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[General Article] City of Heroes: Profitable or Not?

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  • TheLizardbonesTheLizardbones Arkham, VAPosts: 10,910Member


    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.

  • s4ndm4n2006s4ndm4n2006 Baltimore, MDPosts: 54Member
    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.

  • jtcgsjtcgs New Port Richey, ILPosts: 1,777Member
    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

  • TheQuinchTheQuinch Oz, SCPosts: 22Member
    @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?
     
  • TheQuinchTheQuinch Oz, SCPosts: 22Member
    Originally posted by s4ndm4n2006
    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.

     

    In other words, might makes right?

     

    By extension, we are also well within our rights to drag NCsoft, with its history and all its mistakes into the spotlight simply because we can.

  • jtcgsjtcgs New Port Richey, ILPosts: 1,777Member
    Originally posted by Starsman

     


    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.

    Nice, so they could have had 10,000 people playing 2 months before shutdown and was down to 9,500 at shutdown. OMG they retained SOOOOO many people, proof it shouldnt have happned right? WRONG. That is not how business works. They compare quarter over quarter and year over year. if each quarter shows a steady drop and year over year shows a drop with no chance of change in the coming quarters...its axe time.

    So, maybe that last month over month they retained 95-98%...but what was it the month before? how about the month before that? If it was a CONSTANT, that means every single month they were LOSING 2-5% of its playerbase. Over a year long period that is 24-60% of players LEAVING.

    Yeah...think about the flip side for a minute.

    “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

  • adam_noxadam_nox hays, KSPosts: 2,035Member Uncommon
    Originally posted by TheQuinch
    Originally posted by s4ndm4n2006
    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.

     

    In other words, might makes right?

     

    By extension, we are also well within our rights to drag NCsoft, with its history and all its mistakes into the spotlight simply because we can.

    Besides this, it's not conspiracy, the facts are on the side of CoH being profitable, that's all there is to it.  I agree it doesn't matter why they shut down CoH.  What matters is that they didn't have to, and for that they deserve every bit of hatred directed their way.

  • WildFire15WildFire15 NorthallertonPosts: 12Member

    On the matter of retention, I have noticed this plenty of times: People leave City of Heroes to try something else (even I'm guilty of it) but before long, they come back to CoH. There was a stage where I was the only member of my SG still actively player, but over time everyone came back, along with a few new people.

    I'm not sure how accurate the retention thing is, it's likely high as former players would likely dip back in from time to time to play it once it went F2P, but it was clear to me with personal experience that people would happily come back to CoH.

  • TheQuinchTheQuinch Oz, SCPosts: 22Member
    Originally posted by WildFire15

    On the matter of retention, I have noticed this plenty of times: People leave City of Heroes to try something else (even I'm guilty of it) but before long, they come back to CoH. There was a stage where I was the only member of my SG still actively player, but over time everyone came back, along with a few new people.

    I'm not sure how accurate the retention thing is, it's likely high as former players would likely dip back in from time to time to play it once it went F2P, but it was clear to me with personal experience that people would happily come back to CoH.

    Pretty much this. One of the biggest strengths CoH had was that not only was it easy to get into, it was also easy to get back into. If you look around, you'll see plenty of posts from people describing how they left to try out MMO XYZ and came back when it didn't live up to expectations.

  • OzmodanOzmodan Hilliard, OHPosts: 7,183Member Uncommon
    NCSoft is a poorly run studio.  They have a very inflated view of what their products are worth.  A smart corporation would have disposed of Tabula Rasa and City of Heroes, you have to know that there are respectable buyers out there.  Sitting on them is fiscal idiocy.  The studio is run by a bunch of nutcases.
  • TheQuinchTheQuinch Oz, SCPosts: 22Member
    NCsoft is a publisher. Studios are the sub-organizations it owns that actually make stuff - NCsoft just pulls the strings.
  • NaeviusNaevius Houston, TXPosts: 334Member Uncommon
    I'm pretty sure it wasn't consistently profitable. Assuming a minimal staff and server cost, the $4 million overhead seems reasonable. (About the same as a small development project I was on.) And the earnings report shows about the same for revenue, so it was about a break-even or losing business, with little chance of bringing in a lot more money.
  • HoochlerHoochler Minneapolis, MNPosts: 12Member Uncommon
    Originally posted by jtcgs

    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.

    jtcgs, your rabid attacks in the name of anti-rabidism are fun to read.

    I thought we were discussing the details. You want to use numbers when you think they suit your case, but when your numbers don’t show what you want you throw out the use of numbers.

    Along with many others, I would like to learn the truth of what happened to CoH. If that curiosity along with spotting math errors makes me rabid in your book, well then I guess I feel sorry for you.

    From everything I have seen so far, NCSoft misjudged this whole thing from the beginning and made a bad call and they are trying their best to save face and obfuscate what happened as best they can to hide this fact.

  • jtcgsjtcgs New Port Richey, ILPosts: 1,777Member
    Originally posted by Ozmodan
    NCSoft is a poorly run studio.  They have a very inflated view of what their products are worth.  A smart corporation would have disposed of Tabula Rasa and City of Heroes, you have to know that there are respectable buyers out there.  Sitting on them is fiscal idiocy.  The studio is run by a bunch of nutcases.

     NCsoft is also a game maker, They made Lineage 1 & 2 and Nexon paid 688 MILLION dollars for a 14.7% share in the company...so NCSoft is worth more than almost any other game maker. Not bad for a "poorly run studio".

    “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

  • jtcgsjtcgs New Port Richey, ILPosts: 1,777Member
    Originally posted by Hoochler

    jtcgs, your rabid attacks in the name of anti-rabidism are fun to read.

    I thought we were discussing the details. You want to use numbers when you think they suit your case, but when your numbers don’t show what you want you throw out the use of numbers.

     I am still waiting for someone to actually refute my points directly without being shot down in the reply, which was already done...and ignored by you in this post containing nothing short of just a personal attack. Troll attempt failed.

    “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

  • HoochlerHoochler Minneapolis, MNPosts: 12Member Uncommon
    Originally posted by jtcgs
    125,000 x 14.99 per month =  $1,873,750 x 12 months = 22,485,000

    As SAID BY THE PERSON TELLING US THEY RETAINED 95%+ of its subscribers yet at the same time told us it made $12,000,000.

    12 million is NOT 95-98% of 22.4 million.

    This person is a flat out LIAR, I dont CARE if the game was GOOD or not or deserved to be shut down or NOT...he is a liar.

    If you were so concerned about time frames, why post your math scenario in the first place?

    All I am trying to say is that is that the anonymous guy’s math DOES add up under the scenario you laid out if that math is done properly. If anyone is trolling here, its not me.

  • TheLizardbonesTheLizardbones Arkham, VAPosts: 10,910Member


    Originally posted by TheQuinch
    @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?  

    I'd say the chances are pretty close to zero.

    The game was making less and less money every year. To the point that NCSoft thought about shutting the game down. Why would another publisher want to buy a game that has lost the majority of its profit making potential? They would be buying the game so it could wind down and become a liability a lot quicker than having a new game written.

    Paragon Studios could run CoH, but they would not be in a position to develop a new game. Not while running CoH at the same time. This would not make them attractive to anyone as a development house. The only product would be the game itself, which wasn't worth enough for NCSoft to keep it running.

    Not to mention that it would take a publisher with five to ten million dollars sitting around to buy the game and the studio. It would require an investor to have the money to buy the game, and an investor isn't going to green light a game that another investor doesn't think is worth keeping running.

    I'll say it again, it's not a mystery. The game just wasn't financially worth running and selling it would waste even more money. They didn't shut the game down to be mean, they did it to not lose money.

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

  • TheQuinchTheQuinch Oz, SCPosts: 22Member
    Originally posted by jtcgs
    Originally posted by Ozmodan
    NCSoft is a poorly run studio.  They have a very inflated view of what their products are worth.  A smart corporation would have disposed of Tabula Rasa and City of Heroes, you have to know that there are respectable buyers out there.  Sitting on them is fiscal idiocy.  The studio is run by a bunch of nutcases.

     NCsoft is also a game maker, They made Lineage 1 & 2 and Nexon paid 688 MILLION dollars for a 14.7% share in the company...so NCSoft is worth more than almost any other game maker. Not bad for a "poorly run studio".

    You're right - but at the same time, also not.

     

    See, NCsoft is hugely successful, but only in Korea. A quick glance at their revenue breakdowns by region will show you that anything outside the Korean market - especially NA and EU regions - are barely a blip on the radar, with brief exceptions when they push new releases. So while they know and pretty much have a choke-hold on Korean-style grinders {and just so we're absolutely clear, I've got no beef with Korean MMO players and their tastes - if that's what they enjoy, then who am I to argue}, but that doesn't sell nearly as well anywhere outside of Korea. Yet that's what they keep trying to push on everyone, maybe in some desperate, deluded hope that if they just keep throwing enough of them at the wall, one will stick. They made MMOs that broke away from the mold and released them outside of Korea, but they never bothered supporting them - how many players would recognize the names of the four MMOs it killed off before CoH? Heck, how many can you name?

     

    So yes, for all their success, they're poorly run. They don't understand anything outside their tiny specialized niche - they don't seem to want to understand anything outside it. Their way is the way, and from their perspective, it's not their failure that they're not a worldwide success, it's everyone else's for not getting on with the program.

  • TheQuinchTheQuinch Oz, SCPosts: 22Member
    Originally posted by lizardbones

     


    Originally posted by TheQuinch
    @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?  


    I'd say the chances are pretty close to zero.

    The game was making less and less money every year. To the point that NCSoft thought about shutting the game down. Why would another publisher want to buy a game that has lost the majority of its profit making potential? They would be buying the game so it could wind down and become a liability a lot quicker than having a new game written.

    Paragon Studios could run CoH, but they would not be in a position to develop a new game. Not while running CoH at the same time. This would not make them attractive to anyone as a development house. The only product would be the game itself, which wasn't worth enough for NCSoft to keep it running.

    Not to mention that it would take a publisher with five to ten million dollars sitting around to buy the game and the studio. It would require an investor to have the money to buy the game, and an investor isn't going to green light a game that another investor doesn't think is worth keeping running.

    I'll say it again, it's not a mystery. The game just wasn't financially worth running and selling it would waste even more money. They didn't shut the game down to be mean, they did it to not lose money.
     

    Because there was plenty of profit-making potential? Hell, the genre alone would be worth millions - the superhero trend is still going strong, and even the big-budget hitters like DCUO have been quickly floundering. CoH's supposed declining population could easily be chalked up to an increasingly crowded MMO market, coupled with the fact that NCsoft barely ever bothered to even market it. If you asked a CoH player how they found the game, nine out of ten would probably tell you it came recommended by a friend or family or some other word of mouth. Add actual marketing into the mix, and the player influx would have exploded. Compare it with GW2 - NCsoft ran ads for it in the Hobbit showings - are you going to tell me that showing an ad for a make-your-own-superhero MMO at theaters showing the Avengers wouldn't have been worth the investment? Instead, NCsoft simply couldn't have been bothered. That, or the decision to axe it had already been made, profits be damned.

     

    Second, you say that Paragon Studios wouldn't have been able to develop another game while still running CoH - and yet, they've been doing exactly that for years now.

  • rochristrochrist Harvard, MAPosts: 106Member Common

    As someone who had a CoH subscription for 8.5 years without interruption, I damn well KNOW that it was not losing people every month. On the day of the closure announcement it was /far/ healthier than it had been two years previously. Why all the NCSoft suckups escapes me. They have a horrible history. Why would anyone trust them for a single moment?

     

    As for me, you can add me to the will never, ever buy or play an NCSoft product again.

  • RyowulfRyowulf Greensburg, PAPosts: 668Member

    I think the game was making money, but its profit margin wasn't increasing and was likely slowly decreasing.  NCSoft could have kept it going, but they may have wanted to focus on the future.

    Maybe they had better use for the resources the game was using.  Wouldn't you rather put time/money into something you think will grow and/or give you high profits for a time then deal with a game that's making only a little bit of money?

     

  • TheQuinchTheQuinch Oz, SCPosts: 22Member
    Originally posted by Ryowulf

    I think the game was making money, but its profit margin wasn't increasing and was likely slowly decreasing.  NCSoft could have kept it going, but they may have wanted to focus on the future.

    Maybe they had better use for the resources the game was using.  Wouldn't you rather put time/money into something you think will grow and/or give you high profits for a time then deal with a game that's making only a little bit of money?

    But that begs the question, what resources? What money?

    None of it was reused - no development reassignments, no way to reuse the IP. The game was profitable and supporting itself - closing it down was a net loss. So the only way to salvage something from the closure would be to sell the IP - something that NCsoft refuses to do.

     

    Logical, it ain't.

  • TheLizardbonesTheLizardbones Arkham, VAPosts: 10,910Member


    Originally posted by TheQuinch
    Originally posted by lizardbones   Originally posted by TheQuinch @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?  
    I'd say the chances are pretty close to zero. The game was making less and less money every year. To the point that NCSoft thought about shutting the game down. Why would another publisher want to buy a game that has lost the majority of its profit making potential? They would be buying the game so it could wind down and become a liability a lot quicker than having a new game written. Paragon Studios could run CoH, but they would not be in a position to develop a new game. Not while running CoH at the same time. This would not make them attractive to anyone as a development house. The only product would be the game itself, which wasn't worth enough for NCSoft to keep it running. Not to mention that it would take a publisher with five to ten million dollars sitting around to buy the game and the studio. It would require an investor to have the money to buy the game, and an investor isn't going to green light a game that another investor doesn't think is worth keeping running. I'll say it again, it's not a mystery. The game just wasn't financially worth running and selling it would waste even more money. They didn't shut the game down to be mean, they did it to not lose money.  
    Because there was plenty of profit-making potential? Hell, the genre alone would be worth millions - the superhero trend is still going strong, and even the big-budget hitters like DCUO have been quickly floundering. CoH's supposed declining population could easily be chalked up to an increasingly crowded MMO market, coupled with the fact that NCsoft barely ever bothered to even market it. If you asked a CoH player how they found the game, nine out of ten would probably tell you it came recommended by a friend or family or some other word of mouth. Add actual marketing into the mix, and the player influx would have exploded. Compare it with GW2 - NCsoft ran ads for it in the Hobbit showings - are you going to tell me that showing an ad for a make-your-own-superhero MMO at theaters showing the Avengers wouldn't have been worth the investment? Instead, NCsoft simply couldn't have been bothered. That, or the decision to axe it had already been made, profits be damned.

     

    Second, you say that Paragon Studios wouldn't have been able to develop another game while still running CoH - and yet, they've been doing exactly that for years now.




    If there were no super hero MMOs, then you could say that there's lots of potential. There have been three super hero MMOs, and it just didn't work. It doesn't really matter why, but the proof, as they say, is in the pudding. Right there. Three games, three mediocre performance records.

    I'm pretty happy with the super hero movies, but that doesn't mean anything in regards to the MMOs. Just because people like watching super hero movies doesn't mean they want to play a super hero in a game.

    Finally, Paragon Studios added to the existing code base of Heroes. They had to or Villains and Going Rogue wouldn't work with Heroes. They've been writing updates, not new games.

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

  • TorvalTorval Oregon CountryPosts: 7,205Member Uncommon
    Originally posted by TheQuinch
    Originally posted by Ryowulf

    I think the game was making money, but its profit margin wasn't increasing and was likely slowly decreasing.  NCSoft could have kept it going, but they may have wanted to focus on the future.

    Maybe they had better use for the resources the game was using.  Wouldn't you rather put time/money into something you think will grow and/or give you high profits for a time then deal with a game that's making only a little bit of money?

    But that begs the question, what resources? What money?

    None of it was reused - no development reassignments, no way to reuse the IP. The game was profitable and supporting itself - closing it down was a net loss. So the only way to salvage something from the closure would be to sell the IP - something that NCsoft refuses to do.

    Logical, it ain't.

    This has been explained to you in several other posts above.  You just don't want to accept or address those points.  Like I said, the fanboys will never see the reasoning behind the loss.  It's not unexpected, but these posts pretty much support my point.

    There are good business reasons not to release assets.  There are good reasons to shut down a marignally profitible asset.  There are other considerations and factors in making business decisions than just is it profitible.

    There could be and likely are unknown factors in making this decision.  Even the inside anonymous source likely doesn't know all the considerations being made by NCSoft in Korea.

  • logandwjlogandwj Grand Prairie, TXPosts: 25Member
    Originally posted by jtcgs

    All I see is someone trying to vilify NCSoft.

    CoH did NOT have a high retention rate, that is why the servers were merged, because of the LOW POPULATIONS. Their forums were filled with complaints about how the game was losing too many players and they were ASKING for the servers to be merged to help with the population problems.

    That alone is enough to debunk what this person was saying as nothing more than a disgruntled employee...or fan, pretending to be one.

     

     

    "All I see is someone trying to vilify NCSoft."

     

    Really? I don't think anyone needs to villify them. They do that quite nicely all on their own. 5 MMOs killed in 5 years. MMOKiller. They've earned that all by themselves.

     

    CoH did NOT have a high retention rate, that is why the servers were merged, because of the LOW POPULATIONS.

     

    A flat out LIE, and an uninformed one, at that, by someone who obviously never played the game. Servers were NEVER merged. In fact, City of Heroes had MORE servers at close than we did when the game launched. One of the things City of Heroes ASKED NCSoft to do instead of close the game was to merge the servers.

     

    (We found out from the Paragon Devs that that wouldn't have mattered anyway. All the servers were "virtual" servers and no longer residing on actual seperate hardware anymore. Merging them would make no difference in cost of running the game.)

     

    Their forums were filled with complaints about how the game was losing too many players and they were ASKING for the servers to be merged to help with the population problems.

     

    And yet you contradict yourself IN THE SAME PARAGRAPH. You say the servers were merged, yet you say the forums were ASKING for servers to be merged. 

     

    In return, I paraphrase what you yourself said above - the above alone is enough to debunk what this person is saying as nothing more than a bitter fan of NCSoft, pretending to have played City of Heroes. 

     

    -Logan
    ----------
    "Wake UP! Time for SCIENCE!"
    -Adam Savage "Mythbusters"
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