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Revenue Model Shifts in China - Now Subscription-Based

SystemSystem Member UncommonPosts: 5,023
edited September 2016 in News & Features Discussion

imageRevenue Model Shifts in China - Now Subscription-Based

World of Warcraft News - NetEase and Blizzard have shifted the revenue model for World of Warcraft in China. Up to the shift, Chinese players paid in hour-by-hour increments. With the launch of the Legion expansion, Chinese players are now required to pay a monthly subscription up front in order to play. NetEase brought in $37M in August compared to only $8M in July, presumably as a result of the change in revenue generation.

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Comments

  • blueturtle13blueturtle13 Member LegendaryPosts: 12,354
    Smart move and proof once again that the sub model continues to work, regardless of region.

    거북이는 목을 내밀 때 안 움직입니다












  • SBFordSBFord Former Associate EditorMember LegendaryPosts: 33,126
    Smart move and proof once again that the sub model continues to work, regardless of region.
    Especially if it works in China by such a huge margin after a long history of hour-based game play. Pretty astonishing revenue boost from month-to-month with the new model.


    ¯\_(ツ)_/¯ 


  • laseritlaserit Member LegendaryPosts: 6,299
    SBFord said:
    Smart move and proof once again that the sub model continues to work, regardless of region.
    Especially if it works in China by such a huge margin after a long history of hour-based game play. Pretty astonishing revenue boost from month-to-month with the new model.
    It will be interesting to see the numbers six months down the road. 

    "Be water my friend" - Bruce Lee

  • donger56donger56 Member RarePosts: 443
    Just because it works in Asia doesn't mean it will work in the west. What game in the west has an hourly charge to play it? None, because that won't work in the west just like monthly subs don't work as well as they used to. Everything is either F2P or B2P with an optional sub for some games. Sub only games die quickly and don't get that big release boost from the cash shop like other games do. The sub only model is dead in the west and won't be returning. 
  • MendelMendel Member EpicPosts: 3,899
    Compared to hourly charges, the subscription rates must seem like a godsend to the Chinese player.  I'd even venture so far as to suggest that there will be individuals trying to play every hour in the month, just to achieve the absolute minimum cost per hour rate.  Oppressive mandatory rate replaced by a lesser mandatory rate yields more customers, thus more revenue.  If that's not BUS 101, it should be.

    Logic, my dear, merely enables one to be wrong with great authority.

  • laseritlaserit Member LegendaryPosts: 6,299
    edited September 2016
    donger56 said:
    Just because it works in Asia doesn't mean it will work in the west. What game in the west has an hourly charge to play it? None, because that won't work in the west just like monthly subs don't work as well as they used to. Everything is either F2P or B2P with an optional sub for some games. Sub only games die quickly and don't get that big release boost from the cash shop like other games do. The sub only model is dead in the west and won't be returning. 
    You have some valid points. But things we think are dead, never to return have a way of coming back.




    "Be water my friend" - Bruce Lee

  • AeanderAeander Member LegendaryPosts: 5,922
    Smart move and proof once again that the sub model continues to work, regardless of region.
    Well, it works for World of Warcraft. Not so much all the new MMOs that go f2p within a year.

    Also, this was a change from an hourly price model - the most archaic, unfriendly business model possible, which died alongside AOL.
  • laseritlaserit Member LegendaryPosts: 6,299
    Aeander said:
    Smart move and proof once again that the sub model continues to work, regardless of region.
    Well, it works for World of Warcraft. Not so much all the new MMOs that go f2p within a year.

    Also, this was a change from an hourly price model - the most archaic, unfriendly business model possible, which died alongside AOL.
    The F2P cash shop model supports a shit load of mediocre games.

    Only the very rare few will become Rock Stars, although countless numbers will try.

    "Be water my friend" - Bruce Lee

  • MendelMendel Member EpicPosts: 3,899
    laserit said:
    donger56 said:
    Just because it works in Asia doesn't mean it will work in the west. What game in the west has an hourly charge to play it? None, because that won't work in the west just like monthly subs don't work as well as they used to. Everything is either F2P or B2P with an optional sub for some games. Sub only games die quickly and don't get that big release boost from the cash shop like other games do. The sub only model is dead in the west and won't be returning. 
    You have some valid points. But things we think are dead, never to return have a way of coming back.

    I think a picture of a buggy whip would be more appropriate, @laserit.  Bicycles will last as long as the Olympics keeps including them.

    httpbuildingadreamonlinecomwp-contentuploads201511buggy-whipsjpg

    Well, maybe the buggy whip's fate is tied to the future of Harness racing.  Gambling seems to be pretty healthy, though.  So healthy that it may be eternal.  Maybe even healthier than the Olympics.

    You may be right after all, @laserit.

    Logic, my dear, merely enables one to be wrong with great authority.

  • NitemareMMONitemareMMO Member UncommonPosts: 238
    Wonder how many will pass out trying to squeeze as many hours as possible from a sub and refuse to go eat and sleep.
  • TeccaTecca Member UncommonPosts: 45
    Wonder how many will pass out trying to squeeze as many hours as possible from a sub and refuse to go eat and sleep.
    I see it as a way for more of them to relax and not worry as much about using every minute to its fullest potential. Hourly payments would make me play that way, monthly sub would make me feel like I have all the time in the world. 
  • AeanderAeander Member LegendaryPosts: 5,922
    laserit said:
    Aeander said:
    Smart move and proof once again that the sub model continues to work, regardless of region.
    Well, it works for World of Warcraft. Not so much all the new MMOs that go f2p within a year.

    Also, this was a change from an hourly price model - the most archaic, unfriendly business model possible, which died alongside AOL.
    The F2P cash shop model supports a shit load of mediocre games.

    Only the very rare few will become Rock Stars, although countless numbers will try.
    Even if I grant you that, "very few" has looked suspiciously like "none" this past decade. And none of this none has remained a subscription title.
  • laseritlaserit Member LegendaryPosts: 6,299
    Aeander said:
    laserit said:
    Aeander said:
    Smart move and proof once again that the sub model continues to work, regardless of region.
    Well, it works for World of Warcraft. Not so much all the new MMOs that go f2p within a year.

    Also, this was a change from an hourly price model - the most archaic, unfriendly business model possible, which died alongside AOL.
    The F2P cash shop model supports a shit load of mediocre games.

    Only the very rare few will become Rock Stars, although countless numbers will try.
    Even if I grant you that, "very few" has looked suspiciously like "none" this past decade. And none of this none has remained a subscription title.
    IMHO when it comes to this genre. The industry is putting too much focus in one area while neglecting the most important things.

    The cash shop with RNG model will run its course. That's not to say that it will mark the return of the subscription model, but something will take its place.

    Automation will change and is changing many aspects of our economies. The games industry included.


    "Be water my friend" - Bruce Lee

  • AeanderAeander Member LegendaryPosts: 5,922
    laserit said:
    Aeander said:
    laserit said:
    Aeander said:
    Smart move and proof once again that the sub model continues to work, regardless of region.
    Well, it works for World of Warcraft. Not so much all the new MMOs that go f2p within a year.

    Also, this was a change from an hourly price model - the most archaic, unfriendly business model possible, which died alongside AOL.
    The F2P cash shop model supports a shit load of mediocre games.

    Only the very rare few will become Rock Stars, although countless numbers will try.
    Even if I grant you that, "very few" has looked suspiciously like "none" this past decade. And none of this none has remained a subscription title.
    IMHO when it comes to this genre. The industry is putting too much focus in one area while neglecting the most important things.

    The cash shop with RNG model will run its course. That's not to say that it will mark the return of the subscription model, but something will take its place.

    Automation will change and is changing many aspects of our economies. The games industry included.


    I don't think anything will take its place. I think what we'll see in the long term is a diversification of models due to an excess of competition. F2p, b2p, and p2p all feed into eachother and provide a spectrum of options for players. Maybe we'll even see uncommon models like company-wide subscriptions or new things like integration into general subscriptions (like Amazon Prime) or f2p with ingame ads. Certainly, I don't support the last of these for immersion purposes, but I expect more experimentation will happen on the business side of things.
  • VesaviusVesavius Member RarePosts: 7,905
    Smart move and proof once again that the sub model continues to work, regardless of region.


    Been saying the sub model is more than viable for years and years, it just took patience to watch the main market wise up to F2P and burn out on it at their own speed and start to catch up with what I and others have been saying.

    The F2P carpet bagging bubble was just the VCs cashing in, they never gave a crap about us as consumers or gamers.
  • SovrathSovrath Member LegendaryPosts: 28,609
    laserit said:
    donger56 said:
    Just because it works in Asia doesn't mean it will work in the west. What game in the west has an hourly charge to play it? None, because that won't work in the west just like monthly subs don't work as well as they used to. Everything is either F2P or B2P with an optional sub for some games. Sub only games die quickly and don't get that big release boost from the cash shop like other games do. The sub only model is dead in the west and won't be returning. 
    You have some valid points. But things we think are dead, never to return have a way of coming back.




    I totally wan to buy that bike!!!!!
  • VesaviusVesavius Member RarePosts: 7,905
    Wonder how many will pass out trying to squeeze as many hours as possible from a sub and refuse to go eat and sleep.

    This already happened under the old model... In fact, the most famous cases of things like this came from countries that pretty much only ran the old model. 


  • CrazKanukCrazKanuk Member EpicPosts: 6,130
    I don't think this is proof that the sub model is viable at all. What it does prove is that the sub model is more profitable than the F2P model....... if you have enough players to support it. 

    Crazkanuk

    ----------------
    Azarelos - 90 Hunter - Emerald
    Durnzig - 90 Paladin - Emerald
    Demonicron - 90 Death Knight - Emerald Dream - US
    Tankinpain - 90 Monk - Azjol-Nerub - US
    Brindell - 90 Warrior - Emerald Dream - US
    ----------------

  • laseritlaserit Member LegendaryPosts: 6,299
    edited September 2016
    Sovrath said:
    laserit said:
    donger56 said:
    Just because it works in Asia doesn't mean it will work in the west. What game in the west has an hourly charge to play it? None, because that won't work in the west just like monthly subs don't work as well as they used to. Everything is either F2P or B2P with an optional sub for some games. Sub only games die quickly and don't get that big release boost from the cash shop like other games do. The sub only model is dead in the west and won't be returning. 
    You have some valid points. But things we think are dead, never to return have a way of coming back.




    I totally wan to buy that bike!!!!!
    Retro is in, you can go and buy one.

    I'm personally waiting for the banana seat with the stick shift between the balls ;)

    "Be water my friend" - Bruce Lee

  • IggiePuffIggiePuff Member UncommonPosts: 146

    donger56 said:

    Just because it works in Asia doesn't mean it will work in the west. What game in the west has an hourly charge to play it? None, because that won't work in the west just like monthly subs don't work as well as they used to. Everything is either F2P or B2P with an optional sub for some games. Sub only games die quickly and don't get that big release boost from the cash shop like other games do. The sub only model is dead in the west and won't be returning. 



    Well, none has an hourly charge now. But years ago Neverwinter Nights from AOL had an hourly charge and it was a very popular game. EverQuest was reported to be going with hourly charge but then decided to switch to monthly.
  • laseritlaserit Member LegendaryPosts: 6,299
    CrazKanuk said:
    I don't think this is proof that the sub model is viable at all. What it does prove is that the sub model is more profitable than the F2P model....... if you have enough players to support it. 
    The same is true for any model

    "Be water my friend" - Bruce Lee

  • CrazKanukCrazKanuk Member EpicPosts: 6,130
    laserit said:
    CrazKanuk said:
    I don't think this is proof that the sub model is viable at all. What it does prove is that the sub model is more profitable than the F2P model....... if you have enough players to support it. 
    The same is true for any model

    Yeah it definitely is. The difficulty is that WoW is being used as an example of how the subscription model is still viable when they probably, and it wouldn't be that far a stretch, have 10 times the number of subscribers as all other subscription games combined, lol. WoW is an anomaly. It's like a Russian judge who gives the Russian skater 10/10 even though she fell 10 times. That's why the Olympics throws these scores out :) 

    Crazkanuk

    ----------------
    Azarelos - 90 Hunter - Emerald
    Durnzig - 90 Paladin - Emerald
    Demonicron - 90 Death Knight - Emerald Dream - US
    Tankinpain - 90 Monk - Azjol-Nerub - US
    Brindell - 90 Warrior - Emerald Dream - US
    ----------------

  • blueturtle13blueturtle13 Member LegendaryPosts: 12,354

    CrazKanuk said:


    laserit said:


    CrazKanuk said:

    I don't think this is proof that the sub model is viable at all. What it does prove is that the sub model is more profitable than the F2P model....... if you have enough players to support it. 


    The same is true for any model



    Yeah it definitely is. The difficulty is that WoW is being used as an example of how the subscription model is still viable when they probably, and it wouldn't be that far a stretch, have 10 times the number of subscribers as all other subscription games combined, lol. WoW is an anomaly. It's like a Russian judge who gives the Russian skater 10/10 even though she fell 10 times. That's why the Olympics throws these scores out :) 



    I disagree. WOW uses a sub sure but so also does EVE,Lineage, DAoC and a few others. Plus a number of titles coming out in the near future are going to have a sub model. Like Camelot Unchained and Pantheon.

    거북이는 목을 내밀 때 안 움직입니다












  • TorvalTorval Member LegendaryPosts: 19,952
    laserit said:
    Sovrath said:
    laserit said:
    donger56 said:
    Just because it works in Asia doesn't mean it will work in the west. What game in the west has an hourly charge to play it? None, because that won't work in the west just like monthly subs don't work as well as they used to. Everything is either F2P or B2P with an optional sub for some games. Sub only games die quickly and don't get that big release boost from the cash shop like other games do. The sub only model is dead in the west and won't be returning. 
    You have some valid points. But things we think are dead, never to return have a way of coming back.


    I totally wan to buy that bike!!!!!
    Retro is in, you can go and buy one.

    I'm personally waiting for the banana seat with the stick shift between the balls ;)
    They only look retro. They're not built retro. So people like the look of what was. That's about all we can conclude from that.
    Fedora - A modern, free, and open source Operating System. https://getfedora.org/

    traveller, interloper, anomaly, iteration


  • TorvalTorval Member LegendaryPosts: 19,952
    CrazKanuk said:
    laserit said:
    CrazKanuk said:
    I don't think this is proof that the sub model is viable at all. What it does prove is that the sub model is more profitable than the F2P model....... if you have enough players to support it.
    The same is true for any model
    Yeah it definitely is. The difficulty is that WoW is being used as an example of how the subscription model is still viable when they probably, and it wouldn't be that far a stretch, have 10 times the number of subscribers as all other subscription games combined, lol. WoW is an anomaly. It's like a Russian judge who gives the Russian skater 10/10 even though she fell 10 times. That's why the Olympics throws these scores out :)
    I disagree. WOW uses a sub sure but so also does EVE,Lineage, DAoC and a few others. Plus a number of titles coming out in the near future are going to have a sub model. Like Camelot Unchained and Pantheon.
    Of those only WoW and Lineage are notably profitable above other titles though. I think the real test will be how these indie games pull off the mandatory sub.

    I think for a short while it will see a resurgence in popularity. People tend to forget the bad stuff as time passes and the reasons why subscriptions fell out of popularity are mostly forgotten. Those reasons will start to become apparent and then I think it will be harder times. Also a few of those games promise not to have cash shops. WoW, Lineage, and EVE all have multiple additional revenue streams to bolster those numbers. If the indies don't adopt something like that, then they'll be facing that hurdle even quicker.

    WoW and Lineage can maintain their sub because of their inherent inertia. They've maintained a reasonably sized playerbase that lets them make those choices. It doesn't mean that the subscriptions are all the players first choice. It means that they have enough time and effort invested in the game that players will put up with a lot rather than start all over in new games. This is also a real dilemma for new games trying to gain traction.

    DAoC and other old titles have also already paid their development costs off. They can afford to not try and grab additional revenue because the expense of radically changing the business model might not justify itself. It's safer to continue on a lower reliable revenue stream for an aging game nearing its sunset.

    The situation is far more complex than the article or most people parse out. What works for one game won't necessarily work for another. It's important for a game to find the revenue streams that work for it. I think ESO is a great example of a game that's evolved to do that.
    Fedora - A modern, free, and open source Operating System. https://getfedora.org/

    traveller, interloper, anomaly, iteration


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