Square Enix raises outlook thanks to FFXIV: A Realm Reborn


Japanese publisher is expecting a stronger first half of the fiscal year thanks to better than expected sales of the latest Final Fantasy.

FFXIV: A Realm Reborn

Square Enix today announced that it’s revising its first-half fiscal forecast for the period ended September 30. For the six-month period, the company is now expecting to report net sales of 61.7 billion yen and net income of 2.6 billion yen, as compared with the previous outlook of 59 to 63 billion yen in sales with a net loss of 1.3 billion yen.

Square Enix said the upward revision is mainly attributable to software sales of online RPG, Final Fantasy XIV: A Realm Reborn, which was released in August; the publisher also credited console software sales in North America, sales of arcade game machines, and continued group-wide efforts of cost reduction. While Square Enix altered its first half outlook, it’s not adjusting its full-year numbers for the fiscal year ending next March, “due to the uncertainties in the second half of the fiscal year.”

Square Enix recently revealed that Final Fantasy: A Realm Reborn had exceeded 1.5 million registered players in the two months following its release on PC and PS3.

Square Enix has been dealing with some tough times of late, losing more than $130 million in the last fiscal year despite putting out multi-million selling titles like Tomb Raider, Hitman: Absolution and Sleeping Dogs. The games failed to meet internal sales expectations, and in early 2013 Yoichi Wada stepped down. His replacement, Yosuke Matsuda, has described an “urgent” need for reform to get the publisher back on track.

 

[source]

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Warhammer Online – last month and a half-Play for FREE!


The Ancient Gaming Noob

I mentioned previously that EA has announced Warhammer Online will be closing down on December 18th of this year.

As part of the run up (or down) to that terminal date, the WAR team has convinced somebody at EA to allow them to let everybody play for free for the last month and a half.  And by “everybody,” they mean everybody who ever had an account in good standing, which I gather meant that you were a paid subscriber.  From the official site:

A Parting Gift
Posted by From the Devs | 2013 Nov 02 04:00 -0400 GMT

Greetings Warhammer players,

Effective immediately we will be turning off the ability to apply one month subscriptions and game time codes to Warhammer Online accounts and removing the ability to open new Warhammer Online accounts.

To give Warhammer Online a proper sendoff we are opening the game to anyone free of…

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Runescape 3 boosts player numbers by 300,000


Jagex’s latest update also wins back 100,000 lapsed gamers.

Runescape_3

UK developer Jagex has reported 300,000 new players have signed up to Runescape in the last 30 days, and 100,000 lapsed players have reactivated their accounts.

Jagex refused to disclose the current number of active player accounts, but since launch the game has seen 220 million player accounts created.

The latest iteration of the game, RuneScape 3, launched on July 22 and since then players have notched up the equivalent of 600,000 hours of gameplay a day between them.

“Runescape 3 has been the result of the tireless efforts of the development team and the positive reaction from the community, since its launch, shows how aligned they are with the community spirit and sentiment,” said CEO Mark Gerhard.

“This is the first step in allowing players to truly create their own adventure within the game and we’re really excited about seeing how the game evolves through their participation.”

 

[source]

The Elder Scrolls Online “Was Never Planned to Come to Consoles”, Sony Convinced Bethesda to do it


the_elder_scrolls_online

Gamescom award winning The Elder Scrolls Online is set to come out next year on PS4, Xbox One, PC and Mac, but if it wasn’t for the efforts of Sony’s third party relations team, it would have been a PC/Mac exclusive.

Adam Boyes, VP, Publisher & Developer Relations at SCEA, told GameInformer:

Bethesda… cooking up the whole The Elder Scrolls Online deal – that game was never planned to come to consoles and we just kind of kept sitting with them and being like, ‘Why not? PS4′s…’

As we’re sort of disclosing the team and telling them more about the details, I’m like, ‘There’s no reason – I love MMOs and I love The Elder Scrolls.’ So I was like, ‘Why don’t you do this?’ They’re like, ‘We’re not planning it.’ I’m like, ‘Well, what if we built a plan that we could do that?’

Getting that, knowing that a game’s coming to console that was never going to come to consoles, that’s the kind of stuff that is like, “yes!”, you know, hugely awesome.

Of course, with TESO charging $14.99/€12.99/£8.99 a month, whether the game will be a success is up for debate, but at least we now have the choice.

Monetising the MMO


The Elder Scrolls Online, Wildstar and Rift – three different solutions to the same thorny problem.

Monetising the MMO

Monetisation. The rise of app stores and the emergence of new, low friction business models have made this divisive term one of the prevalent issues of recent times. Every game needs to make money, from the earthiest indie to the most high-falutin’ blockbuster, but the concept of ‘monetisation’ has started to creep into the general discourse in unpleasant ways. It is now a staple of public-facing statements issued by executives and developers, a constant reminder of the ambiguous connotations of the term ‘consumer’. A recent article on Gamasutra about coercive monetisation techniques was met with a polarised response, but its statements aren’t too far removed from those released into the public arena week-in, week-out. If anything, it just hit a little too close to home.

For the industry, this is a painful Catch-22. The general trend towards business models that drip-feed revenue in small, relatively painless increments has been motivated by a number of factors; some of which are self-inflicted, but in general it has far more to do with the needs of the customer than corporate greed. And yet many in the core audience find the accoutrements of free-to-play and micro-transactions distasteful. They rail against the sense of being nickled and dimed, even when the factors that cause that feeling are ultimately saving them money. And yet the subscription model – far closer to the traditional ideal of paying a fixed price for a fixed product – has fallen dramatically and obviously from their favour.

“I don’t think there’s ever going to be a time when we think this is the way a free-to-play game should be made and has to be made or you’re gonna fail”

Simon Ffinch, Trion Worlds

If there is a battleground for this conflict it is the MMO, where game after game has shifted from subscriptions to micro-transactions. One of the latest, though almost certainly not the last, is Trion Worlds’ Rift, which was launched to general critical acclaim in March 2011. According to Simon Ffinch, design director at Trion, the decision to embrace free-to-play was not taken to avert commercial disaster, but to provide its “robust and loyal” fanbase with a better experience – a recognition that the “massively multiplayer” aspect of the MMO is vital to the genre’s success.

“It was doing fine,” Ffinch says. “There was no moment where we thought we had to go free-to-play or Rift was gonna die. That absolutely was not the case. We just wanted to open it up to more people, and this is just the way the market is going. We didn’t want to be behind the curve, so to speak.”

In fact, Trion pre-empted the move in February last year with the launch of Rift Lite, which made the game free up to level 20. “It worked great, but it’s not the same as saying it’s free,” Ffinch says. “The word ‘free’ is, well, it’s magic. That’s what brings people in.

“I’ve seen a lot of games make the transition, and some have done it better than others. We wanted to make sure that all the content was always going to be free. The things we’re going to sell are things that players want, but not things that are required in the game. MMOs are better when you have tons of people. We had tons of people already, but now we have tons times tons.”

But if the transition has produced a positive outcome – for now, at least – it isn’t because Trion has done anything particularly daring or original. When I ask Ffinch about the guiding principles behind Rift’s more accessible model, he lists several ideas that are quickly becoming part of an orthodoxy of free-to-play: avoid pay-to-win, no egregious time-gating, monetise cosmetic and convenience items, and so on. If you have read coverage of any game making this kind of strategic shift in the last 12 months that list is likely to be immediately familiar, and it begs the question: after so much talking, are we finally reaching a point where a definitive framework of the ‘right’ way to handle free-to-play has started to take shape.

“We’re getting closer to that,” Ffinch replies, “but we’re not yet at the point where we’ve established a way that it should be done. And you know what, the thing that’s so amazing about the games industry is that when we think we’ve reached that point, somebody will do something that’s completely different.

“I don’t think there’s ever going to be a time when we think this is the way a free-to-play game should be made and has to be made or you’re gonna fail. But I think we’ll reach a way that the majority of people do it.”

“There’s a reason why a lot of the free-to-play games aren’t making money, and that’s your costs don’t go down a lot if you’re free-to-play”

Jeremy Gaffney, NCsoft

However, with so many games following a broadly similar network of conventions, it could be argued that we’re closer than Ffinch is willing to let on. It’s not hard to understand why: the push-and-pull of games struggling with free-to-play is so frequently problemtaic that developers have obvious incentives to demonstrate that they don’t have one hand on the mouse and the other in the consumer’s back-pocket. Finding some kind of standardised harmony between business model and game design would serve that end, and is therefore desirable at the very least. However, according to Carbine Studios’ Jeremy Gaffney, whose substantial experience with online games is difficult to rival, any such homogeneity is not something to be celebrated.

“There’s an interesting phenomenon, which is not very many games actually make a ton of money, and with the ones that do you’d have to squint really hard to find two with the same business model,” he says. “In the Western market, World of Warcraft is the subscription king, and EVE Online is a subscription model with modifications. World of Tanks is free-to-play, but the way they do it is different to Maple Story and the Asian games. You can’t point to any one thing that’s dominant in terms of revenue.”

To put a finer point on the matter, it isn’t that every single MMO or online game employs a radically different model, but that the developers imitating the success stories tend to make far less money – if they make money at all. This is where the pitfalls of emulating the approach of a competitor are found, particularly in games shifting from their original model to one based on micro-transactions. Gaffney believes that when a game is designed with a model integrated into its structure on the most fundamental level it can work to the benefit of all – step forward League of Legends – but MMOs are an expensive business, and more players doesn’t always mean more profit.

“There’s a reason why a lot of the free-to-play games aren’t making money, and that’s your costs don’t go down a lot if you’re free-to-play,” he says. “Your users still use bandwidth and take up servers, and you’d better still be adding content into the game. Not many of your costs drop by going free-to-play, but your user count goes up dramatically. What that means is you get more revenue and less profit, often to the point of [making a loss]… But you’ve got to profit at the end of the day. It’s what you’re in business for.”

Ultimately, Gaffney believes that the games business is driven by innovation, and in MMOs the business model is now a crucial point for original thinking. An MMO does not find an audience through the sort of flashy claims normally found on the back of a plastic box, but through getting “the meat and the potatoes” of the experience right. Increasingly, the meat and potatoes of an MMO involves the balance between playing and paying, and there are myriad ways that balance can be struck – and myriad ways to get it completely wrong.

“Boxed games are a horrible business to be in, because 9 out of every 10 fail. It’s the same with MMOs, but the number of variables in boxed games is much higher”

Jeremy Gaffney, NCsoft

Carbibe’s latest MMO, Wildstar, has taken a more idiosyncratic approach to monetisation than Rift – a combination of free-to-play and subscription that aims to avoid reliance on micro-transactions through a player-driven economy. It is the sort of risk that Gaffney believes must necessarily be taken in the ongoing search to find non-abrasive ways to monetise – the sort of risk that could propel Wildstar to the sort of success that so many recent MMOs have failed to attain. In that sense, Gaffney explains, Wildstar is an anomaly. It is increasingly difficult to find a publisher willing to entertain an MMO model that breaks from established approaches to subscriptions and free-to-play.

“Depending on who you talk to World of Warcraft had a $65 million budget, and budgets have only gone up since then,” he says. “It’s tough to go up to your boss and say, ‘Hey, I’m gonna take $100 million and do something that’s never been done before and, trust me, five years later you’re gonna get something awesome out of it.’ You get conservative when budgets start to get that high, but that’s a mistake, because the second you stop trying to break new ground you get in trouble.

“Boxed games are a horrible business to be in, because 9 out of every 10 fail. It’s the same with MMOs, but the number of variables in boxed games is much higher… With MMOs, at least [success] maps more or less 1-to-1 with game quality. There haven’t been, I would argue, a lot of quality games that people have tried and were like, ‘Nah, the hell with it’ and stopped paying. Why would they? If you did a really good job of making levelling fun and making your elder games fun, why do people tail off? I mean they can – the invisible hand of Adam Smith tends to go and move the market around – but for the most part I like this market because it’s so tied to good games.”

And Gaffney is clear about one thing: a subscription model is the most effective way to realise certain notions of what an MMO should be. He knew that the economics of the modern industry demand that the player be given options, but he also wanted Wildstar to offer a sense of scale and balance that only consistent revenue and no strong reliance on micro-transactions can provide.

“Retention is where the money is at,” he says. “In China, there’s a billion MMOs and they’re all fighting for space, and the ones that rose to the top used to update every three or four months,” Gaffney says. “And then some innovator did that every two months, then once a month, then two weeks. Now, the biggest games over there update weekly. If you want retention, that’s one of the ways you can do it. That’s League of Legends – every three weeks, Bam, new champion. That’s the stuff that separates the haves from the have nots.”

The other example Gaffney offers is World of Warcraft, and in doing so it becomes increasingly clear how Wildstar’s business model took shape. Not every game will build an audience on the scale of WoW, or see as much return on letting people play for free as League of Legends, but a balance between these two poles might provide the most benefit for all parties. As Gaffney rightly points out, “Nobody loves a business model, but everybody hates at least one.”

But which one do people hate the most? It would be easy, and very possibly correct, to point to free-to-play and intrusive micro-transactions, but it should also be clear by now that there is an equally widespread – though not nearly as vocal – public distaste for subscriptions. With The Elder Scrolls Online, ZeniMax is making a strident bet against that being the case. The reasoning goes something like this: people loved Oblivion and Skyrim, buying them by the million at $60 a time, so an Oblivion or Skyrim that lasts forever would offer enough value to persuade millions to part with a monthly subscription.

“With an IP like this, it comes with certain expectations,” says Matt Firor, the head of ZeniMax Online Studios. “It’s an Elder Scrolls game. This is the way you play it. With other models, you have to change the way its played or the rules to facilitate new forms of monetisation. I’m not doing that with this game. I can’t. No Elder Scrolls player would ever accept that.

“We really did look at all of the alternatives, but we were building it to be an Elder Scrolls game… If we’d started out with another business model in mind, it would not have turned out that way.”

“we were building it to be an Elder Scrolls game. If we’d started out with another business model in mind, it would not have turned out that way

Matt Firor, ZeniMax Online

In a sense, The Elder Scrolls Online’s choice of business model was informed by the same factors that guided Gaffney on Wildstar. Firor understands that a lot of people regard the IP as a solitary experience, one defined by the exploration and discovery of a completely open landscape. While there will be multiplayer content and options, it is imperative that the game accurately evokes the experience of playing Oblivion or Skyrim. That means there should always be something new quests and locations to find, and that those quests and locations should be worth finding. That requires time and money, and that’s harder to guarantee with free-to-play.

“This isn’t a referendum on revenue models for other games,” Firor says. “For this game, it’s the right decision, mostly because of the expectations that come with the IP. When you’re playing the game, you’re playing the game – you’re not worrying about pay gates or whether you have access to some content. We really feel that paying once a month and not worrying about all of the other monetisation things, that’s what will appeal most to the Elder Scrolls fans.”

Is this asking too much of the modern gamer? Even for the Skyrim crowd, there is surely an expectation that MMOs now generally cost nothing to play at first. Once someone starts to give a product away for free, it becomes far harder for a competitor to charge for the same basic thing. Wildstar at least gives its players an option, but Firor is confident that the strength of the Edler Scrolls IP – and the fact that the beta has seen more than 3 million registrations – will be enough to make its single-minded approach work. “It’s a big deal,” he says. “Free-to-play is out of the window with that.”

Of course, the last MMO on this scale with so much confidence in subscriptions was Bioware’s The Old Republic, and the Star Wars IP is no lame duck. But the announcement is now made, the wheels have been set inexorably in motion, and all that remains now is the all-important launch. Firor claims that ZeniMax is ready as it is possible to be for the “massive IT exercise” of releasing a persistent online game – a challenge that has defeated companies the size of Blizzard and EA – but he admits that guarantees are impossible to make.

For Gaffney, that’s a huge risk, regardless of any rigorous supporting calculations. If there’s a way for people to play for free, there are more ways to bounce back. If there isn’t, you need a strong start. The entire game need to be in place and fully functioning at the moment of release.

“”It’s not like [subscriptions are] dead, but there’s a barrier: you only have a month to make your case. When games come out and try to fit in the end game stuff after launch… Nope, you got a month, and guess what? You’re gonna be running like a monkey on meth amphetamine for the course of that month, so you won’t have the time to cram it in. You’ll be running around and fixing whatever thing went horrible wrong at launch.

“And something always goes horribly wrong at launch.”

 

[source]