Post by Morreion on May 25, 2012 11:10:58 GMT -5
As detailed here, 38 Studios, headed by visionary Curt Schilling who was bringing us a much-anticipated MMO code named Project Copernicus, has collapsed. The story is still playing out, but here are my thoughts.
1) MMOs are a very speculative investment. Gone are the days of 10-15 years ago when there were few MMOs that had modest player bases. It's a big business now, the market is oversaturated, and new MMOs mostly fail to live up to expectations. They require solid management. Trion Worlds is the exception to this depressing rule of failure so far.
How the hell did Rhode Island give 38 Studios $75 million in taxpayer-funded loans and guarantees? This was an insane thing to do. MMOs are pure speculation. I say this as a fan of 38 Studios and what they were doing. It was the height of irresponsibility to use taxpayer money to fund such a speculative and risky investment by a novice company.
I hate getting political because I hate politics, but giving more of your money to politicians is like giving a gun to a chimp- there's little upside to be expected. They have no clue, folks. They have a different agenda than your best interests.
Is anyone else reminded of Vanguard? Curt Schilling, meet Brad McQuaid. Yet another dream wrecked upon the sea of reality. Sound management is extremely important. It looks like 38 Studios didn't have it. How the heck could they have several hundred employees and have years of work and little to show for it? Sorry, I'm having Vanguard flashbacks here.
I'm guessing that they thought they'd sell a heck of a lot more copies of KIngdoms of Amalur: Reckoning. They sold maybe 400,000 which isn't bad, but they probably counted on many many more. What a risky business, folks.
2) MMOs pretty much consistently fail to realize their expectations these days. Even huge blockbusters like SWTOR which cost up to $300 million hasn't done as well as expected. Sure, they have plenty of players, but in the investment world if people expect a lot out of you and you fall short of that, that's an investment failure. That's speculation for you, and this sounds familiar to any investor. Also, SWTOR has had layoffs recently (though that may be typical of an MMO's development cycle).
I have a feeling that the days of large AAA MMOs may be over. They are too risky and expensive, and the gaming industry is littered with the bleached bones of MMOs that didn't make it. I expect very few big traditional AAA titles to come out going forward.
3) Project Copernicus was supposed to release late this year- they didn't show any screenshots or a video clip until everything started to unravel. Heck, they didn't even have a name for their game yet. People were wondering about the lack of solid info.
This is yet another example of wishful thinking interfering with common sense. If an MMO is talked up big time by the devs with nothing being shown to back it up, be very suspicious. I'm pretty much in skeptical mode constantly these days.
4) MMOs will probably be dominated by two models in the future-
Small indie companies with little budgets
and
F2P titles that fund themselves from cash shop sales
I doubt if there will be lots of investors lining up to pour huge amounts of money into MMOs now. F2P will become a bigger force, to the lament of those like me who think that that funding model taints the very design of games so that 'here's a fun game' becomes 'if you pay a bit, you can get around this boring part of the free design'. Plus, cash shops start out innocent enough but often morph into distasteful sales of such things as locked loot boxes that you need to buy a key to unlock. It's hard to trust the very concept.
Overall, this is not good news. Or maybe it is. I'm more likely than ever to root for little indie companies, just don't expect huge productions or budgets like 38 Studios had.
1) MMOs are a very speculative investment. Gone are the days of 10-15 years ago when there were few MMOs that had modest player bases. It's a big business now, the market is oversaturated, and new MMOs mostly fail to live up to expectations. They require solid management. Trion Worlds is the exception to this depressing rule of failure so far.
How the hell did Rhode Island give 38 Studios $75 million in taxpayer-funded loans and guarantees? This was an insane thing to do. MMOs are pure speculation. I say this as a fan of 38 Studios and what they were doing. It was the height of irresponsibility to use taxpayer money to fund such a speculative and risky investment by a novice company.
I hate getting political because I hate politics, but giving more of your money to politicians is like giving a gun to a chimp- there's little upside to be expected. They have no clue, folks. They have a different agenda than your best interests.
Is anyone else reminded of Vanguard? Curt Schilling, meet Brad McQuaid. Yet another dream wrecked upon the sea of reality. Sound management is extremely important. It looks like 38 Studios didn't have it. How the heck could they have several hundred employees and have years of work and little to show for it? Sorry, I'm having Vanguard flashbacks here.
I'm guessing that they thought they'd sell a heck of a lot more copies of KIngdoms of Amalur: Reckoning. They sold maybe 400,000 which isn't bad, but they probably counted on many many more. What a risky business, folks.
2) MMOs pretty much consistently fail to realize their expectations these days. Even huge blockbusters like SWTOR which cost up to $300 million hasn't done as well as expected. Sure, they have plenty of players, but in the investment world if people expect a lot out of you and you fall short of that, that's an investment failure. That's speculation for you, and this sounds familiar to any investor. Also, SWTOR has had layoffs recently (though that may be typical of an MMO's development cycle).
I have a feeling that the days of large AAA MMOs may be over. They are too risky and expensive, and the gaming industry is littered with the bleached bones of MMOs that didn't make it. I expect very few big traditional AAA titles to come out going forward.
3) Project Copernicus was supposed to release late this year- they didn't show any screenshots or a video clip until everything started to unravel. Heck, they didn't even have a name for their game yet. People were wondering about the lack of solid info.
This is yet another example of wishful thinking interfering with common sense. If an MMO is talked up big time by the devs with nothing being shown to back it up, be very suspicious. I'm pretty much in skeptical mode constantly these days.
4) MMOs will probably be dominated by two models in the future-
Small indie companies with little budgets
and
F2P titles that fund themselves from cash shop sales
I doubt if there will be lots of investors lining up to pour huge amounts of money into MMOs now. F2P will become a bigger force, to the lament of those like me who think that that funding model taints the very design of games so that 'here's a fun game' becomes 'if you pay a bit, you can get around this boring part of the free design'. Plus, cash shops start out innocent enough but often morph into distasteful sales of such things as locked loot boxes that you need to buy a key to unlock. It's hard to trust the very concept.
Overall, this is not good news. Or maybe it is. I'm more likely than ever to root for little indie companies, just don't expect huge productions or budgets like 38 Studios had.
