killer’ finally comes to market. And my guess is that said WoW Killer will be brought to you by none other than Blizzard themselves.

Having said that, there are also a number of things happening inside WoW right now that are clear movements towards a microtransaction based frame of mind. The customize your character haircut could easily be converted to a microtransaction purchase. If you want to move your character to another server, Blizzard charges you a fee for this convenience; a microtransaction of sorts. Likewise, if you want to change your name for whatever the reason may be, again, a small fee is required by Blizzard. Not what you’d normally file under the term ‘microtransaction’ but if viewed in the right light, can be seen as one.

So is the world’s most popular MMORPG, World of Warcraft going free-to-play, microtransaction supported? No. Does this mean that Blizzard is ruling out the possibility of microtransaction-esque purchases? According to Tom Chilton, No.

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Free-to-play Maple Story ranks among top moneymaking MMO’s of 2008.

Monday, February 2nd, 2009

DFC Intelligence is gearing up to publish a comprehensive study of MMO worlds next month, according to GigaOm.  Wagner James Au got a special preview of the report and shares some initial estimates.

DFC’s David Cole says that the 2008 numbers are on the “very conservative” side, indicating that the 2008 numbers are still being crunched, and more exact numbers will be reflected in the February 16th reports.  “We indicate ranges because these numbers are estimates for 2008 based on where we think these products will end up,” said Cole.  And while the numbers are still being tallied, Cole estimates that the rankings should stay more or less the same, with “maybe a slot here or there” changing.

And while it shouldn’t come as a shock that the Blizzard powerhouse World of Warcraft takes the number one spot, Cole believes that if viewed from a pure profit margin, WoW wouldn’t be taking home the gold.  Asian MMO’s, which are traditionally developed at far lower budgets, have a much higher profit margin.  “Profit margin on Asian games is incredibly high,” says Cole, noting that Asian MMOs charge on or around 5-6 cents per hour with prepaid usage cards, a business model that has yet to proliferate the western gaming market.

What’s interesting to note in this projected report is the high ranking of Nexon’s free-to-play Maple Story (supported by microtransactions, prepaid cards, and international licensing), and the catalogue of Shanda’s games (Virtual item sales, prepaid cards, and freemium subscriptions).

1. World of Warcraft, launched 2004
Genre/Platform: Western MMORPG; client install with 3D graphics
Revenue sources: Monthly subscription, retails sales, prepaid cards (in Asia)
DFC estimated 2008 revenue: $500 million-plus

2. Fantasy Westward Journey, launched 2004
Genre/Platform: Asian MMORPG, client install with 2.5D graphics
Revenue sources: Prepaid cards
DFC estimated 2008 revenue: $150-$500 million

3. Maple Story, launched 2003
Genre/Platform: Asian MMORPG for kids, client install with 2D graphics
Revenue sources: Microtransactions, prepaid cards, international licensing
DFC estimated 2008 revenue: $150-$500 million

4. Shanda (company, includes Legend of Mir and World of Legend series), launched 2003
Genre/Platform: Asian MMORPG, client install with 2.5 graphics
Revenue sources: Prepaid cards, virtual item sales, freemium subscriptions
DFC estimated 2008 revenue: $150-$500 million

5. Lineage I and Lineage II , launched 1998 and 2003
Genre/Platform: Asian MMORPG, client install with 2.5 graphics (Lineage) and 3D graphics (Lineage II)
Revenue sources: Subscription, prepaid cards
DFC estimated 2008 revenue: $150-$500 million

6. Runescape
Genre/Platform: Western MMORPG for kids, web-based with 2.5D graphics
Revenue sources: Premium subscription, prepaid cards, real-world advertising
DFC estimated 2008 revenue: $50-$150 million

7. Club Penguin, launched 2006
Genre/Platform: Virtual world for kids, web-based 2.5D graphics
Revenue sources: Premium subscriptions, prepaid game cards
DFC estimated 2008 revenue: $50-$150 million

8. Lord of the Ring Online
Genre/Platform: Western MMORPG, client install with 3D graphics
Revenue sources: Subscription, retail sales
DFC estimated 2008 revenue: $50-$150 million

9. Warhammer Online
Genre/Platform: Western MMORPG, client install with 3D graphics
Revenue sources: Subscription, retail sales
DFC estimated 2008 revenue: $50-$150 million

10. Age of Conan
Genre/Platform: Western MMORPG, client install with 3D graphics
Revenue sources: Subscription, retail sales
DFC estimated 2008 revenue: $50-$150 million

Wagner continues his conversation with Cole around the most popular, in terms of active players, MMO of 2008.  To answer this question, we’ve got to go even a bit further out on the speculation branch, but Cole points out that Fantasy Westward Journey registered 2-3 million concurrent players back in August.  And although Warcraft likes to beat it’s own drum regarding their estimated 11 million+ players, “You’re lucky to get 5-10 percent [of them] playing at the same time,” says Cole.  Minho Kim, developer of Maple Story said in December that the title has 87+ million registrations, but wouldn’t comment on how many of these registered users were/are active monthly users.  Joost van Dreunen from DFC’ estimates the number to be more in the 13 – 17.4 million regular Maple Story players, roughly 15-20 percent of Kim’s estimation.

Cole admits that this year’s list looks remarkably similar to the 2007 list with Conan and Warhammer being released in 2008.  And while only 2 of the top 10 contain some type of microtransaction support, I’d estimate that this list might look very different one year from now with a number of highly anticipated (think Free Realms and Battlefield Heroes) free-to-plays coming online in ’09.

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Funcom’s Age of Conan servers to be halved

Thursday, January 15th, 2009
Age of Conan: Hyborian Adventures

Funcom has just announced their list of planned server merges, with over half falling by the wayside.  Of the current 49 servers in action, post mergers, funcom’s MMO Age of Conan will be reduced to only 18.

While European servers will see the least drastic of the changes, with 12 servers remaining open due to the language variety (Age of Conan is currently available in English, French, German, and Spanish), the North American and Oceanic regions will be hardest hit.  The current 24 servers operating in these areas will be reduced to six, with only one PvP, and two PvE servers remaining open in the United States.  Each of the 3 servers will combine populations of the six or seven currently operating servers.

Funcom tested this move last week, with a successful merger of the Oceanic servers, and is expected to roll out the US and European mergers this week.

This is a significant point in it’s own right, as this is the first quasi-indication from funcom on how AoC’s numbers have dwindled since launch.  The silver lining in this cloud is that dedicated fans, and even those that may be new to the game will see a much increased server population, thus leading to much player-to-player interactions, and naturally a boosted in-game economy (man, I can’t WAIT to see prices on the Auction House explode).

Funcom says that they’re pushing forward with the high level and end game content (a comment we heard directly from funcom representatives at the Leipzig GC), as well as the first expansion pack.

In some ways I’m a bit taken back by this, in other ways, not.  Funcom’s Age of Conan made a lot of noise prior to the launch, won Voodoo Extreme’s MMORPG of the year 2008, and who could forget Keaira’s playboy appearance?  I personally have only spent a few days with Age of Conan, but found the gameplay and graphics to be stellar.  As noted above, I did hear it directly from funcom reps that the biggest problem they’d experienced with the AoC community were complaints about not enough end-game/epic materials and dungeons.  The last I knew, they were working on this content last summer, but weren’t giving out any definitive dates as to when the content would be released.  Another fact to consider is AoC/funcom’s timing.  When AoC was first released, we knew that Blizzard was rapidly moving forward with the WotLK, but hadn’t given any indications to it’s release date.  Funcom nailed the AoC release date; in so much as WoW players (myself included) had cleared a number of heroic dungeons, collected their purples, and were, well, to be quite honest, a bit bored.  Age of Conan fit the bill and filled the void.  Given the massive numbers that Blizzard is yet again reaching with Lich King success, could many others like me have simply moved AoC down the list again?

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Turbine squashes LOTRO microtransaction rumors – new title in the works

Thursday, January 8th, 2009

Maybe publicly posting a microtransaction/e-commerce manager is the new way to generate tons of publicity and hype for your business.  At the same time, dedicated fans of your biggest product tend to get a little jumpy.  A catch-22?

If this is the case, then Turbine has managed to accomplish it’s goals, and then some.  As previously reported Turbine is in fact looking for a microtransaction/e-commerce manager, and let the speculation train leave the station.  It seems as though hundreds of fans of Turbine’s successful Lord of the Rings Online game feared that microtransactions would be applied to this title, thereby igniting some truly ridiculous forum posts, to those that support the growing trend in gaming.

And while Turbine didn’t exactly nip the discussion in the bud, they did acquiesce to public pressure and wild speculation, by revealing that they are in fact working on a new title that will be microtransaction based.

“We know the recent job listing has caused a bit of a stir, but please be aware that this posting is for an unannounced future project,” says Sapience, a Turbine Online Community Specialist.

While this announcement alone is not earth shattering, it does put another brick into the Western market acceptance of microtransactions in the wall.  We’ve now got EA working on Battlefield Heroes (ok, let’s put the delays aside), SOE with free realms, Nexon’s Combat Arms is moving right along, and now Turbine has officially confirmed their development of a microtransaction based title.  Heck, even the stronghold of all things subscription, Blizzard is offering paid character customization, a microtransaction in it’s own right.  The winds of change are hard to ignore, and they seem to just keep gathering steam.

We’re obviously watching Turbine with an eagle eye now, and will keep you up to date with any further developments.

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