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The Free Zone: Has Obsidian's Future Become Brighter or Darker?

Column By Richard Aihoshi on May 21, 2013

A decade ago, veteran developers Feargus Urquhart, Chris Parker, Darren Monahan, Chris Avellone and Chris Jones co-founded Obsidian Entertainment. The new studio got off to an auspicious start with its debut release, Star Wars: Knights of the Old Republic II - The Sith Lords, and has since put out Neverwinter Nights 2 plus its Mask of the Betrayer and Storm of Zehir expansions, Alpha Protocol, Fallout: New Vegas and Dungeon Siege III. While this is quite an impressive list, what's missing is a huge hit, the kind that's big enough to put a large amount of money into a team's coffers so it can both weather lulls between publisher contracts and afford to invest in creating original IPs.

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Admittedly, I know nothing about the state of Obsidian's finances. I do recall that a couple of years back, the studio tried pitching something of its own, and since nothing has been announced since then, I assume no one picked it up. I also wonder if that concept somehow influenced or perhaps even evolved into the company's current crowdfunded endeavor, Project Eternity.

For some time now, I've also been curious if Obsidian would get involved in the MMOG space. That was answered last Friday by the announcement that it will work on one called Skyforge. While I've yet to see any specifics as to what duties are involved, I've been aware of the title since was revealed around two years ago. The developer is the studio that created Allods Online. Originally part of Nival, it went through a couple of ownership changes and is now part of Mail.Ru, the leading provider of Internet services in the Russian-speaking region. The latter is one of the top online game publishers there, but apparently not with the dominant position it had a few years ago when it laid claim to half the market.

All of the above plus some other factors nudged me in the direction of some speculation that, while based on nothing solid, definitely intrigues me. One of these considerations is that Mail.Ru reported a net profit of about $275 million for 2012. As of this March, it also had a net cash balance of nearly $129 million and no outstanding debt. There's also the recent purchase of Gas Powered Games by Wargaming.net. So... is it possible that the deal announced last week might turn out to be the first step toward Mail.Ru acquiring Obsidian?

Let me be clear that I'm not predicting this will happen. However, neither does the possibility strike me as out of the question. Obsidian's principals have all put a decade into their studio. Did they have an exit strategy in mind when they opened the doors? Do they have one now? I don't know, but in either case, what was or is most likely? Selling the company, of course.

Naturally, this begs the question of how much Obsidian might fetch. While it's pretty difficult to gauge this with any real degree of confidence, let's arbitrarily assume the nearly $50 million that Perfect World paid for Cryptic Studios a little less than two years ago as a benchmark. Obviously, I can't speak for the five partners, but how many among us would turn down an offer of this magnitude without seriously considering it? Don't forget that such deals tend to include long-term employment contracts for key personnel, often in the range of three to five years, so it's not as if they'd even have to walk away from continuing to work together for quite some time.

Furthermore, such a marriage might produce some interesting synergies. As a key example, one of Obsidian's key strengths is the ability to create strong stories involving memorable non-player characters. Isn't this an important area where the MMOG category as a whole still has ample room for improvement? And frankly, what other role makes as much intuitive sense for Skyforge? Why else would anyone bring in a second developer other than to add skills that complement rather than duplicate the original team's?

It's also not a huge stretch to think Mail.Ru is looking at the English-speaking market. Licensing the title is certainly an option, but I also wouldn't be completely shocked if the company is entertaining thoughts of starting a publishing operation here in North America. A precedent of sorts already exists since it has one in Germany.

The trend toward increasing offshore ownership of game companies here is a topic I've discussed previously. I've also known Obsidian's principals as well as a number of other team members for as much as 15 years. Accordingly, I can't help but be intrigued to see the studio taking a first step into MMOGs, and also by the chance, however small it may be, that it represents the start of what would undoubtedly be a very interesting journey. 


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The Free Zone
Richard Aihoshi has been writing about MMOGs since the mid-1990s, always with a global perspective. As a result, he has observed the emergence and growth of the free to play business model from its early days in both hemispheres.

He is the former Editor of RPG Vault and his column, focusing on free to play MMOs, appears on MMORPG.com every Monday.
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