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As Titan evolves, Blizzard looks to keep  WoW 's lifeblood pumping
As Titan evolves, Blizzard looks to keep WoW's lifeblood pumping
August 1, 2013 | By Kris Ligman

August 1, 2013 | By Kris Ligman
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    7 comments
More: Console/PC, Social/Online, Business/Marketing



In an earnings call with investors this afternoon, Santa Monica, CA-based publisher Activision Blizzard revisited its second quarter earnings it first previewed last week when announcing a split from parent company Vivendi. It also took the time to address flagging World of Warcraft subscription numbers, and how the company is looking to prop up its MMO offerings in both the intermediate and long-term.

Acknowledging that worldwide subscriptions for WoW had dropped to 7.7 million as of the end of June 2013, Blizzard stated that unlike previous spates of player attrition which favored either the Western or Eastern market, this most recent drop-off was relatively evenly split.

Additionally, during the Q&A portion of the call, Blizzard fielded a question concerning its future outlook for WoW, in light of declining activity and with 'Project Titan' still on the horizon. Blizzard answered that it was "committed" to its existing World of Warcraft playerbase, and that it was looking to regaining some of its lost subscribers by enhancing existing social features.

On the subject of 'Project Titan,' Blizzard boss Mike Morhaime reiterated that there was no set or anticipated launch date for the project. He did, however, confirm that 'Titan' was "unlikely" to be a subscription-based title -- which more or less implicitly acknowledges that Blizzard is at least aware of changing market norms for online games.


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Comments


Pat Frank
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It seems like the WoW subscriber base has become cyclical in nature. If that's true then current numbers are less important than an overall mean that reflects the rise and fall of numbers through the various stages of an expansion. A downward trend in that mean still indicates a problem, but it may be less precipitous than the spikes in monthly reports might suggest. A slow downward trend suggests plenty of time (perhaps even several full expansion cycles) to craft a replacement that the base will accept.

If this is true then we can expect to see some big loss numbers later this year and early next year, as the current expansion reaches the "fallow" stage (no more raid patches coming out, waiting for the next expansion). Then big returns in the fall, as the two-year cycle begins again.

Robert Green
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I'm not an MMO player, but I kinda assumed that the reason that other MMO's have had a hard time maintaining a paid subscriber base is that all the people willing to pay $15 a month for an MMO would rather be playing WoW. In that context, it's not that the market has changed away from being willing to pay $15 a month, but just that there was only ever a limited number of people willing to, and only for the best-of-class. And so if Titan was going to be best-in-class, they may not have had anything to worry about. Perhaps the allure of having 100m potential users instead of 10m was just too strong?

Ramin Shokrizade
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I have to point out, as many others have, that Blizzard includes internet cafe use in their "subscriber" numbers. In fact, most of their numbers are from internet cafes. There a person needs only walk into an internet cafe at least once a month to be counted as a "subscriber" even though they only pay by the hour or session. For us in the West (the target of the "subscriber data") this ends up being a bit misleading.

Santeri Saarinen
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As far as I understand, majority of this internet cafe userbase is from the east. According to reported subscription numbers, the division between east/west has been quite even (east leading by about a million subscribers between 2006 and 2010). Regional numbers haven't been reported after that, but they have reported that subscription losses have been even on both sides or slightly favoring the east.

This would lead me to a conclusion that the difference between actual subscriptions and internet cafe use is decreasing, meaning that almost half of the subscriber numbers is from the west, as normal subscriptions.

So in my opinion it's not that misleading.

Michael Wenk
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All I gotta say is holy crap. If you look at the breakdowns, Blizzard has lost 66% of its revenue with respect to the previous year, and 84% of its operating income (which should be most of how WoW gets posted to the ledger)

Its margin is down to 28% which is lower by a good amount compared to what it had in 2011.

Something has to give. I'd be shocked if WoW doesn't do some major change, perhaps reshuffle, perhaps paradigm shift, maybe free to play sooner than later. But it should not be losing revenue the way it is. Sure summer explains a bit, but Q2 to Q2 should not be that much of a change.

Robert Crouch
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The average worker changes careers 4 times or something in a lifetime. In 40 years of working, that's an average of 10 years per career. World of Warcraft has existed for nearly 10 years. Children who played it as juniors in high school are settling into careers. Young adults who played it in college are supporting families.

While it is an online game, and it's changed over the years, it is a journey, not a fixed product. The game now is irrecoverably different than it was in 2004. The game itself didn't need to be the appeal, the player was part of a world, a changing world, a story progressing. The player made relationships with other players and with the game world.

People strive for mastery. WoW changes the targets, mastery was impossible because the mechanics change with every update. People strive to achieve. WoW kept raising the bar making past achievements obsolete.

For players with investments in the community, or the world, there are compelling reasons to continue. But eventually people want a change.

A new player, whether they're deterred by subscriptions or not, can never have the same experience. It would be like watching Star Wars, but only being able to watch the Phantom Menace because the original trilogy was destroyed. Even if it appeals to them, they know they are missing the history and can never experience it except through anecdotes and wiki articles.

This comment isn't meant to be a criticism of WoW, just a statement that an MMO of this type has a life cycle. I came across an article on the comic http://xkcd.com/1190/ today. I won't ever have the experience that those people that paid attention to it when it was originally posted did. I can read about it, I can experience it in my own way, but the moment is over. WoW can never be a new release again. It can never be the alternative to Everquest again. It can still be an MMO, and capture players attention. But the novelty existed for a cadre of players who mostly couldn't spend 10 years in the same game environment.

They may be able to keep WoW profitable. But I think it would be more likely that another game could recapture the initial game's success than WoW ever reclaiming that title itself. However, that game would have to be as timely and well suited to the environment as WoW was when it was released. If that were an easy task it would have already been done.

Paul Lenoue
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Why the "either-or" mentality with monetization? Why can't the players have several options, from free to play where they can run around with friends and pay for things as they pop up, to monthly passes where they can partake in dungeons/scenarios when they have the time, to subscription where everything is unlocked? I've always wondered why so many people are obsessed with one system to the exclusion of all others.


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