Originally posted by Zorgo

Originally posted by Creslin321

Way back in early 2011, John Ricitello claimed that SWTOR would be "substantially proftiable" with only 500K subs (http://www.gamespot.com/news/star-wars-the-old-republic-needs-only-500k-subscribers-ea-6297338).

Now, fast forward to today, and I'm starting to think this was...well, BS.  I think that the game probably still has at least 500K subs, and yet there have been...

1.  Massive layoffs.

2.  F2P considerations.

3.  Substantial price drops from several retailers.

I really don't see how all this translates into a "substantially proftiable."

Thoughts?  Was Ricitello full of it?  Or are they just anticipating further sub losses?

 

Yeah, that's how they are going to keep it substantially profitable. They didn't lay those folks off to break even - they aren't considering f2p out desperation, it's for profits and dropping the price will expose more to the game, the more you expose, the more you retain - cheap prices does better exposition.

 

So, imagine you are an investor, and you give a company 50 million dollars.  The CEO of said company guarantees you that the product will be "substantially profitable," and thus you would get a decent ROI, with only 500K users.

Now imagine the product comes out, and has over 500K users and yet the company has executed massive layoffs and Is considering changing the entire business model of the product to something that was never intended.

So you go to the CEO and say:

"What gives?  You said this product would be substantially profitable at 500K users, and you have 500K users...but now you're laying all these people off an changing the business model."

And then the CEO says:

"Well, first I didn't define what substantially profitable actually meant, and second I meant it would be substantially profitable at 500K users only if we laid all those people off and changed our business model to something we never really intended."

Would you be pissed?  I know I would.

Originally posted by SuperDonk

Originally posted by AwDiddums

Originally posted by SuperDonk

Originally posted by Mothanos

They are lucky if they can maintain a 250k subs at the ende of this year.

GW2 / TSW / Tera / MoP. its a very hard world out there these days and you need to provide decent stuff for your playerbase or they /uninstal instandly.

 

 

 MoP and GW2 are going to make it tough on swtor, that's for sure. It's hard for me to imagine they get through September without annoucing f2p. The layoffs won't make the conversion to f2p any easier either.

WoW isn't suddenly going to go up hugely in subs because of MoP, it didn't with the other expansions so why now.

Totally new MMO's are more likely to impact on those who have grown tired of SWTOR.

The layoffs, well the company was top heavy, sad to see the talent being sacked but not unexpected.

I left SWTOR to play other games, TERA and recently TSW, I'm now sticking with just TSW and have now come back to SWTOR, TSW is definately a game I don't have to invest crap loads of time to get anyway in, with it so story driven, just as SWTOR is, and thats the way I like them  =)

 You must live in fairytail land if you don't think MoP will have an impact on swtor. There will be without a doubt those who are growing tired of swtor and will either return to wow or migrate gw2. Swtor is a niche game at best, and EA isn't to fond of those. They might not completely kill it like they did with others, but swtor will definately be on maintenance mode from here on out.

 

I'm happy you like TSW and swtor, for the funcom's and bioware's sake, because imo, both of those games are bad. TSW was so bad it lasted me two weeks, at least with swtor I made it to end game and subed for a couple of months. Cut scenes belong in single player rpg games, not MMO's.

Well, I have always enjoyed story driven games and I am still subbed to SWTOR and enjoying the game. I also purchased a lifetime membership for TSW and loving it as well.

Funny how personal tastes in gaming differ so much. I tried GW2 in the last beta and the story and voice acting are so bad and amateur among other things,  in my opinion, that I wouldn't pick up GW2 from a $5 bargain bin even knowing that it won't have a subscription fee. 

Originally posted by Creslin321

Originally posted by Zorgo

Originally posted by Creslin321

Way back in early 2011, John Ricitello claimed that SWTOR would be "substantially proftiable" with only 500K subs (http://www.gamespot.com/news/star-wars-the-old-republic-needs-only-500k-subscribers-ea-6297338).

Now, fast forward to today, and I'm starting to think this was...well, BS.  I think that the game probably still has at least 500K subs, and yet there have been...

1.  Massive layoffs.

2.  F2P considerations.

3.  Substantial price drops from several retailers.

I really don't see how all this translates into a "substantially proftiable."

Thoughts?  Was Ricitello full of it?  Or are they just anticipating further sub losses?

 

Yeah, that's how they are going to keep it substantially profitable. They didn't lay those folks off to break even - they aren't considering f2p out desperation, it's for profits and dropping the price will expose more to the game, the more you expose, the more you retain - cheap prices does better exposition.

 

So, imagine you are an investor, and you give a company 50 million dollars.  The CEO of said company guarantees you that the product will be "substantially profitable," and thus you would get a decent ROI, with only 500K users.

Now imagine the product comes out, and has over 500K users and yet the company has executed massive layoffs and Is considering changing the entire business model of the product to something that was never intended.

So you go to the CEO and say:

"What gives?  You said this product would be substantially profitable at 500K users, and you have 500K users...but now you're laying all these people off an changing the business model."

And then the CEO says:

"Well, first I didn't define what substantially profitable actually meant, and second I meant it would be substantially profitable at 500K users only if we laid all those people off and changed our business model to something we never really intended."

 

Would you be pissed?  I know I would.

I fully admit that it is 100% damage control.

Originally posted by Isturi

Anouther TOR is dead thread. Wow they seem to be the latest flavor of the moment for forum posters. I keep telling you people that TOR is not going no were. Why? AOC, Warhammer, Aion, CoX, LotR and the list goes on and on. If you can open your eyes and take note that these other MMO's are still doing great then what does that mean? That TOR will not DIE anytime soon.

LOL! I wouldn't say those MMO's are doing "great" I would say they are doing enough to just get by.

Originally posted by Airtaee

Originally posted by JoeyMMO

Originally posted by Xthos

I thought the number was closer to maybe 250-350k, but havent played in a bit.  I am from the crowd that thinks they have not made their money back yet (with IP fees and such...).

 I don't think anyone will know though, unless someone knows what fee they are paying for the Star Wars IP.  Some have it at 30%, others scoff at that as insane....  The IP fee makes all the difference, it was raised enough on SWG to make Sony fold their game (which was not doing great, but was able to function under the old agreement).

 The IP fee was 35 cents to the dollar, but that was only after the initial investment was paid off. LA invested in TOR as well. If EA or LA gets paid first isn't clear at all. It's no doubt a complex agreement, and both parties thought they'd make a ton of money from it.

Joey...Can you tell us where the 35% comes from? As i know, SOE and LA negotiated the license as a fixed pay every 3 years. they didnt renew it at 6 months of the next renewal.

I'm pretty sure LA assured their part of the bussiness as a fixed ammount despite the profit from the game, is what they do with Wizards of the coast, what they do with SOE and pretty sure with EA. If you can provide a link about % of benefits i will be really grateful. 

 ...Pachter says that LucasArts will claim 35% of SWTOR's revenue...

http://lmgtfy.com/?q=ea+la+35+percent+swtor

Massively, EuroGamer, ...

Re-reading those articles, sheesh...

Predictions of 1.5M subscribers the first year, bringing in $270M, meaning a profit of $80M for EA after operational expenses and LA's cut. Box sales would largely cover the initial investment, much of the box sales revenue would be profit.

Divnich pegged The Old Republic's potential user base a little higher than Pachter, predicting it will attract three million subscribers by next June. "Taking into account multiple years in service and expansion packs, $500 million in total revenue is not a far stretch. If an MMO can't be profitable at $500m in revenue, then we are all doomed."

Oh well, Google is your friend as long as you don't need the official numbers.

"They really needed the monthly fee model to work, and the fact that it hasn’t makes the game a failure, no matter how many players a free-to-play switch may bring back."

Originally posted by Creslin321

 

Pretty much...I think that anyone who believe that SWTOR isn't in dire straits is in denial.  That said, I'm not trying to make the game fail or anything, from my perspective, the game has already failed to the point where other devs won't be following its example.  So at this point, I would be fine with the game actually gaining some subs.

All I was trying to say with this post was that I felt like Ricitello and friends sold us a false bill of goods with their BS marketing prior to release.  The 500K subs was one thing, and the "200 unique hours of gameplay per class" was another.  These two "facts" were constantly brought up prior to SWTOR's release to indicate how great the game would be, and how it would be fine even with a low number of subs.

I always thought they were BS, and now, well it's more or less proven.  Basically, I don't like being lied to, and I wanted to take this opportunity to point our Ricitello's BS.

They never said 200 hours of unique gameplay per class; they said 200 hours to reach level cap, and that you could reach the level cap without having experienced all of the available content.  Both of which, in my experience, are observably true.  Please criticize based on actual problems, not made up ones.  And none of us have access to actual hard data that tells us how much the game cost, how much they have made on it, or even how many current paying subscribers they have.  Any opinion expressed on any of those things is just so much stinky wind.  Something isn't "more or less proven" just because a critical mass of forum-ragers declare it to be so, based on a combination of circumstantial evidence and personal bias.

As for the "massive" layoffs, how many actual *names* have we heard that were laid off?  As in people who are part of determining the creative direction of the game?  The only one I can recall is Vogel.  Is Freed gone?  Ohlen?  Erickson? Anybody who is actually relevant to the quality of future content? It was my understanding that the hardest hit area of the company doesn't even have anything to do with development, it was the community staff.

Originally posted by Creslin321

 

So, imagine you are an investor, and you give a company 50 million dollars.  The CEO of said company guarantees you that the product will be "substantially profitable," and thus you would get a decent ROI, with only 500K users.

Now imagine the product comes out, and has over 500K users and yet the company has executed massive layoffs and Is considering changing the entire business model of the product to something that was never intended.

So you go to the CEO and say:

"What gives?  You said this product would be substantially profitable at 500K users, and you have 500K users...but now you're laying all these people off an changing the business model."

And then the CEO says:

"Well, first I didn't define what substantially profitable actually meant, and second I meant it would be substantially profitable at 500K users only if we laid all those people off and changed our business model to something we never really intended."

 Would you be pissed?  I know I would.

If you are an investor, you aren't going to care how many people have to be laid off in order to make a profit, or what business model leads to a profit, at least not if you are an intelligent investor.  You just want your profit, whatever it takes to get it.

Originally posted by Creslin321 

So, imagine you are an investor, and you give a company 50 million dollars.  The CEO of said company guarantees you that the product will be "substantially profitable," and thus you would get a decent ROI, with only 500K users.

Now imagine the product comes out, and has over 500K users and yet the company has executed massive layoffs and Is considering changing the entire business model of the product to something that was never intended.

So you go to the CEO and say:

"What gives?  You said this product would be substantially profitable at 500K users, and you have 500K users...but now you're laying all these people off an changing the business model."

And then the CEO says:

"Well, first I didn't define what substantially profitable actually meant, and second I meant it would be substantially profitable at 500K users only if we laid all those people off and changed our business model to something we never really intended."

 

Would you be pissed?  I know I would.

1. No private investor is giving a public company money to invest in game development. EA is a public company, it has no investors. Only shareholders. None of whom have any say or input into EA's internal development workings.

2. No private investor would give any significant amount of money to a private company simply on the word of the CEO. Such a large sum of money would be tied to a contract or contracts drawn up by top of the line  attorneys who ensure the company is both capable of the performance promised and held to specific penalties if the promised performance isn't delivered.

John Riccietello is the poster boy for douchebag ceo's who fleece consumers.

Anything ANYTHING he says has to be taken not with a grain of salt, but with a 5lb bag of salt.

Originally posted by Wicoa

"They really needed the monthly fee model to work, and the fact that it hasn’t makes the game a failure, no matter how many players a free-to-play switch may bring back."

I agree..  I always felt that TOR was nothing more then a sub based KoTOR game.. It was a huge gamble to dump 1/4 of a billion dollars into a KoTOR on steroids game, and hope the tag of "MMORPG" justifies the $15 a month subscription..  Rift lasted 3 months for me, TOR lasted 4 months I think.. LOL  After those two games, I'm avoiding anything that remotely looks like a end game gear grind of instances and stories..  I suspect that TOR will level out to 250K faithfull customers for awhile, then drop down to where Rift is.. 150K?  give or take.. 

Originally posted by JoeyMMO

Originally posted by Airtaee

Originally posted by JoeyMMO

Originally posted by Xthos

I thought the number was closer to maybe 250-350k, but havent played in a bit.  I am from the crowd that thinks they have not made their money back yet (with IP fees and such...).

 I don't think anyone will know though, unless someone knows what fee they are paying for the Star Wars IP.  Some have it at 30%, others scoff at that as insane....  The IP fee makes all the difference, it was raised enough on SWG to make Sony fold their game (which was not doing great, but was able to function under the old agreement).

 The IP fee was 35 cents to the dollar, but that was only after the initial investment was paid off. LA invested in TOR as well. If EA or LA gets paid first isn't clear at all. It's no doubt a complex agreement, and both parties thought they'd make a ton of money from it.

Joey...Can you tell us where the 35% comes from? As i know, SOE and LA negotiated the license as a fixed pay every 3 years. they didnt renew it at 6 months of the next renewal.

I'm pretty sure LA assured their part of the bussiness as a fixed ammount despite the profit from the game, is what they do with Wizards of the coast, what they do with SOE and pretty sure with EA. If you can provide a link about % of benefits i will be really grateful. 

 ...Pachter says that LucasArts will claim 35% of SWTOR's revenue...

http://lmgtfy.com/?q=ea+la+35+percent+swtor

Massively, EuroGamer, ...

Re-reading those articles, sheesh...

Predictions of 1.5M subscribers the first year, bringing in $270M, meaning a profit of $80M for EA after operational expenses and LA's cut. Box sales would largely cover the initial investment, much of the box sales revenue would be profit.

Divnich pegged The Old Republic's potential user base a little higher than Pachter, predicting it will attract three million subscribers by next June. "Taking into account multiple years in service and expansion packs, $500 million in total revenue is not a far stretch. If an MMO can't be profitable at $500m in revenue, then we are all doomed."

Oh well, Google is your friend as long as you don't need the official numbers.

Never trust in anything Pachter says. Ever. :p

The guy is full of it, getting paid to make up so much stuff that eventually he might get the occasional prediction correct. He is the nostradamus of the gaming industry.

Case in point, this is the same guy who said the Wii wouldn't amount to anything. :p

Basically if it doesn't come from the horses mouth, assume it's coming from the end with a tail attached.

---

Originally posted by CazNeerg

If you are an investor, you aren't going to care how many people have to be laid off in order to make a profit, or what business model leads to a profit, at least not if you are an intelligent investor.  You just want your profit, whatever it takes to get it.

---

Yep.

Anyone thinks current layoffs are massive?

In years 2008-2009, EA has laid off almost 3k employees, yet the company is making more money than ever. Buying out other companies pretty much always leads to oversizing and layoffs will follow sooner or later. No news here.

F2P perceived as failure? Ew, c'mon this is getting old...

Price drop? All products drop in price over the time...no news here either.

OP, you call CEO of the biggest western publisher a douchebag, yet you come out as a clueless ranter while doing so...

Of course, when game is in maitenance mode with skeleton crew working on it, it can be profitable with a lot less subs, just look at WHO.

Fact is: game wasnt profitable and they cut expenses, we know that they laid off some 2/3-3/5 of BW Austin permanent staff, they will close 190 servers, they cut customer support...and prolly a lot more stuff that isnt so visible.

1.5 is probably in finishing phase, question is - how good content wise will game do afterwards, since it was doing very poorly with FULL staff on board, and they claimed on many occasions (James Ohlen did to be more precise) that there will be NO layoffs in SWTOR and it will retain FULL team. Weveseen how that worked out.

EA defined what success for SWTOR: "1kk and north long term subs". Less=failure. Especially when we know they expected and were preparing for millions of subs.