Cannibalization? No Problem.

Yesterday, one of our readers raised a good point about Blizzard cannibalizing their own games, especially if they plan on releasing 3 games in one year (which would indeed be quite unusual.) I figured I would make a post about it, because it's an interesting topic.

Basically, there's only a fear of cannibalizing World of Warcraft players.

There's little concern about taking players away from Starcraft or Diablo. If WOW steals away players from D3, it doesn't matter because D3 players already bought the game, but WOW has a subscription fee which provides Blizzard continued revenue. The same with SC2; if WOW were to somehow steal away SC2 players, who cares.. they already bought the game.

This can also apply to Titan, especially if it uses a new revenue model (both RMAH and Product Placement/Advertising combined.)

WOW is a subscription based game which constantly generates revenue. Diablo and Starcraft are not, they are only one-time costs (excluding DLC of course) so those players are of no consequence.

To help even better explain: World of Warcraft PROFIT needs to be protected from cannibalization, not the PLAYERS. :)

So, what Blizzard needs to do is create new systems or methods where players will still contribute to subscription fees, but they will also one-time purchase their other Blizzard titles.

This is why the WOW Annual Pass was such a great idea. It locks players into a 12-month purchase plan, but they will still be getting the Diablo 3 game. It comes with a beta invite to MOP, so even though they might play Diablo 3 for a few months, they're still guaranteed to return to WOW when MOP releases (and probably 'coincidentally' close to when the WOW Annual Pass expires.)

Blizzard wants players to use Diablo 3 for the RMAH, and start building up Battle.net Balance Credit, and use that to purchase other Blizzard titles and monthly WOW subscription purchases.

Because the RMAH system is so critical (especially for their future), it's the reason why HOTS nor MOP will be released before Diablo 3. They want players to start building up B.Net Bucks and get comfortable with the new credit system.

Diablo 3 actually complements MOP very well (it won't cannibalize players) because it's a "free game" (or a one-time cost), and since there's no subscription, there's no rush to play it and players will use D3 to pay for their WOW subscription.

Blizzard will also find other new or clever ways of motivating you to use your B.Net Bucks or ensure you buy WOW:

• Release MOP 6+ months after D3, say, when most WOW players and Diablo fans already own D3.
• If they can roll out the D3 RMAH, and then the SC2 Arcade, users from both the Diablo and Starcraft franchises will be selling virtual items on those systems and building up Battle.net Credit to purchase other titles or subscriptions.
• This is also why it's so important to increase their game catalog. (Talked about in other posts about Activision games in Battle.net.) If the RMAH and Arcade are highly successful, they'll need to increase their Blizzard Store merchandise, features, and titles. I think they're going to wait and see what happens with the RMAH first though.
• Blizzard may drop prices if B.Net Credits are used to purchase games or subscriptions for friends and family members. You might not be able to get a SC2 gamer playing WOW, but you can at least get them to buy gifts for their friends. And, perhaps you can receive bonuses yourself (appeal to our selfishness) if you invite friends.. like, special banners or aesthetics in D3 or SC2. WOW already does something like this for friend invites (power leveling, mounts, free subscription time, etc.)
• The B.Net Credit will be much easier to setup than the PayPal system. There will more restrictions and punishment in place for using the PayPal system (e.g. hefty cash out charges to encourage you to use the B.Net Balance system instead.)
• When Diablo 3 is released (or right before), make WOW as undesirable as possible. Implement changes that piss off players, don't make any updates, make them bored, etc. The intention is to get them playing Diablo 3, but then make MOP extremely desirable again when it comes out (very positive changes and an overpowered Monk class until after Christmas, etc.)
• For the above, this will probably be around the time too that Blizzard removes the 10-character restriction from realms. Removing that restriction is a great way to bring players back.
• Make certain WOW virtual items (specialty pets or aesthetic changes) only available via B.Net Balance credits.
• Make certain payment methods more difficult, region locked, or restricted to control which methods players are more statistically probable to use. Hard to see buttons, missing instructions or support, etc.
• Special events where users can save money using B.Net Credits for purchases. For example, you can save 5-15% on the MOP or HOTS pre-download if you purchase using B.Net Credits earned through Diablo 3.