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Top 10 money-making MMOs of 2008
In an upcoming "comprehensive study" by DFC Intelligence, they take a look at the top money-makers in the MMO space worldwide. To no one's surprise, World of Warcaft has topped the list, followed by several Asian MMOs like MapleStory, Lineage I and II, Shanda and Fantasy Westward Journey. As for the most users, this study doesn't touch on that. With such a wide discrepancy between active subscribers and prepaid game card users, it's a difficult number to tack down.What makes this list frustrating is the complete lack of details involved. While WoW is reported to have earned $500 million+ in 2008, the next four on the list are reporting $150-$500 million, and the final five are reporting anything in the $50-$150 million range. To the company's credit, this isn't the final analysis. Their detailed February 16th report promises to give more information on each of the top 10 games. We certainly look forward to that.
AT&T reports fourth quarter earnings, things looking less rosy
Verizon managed to pull off an impressive 15 percent growth in revenue in the fourth quarter of the year thanks in large part to its wireless unit, but its closest rival -- AT&T -- didn't manage to come across the same good fortune. Contrasting to its strong Q3, reported earnings per share fell 10 cents in Q4 versus the year prior, making for a nearly 20 percent drop; on the upside, full-year EPS still rose from $1.97 to $2.16 on the strength of 2008's first three quarters. The last three months of the year saw some 1.9 million iPhone 3G activations, 40 percent of which were new to the carrier -- not bad -- and data revenues consider to shoot through the roof, rising another 51.2 percent. Might as well invest the revenue you do have into beefing up that data network now that you've got everyone hooked on it, eh, guys?
Nokia loses sales, money, and market share in 2008 -- but not hope
Nokia has announced its financial figures for 2008, and while the news is predictably not good, it is a bit better than we've seen from other players in the mobile space. The company's overall sales were down 19 percent in Q4 of 2008 to €12.7 billion, while sales of devices and services were down 27 percent to €8.1 billion. Perhaps more troublingly it lost ground in the market share race, maintaining its number one position but dropping from 40 percent down to 37. While Nokia doesn't exactly see any bright light at the end of this economic tunnel just yet, it does at least think it won't lose any further ground in terms of market share. We'd love to hear what the good folks at Palm have to say about that.[Warning: PDF read link]
DisplaySearch revises LCD TV forecasts for 2009, takes 'em lower
No surprises here, but the analysts at DisplaySearch have evidently been working overtime in order to revise the 2009 forecast for LCD TV shipments. We're not particularly sure where the originals sat, but if these new numbers prove true, we'll see LCD TV revenue fall year-over-year for the first time in the history of LCD TV shipments. The updated report notes that key factors in the downturn are "reductions in forecast TV prices and revised forecasts for year-over-year shipment growth for LCD and PDP TVs in 2009, down by 7 and 6 points from previous, respectively." As of now, LCD TV revenues are slated to drop 16% year-over-year, with total TV revenues falling 18%. Get a few big-screen OLED TVs out for under two large, and we bet all that changes -- don't mind that we're asking for the impossible or anything.
The Man can't hold HTC down as it sees highest revenues ever
For the vast majority of mobile makers, the past few months have been ones they'd love to forget. For HTC, it could actually throw a party in remembrance. The outfit responsible for the Touch Pro / Diamond, Touch HD and T-Mobile G1 (among others) has reportedly witnessed its revenues skyrocket to a record high of around $528.6 million in November, which is up nearly 11% sequentially and 22.1% on the year. Oh HTC, just think how much higher that figure would be if you'd loose the Touch HD on US soil...[Via WMPowerUser, image courtesy of CNET]
Palm's preliminary quarter-end results show drooping revenues, bleak outlook
Remember when we used to write about Palm in order to talk about its devices and / or operating system(s)? Man, those were the days. Now, it just seems like one sadness-filled report after another, and just days after hearing that it would be cutting an undisclosed amount of employees in order to trim operating expenses, in comes even more doom and gloom courtesy of its preliminary Q2 (fiscal year 2009) results. The company is expecting to record revenues ranging between $190 million to $195 million, far short of the $331 million Wall Street had been counting on. The shortfall was blamed on "a difficult economic environment [which had] greatly intensified the negative impact on product sales." Of course, the visionary Ed Colligan (CEO) still maintains that by reducing its cost structure it can "launch next-generation products as planned," but seriously, why should we believe that line now? Time to put up or shut up, Palm.[Via CNET, image courtesy of PalmFocus]
MS Q1 '09 revenues up, 360 division profitable
Recently, Microsoft gave their investors exactly what they wanted. They handed over their Q1 2009 fiscal results (MS's fiscal year starts in June) to hungry investors and, lo and behold, the Xbox 360 division turned a profit! The Entertainment and Devices Division (EDD) - the division that houses products like the 360 and Zune - boasted an operating income of $178 million, up from last year's $167 million, and an overall revenue increase of 9%. Though, technically, the 360 wasn't the big bread winner as other products in the EDD accounted for $216 million in sales. Microsoft also revealed that lifetime Xbox 360 sales have reached 22 million, which is 2 million shy of the original Xbox's install base. Golf clap for team 360.[Thanks, Scott O.]
Analyst: WAR subscriptions will eventually settle around 250,000
Business analyst Arvind Bhatia shared his predictions about Warhammer Online's financial future with Edge magazine yesterday. Bhatia, who works at brokerage firm Stern Agee, said he believes EA is ultimately shooting for around 250,000 - 300,000 subscribers once the launch dust clears, with occassional bumps when major content releases such as expansons occur.Given the hype around the game, those numbers seem a little low, but Bhatia said he based his projections on statements made by EA reps saying that the company hopes to break even on its investment. After the game shipped 1.5 million copies, some initial sales data began to emerge which indicated that sales are meeting but not significantly exceeding EA's conservative expectations. In the end Bhatia expects the company to pull in between $55 and 60 million dollars of revenue from WAR.Numbers like the ones above would clearly not make WAR a WoW-killer, but they would make it one of the elite few truly successful Western, subscription-based MMOs. Certainly this prediction is a far cry from Paul Barnett's wild bet. But of course even Barnett admits his number is a little outrageous, and he only stands to lose $26 if he loses, y'know.
Nokia lowers Q3 outlook on tough competition, product slip
2008 has generally treated Espoo pretty well, but every rose has its thorn -- and for Nokia, that thorn might just end up being the third quarter. The company has now revised its Q3 market share estimate downward, now predicting a slip from Q2 rather than the flat line it'd been suggesting before; cited reasons include a "tactical decision to not meet certain aggressive pricing of some competitors," generally fierce competition (particularly on the low end), and the delayed launch of an unnamed midrange handset. In justifying its failure to meet market pricing head-on in every market segment, Nokia says it's only going to play that game where it thinks it's profitable to do so, and for what it's worth, it still expects to ship about 10 percent more devices in 2008 than it did in 2007. What's more, they say they expect to meet the rest of their expected launch dates in '08 -- so it looks like every night has its dawn after all.[Via mocoNews]
Xbox 360 DLC has brought in $240 million
Microsoft recently revealed that the Xbox Live Marketplace has seen over $240 million in revenue, with $180 million of that occurring in the last 12 months. Gamasutra reports the company also revealed that games with paid DLC make an average of $21 million more at retail if the content hits within a 30-day "sweet spot," causing customers to hold on to the titles longer.Gamasutra's piece also delves deeper into XBLM issues like content testing and the submission process, but we're surprised by that spike in revenue over the last year. It means the Marketplace made $60 million since its inception in late 2005 and then raked in $180 million over the last year. We'll take that as a sign customers are getting comfortable with this newfangled digital shopping thing the kids are talking about.
EA generated $90m through digital distribution in Q1
While NPD reports are great for tallying up the sales of actual physical games – you know, like on discs and what not – a rapidly growing segment of the video game industry operates outside their purview, performing the mysterious (and often times lucrative) alchemy of turning bits slung digitally over the internet into cold, hard cash.Electronic Arts shared some figures during their fiscal Q1 conference call, announcing it generated over $90 million in revenue through digital distribution in that three month period. Those figures are ostensibly gathered from digital sales of PC games on the EA Store, not to mention downloadable content for video game consoles (insert your own joke here about Battlefield weapons here). Sized up against EA's overall quarterly revenue of $804m, digital distribution accounts for an impressive 11% of that total and, we're quite certain, will continue to grow.
AT&T grows data revenue by leaps and bounds -- again
Okay, AT&T, we get it, you've finally figured out how to pitch data services to your subscriber base. Good for you! Last quarter saw a nice boost in data revenue for the megacarrier, likely due to a proliferation of 3G-compatible handsets that make mobile byte consumption less painful -- not to mention the fact that virtually every iPhone customer is signed up for a data plan -- and they're at it again this quarter with a staggering 52 percent bump in cash flow from data alone (which includes messaging, but still a sobering stat). Overall, revenue from the wireless division was met with a 15.8 percent gain, thanks in part to a net subscriber gain of 1.3 million, giving AT&T a grand total of 72.9 million heads. They'll still be dwarfed when the Verizon-Alltel thing goes down, but don't be down on yourself, AT&T -- there's nothing wrong with being number two. Honest.[Via mocoNews]
Activision releases record earnings report before merger
The middle of the biggest convention in the industry probably isn't the best time to trumpet some record earnings, but the fiscal calendar waits for no convention, as they say. Activision's first quarter in fiscal '09 (and their last quarter before officially becoming Activision Blizzard) was the best non-holiday quarter in the company's history, with revenues coming in at a whopping $650 million (well above the projections $500 million).Unsurprisingly, the quarter's Guitar Heroes (both On Tour and Aerosmith) contributed a lot to the bottom line. More surprisingly, the Kung Fu Panda game also contributed a fair share, representing as Activision's largest Dreamworks-associated game to date. Now that's one large panda!
Player vs. Everything: The retention game
The conventional wisdom in any service-driven industry is that it's far, far cheaper to retain an existing customer than to recruit a new one. This is especially true in the MMOG industry, where your business model is largely dependent on maintaining a long-term subscriber base. The concept also applies to transaction-driven and episodic games, where you need your customers to want to stick around and continue spending money. Box sales are great, but ultimately they're pretty useless except as an indicator of how many people actually bought the game -- returning players are the bread and butter of the MMO world. In fact, that's exactly why companies are so interested in finding out why you're quitting their game. If they can fix issues that are making a lot of people quit, they can retain more customers and drive up their revenue. Surprisingly, Blizzard is the only company I know of which actually makes people fill out an exit survey in order to cancel a subscription. It's not that annoying and it gives them great information about how to make their game better for you (so if you're adamant on copying Blizzard, that's a good thing to copy). Unfortunately, Blizzard keeps notoriously quiet about their internal numbers like that. So why exactly do people quit MMOGs, and what can and should game companies be doing to keep you interested?
Research firm expects flat-panel sales to spearhead 2008 electronics growth
2008 -- the year of the Beijing Olympics, a global increase in HD adoption and four years away from anything meaningful. According to UK-based Understanding & Solutions, flat-panel sales will be paramount in revenue growth in worldwide consumer electronics products. The analysis jives with pretty much everything else we've heard thus far, as LCD growth in developing nations will purportedly give a nice boost to the sector. TV manufacturers are expected to ship 128 million LCD and plasma sets in 2008, which would be up 38-percent from last year if John Bird's assumptions are accurate. It's also noted that these figures should remain in tact despite estimated slumps in US / UK flat-panel purchases, but alas, only time will tell if 2008 becomes a banner year for HDTV adoption.[Image courtesy of Dallas News]
MapleStory reaps over $29 million in U.S. virtual item sales
2007 proved to be a good year for Nexon in the United States, particularly with its free-to-play MapleStory. The Wall Street Journal (subscription required) reports that the although the game has 85 million users worldwide, only 5.9 million of them are U.S. players. Given the relatively small percentage of its player base located in the United States, it's surprising that MapleStory made an absolute killing on in-world transactions in 2007; the WSJ reports that 'Nexon's U.S. revenue last year more than tripled to $29.3 million from $8.5 million the prior year.'Jeremy Liew provides some additional commentary on the Nexon windfall over at Lightspeed: "With $30m in US sales and 6m US registered users, assuming a 20% "active player" rate and 10% "buyer rate", that implies an ARPU of $20/mth which sounds about right and is consistent with number we've seen from games in Asia. It sounds like the US will be following very similar models of virtual goods monetization that we've seen in Asia." It's interesting that the predominantly Asian business model of legitimized RMT is already gaining some degree of acceptance in the United States, albeit a slow acceptance. Via PlayNoEvil
Asia to dominate all online life by 2013
The research firm In-Stat has released a report on the growth of online gaming in the Asia/Pacific region. Total online gaming revenue in Asia for 2007 was a healthy $5.8 billion, but In-Stat claims that market revenues in Asia will spike over the next five years -- hitting a staggering $21.1 billion in 2013. Yeah, that's in US dollars. In-Stat claims that a confluence of factors such as greater availability of broadband, ever-increasing content distributed across wider mediums, and 'the unique experience that online gaming offers' will propel demand. (Read: many of Asia's gamers surpass our notions of 'hardcore'... we don't have a word for that level of devotion yet.) They go on to claim China will become the largest market in Asia -- no real surprise there -- particularly as over 50% of the country's online games are developed locally. Given this phenomenal rate of online gaming adoption coupled with steady broadband penetration and speed boosts, it's only a matter of time before China's cities are as wired as South Korea's. If that sheer number of gamers can harness unthrottled bandwidth, China may very well become the pulsing digital heart of the online gaming world. Via PlayNoEvil
Virgin Mobile's first quarter earnings: down, but good times supposedly ahead
Virgin Mobile's warnings of a bleak quarter were pretty dead-on, with a mere 17,772 net adds coming on board during the three-month time frame ending March 31 -- not quite the blockbuster 309,721 reported in the same period a year ago. Similarly, revenue and income both took a dive, supposedly in part due to a big marketing push focused on the MVNO's new pricing plans. If there's a silver lining on the dark, rumbling cloud, though, it's that the CEO believes they'll start to see some positive growth again in the third quarter after a weak second (for his sake, we hope he's right). Also notable was a mention that although the company had no strategic partnerships, alliances, or investments to announce, it was definitely open to "non-organic growth" in the form of another MVNO or "capability." Wonder what he may have been talking about there?[Via mocoNews]
Verizon follows AT&T on the black ink trail
It looks like it's a surprisingly good time to be a behemoth US carrier, with both AT&T and Verizon reporting some pretty aggressive profits in the first quarter of 2008 in the face of a flagging economy. Many of Verizon's results closely mirror AT&T's actually, with data revenue absolutely destroying the numbers from a year ago -- up 48.9 percent year over year, in Big Red's case. As we can see from Verizon's own documentation here, they're tooting their horn against their arch-nemesis with more net adds, a slightly better ARPU, lower churn, and lower cost per customer, with service revenue and total subs (of course) being AT&T's big wins. Whether the momentum can be kept up through a challenging '08 remains to be seen, but it's a solid start for the nation's number two. Hit the gallery below for a big shot of Verizon's message to employees regarding the results.[Thanks, anonymous tipster]%Gallery-21818%
Qualcomm rakes in more quarterly cash than it did a year ago
The royalty, lawsuit, and chipset machine better known as Qualcomm has gone public with its digits for the second quarter of fiscal 2008, and to sum things up, it's all looking pretty rosy. At $2.61 billion, revenue was up a solid 17 percent year over year -- up 7 from the previous quarter -- and income totaled $766 million, up 6 percent year over year. That works out to 47 cents worth of diluted earnings per share, a 9 percent improvement over the same period a year ago. The MediaFLO division still isn't in the black, though, with its Qualcomm Strategic Initiatives parent reporting a loss of 2 cents per share and $76 million worth of operating expenses in the quarter, "primarily related" to the mobile TV unit. Guess there's probably a little pressure for the AT&T launch to go smoothly, swiftly, and profitably, eh? [Warning: PDF link][Via mocoNews]
