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News & Features Discussion  » [General Article] City of Heroes: Profitable or Not?

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252 posts found
  Starsman

Apprentice Member

Joined: 12/18/12
Posts: 14

1/04/13 12:37:56 PM#61


Originally posted by BurntToast6
CoH DID NOT have a 95% retention rate let's be VERY clear about that - that information is easily accessed. CoH was running at approx 25% of it's peak subscriber base at the end.

Retention rate is not calculated from launch, but month to month. Usually you refer to the last few months or year's average retention rate. In fact, if the game only had peak level players and just lost players since (assuming no new players) at a 95% retention rate after 8 years, it would be under 1% of it's original peak (losing about 5% players every month.)

So 95% retention rate sounds more than right, actually if the game had 25% of the population it sounds higher (either that or there was a way higher influx of new players over the years than I would guess.)


Total operating cost of 4 million - you're kidding right? Competing against Google in Mountain View...and you think 50k a year is high for a developer??? Try LOW.

Video game industry pays very little. I recall inquiring to apply when they were openly recruiting about 5 years back, and number I got listed 50 as a high figure for a designer. Q&A likely gets less than that, only senior designers (most got fired few years back) would be paid closer to the 70 mark.


There is absolutely NO ONE on RECORD stating they offered 80 million to purchase CoH - What kind of fool would?

Nor does this article state that. It says that's the number NCSoft used to block any real offers. Note that although the dev is being kept anonymous, this was a phone call, not an anonymous tip. Someone at MMORPG knows who it was but are using journalistic powers to keep them safe.


NCSoft valuation of CoH @ 3 million for tax purposes; funny since NCSoft has not even filed their tazes yet...how would this ANONYMOUS source know this?

Again: anonymous to us. Not to the journalist that talked to him on the phone.


I love how the anonymous source didn't try to claim no one at Paragon saw this coming; like they claimed in the beginning ... since both Matt Miller and Melissa Bianco have admitted they knew approximately 2 months before the announcement.

I think Matt Miller did say they saw something coming, but no one saw the "you are all fired as of tomorrow" coming. So far Matt Miller's words have been a bit open ended, but they do seem to hint at NCSoft simply having expressed lack of interest in the studio's potential.


If this anonymous source stands behind their information (which is full of mistruths) why don't they actually say who they are...

Because everyone had to sign NDAs to receive their severance packages, openly discussing this information at all violates the contract and makes them liable for a lot of money (it also can be career suicide since no one else in the industry will trust them.)


but since most of the information can easily be debunked...

Show me the debunking. So far the only evidence towards any end is the profit reports. I can say this much: whoever spoke is unlikely related to payroll or budgeting, because there IS an overhead for benefits on top of salaries, but it’s still not enough to take the game average income into the red.


it just solidifies that Anonymous is just another fan trying to spread misinformation and ill will because "Big Bad NCSoft" closed down their game.

That line is also an accusation against Rob Lashley's journalistic integrity. You are claiming he didn't verify the identity of the source on the phone. Certainly in the realm of human possibility, but I think Lashley appreciate his career more than that.

  TheLizardbones

Apprentice Member

Joined: 6/11/08
Posts: 10959

I think with my heart and move with my head.-Kongos

1/04/13 12:46:29 PM#62

It's not a huge mystery. Even if the game was profitable, it wasn't profitable enough. It would be getting steadily less profitable over time too. It doesn't look like there were plans or incentive to create a CoH2 either. They decided to cut their losses before they became losses or when they actually turned from profits to losses and focus on what they knew they could focus on.

I can not remember winning or losing a single debate on the internet.

  Dreamo84

Defender of Worlds

Joined: 5/20/04
Posts: 3368

I actually still like MMORPGs

1/04/13 12:50:44 PM#63
If it was TRULY profitable in a significant way you have to believe NCsoft would have kept it around. If it was profitable in a sense that "we are making $2,000 this month and next month we will make half that and so on" then they probably just didn't want to wait until they actually did lose money.

  TheQuinch

Novice Member

Joined: 11/01/12
Posts: 22

1/04/13 12:51:19 PM#64
Originally posted by lizardbones

It's not a huge mystery. Even if the game was profitable, it wasn't profitable enough. It would be getting steadily less profitable over time too. It doesn't look like there were plans or incentive to create a CoH2 either. They decided to cut their losses before they became losses or when they actually turned from profits to losses and focus on what they knew they could focus on.

Let me be clear, very few people contest NCsoft's right to close the game down. What the outrade is about is the fact that NCsoft is trying its damnedes to make sure the game stays closed, even to the point of blowing off people looking to buy the game off them.

  TheQuinch

Novice Member

Joined: 11/01/12
Posts: 22

1/04/13 12:53:00 PM#65
Originally posted by Fendel84M
If it was TRULY profitable in a significant way you have to believe NCsoft would have kept it around. If it was profitable in a sense that "we are making $2,000 this month and next month we will make half that and so on" then they probably just didn't want to wait until they actually did lose money.
 

But if that were the case, they could have simply cut costs. Lay off developers, etc. Instead, they decided to put the whole thing into the ground, there and then, probably expecting the players to move to GW2 or some other game.

  Torval

Elite Member

Joined: 6/10/09
Posts: 6386

1/04/13 12:55:17 PM#66
Originally posted by Ramonski7
Originally posted by Akais

I'm inclined to think of this as an issue or profit margin rather than profit as well.

NCSoft has a history of axing games that don't trend to their expectations when it comes to profit margin. 

What I don't entirely understand is why the game couldn't get sold.

It seems silly to me that NCSoft would turn down any potential profits able to be realized with the sale of a game with an installed and rather loyal fanbase. There are tons of companies that would pay handsomely for this. Likewise,  the IP is so niche that it's highly unlikely NCSoft will ever use it again constructively.

I can think of two very good reasons why they didn't want to sell the CoH ip

  1. Because of the various components that make up CoH/Paragon Studios (combat system, art resources, server structure, game engine, the studio itself (loc, equip), etc) are things NCSoft would rather keep for themselves than lose the rights to use them in future projects. (think of scrapping a car for parts rather than selling the whole car)
  2. It would sever all ties with Cryptic Studios and void any contractual obligations they may have had from the original sale of CoH to NCSoft which may have included but not limted to royalties, copyright agreements and/or patent partnerships.
Number 2 in particular would make sense because I always wondered why NCSoft never challenged Cryptic Studios when they made CO. Seeing as CO is a very close copy of the game structure of CoH and a copyright agreement or patent partnership would explained that. Maybe everything developed for CoH that Paragon Studios created , even after the sale, would have also been fair game for Cryptic Studios to use if they chose to use them.
 
Dunno really and all this is pure speculation on my part brought on by reading too many news articles of how wall street operates in a similar fashion.

This post makes the most sense to me along with the poster that pointed out that it could be related to the profit margin being too low, not that it was totally not profitible.

In business it's not always about "just being profitible", but how profitible are you (the margin) and how much risk does the overhead hold.  There is are advantages to streamlining and focusing along with keeping diverse enough so if one aspect of your business sinks your whole company doesn't sink.  In addition to the points Ramonski makes, which are really spot on, it's not necessarily in NCSoft's best interest to help an unrelated company succeed in this very competitive marketplace.

I have to credit Bill and crew with having a pretty large set to open this can of worms.  I don't think most CoH fans will see and accept the reasonable points and that NC probably cut its losses before they could damage the financials.  Everyone else will likely shrug and maybe feel bad at the loss, but that's about it.

Curse you AquaScum!

  Starsman

Apprentice Member

Joined: 12/18/12
Posts: 14

1/04/13 12:57:32 PM#67
Originally posted by Fendel84M
If it was TRULY profitable in a significant way you have to believe NCsoft would have kept it around. If it was profitable in a sense that "we are making $2,000 this month and next month we will make half that and so on" then they probably just didn't want to wait until they actually did lose money.

It was profitable enough to finance the development of a second MMO, had it continued to the point of launch it would have made the studio much more profitable.

 

 

  BurntToast6

Apprentice Member

Joined: 4/24/12
Posts: 3

1/04/13 12:57:37 PM#68
Like I said: How convenient for them to be anonymous - just means they can say anything they want and not be held liable. This article is not an investigative piece as mmorpg did no investigating...they simply provided information from someone hiding behind anonymity and from NCSoft themselves. Since NCSoft threw their name out there with their facts...I am more apt to believe them than some anonymous disgruntled ex-employee trying to stir up animosity through misnformation and half truths.
  Four0Six

Advanced Member

Joined: 12/18/11
Posts: 1192

1/04/13 12:58:37 PM#69

Capitalist Rant of the Day:

I, as is obvious by my post history am a capitalist.

Now, the importance of the closure of CoH and the honesty of NC concerning such IS very important to me. Why? It leads to a valuation of the integrity of NC. I am not a "blind consumer" that buys what ever without concern to who/how/why said product was made and the treatment of the producers/consumers/maintainers of said product.

There are countless posts and threads that pertain to the "degradation" of MMORPGS in quality, and inovation. Most often they end with "STOP buying the crap, and they will stop producing it.!!!" This is a truism of capitalism.

I will never again buy a product from NC. Never ever erver ever. ( I had some hope for Wildstar, but now don't even follow the news bits concerning this game.)

Without articles and conversation surronding the closure of CoH, we would all believe that "CoH was totaly unprofitable".

The "rage" against Rob for an "unidentifeid source" is fail. Why? He sights teh reports that back up the sources statements. That is Com 101 folks, take a class. Seems Rob did.

 

Keep up the quality reporting MMORPG, this time . *smiles*

I'm off to buy lotto tickets so I can hire Paragon, and crank out a viable Super Hero Sandbox. *pbbbbbt*

(just kidding, I don't buy lotto tickets 'cuz Im a capitalist and it is a loosing bet.)

  Torval

Elite Member

Joined: 6/10/09
Posts: 6386

1/04/13 12:59:32 PM#70
Originally posted by TheQuinch
Originally posted by lizardbones

It's not a huge mystery. Even if the game was profitable, it wasn't profitable enough. It would be getting steadily less profitable over time too. It doesn't look like there were plans or incentive to create a CoH2 either. They decided to cut their losses before they became losses or when they actually turned from profits to losses and focus on what they knew they could focus on.

Let me be clear, very few people contest NCsoft's right to close the game down. What the outrade is about is the fact that NCsoft is trying its damnedes to make sure the game stays closed, even to the point of blowing off people looking to buy the game off them.

I don't think anyone is arguing that NC doesn't want anyone else to run the game.  They want a ridiculously high price to recoup the potential loss of the sale.  A few have already pointed out why it could be their best interest to keep the game shuttered, not the least of which are patent and design agreements with Cryptic and positioning a competitor to succeed in a very competitive space at the moment.

If the game is only worth a few million dollars and they want a huge sum for its sale then either there is a reason.  Either they don't want to give competitors a foothold or they have more at stake than is visible on the surface.

Curse you AquaScum!

  Starsman

Apprentice Member

Joined: 12/18/12
Posts: 14

1/04/13 12:59:49 PM#71


Originally posted by TheQuinchBut if that were the case, they could have simply cut costs. Lay off developers, etc. Instead, they decided to put the whole thing into the ground, there and then, probably expecting the players to move to GW2 or some other game.
 

Canceling the ongling development on the new LostCraft MMO would also cut studio's labor costs nearly by half.

  Starsman

Apprentice Member

Joined: 12/18/12
Posts: 14

1/04/13 1:05:44 PM#72
Originally posted by BurntToast6
Like I said: How convenient for them to be anonymous - just means they can say anything they want and not be held liable. This article is not an investigative piece as mmorpg did no investigating...they simply provided information from someone hiding behind anonymity and from NCSoft themselves. Since NCSoft threw their name out there with their facts...I am more apt to believe them than some anonymous disgruntled ex-employee trying to stir up animosity through misnformation and half truths.

This may not be an "investigative piece" (to your standards, they did enough legwork to also ask NCSoft and double chedk the quarterly reports to see  if things checked up) but it is journalism.

There ARE consequences for the anonymous source to just make things up. Rob Lashley still knows who it is, and making easily disprovable statements like that can kill the individual's reputation not only with Rob, but also with all his peers.

So far we have numbers from NCSoft that seem to double check with Anonymous Ex-Employee. We have nothing but words from NCSoft denying them. I would love to see some information from NCSoft supporting their position.

  Light314

Novice Member

Joined: 12/17/12
Posts: 1

1/04/13 1:09:43 PM#73

Uhm, no. If you  look into things for more than 5 minutes, it's quite obvious things are not "as simple as that".

Wouldn't it be wonderful if we lived in a world where things really  were "as simple as that"?

We don't.

  downix

Novice Member

Joined: 12/15/12
Posts: 2

1/04/13 1:11:58 PM#74

Notice the key words in te NCSoft response, "The studio was unprofitable." The studio was supporting more than one game with only the profits from a single game. Developing a game is expensive, on top of the 80 staffers (20-25 for CoH, the rest to develop the "other product" based on experience in this industry) they had licensing costs, development, contractors for the new product. So, it is quite possible for both to be true, CoH was itself profitable, while the studio wasn't because it was developing a new property.

 

As for attempting to sell it, I know of three attempts to purchase the game, which NCSoft simply ignored. They can claim they found noone to work with, but so can I claim I never get any of my bills if I refuse to visit my mailbox.

 
  botrytis

Advanced Member

Joined: 1/04/05
Posts: 2595

1/04/13 1:13:12 PM#75
Originally posted by Torvaldr
Originally posted by TheQuinch
Originally posted by lizardbones

It's not a huge mystery. Even if the game was profitable, it wasn't profitable enough. It would be getting steadily less profitable over time too. It doesn't look like there were plans or incentive to create a CoH2 either. They decided to cut their losses before they became losses or when they actually turned from profits to losses and focus on what they knew they could focus on.

Let me be clear, very few people contest NCsoft's right to close the game down. What the outrade is about is the fact that NCsoft is trying its damnedes to make sure the game stays closed, even to the point of blowing off people looking to buy the game off them.

I don't think anyone is arguing that NC doesn't want anyone else to run the game.  They want a ridiculously high price to recoup the potential loss of the sale.  A few have already pointed out why it could be their best interest to keep the game shuttered, not the least of which are patent and design agreements with Cryptic and positioning a competitor to succeed in a very competitive space at the moment.

If the game is only worth a few million dollars and they want a huge sum for its sale then either there is a reason.  Either they don't want to give competitors a foothold or they have more at stake than is visible on the surface.

NCSoft probably wants to recoup licensing fees, etc. It all adds up over time - and if they used a 3rd party engine, that is in the price also. People like to pick on the big dogs as being heartless. Is it heartless to put a suffering animal out of it's misery before it starts suffering? People see CoH as a low hangning fruit, right now, that they can buy cheaply and make money on. NCSoft, just wants a break even return on investment. People are reading more into this then there really is.

 

Please stop drinking the conspiracy Kool-Aid people.

"In 50 years, when I talk to my grandchildren about these days, I'll make sure to mention what an accomplished MMO player I was. They are going to be so proud ..."
by Naqaj - 7/17/2013 MMORPG.com forum

  TheQuinch

Novice Member

Joined: 11/01/12
Posts: 22

1/04/13 1:21:15 PM#76
Originally posted by botrytis
Originally posted by Torvaldr
Originally posted by TheQuinch
Originally posted by lizardbones

It's not a huge mystery. Even if the game was profitable, it wasn't profitable enough. It would be getting steadily less profitable over time too. It doesn't look like there were plans or incentive to create a CoH2 either. They decided to cut their losses before they became losses or when they actually turned from profits to losses and focus on what they knew they could focus on.

Let me be clear, very few people contest NCsoft's right to close the game down. What the outrade is about is the fact that NCsoft is trying its damnedes to make sure the game stays closed, even to the point of blowing off people looking to buy the game off them.

I don't think anyone is arguing that NC doesn't want anyone else to run the game.  They want a ridiculously high price to recoup the potential loss of the sale.  A few have already pointed out why it could be their best interest to keep the game shuttered, not the least of which are patent and design agreements with Cryptic and positioning a competitor to succeed in a very competitive space at the moment.

If the game is only worth a few million dollars and they want a huge sum for its sale then either there is a reason.  Either they don't want to give competitors a foothold or they have more at stake than is visible on the surface.

NCSoft probably wants to recoup licensing fees, etc. It all adds up over time - and if they used a 3rd party engine, that is in the price also. People like to pick on the big dogs as being heartless. Is it heartless to put a suffering animal out of it's misery before it starts suffering? People see CoH as a low hangning fruit, right now, that they can buy cheaply and make money on. NCSoft, just wants a break even return on investment. People are reading more into this then there really is.

 

Please stop drinking the conspiracy Kool-Aid people.

Except NCsoft recouped its investment on CoH a long time ago?

  TheLizardbones

Apprentice Member

Joined: 6/11/08
Posts: 10959

I think with my heart and move with my head.-Kongos

1/04/13 1:26:01 PM#77


Originally posted by TheQuinch

Originally posted by lizardbones It's not a huge mystery. Even if the game was profitable, it wasn't profitable enough. It would be getting steadily less profitable over time too. It doesn't look like there were plans or incentive to create a CoH2 either. They decided to cut their losses before they became losses or when they actually turned from profits to losses and focus on what they knew they could focus on.
Let me be clear, very few people contest NCsoft's right to close the game down. What the outrade is about is the fact that NCsoft is trying its damnedes to make sure the game stays closed, even to the point of blowing off people looking to buy the game off them.



The game was in decline, losing value every year. The announcement to close or sell the game would devalue it even further. The players who would leave after an announcement like that would devalue the game even further still, and they would get zero new players after that. NC Soft would have to hold out for a good sale price, which there's no guarantee that they would get, leading to the possibility that they would lose money on any deal that they got.

If they were brushing off offers to buy the game, it was because the offers were not worth their time. Unless the offers came from investment companies, known developers or lottery winners with more money than sense, there wouldn't be any point in even listening to the offers. The offers would have to be quick, and would have to be in the five to ten million dollar range to even be considered. The offer would have to be cash too.

The twenty thousand people who signed the petition would need to pony up at least $300 each to get in the ball park of what the game and studio would go for, and this is in addition to the money they would have to spend in game to keep the studio and game going.

It really isn't that big a mystery.

I can not remember winning or losing a single debate on the internet.

  s4ndm4n2006

Advanced Member

Joined: 12/22/08
Posts: 56

Sleep? Who needs slee.... zzzzzz

1/04/13 1:29:17 PM#78
Originally posted by botrytis

Please stop drinking the conspiracy Kool-Aid people.

LOL this. 

Shoot I'm more apt to say that even in the worst case it had nothing to do with profitability, NCSoft had the right to close and dang game they want even if just bored with it.  I mean, of course it would be stupid to close down an obviously big game such as GW2 but bottom line is, they could... and they would be totally in their rights to do so. 

I get so sick of the automatic attack on any big company just because of that fact.  If it was a small game house and they simply said they closed due to profitability I bet it would have gone unquestioned.

  jtcgs

Advanced Member

Joined: 9/28/04
Posts: 1843

1/04/13 1:29:23 PM#79
Originally posted by Hoochler

Was the time period of the ~95% retention ever stated?

Congrats, and that is why the game was shut down and you can be lied to.

Semantics.

He didnt state specifically WHEN they retained paying customers. So, he could have easily chosen the ONE time in the last 4 YEARS when that statistic was true to make it SOUND like the game was doing fine. Heck, so now we can apply that to everything. He didnt say what PERIOD of time they were making a profit, just that they did. In fact, he gave NO time periods for anything he said at all, so lets just throw that up in the air also.

Rabid fanboyism...dont let details, specifics, truth or anything else get in the way of blindly defending, throw out any and all conflicting information and try to form reality to your personal wants.

I LIKED COH, thought it was a damn good game...but im going to call BS when I hear it. feelings aside. Reality is reality no matter how much you dislike it.

“I hope we shall crush...in its birth the aristocracy of our moneyed corporations, which dare already to challenge our government to a trial of strength and bid defiance to the laws of our country." ~Thomes Jefferson

  TheQuinch

Novice Member

Joined: 11/01/12
Posts: 22

1/04/13 1:32:17 PM#80
@lizardbones: If that's the case, then here's a question back at you - CoH is a game with well over eight years of development behind it, well past the point of content crunch that's the make-or-break factor of starting MMOs, with a built-in playerbase. In a market where enduring,  MMOs are few and far between, and given that CoH managed to remain profitable despite a total lack of marketing, what are the odds that NCsoft hasn't been approached with a valid offer from a serious publisher?
 
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