Another month has come and gone which means it’s time to start taking a look at the MMO business news for February 2018. This month we got lots of good news from our favorite game developers with their quarterly reports, the Better Business Bureau paid a visit to Star Citizen, and of course, there was more to be said about lockboxes.
FFXIV Population Growth
As part of Square Enix’s financial report, we learned that FFXIV has seen a growth in population. Final Fantasy XIV and Dragon Quest X both saw an increase in subscribers and a boost in disc sales thanks to expansions. Square Enix on the whole, however, saw sales that were a bit flat. This was because the company didn’t release many blockbusters. Profits, on the whole, were up for the last 9 months of 2017.
Funcom’s Best Year
Funcom had a great 2017, their most profitable year ever, in fact. The studio made $23.2 million in revenue and $6.64 million in profit. In 2016 their revenue was only $7.3 million. All of this means there are a lot of exciting things coming in Funcom’s future, starting of course with Mutant Year Zero which was announced at the end of February. It also means we can expect new content for Secret World Legends sometime soon.
Greed Monger Issues Refunds
Just when you thought you’d never hear about Greed Monger ever again, it’s back in the news. Former developer Jason Appleton has started giving refunds for those who Kickstarted Greed Monger way back in 2012. He wrote on Kickstarter that he was limited to $2,000 a day on Paypal but that refunds would be coming. Turns out the Greed Monger guys aren’t greedy after all.
Pay to Play on the Decline
Pay to play MMOs are down 9% in January according to Superdata’s report on January. There wasn’t a whole lot of change in the top grossing titles by category from December to January. You can see the top 10 in all three categories below.
Oddly enough, Superdata still has faith that VR can have a strong future. Earlier in the month, they said that VR has nowhere to go but up, which of course means that it’s at rock bottom right now.
NCSoft Quarterly Report
For NCSoft, this was the quarter that included Guild Wars 2’s expansion Path of Fire which more than doubled the game’s quarterly revenue year on year. This makes quite the comeback as Q2 2017 was the worst quarter on record for Guild Wars 2. Revenue is up 87% for the entire company, though it doesn’t compare to Q3 when Lineage M released in Asia. Aion, Lineage, and Lineage II all saw a decline, while Blade and Soul had a strong quarter. There’s a lot of hope for 2018 which will see the release of Blade & Soul II, Aion Tempest, and Lineage II M.
Star Citizen Meets BBB
Star Citizen creators Cloud Imperium met with representatives of the Better Business Bureau of California, which was described as an introductory meeting as well as cordial and constructive. The goal of the meeting was to encourage Cloud Imperium to improve communication and transparency on production schedules. The BBB seemed quite pleased with the meeting and are hopeful for the future of the game.
Activision Blizzard Has Record Quarter and Record Year
Net revenue rose 6% to $7.02 billion for the year with $2.04 billion of that just in the final quarter. $4 billion, that’s more than half of the revenue, came from microtransactions. Blizzard also notoriously doesn’t report player numbers anymore, but they did say that Overwatch had 40 million active users during the quarter. It isn’t all good news though, as PC and console business is down 4% and 3% respectively. This decline came from how few major releases the company had in 2017. There was, however, growth in mobile and ancillary revenues like merch.
Massive Investment in Kakao
Kakao Games, the folks behind Black Desert Online, received a massive $131.6 million investment package. It came as a bundle from five different companies; Tencent, Netmarble, Bluehole, Premier Growth-M&A PEF, and Actozsoft. With this investment, Kakao plans on expanding globally and acquiring other studios. We’ll be able to watch as Kakao expands and pinpoint it back to this investment. It’s good to be Kakao right now.
Nexon Yearly Report Looks Up
Thanks to successes like Dungeon & Fighter in China, Nexon reported a 28% increase in revenue in 2017 over 2016. That means they brought in a total of $2.2 billion, with 72% of that revenue made from PC games and 28% from mobile. If you break down the revenue by country, China accounts for 43% of it, followed by Korea at 40%, and Japan tied with North America with 6% each. Nexon also took the time to split its stock at the time of the report.
Marvel Heroes Revival Attempt
A group on Indiegogo claims to be raising funds to bring back Marvel Heroes, but it looks like it’s a little too good to be true. The company behind it is tied to a diploma mill college and seems to have a fake address. For that reason, I won’t be linking to the Indiegogo campaign and I encourage you to do your research before you give them any money. Sadly, this appears to be a scam attempt on the Marvel Heroes community.
H1Z1 Population Crash
Just before H1Z1 launched in February it became clear that the population of the once popular title had declined more than 90% in just half a year. A number of factors contributed to the decline, but competition in the battle royal genre seems to be the biggest factor. Since launching on the 28th there has been a boost in population, however, that boost seems short-lived as SteamCharts shows that numbers are declining once again.
Netmarble Financials Down
The last quarter of 2017 didn’t bring the best news for Netmarble. Revenue went up some, however, net profit was down. Something that was quite notable about revenue is that South Korea only counted for 32% of it as opposed to the 69% in the first quarter of 2017. Mobile MMORPGs are still driving profits with games like Lineage M and Tera M. Netmarble has several high profile mobile games coming in 2018, along with a game for Nintendo Switch.
Lockboxes: The Continuing Saga
The continuing saga of lockboxes could almost be a weekly column all on its own. More and more politicians are getting involved, and more governments are too. In Germany, the German Youth Protection Commission is examining the problem as a potential gambling concern and may ban certain elements. It’s expected that the commission will reveal what they decide sometime in March. This is all apparently based on an unpublished study from the University of Hamburg which looked at game sales and business models. It ultimately decided that actively targeting whales is a typical feature of gambling markets. It will be interesting to watch where that goes next.
In Sweden, lockboxes may be classified as gambling by 2019. This, according to a Public Administration Minister, is coming about because “It is obvious that there are many people suffering from gambling addiction, who also get stuck in this type of gambling and lose money because of it.”
In New Hampshire, Senator Maggie Hassan has taken up the cause. She sits on the Commerce, Science, and Transportation Committee and recently asked FTC nominees on their opinions on gaming addiction and lockboxes. All four nominees said the issue is one they’d like to address.
The ESRB has proposed a new label on games that feature microtransactions. It won’t be explicit to lootboxes because a large majority of parents don’t know what a lootbox is. The proposal does little to change anything and feels more like they’re just trying to get government officials out of industry business though. The ESRB still doesn’t require publishers to reveal the odds for their lockboxes.
And finally, Sea of Thieves has taken a stand to say it will never have lockboxes. Instead, it will have microtransactions. Go Sea of Thieves!
And that’s a wrap on the MMO business news for February 2018. Thanks to the popularity of the column and how much there is to talk about these days we’ll be publishing these articles twice a month now. And no, there won’t be a column just about lockboxes, or at least I won’t be writing it. It’ll destroy my soul.Related: Column, Financials, Lockbox, MMO, MMO Money, MMORPG, SuperData