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Kotick Questions Star Wars: The Old Republic's Profitability
by Mike Rose [Console/PC, Business]
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November 29, 2011
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Activision Blizzard CEO Bobby Kotick has made light of the idea that BioWare and Electronic Arts' upcoming Star Wars: The Old Republic MMO may steal users from World of Warcraft and end its reign of the MMO space.
World of Warcraft has lost nearly 1 million subscribers in the last three months, and analysts have suggested that the Star Wars MMO, due to be released next month, is shaping up to be the next big massively multiplayer title.
However, talking at the Reuters Media Summit yesterday, Kotick said that he questions whether EA will even make money from the upcoming title, given that it will be paying LucasArts for the licensing rights.
"Lucas is going to be the principal beneficiary of the success of Star Wars," he argued. "We've been in business with Lucas for a long time and the economics will always accrue to the benefit of Lucas, so I don't really understand how the economics work for Electronic Arts."
He said that he does not think The Old Republic will steal users from WoW, adding, "If you look at the history of the people investing in an MMO and achieving success, it's a small number."
In comparison, EA CEO John Riccitiello said earlier this year that The Old Republic will be "substantially profitable" if it sees at least half a million subscribers in total.
Elsewhere, Kotick discussed the success of Activision's Skylanders, noting that the game and corresponding toys have exceeded company expectations to such a degree that he believes it will sell out in the U.S. during the holiday season.
"[Skylanders] are in high demand. Retailers across the board are concerned that they will be out of inventory well before Christmas," he explained.
"There's nothing we can do because they are made offshore and we can't get product made that quickly."
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Today is 4.3 is WoW and I am excited to go back in and see if things will be improving with some of the new adjustments. This could be a 4 week trial until SWTOR releases. If WoW doesnt recapture my love for the game, i will be moving on for a while. I may come back but not til after I exhaust all content in SWTOR.
I am sure I am not the only one who feels this way. I like Blizzard and Bioware.
SWTOR will be fine. WoW will be fine. They're both excellent MMOs with excellent DNA.
It's pretty polished in it's pre-launch state. Not quite Blizzard polished, but far better and feature complete than most MMOs at launch. I truly believe it has a solid future ahead of it. While I doubt it will ever achieve 12 million subs, it will do well, and if Bioware treats it right and adds content on a timely basis (WoW's shortfall), all the better.
It's just easier to turn an existing video game into an MMO than to turn something else into an MMO. 100% of the fans of Warcraft 1 2 and 3 were players of video games. That made it a lot easier to sell an MMO in that world.
I love Star Wars. A lot of my early MUD experiences were SW MUDs in the late 90s. I was so amped when SWG was announced. But... I dunno man. It seems impossible to make the Star Wars universe feel "real" in an MMO context. I think it's kind of a fools errand to try. Maybe TOR will prove me wrong? :-\
Still...tacking on a setting/franchise is not(nor should be) a panacea for game development.
I'm sure talking about the huge demographic star wars fans make, might score some points for the market analysts at a board meeting.
But how did Age of Conan fare with that equation?
Gameplay and rule mechanics still matter, just look what happened to Star Wars Galaxies.
I also like how the article title and opening statements are about EA and the Star Wars MMO, but then the last third of the article is about a the success of Skylanders. Almost as if the whole point was to leave us with the thought that Skylanders are going to do very well. Which again has nothing to do with the title. It seems a little suspicious to me.
"Activision Blizzard CEO Bobby Kotick has made light of the idea that BioWare and Electronic Arts' upcoming Star Wars: The Old Republic MMO may steal users from World of Warcraft and end its reign of the MMO space."
The loss of users to SWTOR would result in a loss in marketshare, which in turn could badly affect the share price. What Bobby's done is:
1) Refute the idea that they'll lose marketshare
2) Refute the idea that the new competitor has a sustainable business model
3) Highlight a new revenue stream with high profit margins (the toys especially are made for pennies and sold for dollars), to make the point that they have multiple revenue streams
All told, it makes perfect sense to me...
Lol! You are so going to loose your job this time.
So, in the end, it'll be popular enough and profitable but a "WoW Killer" this isn't. Just like Aion, Rift, and everything else that was going to be and never did. Doesn't mean those MMOs are dead and buried, far from it. It just means they'll be able to grab their slice and sustain for a few years. WoW will continue to lose people though since people are really, really bored with it, but I know people who do the "WoW Killer Bounce": they leave WoW heading for the newest MMO that's gonna replace WoW for them then three to six months later they decide to head back to WoW because end-game PvP is better or something else about the new MMO they're playing is just not quite as good as WoW's.
Honestly, I'd love to see a real WoW killer but really...what is a WoW killer? Everyone compares all new mainstream MMOs with WoW and they expect them to follow the same conventions (down to key bindings and that exclamation point above NPCs heads), for good reason. If the next big "WoW killer" is going to be truly innovative and different, can you even compare it to WoW? How could it be different enough to not just bring people over during launch (the starved MMO masses tired of playing WoW) but keep them a year later?