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Originally posted by rochristAs 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.
I can not remember winning or losing a single debate on the internet.
Originally posted by lizardbones If you look at their earnings reports going back to Q3 of 2010, even if the game has not been losing people, it has been making less and less money.
Matt Miller, the game's lead designer, confirmed CoH was making more money when it went F2P then it ever had. Are you telling us he's completely clueless or lying?
Originally posted by Rthuth434 Originally posted by Starsman Originally posted by Rthuth434 yet all their reports show aion pulling in more money than CoH.
CoH was pulling about two times what Guild Wars 1 was pulling (look at NCSoft reports.) Why is Guild Wars 1 still running then?
CoH costs exponentially more to run, always did. plus when both were in their earning primes there was a dimensional gap between what they pulled in in GW's favor.
Got a credible source for that? Specific numbers?
-Logan----------"Wake UP! Time for SCIENCE!"-Adam Savage "Mythbusters"----------
Originally posted by lizardbones If you look at their earnings reports going back to Q3 of 2010, even if the game has not been losing people, it has been making less and less money.
While it is true that this is the fate of all MMOs eventually, it appears that City of Heroes was doing quite well, even considering that. And Matt "Positron" Miller (and other former Paragon Studios employees, including, IIRC Brian Clayton, the general manager) is on record saying that going F2P boosted sales significantly.
This was not a game that was dying. It was holding it's own. It had a comfortable niche and a dedicated playerbase. And it was doing all of that with ZERO advertising. Solely via word of mouth. If NCSoft had actually promoted the game or even given funds to do so, what then? Particularly in a year which saw the Avengers movie released?
If NCSoft isn't concerned about profits, but instead looks at profit margins, then fine, they could have done any number of things to cut costs and keep the game running and more profitable. Paragon Studios was working on another project other than COH. That's why there were 80 employees rather than 25-40. If costs needed to be cut, then they could have ditched the "secret project" and those extra employees.
If they still felt CIty of Heroes wasn't a good fit with their corporate model, then do what other corporations do all the time - SELL it.
And before anyone says anything about "what company would want to take on a studio that currently has one old game and no other projects" well -
1) As alluded above, Paragon did in fact have another game in the works
2) Look at the example of Champions Online and Cryptic Studios. Atari/Infogames couldn't keep them running, so sold Cryptic Studios to Perfect World.
That is what a RATIONAL company does. NCSoft doesn't seem to be making rational business decisions though.
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.
The source didn't say 95% retention rate. The source said 95%-98% "stick rate," which is how many people stay for a set period of time. In this case, I'm guessing from one month to the next; that is, only 2%-5% of new subscribers canceled their subscription after the first month. For an MMORPG, that's a very high rate.
And Toast, I've seen you try this several times before, where you compare peak subscriber numbers to current numbers in some misguided attempt to portray the game as on its last leg. It was an eight-year-old game. Of course subscriber numbers had fallen from their peak, duh. So has World of Warcraft's. So has every other game NCsoft has published. So has virtually every game published more than a year or two ago. It's the nature of the business.
Originally posted by BurntToast6 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.
Because all developers are the same, right? "I specialize in balancing character classes to provide a fun and engaging gaming experience." "Oh, okay, here's $100,000, I guess we'll get you to work at YouTube." Do you think that actors at community theaters in Los Angeles all make $40 million per show because that's what Tom Cruise makes?
Now, that's not to say that there were undoubtedly some people at Paragon Studios who made upwards or into six figures. But you'd also probably find it shocking to find out that most of the people who worked there were not, in fact, people who write program code. There were also a lot of artists, writers, editors, and (for lack of a better image) spreadsheet jockeys that, while critical to the development process, are notoriously low-paid workers. An average of $50,000 sounds pretty much in line with what I expected.
Originally posted by BurntToast6 There is absolutely NO ONE on RECORD stating they offered 80 million to purchase CoH - What kind of fool would? EVEN IF all the other numbers were correct and EVERY player remained VIP that would take 10 YEARS JUST to recoup costs. All you have for this 80 million offer is yet ANOTHER anonymous source. 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?
Yes, there is. Did you not just read the article above? It's an anonymous source, but presumably it's someone that Bill knows is a Paragon Studios insider, unless you think the author of this article is lying or making stuff up.
As for who would pay that much, NOW you seem to be getting the idea. NCsoft may have at some time been genuinely interested in selling City of Heroes, but before a deal could be worked out, they either changed their mind or never really intended to have a deal to begin with, and made the terms of the sale so onerous that no one would purchase it.
Originally posted by BurntToast6 The only thing this anonymous source got correct was this: NCSoft tried to work with Paragon, they really did. But the profits were not what they needed to be, and CoH/Paragon were the weak link in NCsoft's lineup moving forward. 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.
See, now you're just not making sense. First of all, you incorrectly make it sound as if NCsoft initiated these talks, which is not true. It was the other way around. Second of all, if "profits were not what they needed to be," why would Paragon Studios management try to organize a buy-out of the property? Honestly, how dumb would that be? "Gee, this game isn't making the profits we want, so let's use our personal financies to acquire it!"
And when people say that no one at Paragon knew it was coming, they didn't mean literally zero people at the studio. They meant that it came as an utter shock to everyone except a very, very few people in management. I've even heard that while they were in the Friday morning meeting, NCsoft was disabling their accounts, leaving most of the employees without access to their portfolios to use in searching for their next job.
You also are mischaracterizing this as being a done deal two months before the announcement. In fact, two months was when management first got wind that closing Paragon studios was a possibility, and they immediately started working hard to prevent it.
Originally posted by BurntToast6 If this anonymous source stands behind their information (which is full of mistruths) why don't they actually say who they are...oh I know - because if you are anonymous you can't be held liable for slander and lies.
Two really good reasons:
First, the person is almost certainly either under NDA or contractual agreement not to discuss it, and if it's found out who it is, NCsoft will almost certainly file a lawsuit against them.
Second, from what I've heard through the grapevine, NCsoft has tried on multiple occasions to throw Paragon Studios under the bus--to portray the closure of City of Heroes as a failure of the development studio instead of a willing decision by the publisher. The problem is that the people who worked at Paragon Studios are justifiably proud of all of their accomplishments, and if the studio and game closure is blamed on Paragon Studios, that especially reflects badly on the management.
I know that for months, there's been this tense stalemate where NCsoft doesn't badmouth Paragon Studios, and Paragon Studios doesn't badmouth NCsoft. Everybody plays nice and no one gets hurt. As Bill said in his article, though:
Originally posted by William Murphy I mentioned that CoH was not profitable, and this is why it was shut down in November. Why? Because this is what we were told by NCsoft as one of the driving reasons behind the closure of the game.
In other words, NCsoft is now breaking their uneasy truce, opting to try to throw Paragon Studios under the bus again. Maybe they think that since everyone is officially gone, it's probably safe now. Obviously not, and someone whose reputation is being dinged by false allegations of the studio not being profitable (or perhaps just someone who wants to set the record straight) is reacting.
There are definitely a lot of falsehoods and half-truths being flung around, but it's not by the anonymous source. The most compelling things to ask yourself when trying to figure out who is being more honest in this he said/she said situation are:
This story isn't over yet, and I'm really glad that MMORPG.com is pressing on with their coverage!
There are several very mistaken posts I have seen above:
1. holding the IP and not selling gives them some special deal with Cryptic - no Cryptic specifically said there is no rules or deals the game was purchased as is completely for $8 million by NCSoft from them.
2. the game was unprofitable - wrong - the STUDIO running 1 game and developing 2 others may not have been profitable. City of Heroes only needed staffing of 20ish to run with 3-4 releases a year. They had a staff of over 80.
Also of note City of Heroes was closed with over 60,000 monthly subscribers - not including F2P players. 60,000 x $15. Direct quotes from top developers said that the game was making more than it ever had since the F2P conversion. If you want to look at numbers ignore Q3 as the closure included refunds and most players were granted a 3 month free ride.
Valve was rumored to have offered $3 million for the game - others had offered more working from $6-10 million or roughly a years profit.
Originally posted by Hoochler 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.
I didnt bring up time frames, the person with no ground to stand on did because suddenly the numbers didnt add up so it was time to bring out the red herring.
No matter how it is SPUN it does not add up.
If the defense of, they have a 95-98% retention rate can only be defended with "there was no time frame" then the same must also be applied to the "they made 12 million"...because NO TIME FRAME WAS GIVEN. Then add the complete LACK OF INFORMATION about the "previous" loss of players and there is a TOTAL LACK OF CONTEXT.
if the 95-98% retention was only for a "month" then what was it the previous month, and the month before that and the month before that?
because again, no matter how you SPIN it, 95-98% retention = 2-5% LOWER PLAYERBASE. so sorry bud, a drop of 2-5% in ONE MONTH...thats a LARGE AMOUNT OF PLAYERS not knowing what the drop was each month before that. The game could have lost HALF its playerbase in the last year and seeing as how it went F2P because of a drop in players and revenue, ODDS ARE THAT THEY HAVE BEEN LOSING PLAYERS FOR YEARS!
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
Paragon Studios was not making money, it was in the red, but not irrevokably so. As such NCSoft was shopping for buyers, in a reasonable attempt to see if someone else felt that they could turn this around. The information provided by the 'anonymous former employees' is not as accurate as they would have you believe.
Paragon Studios Management knew about the situation, and had gone 'shopping' to local companies looking for a buyer for a quarter before the announcement. This was not a suprise to anyone in the local area, working in the industry.
Originally posted by logandwj Originally posted by lizardbones If you look at their earnings reports going back to Q3 of 2010, even if the game has not been losing people, it has been making less and less money.
Originally posted by Superman0X Paragon Studios was not making money, it was in the red, but not irrevokably so. As such NCSoft was shopping for buyers, in a reasonable attempt to see if someone else felt that they could turn this around. The information provided by the 'anonymous former employees' is not as accurate as they would have you believe. Paragon Studios Management knew about the situation, and had gone 'shopping' to local companies looking for a buyer for a quarter before the announcement. This was not a suprise to anyone in the local area, working in the industry.
This is PRECISELY my point. City of Heroes WAS quite profitable.
Paragon studio's developing 2 other games and running CoH was not. This is not a fault on Paragon as the second game was not one they wanted to do. Running CoH and also developing CoH2 would likely make them in the $2-4 million a year profit range. In other words exactly what you would expect to see from a studio with 50 on staff.
Originally posted by WildFire15 Originally posted by lizardbones If you look at their earnings reports going back to Q3 of 2010, even if the game has not been losing people, it has been making less and less money.
This is simple: COH was profitable. Paragon Studios was not.
Unanswered question of great import for this discussion: What Publisher/Inverstor was funding the development of the game(s?) under development at Paragon? How many milestones, if any, were missed during the development cycle of said new games? In other words, how confident did the Publisher/Investor feel they would get a reasonable return on their investment of the game(s) under development?
Also, who owns the rights to the (new?) Intellectual Properties Paragon Studios was developing?
If NCSoft was the Publisher/Investor for the games being developed by Paragon Studios, and they'd ponied (not a reference to Dark Pony!) up a substational sum with diminishing confidence of a substantional return, then the alleged asked for buy out price of $80 million makes a lot of sense.
That would have been the price for NCSoft to be made "whole," not what they felt COX was actually worth. But what NCSoft wants to get back (If they were the Publisher).
tldr; NCSoft can't sell COX and or Paragon and all other assets for $3 million, or even $10 million, because the sale would also include (duh!) the new potentially profitable intellectual properties.
And NCSoft, for what ever reason, if they are indeed the Publisher/Investor for the games under development at Paragon Studios, decided to use their money for something else. Not necessarily a lack of confidence in COX, but maybe a lack of confidence in the Studio's other projects?
edited for clarity and ease of reading, yours not mine :P
Paragon wasn't given a choice and the person calling in may not be privy to all the management decisions.
I believe the choice not to sell was due to Paragon trying to fund a game buyout after NCSoft shot down CoH2. Once they shoot down the games successor you know in time you are dead. So the studio tried to cut a deal to stay afloat or move to a new product .
I know you aren't aware but we have inside info that this was partially true - except after closure the CoH game was severed from the other liability.
So a new offer to buy may work now.
Originally posted by lizardbones Do you guys even read what people are typing? The game was making less money in Q2 of 2012 than it did in Q3 or Q4 of 2010. It was making less and less money over time. If Matt Miller says otherwise, then he needs to go over NCSoft's financial reports. The ones that can get them sued, which leads me to think they are probably accurate.
Simple question: Q2, 2012, did City of Heroes did less than it did in Q2, 2011?
Ok i want to put my 2 cents in if u dont like it oh well u need to think on it over all, first off they keep saying they tried to sell the rights and paragon studios if that was true then why did they anounced the closure, and laying them all off on the same day. They gave no anouncements about closeing it down, or did they mention anything about laying them all off. So for that there is a fact that they keep stepping around is that they never planed on selling CoX. In the same way there fact about it being non profitable? Again they keep steping around it, and there is another fact that came up befor and that is after the closure of CoX there mother corperation chewed them out for loseing CoX. So what dose that say? I just let ou all think on that for now
Originally posted by lizardbones Originally posted by WildFire15 Originally posted by lizardbones If you look at their earnings reports going back to Q3 of 2010, even if the game has not been losing people, it has been making less and less money.
Well, if you don't believe the word of someone who was actually involved in the studio then really there's no hope for you. In future, you may have to go through an unreasonable shut down of your own game and you'll be shocked to see we'll actually be on your side, working out the reasons behind the shut down.
Originally posted by Starsman Originally posted by lizardbones Do you guys even read what people are typing? The game was making less money in Q2 of 2012 than it did in Q3 or Q4 of 2010. It was making less and less money over time. If Matt Miller says otherwise, then he needs to go over NCSoft's financial reports. The ones that can get them sued, which leads me to think they are probably accurate.
Originally posted by WildFire15 Originally posted by lizardbones Originally posted by WildFire15 Originally posted by lizardbones If you look at their earnings reports going back to Q3 of 2010, even if the game has not been losing people, it has been making less and less money.
Originally posted by JohnR Thank you for this article and continuing to cover this story! Like many CoH fans, I just want my MMO back, optimally with the same development team (yeah I know a total pipe dream.) I've felt if we could understand why NCSoft closed CoH when so many indicators were there that it was profitable, that it was reaching profit targets under both subscription and free2play models, it seems irrational to close it, and equally irrational not to sell the IP to another publisher. Kuddos for getting NCSoft to talk to MMORPG.com!!! I still wish NCSoft would be more open about this and would work with the fans to get City of Heroes restored. They really did the CoH community a huge disservice by closing it and thus far seem to be resisting efforts for the MMO to come back, or even just talk to people. I hope MMORPG journalists will continue contacting NCSoft; the two sides of this story are so very different! The truth lies in their internal accounting, which of course they could distort, lie about, or simply not divulge. Thanks again for this article! /em holdtorch
I would like to echo this sentiment. Thank you so much, MMORPG.com. You're doing good work here. We need to keep this story in the limelight because it is important not just to City of Heroes fans and gamers, but to ALL MMO players. The seemingly irrational nature of the closing of COH and the near complete stonewall of silence that NCSoft has hidden behind (only just now beginning to show cracks - thus their attempts at "damage control" by calling people liars who have merely pointed out the facts) are wake-up calls to the entire industry.
MMO makers and publishers need to be aware of just how badly this whole situation was handled by NCSoft so that they learn by example and never do things like that themselves.
This is not to say that games should be kept in perpetuity forever. Companies have the right (and the obligation to their stockholders) to make money and profits. But as long as a game is profitable, don't alienate your potential customers by closing it down, sitting on the IP and refusing to sell it or allow the game to be run privately. That way lies public relations NIGHTMARE.
In short - don't do what NCSoft has done if you want to remain viable as a game publisher.
Originally posted by lizardbones Originally posted by Starsman Originally posted by lizardbones Do you guys even read what people are typing? The game was making less money in Q2 of 2012 than it did in Q3 or Q4 of 2010. It was making less and less money over time. If Matt Miller says otherwise, then he needs to go over NCSoft's financial reports. The ones that can get them sued, which leads me to think they are probably accurate.
Wrong. You did not even bother to check.
They saw a 2% growth. In fact, the last 3 quarters together saw an average growth of 1% (6%, -5%, 2% for 11Q4, 12Q1 and 12Q2 respectively) and the one quarter with loss (12Q1) showed traction on the loss (that quarter was historically a big loser, they halved loss rate this last year.)
Overall, for the last 3 reported quarters, the game was in an upswing. And mind you: I am still double checking something else in the accounting, because it appears NCSoft was not reporting Cash Shop revenue into the game's quarterly report revenue line. The huge increase attributed to F2P by everyone (NCSoft included) is nowhere to be seen in the reports.
But it's good to know you are not actually looking at the reports.
Originally posted by lizardbones ** edit ** I went back to Q3 of 2010. Each quarter, the game made less money, with the exception of Q4 of 2011.
Ah so now you looked. And you still see it as every quarter... for exception of 2 (out of 3....) since the game went F2P are losses...
Originally posted by Starsman Originally posted by lizardbones ** edit ** I went back to Q3 of 2010. Each quarter, the game made less money, with the exception of Q4 of 2011.
Originally posted by lizardbones I have no idea what the F2P date was, and I never mentioned whether the game was profitable or not. The game's sales dropped. Each peak exception quarter was less than the previous exception quarter before it. The game steadily earned less money over time. There's no way to know if the money made was profitable or not. ** edit ** Just put the total sales into a spreadsheet and do a trend line. It'll be pointing down.
F2P was a few days shy of Q4, 2011. Draw your Trend line from that point, and it will be pointing up.