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 World of Warcraft  Subscriptions Continue To Decline, Though More Slowly
World of Warcraft Subscriptions Continue To Decline, Though More Slowly
August 3, 2011 | By Frank Cifaldi




While Blizzard has slowed down its World of Warcraft subscription churn, it hasn't stopped the bleeding yet: according to the company, the subscription count dropped slightly to 11.1 million worldwide during the quarter ending June 30.

Speaking to Activision Blizzard investors during a Gamasutra-attended conference call Wednesday, Blizzard president Michael Morhaime said that the decline -- now in its second quarter -- is to be expected after the release of a major expansion like December's Cataclysm, saying that "what we have seen is that subscribership tends to be seasonal and driven by content updates."

"So as we're heading further away from an expansion launch, it's normal to see some declines," he continued.

But that churn, while normal, is increasing with each new expansion as Morhaime explained back in May.

"As our players have become more experienced playing World of Warcraft over many years, they have become much better and much faster at consuming content," he said at the time. "And so I think with Cataclysm they were able to consume the content faster than with previous expansions, but that's why we're working on developing more content."

That new content, Morhaime said today, will include "major new raid and dungeon content."

"We believe that this new in-game content will keep the game fresh for current players, and provide compelling reasons for lapsed players to come back," he said.

Also helping to slow down the bleeding is the game's new trial system: in late June, the company changed its trial system: rather than its traditional timed trial, players can now play for an unlimited amount of time for free, though their characters stop leveling up at 20 (the current cap for players with all available content is 85).

The move, said Morhaime, has resulted in a "significant increase" in new account creations. While Morhaime says it's "still too early to tell" how often these new players become subscribers, the company believes that it is "an important direction for us to continue lowering that barrier to trial and reaching new players around the world."

Morhaime also says that the game's international expansion will help the churn: the company still sees big opportunities in China (where partner NetEase recently launched the latest expansion, Cataclysm), the country that claims the most broadband users of any nation in the world. He also said that the game has seen "great success" in Russia, and that the game's upcoming Portuguese localization should attract new players.

"Their economy has performed very well compared to the rest of the world during the recession," he said, speaking of Brazil. "We already have some Brazilians playing in English, but we think the market can be a lot bigger in Portuguese."

"There are other countries that we're looking at beyond these as well, but I don't have anything that I can talk about."

Despite the churn, overall revenues were up for the quarter ending June 30, at $313 million versus $299 million from a year ago, thanks to Cataclysm sales and its growth in China. Its operating margins were down, however, which Morhaime says is because the company is investing more into the development of new projects "that haven't necessarily been announced."


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Comments


Curtis Turner - IceIYIaN
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You've gotta have a non-paid account to play as level 20 or can any account play as level 20? Sounds like non-paying accounts are the only ones that can play... Sounds silly.

Glenn Sturgeon
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I expect by the time Blizz releases thier next MMO WOW will be a F2P game with an optional sub and likely more emphisis on micro transactions.

Michael Mucci
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Sounds like they've already gone this route with D3

Steve Badley
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In their Q2 conference call Blizzard said the cure is more expeditious releases of “major new raid and dungeon content.” This is supposed to address (a) players getting so good that they are consuming content too fast, and (b) subscribership's susceptibility to major expansion release churnover. In reality players aren't blowing through content - hardcore players are blowing through content.



According to WoWProgress.com there are 1,605,430 level 85 characters that have either personally scored a kill in Tier 11 content, or are members of a guild that has. Since most raiding guilds will likely have some level 85 characters that don’t raid, the actual number of players who do raid will be less. Factor in the number of T11 raiders who also have multiple raiding toons and the number of subscribers who raid drops even more. So the absolute best case scenario using the raw 1.6M number makes it a fairly safe bet that (of the current 11.1 million subscribers) barely 14% are engaged in raiding. Which means that 86% are not.



For the 86% who aren’t rocketing through T11/T12 raids and heroics, increased emphasis on more end game dungeon and raid content tells them that their $15.00 a month isn’t as valuable as the $15.00 a month paid by the 14% of subscribers who do raid. So this announcement that frequent “major new raid and dungeon content” releases will spearhead the recovery of WoW’s subscribership essentially indicates that the 14% is somehow generating more revenue than the 86%.



World of Warcraft’s primary game play directive has become one of herding the masses into end game as quickly as possible in pursuit of ensuing major expansion sales. But unless the expectation is that the "other" 86% drop what they're doing and catch up, I don't see how this fixes the subscriber problem.



Activision Blizzard Q2 Podcast: http://investor.activision.com/disclaimer.cfm?eventid=100191

My blog on this topic: http://galactickegger.com/blog/cataclysm-too-much-or-not-enough/

John Dunson
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You fail to address, Mr. Bradley, that dungeon content often has nothing to do with raid content. So what percentage of players does that add to your 14%? In my own personal experience, almost everyone participates in regular dungeons, regardless of whether or not they're in a guild.


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