Tobold's Blog
Tuesday, March 17, 2009
Perceptions of success

There are various ways to measure the success of a commercial product. Many of them are misleading. For example number of sales, or revenue, can be misleading if you don't know the profit margin. Selling a lot at a loss isn't success. And even profit numbers don't tell you the whole story, because $1 million of profit is a lot for a project that did cost you half a million, but is nothing for a project that cost you $100 million. So the good numbers you'd need are things like return on investment, or return on capital employed. And in many cases as an outsider you'll never be able to get hold of these numbers. So what remains to the observer is a perception of success which might or might not have anything to do with reality.

So kudos to Aventurine, makers of Darkfall, for their great managing of expectations. By running only one server, and limiting the number of people they let on that server, they effectively created a situation where it appears that people are banging on their door begging to be let in. The main complaint about Darkfall right now is the length of the time you need to wait in queue to get in. This creates a great impression of success.

There is no doubt that Warhammer Online has a lot more subscribers than Darkfall. But Mythic did exactly the opposite, opened up too many servers, and then Mark Jacobs made stupid comments on how WAR needed 500k subscribers to be successful, and how closing servers would be an utter failure. So when they reported first 300k subscribers, and then closing down 60% of their servers, the impression is one of failure.

Honestly I have no idea what the return on investment is on either Warhammer Online or Darkfall. I don't know how much these two projects did cost, I only have a faint idea of their revenues, and no idea of their profit margins. Darkfall took 7 years to develop, so maybe it was very expensive, but maybe they didn't have all that many people working on it, and it was very cheap. Do they really just need one server full of subscribers to survive? The only thing I do know is that there is a general perception of success surrounding Darkfall. Darkfall *seems* more successful than WAR, even if that might not be real.
It certainly is a great strategy. It will be very interesting to see if they add servers throughout the year. If they add one, we can say they only needed it to address the hype after launch. But what if they add 2-5 more servers throughout the year...?
I've been thinking about this too. I think one big difference is that Aventurine was probably more realistic about how many players they'd end up with than Mythic was. Darkfall is a niche game on purpose, and War is a niche game by accident. For that reason I imagine Aventurine would have much lower expectations of how many players they'd get, and (if they were smart), keep their costs low accordingly.

I was just talking to my friend tonight how the (excellent) movie Primer made only half a million dollars, but since its entire budget was 7 thousand dollars, it was an unimaginable success:

People who say to shoot for the stars aren't necessarily right.

The other thing AV seems to understand is you can't open a server and have it work if it's half empty, which is part of the delay in opening up EU-2. They understand that while a lot of people are going to get hyped about DF, only a small percentage of those players will actually be around the second month, so they are letting those players quit, replacing them, and eventually finding their market base (which right now looks to be larger than they expected, as honestly the game is far better than anyone really thought it would be).

Going the negative route, you can say they don't have the hardware/tech to actually launch the game. Going positive, you can say they are managing the community and doing what is best for the game long-term, rather than opening up the flood gate day 1 and dealing with the fallout in 30 days. Previous releases have shown us what the WoW tourists do to a new MMO, especially one based around PvP (PotBS, WAR), so limiting their impact is a smart move long-term IMO.
AV is at the tipping point right now. They have far more people wanting to be customers than they are able to support and they are desperately struggling to meet that demand. They are in a position where they need to be able to easily scale their ability to support as relative the the number of customers they have. As someone that has been playing since launch and while it's far from perfect, it is far and away the most engrossing/captivating/immersive MMO I've ever played. While that is not the opinion everyone has, it seems to be the predominant opinion of people I run accross. That, to me, is "success". That said, if they don't scale quickly the one over crowded server they have will start losing subscribers. They need to expand their server base not just for new customers, but also to help manage the existing in game populations.
Biggest question about profit of AV is what was the 20 million Euro convertible bond for? Can't pay that off with just one server that holds 10000 simultaneous players.
If the WAR Choppa doesn't work out for me I may be jumping on the Darkfall bandwagon.
It is an interesting trade off. Mythic has invested in capital that is, at best, sitting idle because they were ambitious. Aventurine is conservative and has less capital, but their customers may get tired of waiting and move on to something else.
The most interesting thing to me about the Darkfall situation is that they can actually afford to limit their release.

I was positive that the game would be released when they hit the point of NEEDING to push as many boxes as quickly as possible to avoid imminent bankruptcy. Very impressed that they were actually able to launch on their own terms.
i got about three stories up this week after I got my darkfall account. they vary from "wow this game sucks" to "hmm... maybe there IS something here after all" to "well, that was neat... ahem, *WAS*"

I'm over it. Maybe see if i can sell my account before anyone else realizes why they don't let anyone but those "hardcore" enough to camp the darkfall store in to play.
I'm pretty sure that having to stop selling their game because of the 6 hour queues to log in to their single server was not part of any clever marketing plan.
> Darkfall is a niche game on purpose, and War is a niche game by accident.


That's a bit glib, but spot on and hilarious. :)

Muckbeast - Game Design and Online Worlds
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