Turbine Cuts Out Publishers With Funding Boost

Thanks to an anonymous reader for pointing to an official press release announcing MMORPG developer Turbine has secured almost $20 million in venture capital funding to help fund Turbine's first self-published PC MMO project, Dungeons & Dragons Online. A GameSpot story quotes a Turbine spokesman as saying the move presents a "total shift in [our] business model. We're taking out the middle man between us and our fans." The Asheron's Call developers are still "partnered with Atari for retail marketing and distribution" on D&D Online, the company it "secured the D&D MMORPG sublicense" from earlier this year, but describes its intent to "[transition] from a developer into service publisher with its newest franchises." Turbine are also still working on The Lord Of The Rings: Middle-Earth Online in partnership with Vivendi.

Comments

Re:Good for Turbine

[whorfin]

If Turbine can put out a decent MMPORG (which is likely), they will be getting all of the profits generated by the subscribers. And once they pay back the venture capitol, they will quite likely still be pulling in money from the MMPORG, and own the rights to the sequel them selves.

Actually, you're describing a loan. Venture Capital buys a stake in a private company, and they intend to get their money back by selling that stake later, likely after the company IPOs. Venture Capital firms typically only give money in exchange for some level of control in the company affairs, as well, so if Turbine fails, the head of the company will likely be gone, with the VCs taking control and installing 'their' management.

So yes, Turbine may own the rights to the sequels (not in this case, though, their products are licenses, the license owners almost certainly retained the rights), but now the VCs own the rights to the company. And just to make you feel worse, VCs make Lawyers look soft and cuddly.