Adam Martin takes a detailed look at how to guesstimate MMO subscriber numbers.
I am a bit leery about this whole “gotta know how many subs MMO has!” long running discussion. Part of it is because I’m fairly engaged with the general MMO fanbase, who use MMO sub numbers solely as a weapon (if they like an MMO, big numbers mean they are right, if they dislike an MMO, small numbers mean they are right). And part of it is just trying to work in the same industry as Blizzard, with the unspoken, or all too often spoken demand of “hey, why don’t YOU get eleven quadjillion subscribers, anyway?”
I suppose I don’t really take the long view. In the end if an MMO makes enough back to pay the initial investment, keep everyone on salary and kick a bit back to the owners, oh, and is also, you know, a fun game, I consider it a success. But that’s a view that is increasingly out of fashion.
{ 25 comments… read them below or add one }
You have just violated the interwebs for making too much sense and shall be punished accordingly.
Jason (resident drunken idiot of Channel Massive)
Hmm Jason…that picture doesn’t look like the channel massive Jason at all. 2 pictures of you on the Internet, which to believe?
Have any MMOs since UO hit negative subscribers?
Is that ‘negative’ as in less than zero or ‘negative’ as in “You guys suck!”? If it is the latter, I would argue that ALL of them have hit that mark.
Dang it, your post made me realize LiveJournal is failing to syndicate T=Machine because his feed is too large… now I’m going back through looking for stuff I missed.
If your MMO doesn’t have 15 bazillion subs and have AAA costs, it doesn’t count.
Look at Maple Story and Ragnorok(sp?) Online!
@Copppertopper
That’s me without my creepy porn stash.
I’m totally with you Scott. Using subscriber numbers to ‘prove’ that a game is quality is ridiculous. I read somebody the other day compare it to implying that McDonald’s has the best food because the most people eat there.
If people want to you use subscriber numbers to point to the most successful business ventures, then that is ok, of course assuming they also reference costs of running servers and keeping updates pouring out for the game.
I agree with you Scott, and it’s one of the reasons I don’t like it when games companies become publicly traded. The average investor would probably define success as the size of your playerbase. With World of Warcraft at 11 million subscriptions, most investor will demand that you achieve that in your game. However, as we’ve seen, WoW is a not the game is used to be. The major guilds have cleared out the content within less than one month, and I am sure once people have gotten their purples from Wintergrasp, it’s going to be a deadzone.
On the other hand, you have Eve Online, which is a high quality and probably the most in depth MMO ever created. However, it doesn’t have the playerbase that WoW has, and the average player would consider it an “elitist” MMO. It’s a quality vs. quantity argument.
“In the end if an MMO makes enough back to pay the initial investment, keep everyone on salary and kick a bit back to the owners, oh, and is also, you know, a fun game, I consider it a success. But that’s a view that is increasingly out of fashion.”
Not just in the MMOG industry. You’re describing the commercial world back in the days when a return on investment in the form of a healthy yearly dividend was considered the hallmark of a successful company. Now unless there is an ever-increasing stock price (subscriber base?), something is “wrong.”
Numbers tell you how big the market is, but the rate of change matters too. And the only way to really track that is regular data points.
You can spin the difference between ten million and ten thousand customers as a matter of niche appeal. But negative growth for X years can’t really be spun in a positive light.
Whether or not dividend payouts are better than capital gains is not a simple question and somewhat beside the point. Unlike Lum and Anonyous if I’m an owner of a company that sells a product and a service I want more than my money back plus ‘a bit’. If you really think that the financial performance of a gaming company aren’t important I really hope you’ve put your retirement money where your mouth is and have it invested in places that give you back your original investment plus ‘a bit’.
At this point, most people would be overjoyed to get back their retirement investment MINUS ‘a bit’.
The whole theory that you must cash out at 500% to succeed should not even require a single word to dismiss. Growth isn’t a viable strategy. I’m sure the bacteria in the petri dish are busy congratulating themselves on doubling every X minutes. At least until they run out of agar.
@JuJutsu: A private company can settle in and be happy making millions a year after expenses. A Publically traded company cannot. They always have to push more, more, more to increase stock value and attract investors. Those “pushes” are typically employee cuts after successful financial quarters.
JuJutsu, there are very few ways that a company can grow beyond a few percent a year that don’t entail large amounts of risk. Any mature company that doesn’t pay dividends, including those in sectors that don’t normally pay dividends (technology related garbage), is almost certain to either be wasting that money on stupid projects, or just sitting on it. Microsoft had what, a hundred billion in cash, just sitting there? Because it didn’t pay dividends and its managers were able to at least partially restrain themselves from empire building. Does that sound like a good way to use your money? And it’s not even as bad as the (more common) alternative.
Perpetual growth in a finite world is mathematically impossible. It’s one of the reasons I’ve always loathed the stock market and the investment economy. Crashes are inevitable, and those who engineer the crashes profit wildly from the suckers who gamble in the markets.
Publicly traded companies relying on growth to make numbers are simply setting themselves up to fail. It’s inevitable, and only a matter of when, not if.
If an MMO is stable and profitable (paying dividends, effectively) for the devs and maintenance crew, it’s successful. Perhaps paradoxically on the surface, an MMO relying on a perpetually expanding user base to meet payroll and shareholder demands will inevitably fail. It will be successful for a while, but cannot last. To some, that’s success, but to my mind, where one of the core concepts of an MMO is to provide a virtual persistent world, a persistent (sustainable, not growth-based) business model fits better than a churn and burn model.
I’m a bit over my head with all the financial talk here. To me, all the subscription numbers tell me is that “Hey, I can play with more people on game X.”
Considering the lack of price differential (free or $15/month) in MMRPGs, one would think that subscriber numbers for the $15/month games would be in indicator of quality of play.
For example if AoC had actually been a good game, they’d probably be competing with WoW numbers right now.
@Shiro: Then all you really need to know is that the game has 3000 players or more. I mean, that is the typical server cap, right? So hit 3000 subs and the server will always be full enough for you to play!
@D-One: Sadly the $15 is THE indicator if a MMO title is “of value” to play. Why do consumers do that? Here are two bottles of headache medicine. One is $5, the other is $10. Better buy the $10 one because it must be “better”. Consumers are programmed that more expensive means better, which normally isn’t true.
“Microsoft had what, a hundred billion in cash, just sitting there? Because it didn’t pay dividends and its managers were able to at least partially restrain themselves from empire building. Does that sound like a good way to use your money? And it’s not even as bad as the (more common) alternative.”
Actually it likely saved the company from this financal crisis and ensured its position as a top power player for the next cycle. As they can now use all that liquidy to run their buissness (trust me, a lot of companies are in a daily battle just to find the daily cash to pay salary, inventory etc) B) buy up good companies that are now so cash straped they can’t pay the bills. (because they paided out all their cash in dividends expecting to always be able to borrow cash short term).
There’s a huge difference between maintaining liquidity and letting your money just sit there because you don’t know what to do with it. Given that Microsoft announced large dividends a couple years back to get rid of some of this cash, I sincerely doubt that they needed it to ensure adequate cash flow.
Looks like Amazon has Warhammer Online for $20. It’s dead, Jim!
MMO box prices (that don’t have “World of Warcraft” in front of them) tend to fall pretty quickly after their release dates, so this isn’t a surprising or unusual thing.
Players track subscription numbers because of previous experiences with games like AC2.
“I suppose I don’t really take the long view. In the end if an MMO makes enough back to pay the initial investment, keep everyone on salary and kick a bit back to the owners, oh, and is also, you know, a fun game, I consider it a success.”
This is my mantra. As long as the company in question has planned their game well and haven’t oversold, they can easily be “successful”. It’s all about management of time and resources.