Gamasutra: The Art & Business of Making Gamesspacer
View All     RSS
April 26, 2015
arrowPress Releases
April 26, 2015
PR Newswire
View All






If you enjoy reading this site, you might also want to check out these UBM Tech sites:


Analyst Talks  World Of Warcraft  Churn, Monthly Revenues
Analyst Talks World Of Warcraft Churn, Monthly Revenues
December 6, 2007 | By Staff

December 6, 2007 | By Staff
Comments
    Post A Comment
More: Console/PC



In a new analyst note, Mike Hickey from Janco Partners has been examining Blizzard's World Of Warcraft success in light of the Activision/Blizzard merger, suggesting average monthly WoW revenue in "the low teens" per user, and a churn rate as low as 4-5% per month.

In his note, in which the financial analyst raised Activision's share price target from $20 to $35 in advance of the merger, Hickey particularly noted: "We expect the Companyís WoW franchise will provide a strong source of continued growth. However, with a multitude of competitive MMOs positioned to enter the channel, potential subscriber fatigue and competitive options could undermine subscriber growth projections."

However, he continued: "That said, with only 4 years in the market, World Of Warcraft continues to attract subscribers at an amazing rate, with churn reported to be below other well performing subscriber based business models (we are thinking below a 4 to 5% per month.)" Churn rate refers to the number of subscribers who leave the service during the month.

Hickey also notes: "WoW controlled 5.6 and 8.1 million subscribers in í05 and í06 respectively, up 45%. Through 09/30/07, WoW controlled 9.3 million subscribers, up a respectable 15% before the seasonally hot Q4 period. The average revenue per unit (ARPU) is estimated to be in the low teens, which includes the dampening impacts of their 22% royalty agreement with [Chinese partner] The9."

The 'low teens' comment from Hickey refers to the average monthly fee in dollars for each World Of Warcraft user. The fee in North America is $14.99 per month to play the MMO, but lower Asian and Chinese fees and variations elsewhere in the world obviously affect totals.

The analyst concludes: "Management anticipates ample opportunity to grow both their WoW subscriber base and ARPU, which seems achievable. Importantly, Vivendiís determination to own a large majority of the newly created Activision Blizzard suggests to us they remain exceedingly confident in the growth of their WoW franchise."


Related Jobs

2K
2K — Novato, California, United States
[04.24.15]

Recruiting Coordinator – Temp
2K Las Vegas
2K Las Vegas — Las Vegas, Nevada, United States
[04.24.15]

Lead QA Tester
id Software
id Software — Richardson, Texas, United States
[04.24.15]

Senior Gameplay Programmer
HB Studios
HB Studios — Lunenburg, Nova Scotia, Canada
[04.24.15]

Producer









Loading Comments

loader image