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Massive Business Model Wars
Next Generation has an article up discussing the throwing down of the gauntlet that Guild Wars' business model represents. There is, indeed, more than just a monthly fee. From the article: "We're not the only ones in the industry looking at business models...If our competitors did this, would we be cheesed off? The answer is yes. We would view this model as one that might be used against us. So we wanted to be there before our competitors."
I think the Guild Wars model is fantastic personally (although I think it has to be recognized that it's not being applied to a standard MMOG- Guild Wars is much more like Diablo II/PSO when it comes to the actual formating/instancing of the gameplay), but I'm not sure it'll really be used all that much. I mean, when you look at a game like WoW (one of the highest-price-per-month games out there, and of course, one of the most successful), where Blizzard literally has players distribute game patches themselves, regardless of the monthly fee compenstation, I just don't see any big MMO developers jumping ship anytime soon.
I just don't understand how they can think that they have this *NEW* idea. I play my FPSs online for free and have been for a very long time. I don't understand why the MMORPGs have been different.
Oh that's right I, and many others, have been paying monthly fees so why wouldn't they charge. :(
Never Underestimate the Power of Stupid People in Large Groups.
One of the key business challenges Next Generation faces is revenue variability. While box sales of Guild Wars have been phenomenal, it is basically a point sale with unlimited support costs flowing behind it. Next Generation plans on making money to cover the support costs by continuously releasing expansion packs and/or new games.
One challenge with this model is that the company will have consistently growing support costs while revenue will be generated in large spikes. It is very difficult to gauge how much revenue a new game will generate, and without an accurate forecast the problems of scaling backend support grow proportionately. But the real danger lies in that in only takes one poor-selling game to threaten the company's future.
If Guild Wars has 20 million players, and Next Generation is eating all those support costs without a monthly revenue stream supporting it, what happens if the next expansion pack flops? Suddenly you have another 9-12months of support costs ahead of you with no real revenue to feed it.
The whole thing reminds me of the pager companies in the 90s that offered lifetime pager service for an initial flat fee. They enjoyed explosive growth, but as soon as the market saturated, it only took one month for their support costs (satellite bandwidth in this case) to sink them. The owners of the company pocket millions and the subscribers were left out to dry. I can very easily see the same thing happening to the Guild Wars installed base.
Its the same business model as Diablo II. I don't see how its any different. Instead of creating matchups in the BNet client you make matchups in towns where you can only see 10% of the people actually in the town because the other 90% are in a different instance of the town.
i could not think of anything clever.
Let's see....
Guild Wars offers an online gaming universe for the price of the box; and that's it. No monthly subscriptions.
and
NCSoft hopes to create a large enough fan base to guarantee sales of sequels and add-ons.
I don't see how no monthly fee equals "more than just a monthly fee". They've already said that you can play forever. If you want to buy the expansion, then you get the advantages of it, but if not, keep playing the game you bought. And this summer, they're putting out a mini expansion - Sorrow's Furnace. For free. Not to mention the weekly patches, fixes, new quests and the like.
I'm not an MMO guy. Far from it. I bought this because I wanted something like Neverwinter Nights, and I haven't been disappointed. Everything but the "cities" (which are basically chat channels and places to form a group) are personalized for you and your group. The only PCs you'll see outside a city are in your group of 4/6/8 people. It's damn cool. Might be enough to make me drop my sig.
"Sometimes a woman is a kind of religion, she can save your soul & set you free from all your sins" - Bad Examples
GW is not sustainable. I have been playing since beta, and really enjoy most of the game. However it simply will not hold up for long. The business model is based on expansions every 6 months... they already are going to be behind on the first expansion by a number of months. On top of that they have shot themselves in the foot while painting themselves into a corner by two decisions:
1. Expansions will not unbalance the game to players who do not purchase it.
2. Level caps at 20 which can be reached in 1-2 days quickly or about 1 month with normal play. (weapons and armor max out too at preset levels that are easily had by mid/late game)
While these seem like good things, it is a major flaw for longevity. If I buy the expansion I already know that I will not be able to grow my character any more than he is now, I will not be able to buy/find more powerful or unique weapons/armor, and nothing else will change much.
Why keep playing? What needs to happen is that PvP and PvE need to be separated (they are already bastardized and semi-split as it is) and PvE needs no limits and expansions need to progress levels and more and more powerful weapons, while PvP can stay balanced regardless of expansions.
I don't think expansions are going to offer much and people may buy one but I think that will be about it for Guild Wars. I hate to say it, but too many bad decisions have been made to date that all limit the longterm success of the game.
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