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Online Games Boom - Who Benefits?
Next Generation has a piece looking, in some depth, at who exactly is benefiting from the boom in online gaming. From the article: "Electronic Arts provides a prime example of the struggles traditional publishers have faced when it comes to online games. Back around the turn of the century, the market visionaries at EA boldly declared that online games would be a prime driver of future growth and would account for as much as 20% of revenue in a mere three years (by 2003). EA even set-up a separate stock for its online game holdings. Since that time, Electronic Art's growth has been nothing short of spectacular. However, that growth has not been because of online games. This is despite the fact that EA is a leader in an emerging online game category, subscription-based casual games. "
RTFA. Look at the charts, if reading is too much of a bother.
Game companies are poised to see continued growth in online gaming revenues, the point of the article is that a lot of the successes are companies that did not come from established, traditional game companies.
"Unless an online game hits it big, or has a very dedicated group of fans, there isn't any money to be made as every two-bit publisher is trying to ride this fad with their Evercrack clones."
Not even close to accurate. Yes, there is a lot of competition, as is true with any emerging market. But that doesn't mean that the market doesn't exist and there is no money to be made. It just means that more companies are vying for the increasing slice of pie.
Now, IMO, the companies who will profit greatly in the long run are those who:
(1) Publish the games best tailored to the subscription model -- like scheduled content, etc.
(2) Have the best variety of games tailored to their market (i.e., Popcap shouldn't publish an MMORPG, while Blizzard should publish a SciFi MMORPG)
(3) As with any entertainment business, the company with the best marketing usually fares well -- look for the companies with the largest marketing budget.
"Trolls they were, but filled with the evil will of their master: a fell race..." -- J.R.R. Tolkien on Olog-hai
Well, with AT&T/SBC buying Bell South, it's getting more likely to be the telco will win...
according to the article. It seems to me that we can expect this to continue to expand, and this will change the mix of popular games.
I've noticed that Konami, for example, does well with martial arts sector games, and that these are especially popular in those countries.
-- Tigger warning: This post may contain tiggers! --
Am I the only one that doesn't like to HAVE to connect to the net to play a game? There are a number of reasons, not the least being having to buy a game and then PAY for the ability to play it. Sometimes I want to play a game on my own. I don't like cheat books, I don't like asking people for help I want to play it, and I want to beat it myself. Sure, everyonce in a while, I like playing an FPS with a friend on the net in a multiplayer mode, but I like playing games that have offline aspects. Games that don't require anything but my TV, my Console and my sound system to work (or my PC and speakers). It seems to me that games that require you to play online seem more like thin-clients than real games. I hope there will continue to be plenty of offline playable games in the future. Am I the only one that thinks this whole MMO thing is just a fad that doesn't seem appealing at all?
-=JML=-
World of Warcraft has about 8 million subscibers.
8 Million * $15/month * 12 months = $1.44 billion dollars per year.
That's probably a bit on the high side, and doesn't include the box price (8 million boxes at $50 = $400 mill), but regardless, blizzard stands to pull in billions of dollars over the life of the franchise.
My experience is probably colored by the fact that I worked on two online projects.
I was at Fujitsu when they had the WorldsAway virtual chat world in 1997. At the time, it seems like everyone was trying to build a virtual online chat world community. I even got the book, "Avatars!" by Bruce Damer, at a convention that was held at San Francisco State University to showcase the new technologies. Looking through the book now, I don't any of them survived except for a few niche survivors. Fujitsu sold the division since it never made any money after so many years. That was definitely a fad.
The second one was Horizons at Atari in 2004. This online game was picked up by Atari because they wanted an online game to compete with every other gaming company getting into this "next big thing". (This was also the same time the video game industry was rushing into Hollywood licenses.) Horizons wasn't a bad game. It's just another Evercrack clone that may survive with dedicated fan base but won't really change the gaming world.
Whenever the video game industry is stampeding in the same direction, I consider it to be a fad. How many times have we heard that the PC was dead? Or the console is dead? Or Duke Nukem Forever is coming out Really Soon Now (TM)?
I've seen newspapers quoting figures like a BILLION dollars in revenue for the year.
To put that in perspective, it's about $999,985,000 more than I expect to earn this year.
I don't think size is as important. I don't think big ensures success (eg: profits). All one really needs is enough user base to over the costs of development and operations--everything above that is gravy.
Project Entropia has been around for like 8 years now. At first, there were not many players. But today they have over 300K players. Second Life has been around for about 3 yrs and is boasting around 30K user base. And these games are going strong. I'm sure theres lot of other games that have made it by being small too.