The 30th of January 2013 sees EA’s first earnings call since Star Wars: The Old Republic went free-to-play.
This is significant for the MMO industry for several reasons:
1) SWTOR is believed to have cost $200+ million to develop, making it the most expensive game of all time.
2) Having launched as a subscription service, it heavily hemorrhaged players from an initial 2 million to around 500k on the last earnings call, a pattern that reflects how many ‘themepark’ MMOs perform in their first year but to the shock of commenters that expected a challenger for WoW
3) Like many similar titles, it has transitioned to a free-to-play model in order to retain players and boost revenues. Many have questioned the logic of this move.
The MMO blogosphere is a highly tribal environment. Everyone has their favourite MMO(s) and theories why some games succeed and others fail. But in the last few years, we’ve had very little data on which to base our theses. For this reason, I look forward to any data we can glean from this earnings call.
I predict that EA will announce the Cartel Market as a success. I have no doubt that many new players have been attracted to the game and that high revenue players (‘whales’) have invested heavily in cartel packs on the chance to win very rare cosmetic gear.
This survey from Darth Hater (link), although suffering from the usual community website selection bias issues, indicates a decent ARPU from players that decide to pay for goods.
|How much real money have you spent on Cartel Coins?|
|$5 – $10||5%|
|$11 – $20||6%|
|$21 – $50||15%|
|$51 – $100||11%|
|$101 – $200||8%|
|How likely are you to purchase additional items from the Cartel Market in the future on a scale of 1-5 (with 1 being “no frickin way” and 5 being “definitely”) ?|
So the overall story is that players have shown a willingness to spend, with many spending big.
What isn’t clear is whether the game has recovered sufficient subscribers or seeing sufficient revenues to be a future focus for investment in new content, or if this is just a case of milking the cash cow. Players that have been with the game since launch want to see new class story content, but there needs to be a compelling reason for EA to get its wallet out so soon after launch.
Can F2P plug the gap in SWTOR’s revenues? Looking at F2P competitors such as Lord of the Rings Online and Champions Online, this commercial information is closely hidden, so the general consensus is that they are fading out.
On this basis, I suggest the following interpretation of the earnings call:
-More financial data means the game is doing well (ARPU, revenues, # of subscribers, % of subscribers, Cartel Shop sales etc)
-Abstract game data means that it has a year or so left to live ( # of characters created, accounts created)
It be interesting to see how this plays out.