Jan 24, 2011

Posted by in Electronic Arts, MMO, News | 14 Comments

Analyst: EA Investors "Betting Against" The Old Republic

While virtually everyone reading Ask A Jedi probably agrees that Star Wars™: The Old Republic™ is going to be the game that finally walks on water, it seems that some analysts are not as rosy with their outlook on the prospects for the title.

Gamasutra’s Leigh Alexander provided some perspective on Janco Partners analyst Mike Hickey, and the rationale behind his cautionary tone:

We believe many investors are betting against SWTOR achieving market success, provided the company’s (Warhammer Online from Mythic) and industry’s track record at releasing successful new MMOs.

Essentially, Hickey is factoring in things about EA’s history of releasing massively-multiplayer games, citing both Warhammer and All Points Bulletin (each development studio owned by EA,) in rendering his analysis. Given just those factors, it would be easy to agree with him. But there’s more to it than that – BioWare is involved, for instance.

So what’s our take?

Although contrary to the unbiased position they should be projecting, analysts usually have an agenda. And that agenda usually revolves around making money or gaining notoriety. Everything that’s mentioned in the writeup is merely an opinion and not a fact, nor a rendition of the future. Heck, he’s not even talking about the game itself… just using data, some precedent and speculation to form an opinion of the potential fiscal performance.

That said, it’s no secret that a gargantuan effort (and pocketbook) is required to develop, produce, launch and support a triple-A MMO such as The Old Republic™. It’s a risk that only a very finite number of publishers or studios can undertake. There’s no doubt that BioWare faces challenges.

Even with Star Wars™ as the intellectual property license, there’s no guarantee of blockbuster success. See Lord of The Rings Online™ and the recent shift to a free-to-play model for a recent similar example.

But luckily, we’re not investors. We’re gamers. We’re seeing all of the right things that BioWare and LucasArts are doing with The Old Republic™, and I think as gamers, that’s all we should be focused on. Let the business take care of itself, one way or another.

The bottom line is there’s no reason to let one analyst’s opinion of the potential success or failure of the game dampen your enthusiasm for it.

via Gamasutra

  1. LOTRO’s shift to the F2P model was not because of poor income from the game. It was decided to do it because the game would make even more money that way and it does.

    • Lethality says:

      Well, the fact is LoTRO was underperforming and that was the reason for changing the revenue model.

      As I said, I think its a decent model, but has gotten a bad rap from other games application of it. Not saying LoTRO.

      • Underperforming? That is the strange thing to say for a four year old MMO that claims to have been the second biggest P2P MMO after the one that should not be named. Seriously WoW’s success is an exceptions and not the rule. If your game manages to keep half a mil people wrapt up for five years paying subscription every month then it should be considered a success and not a failure. LOTRO changed model because it was getting old and going F2P did wonders for a really dying game – Dungeons and Dragons Online so Turbine decided to go F2P with that one as well in order to increase their profits not because it was not doing well(for a 4 year old game that is).

        My point was that LOTRO was very successful and it was because of two things – first – it was a decent game and second – it was based in a famous franchise. Either one missing and it would have gone south really quick as it happened to Warhammer Online or Star Trek Online(which were not all that bad but instead were not finished and in case of P2P games – this is lethal).

        • Lethality says:

          Before you think I am picking on LoTRO, I am a founder and lifetime subscriber… I’ve been there since before the beginning.

          But yes, underperforming. As in, they felt they could earn more revenue. Which as has been proven, they can. That’s the definition of underperforming. Underperforming doesn’t mean failure, but rather room for improvement.

          WoW’s success may be the exception, but it sadly also has become an expectation for investors who don’t know any better.

          The issue TOR has is that while BioWare has said they’re not competing with WoW, their budget and ambitions of a “10 year investment” say otherwise. They really have large expectations for the game, so almost assuredly on some level it isn’t going to meet all of them. But that doesn’t mean the game is a failure (and all of us here obviously are praying it isn’t!)

          • Well, for me underperforming means “less than expected” and I can say that LOTRO did as expected if not a little bit better than any normal 4 year old MMO after WoW came out.

            Still with your definition I would agree that it did not earn as much as it could have and as it now does.

            Still my point was entirely different – I think SWTOR would do great if it is a decent MMO as it has a huge franchise behind it as LOTRO did. Still if it does not meet the quality for an average MMO then it will be quickly forgotten as STO and Warhammer.

          • Just to chip in on this one, the game may be great but the problem was that the over all running cost and subscriber level was not turning th same profit a year ago, two years ago etc. It was a decline that was slow and levelled out to a profitable but at a small margin.

  2. I loved Lotro, I would still be playing it today if it wasn’t or the lack of end game group content. Which I don’t blame lotro for at all, the community seems to prefer the solo game over group content. At least on CrickHollow server.

    But I totally agree with Lethality, the game was underperforming in the eyes of many. While it may have performed well compared to other MMOs, it was underperforming by loto expectations. Subs had been quite stagnant for last few years and wasn’t showing much growth..hence they tried a new strategy to boost engagement in their game.

    I think the game mechanics of lotro was absolutely top notch. Captain class IMO was one of the best designed support classes I have seen in my limited MMO experience.

  3. AlexWhiteSaber says:

    EA has the same problem of SOE —-> GREED.

    But if they’ve learned with their old mistakes that cost them millions of dollars we should not worry.

    Lesons they should have learned:

    1- Don’t realease SWTOR before it is 90% ready (even if the realease date is 31/12/2013) better have 2 million ppl waiting for a great game than have 1 million players frustated with it (eg. AoC)

    2- Don’t include MT’s for any kind of ingame bonus, game content etc. MTs should be exclusively for server transfer, number of chars, name change. No extra bag slots, extra xp, extra dmg, armour, weapon etc… it will ruin the game and a lot of players will quite.

    3- Subscription price. Don’t go any further than 15.00 per month. But if they really want ppl to stay with it regardless of any game issue the subs. price should be 10.00

    • Ad.1 – Beta testers say the game already looks 90% complete, good sign I guess. I guess BioWare wouldn’t let EA kill their name by releasing game early. And EA itself should know better after AoC failure, even being greedy ******* they are. I guess the game will be complete on release – they still got over 3 months – just without some cool features like player housing / guild capital ships etc. on launch day.

      Ad.2 – 100% agreed. If they go for MTs for unfair advantages I quit, no matter how awesome this game might be. That’s what killed S4 League for me. Best shooter I’ve ever played, awesome game mechanics. But once publisher got greedy, people spending like 50€ per month had ~triple dmg / dmg resistance the free players had. Now imagine they even allowed this in ESL. We got stomped in 1st match – three skilled, but free players vs. three less skilled, but full €-geared players.

      Ad.3 Again, agreed. ~2kk 10$ subscribers are better than 500k 15$ subscribers.

  4. While I have faith in Bioware to create a good game I don’t have any faith in EA’s integrity or they ability to stay hands off and not try to squese blood from stones.

  5. Using statistics for betting money like this always fails more than it wins. The basic rule of thumb is statistics fail when you apply it to an individual. As per Murphy’s Law the Individual will almost always be the exception to all ‘statistical’ rules.

    So let them see the glass as half empty. I choose to see it as half full and laugh at them while I have loads of fun in TOR. Who cares whether some bean counter thinks it is a success or not?

    As long as we the paying consumer are having fun. That is all that matters to us. Of course I want them to make lots of money but listening to reviews fails to divine the future, ever.

    Having been in beta for a few months, I can easily say that I will have loads of fun. I was in WAR beta too and TOR holds my interest like I ‘wanted’ WAR too.

  6. Anyone betting against it at this point is a fool. while it is true that EA has a really, really, and I mean really bad rep as far as mmo’s Bioware is involved as is lucas arts. I think Lucas learned a lesson letting Sony take the reins with SWG and totally trashing the ip. I don’t think he will let that happen again. Until Sony totally trashed SWG Lucas had a stake in it. In fact in a “after the star wars” interview he mentioned he would take a direct hand in putting SWG back on track. Although that never happened I am guessing that when the Head of Sony went around firing all the experienced staff who objected to the CU trash they threw at us, he realized fixing it was going to be very costly, just getting a competent staff trained on how to use the software before they could fix it.

    I don’t think Lucas will let another Huge turd of a company like EA trash his IP again and I am sure he saw to that in the contracts.

  7. I’m amazed that people still talk about “free to play” mmos as if they’ve failed somehow by switching over from subscription based play.

    If you bothered to pay any attention to the real world you’d know that profits for games like Age of Conan and LOTRO have multiplied since going FTP. It’s a hugely successful platform, and it’s the subscription-based play that should be considered stale and outdated. It’s an old model that is no longer relevant. The companies that don’t get with the times will eventually be left behind.

Leave a Reply

Your email address will not be published. Required fields are marked *