As you can tell by the those subscription and financials, things have been looking very bad over the past several months. Not only do these officially confirm the accuracy of previous estimates, but also the manipulation involved in the Subscriber™ definition. =]
As explained many times in the past, there's a significant difference between subscriptions and Blizzard Subscriptions™. Investors and the public get to see their public financials, but it's not like they're legally required to reveal actual subscriber numbers (or names) to anyone. They use a special definition for public announcements, but that's about it - and that number can be manipulated in any which way they want. I also have an interesting news reveal shortly where the Blizzard marketing team will soon be able to manipulate this number even further to their advantage. =]
Based on the subscription numbers, you can see that they've lost a little over 10% of their subscribers and they still haven't been able to fix their attrition issues while churn is in some serious trouble (i.e. the rate of losing players has been higher than gaining players for almost a year now.)
In regards to the sudden drop in players (and associated revenue), I'm not sure how they can keep this information hidden any longer. I don't know how they can continue justifying their public financials considering the massive losses in micro-transactions and pet/store sales. Even with such a sudden drop (ie, 700-800k Subscriptions™), I don't think an official or documented announcement will ever be made. The Q1 (Jan/Feb/Mar) 2011 financials call is coming up in a couple months and I'm really looking forwards to it, especially after the massive release of all of this information. =]
You should see some interesting and more desperate actions soon in order to increase their revenue. One of them is new pet/store sales, but I'll be putting that up in another post right after this one before my 2 major updates.
One of their acts of desperation, which I think I've talked about in the past, is turning World of Warcraft into a F2P system like what everyone else is doing. That's right! Blizzard is planning changing their treasured game into a F2P structure.. well, sort of. Basically, the free 14-day trial period is being changed to unlimited play up to level 20. The announcement is planned "at the end of Q2 2011", so you should hear about it very soon.
This information was actually pretty easy to find, a ton of employees knew about it already so I didn't have to go through my usual channels. I don't know any more details over than the F2P modification, however, because they need to keep gold farmers and spammers on a leash, I'm sure you'll see a lot of restrictions in place similar to the trial method. For example, chat, AH restrictions, and probably a limit on gold and/or a bank limit so that they can't be used as mules. I'm also not surprised by the timing of the announcement either, it's right at the cusp of a new quarter in which they want to drive their revenue and artificially increase subscription numbers. =]
You see, this new approach reeks of both desperation and brilliance. Subscription attrition has reached a terrible state, and they're going to continue plummeting for years to come. However, because of this new method and the influx of "free players", it will artificially increase their Subscription™ count astronomically. Will they be changing their special Subscriber™ definition, or will it remain the same? If you ever see a "12 million" or "13 million subscriber" announcement in the future, just remember that 3-4 million of those "subs" might be in fact F2P players. =] And those numbers don't even come close to real players as you're well aware..
From what I can tell, this is just the first step in a new long-term plan and they have a lot of other stuff scheduled for the future (e.g. lowering the cost of WoW, reduced expansion pack price points, and eventual subscription fees). I didn't like the "Cataclysm experiment", but I do like this experiment.. I'm surprised they didn't do it sooner.
Okay, now that I'm past all of the boring stuff, it's time to move onto the more important and mind-blowing updates! Should be up momentarily so please hold tight.. I'm sifting through a ton of information and emails here and trying to sort things out to find the important bits.
Hmmm.. saw an interesting new domain registration just yesterday.
Here's the link, check it out:
http://www.activisioncommercialsummit.com
It's an Activision / Blizzard streaming webpage apparently for an upcoming conference (called the "Activision Commercial Summit") on 03/23/2011. Seems like they're cutting it awfully short and I have no idea what this is.
The domain was registered by CUBIC COMUNICACION AUDIOVISUAL (in Barcelona) who will be providing the streaming services of the event. There's no streaming video available at the moment, it's locked. (There's a chat channel attached to the video stream too, usually something like this is reserved for business conferences.)
I'll search around, and see if I can dig up more information about this summit. There are some educational gaming conferences taking place this month. Or, maybe this is just testing (or a sales pitch) for an event they'll be potentially hosting in the future.
Have you guys heard anything about this? Anything that Activision is supposed to be announcing in Barcelona on March 23rd?
* UPDATE (03/21/2011):
The webpage has been updated with the following news item:
"The Activision EU Commercial Summit stream will commence at 10am GMT+1"
And there's a countdown clock now too.
The thing is, Blizzard is very predictable in regards to their ban waves.
They've been collecting user details for months, but wait until a certain time before banning all players at once. Banning still occurs on a regular monthly basis, mind you, but those are for high visibility infractions (e.g. botting that's noticeable by other players.) They want to keep their customers as happy as possible, so exploits/bots that are more visible are dealt with more expediently.
There's a significant amount of revenue to be made from banning accounts.. for one, the players purchase WoW and the expansion packs again, and they pay for a new subscription. It also looks good on paper because it counts as 2 "active subscriptions" since the banned account was already paid until the end of the month.
Blizzard will have large ban waves when revenue is typically lower than expected. They want to make sure their quarterly returns are as high as possible (to impress their shareholders), so bans typically take place during certain quarters.
This well-timed ban wave takes place right before their first quarter ending March 31, 2011. It's also taking place right before pay day. Coincidence? I don't think so. =]
(Note: It's not a very good sign that this took place so soon after Cataclysm sales either.)
As you're aware, Activision Blizzard prepared their shareholders during their last conference with the knowledge that they shouldn't expect any major game releases this year. With that in mind, they still need to drive revenue as best they can - meaning this year, you should expect either new paid services (or existing services with a twist like special discounts) and/or new virtual pets or other items that can be purchased. We might see some new merchandising, or other cool little things to increase revenue. You can also expect increased banning and re-activation of accounts. =]
This applies to all of Blizzard's games, not just World of Warcraft.
And if that wasn't interesting enough, look what Blizzard just posted (Source):
So Homefront launched today, I forgot all about it actually. =]
It will be a couple days before THQ releases sales figures information (if it's not doing so well, though, they won't release many details or even make an announcement at all.) The revelation of the Single Player mission being only 5 hours long couldn't have helped matters.
I'm always interested in future predictions made by industry experts, but that sort of information is very difficult to come by. No one wants to make educated guesses any more (for fear of being incorrect), and most analysts wait until the last minute (eg 24 hours after launch to make a "prediction of first week's sales") or wait until they can see Pre-Order numbers before making any predictions.
Here are the most prominent sales predictions for Homefront, for example:
1. Lazard Capital analyst Colin Sebastian predicts 1.5 million sales by the end of this month.
2. Michael Pachter doesn't expect Homefront sales to do very well, but he never provided any figures and kept his comments as vague as possible (he's been doing this more often unfortunately).
3. And then there's "HULIQ", they forecasted that sales figures for Homefront will hit 1.25 million in the first 6 months and 2 million by 12 months. Provided, of course, that they release one high-quality DLC, and offer a stable multiplayer experience, etc. I've never heard of HULIQ before, but the webpage looks a little sketchy and needs some major updates.
Most recent reviews of Homefront have made one thing very certain: the multiplayer experience isn't anything like Black Ops. In BO, an inexperienced camper can just stand in one place and get a 20-kill streak. Homefront is different, leaving brainless gamers very frustrated with the game since they won't survive as long as they could in BO (or earn achievements as quickly). Experienced players are finding the multiplayer experience quite refreshing and fun however. It's like Cataclysm Heroics for FPS players.
So, although initial sales won't be as high during the first week - I think the game can have some real staying power thanks to it's multiplayer experience (the "perk" system looks very cool too).
I wish that there were more industry experts out there predicting this kind of stuff though, even if they're wrong at least they can give a reason as to WHY they made their prediction. The best articles I've read are the ones with figures, past comparisons, trends, and logical reasoning as to why they picked that number.
For example, consider LA Noire.
I make a lot of decisions based on what people are saying about the game, and the general consensus is that LA Noire is going to be an awesome game. But, I'm getting a very bad feeling about what people are really saying about it.
Most are saying it awesome, but they're not saying the gameplay or story is awesome, they're praising the setting and new facial capture technology. It's not, "You gotta play this game, it's brilliant and so fun!", instead it's "OMG. Check out that facial capture technology! Look at their faces, they're so real! The faces! The faces!".
For those fortunate enough to have played the LA Noire demo, they played the best parts: the clue gathering and interrogation mini-games. However, 20 minutes isn't enough time to make a decision about the game.. did they consider that they would be playing the same mini-games over and over and over throughout the entire length of the game?
The game has been described as Rockstar's most adult oriented or "serious game". It's a slower paced game than their other lineups, and a lot of time has been spent on facial capture and voice acting. So, you can anticipate a LOT of cut scenes and player conversations.
From what I've seen, it appears to be a very linear (and slow paced) interactive detective novel, with conversational mini-games, and a lot of cut scenes that could potentially interfere with gameplay. Once the novelty of their faces and voice acting wear off, that's what you're left with.
Word is that it's impossible to fail a case too (all of the cases are pre-determined too, it's not like Clue where there are random killings, random scenarios, and random evidence.)
I know that I'm going to enjoy the game myself, but I'm getting a bad feeling that many players are going to be disappointed after playing the game "for real". Re-playability is also a big concern in it's present state, but it can be solved through DLC.
Bethesda's games for example (Fallout 3, Oblivion, Morrowind, etc.) I absolutely loved, but I _hated_ the same old NPC interactions and vendor menus (which they replicated across all of their games). It's the one thing I never really like about the game, but fortunately they weren't a significant part of the game. In LA Noire, player interactions ARE a big part of the game. When questioning suspects, I suspect that players will start seeing the exact same facial cues and "looks" over-and-over, which kills a lot of the fun in try to determine guilt, innocence, or deception (of course, they need to dumb it down though so as not to frustrate inexperience players.)
Pachter said that he would never underestimate Rockstar again, so whimsically predicted that LA Noire would sell as many games as Red Dead Redemption had. Problem is, Rockstar is publishing the game this time around.. Team Bondi is developer. The reason he underestimated RDR the first time is because he thought the genre/setting was too limited. I think this is true for LA Noire though, a western shooter has a tremendous market size compared to a detective game.
Is it mostly an interactive detective novel though? Do most people realize that it's not like GTA/RDR in terms of gameplay? I don't know.
What I do know is that I'm getting the same old SPORE-like vibe from this upcoming game release. Screenshots and demos are showing off the best parts (to control perception of the game), there's a huge amount of hype, gameplay videos are limited, players are expecting one thing (but they're going to get something different), and gamers are forgetting about re-playability and repetition (e.g. mini-games) within the game.
Anyways.. I think there's going to be a big explosion of sales during the first month, as people will be expecting the currently promoted game (the perception is RDR in the 1940's), but they'll be getting something completely different out of the box. Once the initial novelty wears off though, sales will decline and I don't think they'll reach the same heights as RDR. Either way, though, first day sales are definitely going to be highly successful for Rockstar.