This Just In, We're All Doomed

Nice market you have there, I'll take that now.

A new market forecast from a global research firm puts the global MMO market at $8 billion this year, thanks largely to growth in China and Korea. Gamasutra, which unlike me could apparently afford the $2000 to read it, notes:

the MMORPG industry can be essentially considered as two regions, with Blizzard Entertainment dominating the “slowly growing” Western market, and publishers such as Shanda, Netease, Nexon, and NCsoft driving most of the MMORPG market’s growth in Asia.

Strategy Analytics believes MMORPGs in the Western market are showing signs of a slowdown due to competition with console video games and the rising popularity of social games. It also says that the traditional subscription model in many Western MMORPGs has “lost traction and growth momentum.”

It goes on to assert that future growth in the Western market will be spurred on by Asian companies entering the US market, because, you know, that never happened before.

  • http://www.facebook.com/ptithom Thomas Bidaux

    Most of those studies totally miss the F2P games available in the West.
    Not saying this one does, but it wouldn’t surprise me.

  • http://Website bonedead

    Wait so, it’s just gonna happen?  Are they betting on FFXIV or something?  Or is everyone just randomly going to start playing the Asian games with rmt shops?  lol

    I can’t believe people actually get paid to make shit up, but I will gladly take any available position.

  • http://Website DoubleD

    Maybe Western markets are flattening because of the lack of attention to said games going F2P?
    It seems its a western mindset has evolved to hype a new MMORPG to frothing lunatic crazyness just to hit paydirt on the inital box sales. Recoup costs,  then rely on monthly subscriptions for ‘creame’. When their dev team goes to make the next frothing marketed mmorpg. The live team just is clueless.
     
    Then western games are in a pickle, and watch as their subs decline (Gee, I wonder why nobody playing anymore, since our game is half baked market hype) and go f2p as a means to milk it a bit more..
     
    As the Eastern market tends to item shop everything and be motivated to develop by paid for content.
     
    Hmm..
     
     

  • Lenin

    First Scott, as you well know, Asian MMOs will never succeed in Western markets except as a fringe phenomenon. Secondly, as Thomas rightly asserts, I’m sure this study is totally US-centric, and misses the huge success of, say, a game like Dofus. Thirdly, there is very likely plenty of room for middle-market MMOs, namely those with, say, a lower subscription, or a 100-150k player audience, and development/support costs managed to those expectations.

    The only real, and probably healthy change, is that the days of the “WoW-killer” or even WoW competitor fantasy are over.

    Then again even that’s not news; how many naive developers and publishers were fantasizing about making a “Diablo-killer” a few short years ago? Then Blizzard pulled the rug out from under them all and created WoW.

    There will always be silly Blizzard-chasers in this biz, this is what we have learned.

  • http://stabbedup.blogspot.com/ Stabs

    They seem to be missing something that’s right under their noses.
     
    They state that Blizzard utterly dominates the Western segment. Then they surmise that slowdown in the West is due to console games and social games.
     
    I wonder if, when Cataclysm is released, and interest in WoW peaks again they will conclude that consoles and social games were similarly responsible.
     
    In a market measured by WoW, WoW having a slow period equals the market having a slow period and they really don’t need to be looking for external factors.
     
    And this costs $2000? To get an analysis that misses the obvious? Somehow I doubt Gamasutra actually paid for their copy.

  • http://stabbedup.blogspot.com/ Stabs

    Oh and another thing. Analyst Jia Wu cites MMOs going free to play as an example of the Western market slowing down. One of the examples he gives is DDO. He really didn’t do even the least bit of homework because DDO made more money after switching to F2P not less. In fact it’s the spectacular financial success of Eberron Unlimited that has led to most of the other examples of games switching business models.
     
    Would anyone care to pay me $2000 each to do a better job?

  • http://Website Lenin

    Stabs absolutely correct: DDO going F2P (I have good info but of course can’t share proprietary details) has been a spectacular success for Turbine.

  • http://geldonsgaming.blogspot.com geldonyetich

    Mayhap Mr. Jia Wu, previously holding marketing and planning positions for a major Chinese net portal, is a little biased in favor towards his past interests.
    That said, I suppose it’s not that hard to put 2 and 2 together when you see that most Western MMORPGs lately have been trying (and failing) to be the new WoW, when meanwhile of you look to the far East you’ll see they’ve branched out into MMOs far beyond mere Dikumud hack and slashers.
    As far as being wired goes, South Korea makes us look like a bunch of dirt-eating cowboys.  We really aught to get a jump on that.

  • http://geldonsgaming.blogspot.com geldonyetich

    I see the subject has sort of shifted DDO’s success.

    You know, I’m holding out judgement on whether or not going F2P was a good move for the traditional MMORPG until I see what happens. 

    DDO was always a game heavily held down but its highly instanced nature, it didn’t feel particularly worth spending $15/mo for a key to an uglier Guild Wars based off of kludgy Dungeons and Dragons mechanics.  So, when it went F2P with micropayments, it pulled 500% profit?  I’m not surprised at all, considering.

    LOTRO, on the other hand, is a triple-A MMORPG.  It can hold its own with the best of them.  Will going from a monthly subscription to F2P actually prove profitable?  Well, it will at least get those freeloading Lifetime Subscribers who’ve hung around for 12 months more than they paid for to drop a dime on Turbine from time to time.  Aside from that…?

    EQ2 will be a similar case.

  • http://www.mmomisanthrope.wordpress.com Dblade

    I think there’s a reason why that’s not given: a lot of Korean F2P games are not MMOs, but are virtual free console games with a grind slapped on. There is nothing MMO about Dungeon Fighter Online for one. Pangya is golf: there are fighting, arena shooter, driving, snowboarding, etc.
    It’s big because that way they eliminate piracy, and that is what is driving f2p growth. When the Koreans want to make a decent game to attract western viewers, it’s traditional like Aion or Tera.

  • http://beafraid.com hellfire

    I’ve always said that I think in the *Western* market there’s no one-size-fits-all scenario. I think there’s plenty of “growth” left with traditional games like WoW and Old Republic right alongside F2P DDO, EQ2, et al right alongside “hybrid” games like Guild Wars/2. I played the beta of GW, didn’t buy retail. I beta’d EQ2, never bought retail. I will be picking up GW2 and giving F2P-EQ2 a try as soon as it’s publicly available.
     
    Tangent: If Guild Wars 2 can pull off HALF of what the teaser vids are teasing there just might be some sparks of competition in the sword-n-sorcery space.

  • http://aaa sinij

    Years of shitting in the box finally caught up to “teh industry”. If only you spent less time cloning EQ and more time trying to build competitive sandboxes.
    Plus: New comment system is spawn of Satan.

  • http://Website Count Nerfedalot

    That whitepaper totally should have closed with the line:
     
    “All your base are belong to us!”

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  • http://Website dartwick

    The future of western gaming is better tools which will allow smaller developers to afordably develop more niche products with out compromising quality.
    These tools do not yet exist or at least do not exist with enough accessibility.
    The west is a niche based societyas of the last 20 years and is becoming even more so. Especially with respect to products aimed at adults.
     
     

  • http://Website Bosh

    “In a market measured by WoW, WoW having a slow period equals the market having a slow period and they really don’t need to be looking for external factors.”

    Exactly. Any slowdown is mostly just “WoW is old now.” There’s not much else to it.

  • http://unsubject.wordpress.com UnSubject

    @Bosh: That’s not really something the NA market should be crowing too loudly.

    Regarding DDO going F2P: it might have been successful for Turbine, but did it actually help grow the MMO market, or just cannibalise existing players from other games? If it was cannibalism, then the market didn’t grow as a result of that action.

    Also, there is no ‘one-size-fits-all’ for the Asian market either. If anything, that region is churning out more MMOs at lower costs, meaning it can better cater to various niches than Western developers, many of whom tend to favour the big dollar, one-new-title-every-six-years model.

  • http://Website ToeJob

    I’m hoping that if Old Republic launches well it will draw interest in Simutronics Hero Engine and hopefully the newcomers to the MMO market can afford to use it.  Might as well get something out of it since they’ve all but buried Heroes Journey in the litter box.

  • http://stabbedup.blogspot.com/ Stabs

    Regarding F2P DDO I think it will turn out to be the WoW of free-to-plays. Lots of people will emulate it hoping for the same success, won’t get it and much wailing and gnashing of teeth will therefrom arise.
    It doesn’t help that some of the F2P implementation has been pants on head stupid. Allods had a sit out and don’t play for an hour mechanic that they’ve now changed to occasionally chuck an item in the rubbish bin for non-payers. EQ2 are planning a special ghetto for non-payers where they will be able to wipe with all the other freeloading numpties.

  • http://Website Amaranthar

    DDO hasn’t passed the test yet on FtP. It takes time to see if something is going to stick. Especially something that’s basically new to their market. They may have saved themselves temporarily, but they haven’t yet saved themselves. I think they will,I don’t think they’ll die off, but I don’t expect any wild success story from it.
    Huge difference between the Western markets and the Asian markets. Obviously the two look at their games differently, and I suspect that it has a lot to do with differences in the communities. I mean, in the US we have sports in every school, activities in every community, mobility so that small communities are always visiting larger neighbors to make use of what they have. Kids have a lot to do. I don’t know the facts in Asian countries, but I suspect sports are more limited and community activities are too. I think, if this is correct, that kids in Asian countries view gaming as more of a sport/competitive things. Especially boys who need that outlet, by their nature, and this doesn’t change anywhere in the world.
    I don’t know if I’m right about that, it’s pure speculation. I’d love to hear comments and real facts, not so much arguments based on closed minds and exceptions or specifically narrow “facts”.
    The Western market is hurting, and I think it’s because we have WoW, and WoW clones, and nothing else that’s funded well and “modern” (except Eve, which isn’t a full MMORPG without avatars on the ground and worlds to explore on foot). And it’s not being accepted anymore. It’s drying up, just beginning to, actually, in the bigger scope of things.
    The fraternity of developers don’t seem to see this yet, being all locked away in your circles and looking down your noses at the players who’ve been telling you it was going to happen, and why it was always going to happen, and offering solutions that those inside the circle can’t or won’t seem to work with. “It can’t be done”, how I have grown so fond of those words over the years. There are always answers to problems, unless your stuck inside a circle and always looking inward, never outward. And that’s exactly what the fraternity of developers seem to be doing over the last 10ish years. But hey, maybe man can’t fly. Maybe you can’t walk on the moon. Maybe you can’t make a hotter chili than Chef Boyardee. Maybe I’m all wrong.

  • http://Website Mikyo

    Patronage, gifting, and togetherness are Asian traditions.  In the USA, not.

  • http://Website Guy

    I agree that any slowdown perceived is most likely due to a slowdown in WoW. And maybe people in the MMO industry don’t like to think about this, but it is possible that for many people, playing a game like WoW is a once in a lifetime or once in 10 years experience. There is major burnout associated with MMOs, seeing as they’re games intended to be played for many multiples over a typical single player RPG, which are already too long for most. Counting on the existing size of the market as the minimum market for the future may be a mistake.

    However, there is of course the new wave of fresh players who have never had the experience before, plus the recurring diehards who really do love the current MMO format.

  • http://tremayneslaw.wordpress.com/ Tremayne

    I still think the Western market is likely to make a leap in size when someone launches the next generation of MMO – which I expect to be on a console platform, episodic or time-casual, and incorporate social networking features (but not be one of those Zynga social games where they forgot to include the game part of it). In the same way that WoW gew the market by making a game that was soloable and refreshingly un-grindy (don’t laugh – compare WoW at launch to EQ, or even DAoC), someone will grow the market by making something that’s accessible  and fun for people outside the current niche.

    Naturally, all of the MMO old hands will decry the new game as “dumbed down” and “not a proper MMO”. But they guys who publish it won’t care – they’ll have five times the income of the previous big beast in the industry and will be able to hire Bill Gates to empty their trash cans …

  • http://Website Kaalinn

    What’s really been bugging me about the “Western market” is that WoW has always been viewed as “the standard” or “the rule” now, and this view has never been questioned. Maybe WoW isn’t the rule, but the exception. Maybe the fact that everyone who tried to produce something on par with it didn’t make it is because it is, in the literal sense, exceptional.
    I’m guessing most people would agree that WoW, in very broad and basic terms, takes the lowest common denominator and polishes it to a sheen. As such it’s obviously attracted the largest market share… and really the only way you’re gonna top that is by making a 99.9% exact copy, with equal polish….. except Blizzard has way more resources and money at this point and you can’t keep up at all.
    So what’s there to do? Let’s use an example of what I think is a similar situation……. paper tissues. No one really cares what brand of bog standard tissues they buy. You do the same stuff with it, they’re all sheets of white paper and you throw em away anyway, the only real difference is the print on the plastic. The brand selling the most will simply be the brand with the biggest presence and maybe the biggest brand recognition or synonimity of the brand with the product (such as “Coke” essentially meaning “Cola” for the US market). BUT some guy brings out some sort of scented tissue…. some people will hate the scent, some will like it, maybe some will use it cause of special circumstances that make it just right for them (or maybe not), like allergies or having the flu (since well there’s always transitional players in MMOs too right?). You can be a successful non-mainstream tissue and run a succesful business…. just don’t expect to be the exception to the rule. WoW’s subscription numbers right now are viewed as what you (approximately) need to be succesful apparently, but success should be measured by production cost, running cost, and several other factors… there is always critical acclaim and, at least to some, artistic merit.
    Sure at this point WoW is critically acclaimed because critical acclaim equals subscription numbers for many, but if you look at a lot of the examples given in other comments there’s plenty of games that you would easily consider a success as long as you don’t completely debunk that success is possible without WoW-like numbers. It would be rather beneficial to simply view those numbers as a success and see WoWs as the exception.

  • http://Website Peter S.

    To build on Kaalinn’s post, there has been chronic underestimation of the risk(s) of developing a too-similar product and overestimation of the risk(s) of developing a too-different product present in the realm of game development for a good two decades now.  (Relative to each other, that is.)

  • http://tremayneslaw.wordpress.com/ Tremayne

    Kaalinn – only a fool would regard Wow’s subscription figures as “what you need to be successful” because no other Western subscription MMO gets so much as a tenth of that. WoW hasn’t dominated the MMO market – it created a brand new MMO market many times bigger than the whole market was before it arrived, and dominates THAT.
    Financially, even a triple A rated MMO can be successful with something like 100,000 subscribers as long as the development costs didn’t spiral completely out of control (*cough* Tabula Rasa *cough*). Of course, the investors would like to see WoW-like figures, but as long as the game gives a decent return then everyone’s happy.
    From a player point of view, a game’s successful as long as the servers stay open – and ideally, it does well enough to get regular live updates rather than being placed in maintenance mode. Funnily enough, the criteria for that are pretty much the same as finiancial success – if it makes money, it stays open. If it’s a rathole, people stop pouring money down it.
    Critical success – fuggedaboutit. You might get some nice reviews in magazines, but no matter WHAT you do, the gaming forum community will be full of flames and hatred. Hey, that’s what we do!

  • http://www.cesspit.net Abalieno

    Every time I read DDO next to “spectacular financial success” I have to chuckle. You people are still so gullible.
    That said there’s that “Tera” Korean game that may end up doing a couple of interesting things.
    Two of which would be technical achievements if not vaporware: zoneless world and most concurrent players on a single server.

  • http://Website Moniker

    How exactly is buying and using a product free loading? If Turbine thinks the life time subscription is a bad idea then why offer it? they thought it was a good idea. There are obvious up sides. Why do you think it’s free loading?

  • http://Website Guy

    Heh, visually, TERA looks like a souped up version of WoW. In a good way that is, not an EQ2 way. Pretty. Where are those two tech features discussed/described?

  • http://www.cesspit.net Abalieno

    They also claim completely target-less combat. You should aim like a shooter and I think all skills are positional/area-based.
     
    I read these things not on the game site but on the developer site.
    http://www.bluehole.net/eng/eng.html#project

  • http://stabbedup.blogspot.com/ Stabs

    Every time I read DDO next to “spectacular financial success” I have to chuckle. You people are still so gullible.
     
    versus
     
    WESTWOOD, MA – February 26, 2010 –Turbine, Inc. announced today that Dungeons & Dragons Online®: Eberron Unlimited™ (DDO Unlimited), the world’s best free-to-play massively multiplayer online role playing game (MMORPG) has already attracted over one million new players since its September 2009 launch.  The massive influx of new players has been across all of the various consumer plans available.  DDO Unlimited’s paid subscriber base has more than doubled, while at the same time players are transacting in the new DDO store at three times the industry average, growing the franchise’s revenue over 500% since its launch in September.
    http://www.turbine.com/news/5-press/93-dungeons-a-dragons-onliner-eberron-unlimited-surpasses-one-million-new-players.html
     
    I guess it could just be lies. But why bother? They could have just stayed sub-based and lied.

  • http://www.cesspit.net Abalieno

    500% is a number used to make a nice impression but is irrelevant if used out of context.
     
    If there were 1000 players left in September and now 5000 it means there was a nice growth, but a nice growth that means basically nothing concrete or useful to take into consideration for the rest of the industry. It’s irrelevant marketing speech.
     
    I want to know how much the game cost from conception till today, then I want to know how much the game earned in the whole timespan. That ratio will determine if there was a spectacular financial success or not.
     
    The rest is irrelevant and only used for those people who are gullible and think Press Releases correspond to factual and correct information instead of advertisement.

  • http://Website Votan

    Could it possibly be that the western market is flat because almost all of the new games released in the last 5 years have sucked? 

    Massively over hyped, brken promises, broken games, bad design, describes almost every single MMO released since WoW.  And WoW has been dumbed down so much that it is now designed for your average 5 year old.

    The one thing that has changed is the players no longer hang around paying companies money for half finished or crappy products or willing to wait around for the game to be “fixed”.  See Aion, Warhammer, Star Trek, ABP, Champions, Fallen Earth, Global Agenda, Matrix, Sims, SWG. and pick anyone of the 1000 Asian F2P games that litter every MMO web site they all have one thing in common they all suck..  

     Stop making crappy buggy badly designed products and maybe you can get some “growth”.  Till then I am the part of the western market that will stick with console games rather than pay MMO companies for the absolute crap they have produced in the last 5 years.

  • http://unsubject.wordpress.com UnSubject

    @Tremayne: The thing is that if you only plan for 100k players, you can only have a development budget that suits that player target. Cryptic are very possibly working on this kind of model, but get crucified for not delivering all things to all people as a result (and although I think a lot of criticism of Cryptic is accurate, I’ve also seen a lot of hyperbolic abuse too).

  • http://Website Mark

    An interesting topic would be discussing what kind of development budget can you justify for an MMO that is expected to retain 100,000 subscribers?
     
    I realize EA and Acti-Blizzard would never greenlight any MMO project that projected subscriber numbers like that, but I am curious at what kind of development budget is in line with that number of subscribers.