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Stardock Details 'Difficult Year,' Highlights Strong Impulse Profits

Stardock Details 'Difficult Year,' Highlights Strong Impulse Profits

February 22, 2011 | By Kyle Orland

February 22, 2011 | By Kyle Orland
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More: Console/PC

As a private company, PC game publisher and developer Stardock (Galactic Civilizations franchise) doesn't release regular financial reports for public perusal.

But in a surprisingly frank Customer Report released today, Stardock president and CEO Brad Wardell acknowledged a "difficult" 2010 for the company's games unit.

The troubled launch of internally developed title Elemental: War of Magic was a large part of the company's troubles, creating what the document calls "a black eye for the company."

Unlike previous Stardock-published release Demigod, which recovered from launch window gameplay issues, the company doesn't think War of Magic is set for a comeback.

"While War of Magic has subsequently been greatly improved, Stardock is not convinced that this title, with a 55 Metacritic average, can redeem itself," Wardell writes.

Instead, the game's failure has led the company to shuffle its staff, refocus its QA process, and put its efforts towards a new Elemental: Fallen Enchantress title, which will be provided free to War of Magic purchasers.

The Customer Report reveals Stardock's digital distribution platform, Impulse, as the company's most profitable business unit in 2010, with approximately 3 million users and strong revenue growth through the year.

"Valve CEO Gabe Newell recently stated that Valve is more profitable than Apple or Google per employee," Wardell writes. "Given the per employee profit of Impulse, we believe that statement."

Though Impulse trails digital distribution leader Steam significantly in terms of users, Wardell stressed that investments in the Impulse backend have allowed it to release up to five titles per week, allowing it earlier access to many indie titles.

In the document, Wardell gently chastised other digital distribution platforms for offering games that use Valve's Steamworks platform, which requires users to download Steam and "thus turn[s] their customers into Steam users!"

Wardell proudly pointed out that Impulse does not stock games that require SteamWorks. Similarly, he doesn't expect Steam to carry games that will use Stardock's similar Impulse: Reactor platform, which the company will be focusing on releasing in 2011.

Looking to the future, Stardock announced its modding-focused Kumquat 3D game engine is still an estimated 18 months out, and teased "three big announcements in 2011 concerning its future plans for the PC."

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