Jeff Strain, “The subscription model is not the future of the games industry”

Jeff Strain, co-founder of ArenaNet and developer of Guild Wars, said that basing an MMO on an existing film, TV, or book franchise won’t lead to success in the genre, during the Games Convention Developers Conference session. “Even the big two [franchises] haven’t lived up to their expectation”. He went on to point out that the top two MMOs are based on original worlds, unrestricted by the linear nature of products designed for other media.

Follow up:

Top two MMOs – EVE Online and World of Warcraft. I can not say that WoW is based on original worlds since it was actually taken from Warhammer, but that’s another story to tell for another day. He also warned other companies on trying to follow Blizzard’s methods for WoW too closely, he said, “The best-placed people to create World of Warcraft’s successor, it’s the World of Warcraft team. Let’s all do our own thing, and be good at it.” Now finally someone from the gamedev world said it, don’t you agree? We’ve seen countless of WoW-clones since WoW came out, and where are these MMOs now? Nowhere to be found – simply forgotten (and some local game publishers is targetting in bringing these WoW clones in the Philippines, good luck.)

“It’s exceptionally polished”, Jeff said about WoW, and I agree, if you play Lineage II, you will see how much of WoW originally came from NCsoft’s Lineage 2 which Blizzard “polished”, and which many other MMO companies do, though in WoW’s case, they just become a ‘WoW-clone’. The most interesting part? “Don’t count on subscriptions. The subscription model is not the future of the games industry.” He continued, “Gamers don’t buy the argument that an MMO has to charge a subscription fee to cover the ongoing cost of servers and development. We know it, and they know it.”

Such strong words in my opinion, for someone working for Guild Wars backed by NCsoft Austin (Richard Garriott’s), and for someone who doesn’t have any data on the market here in South-East Asia. What do I mean? They will not be able to penetrate the markets of other countries, especially the emerging and young MMO markets in the world if they will rely on “box-selling-free-subscription” model, like Guild Wars, especially here in Asia (more specifically, South-East Asia). It simply will not work. Take Korea and Taiwan for example, they offer a “subscription-type” for Guild Wars for those who can not afford to pay for the box, but can afford paying in “small amounts” on a monthly basis. GW was accepted in those countries.

But take it for South-East Asia, especially in the Philippines, GW failed to conquer the market. If NCsoft implemented the same model as they have implemented in other Asian countries, GW will be number 1 locally and in other South-East Asian nations. But, whoever will be their distribution partners must also get something out of those monthly payments. In other words, instead of ArenaNet/NCsoft getting 100% of those monthly subscriptions, they will only get 60% to 70% at most. Can that 60% – 70% be enough to pay for the additional cost for additional servers (and its maintenance, customer support, etc.) for the number of players who will play GW in these “sachet-type” countries?

It will not work. The Western world is far different from the Eastern world. Yes, it will work in the West – the US, EU, but here in the East, their games of the GW-model, will never be #1 unless you offer subscription. The market here prefers “sachet” payment like subscription, than buying a game box. Not counting the fact that the regional market (East Asia) is saturated with Virtual Asset Sales type 2 – Free-to-Play with Item-Mall. Can a GW-type model “buy-box-free-forever-buy-expansion-every-6-months” compete with VAS-2? I doubt, and the proof is here with us all along, GW failed in South-East Asia. It has potential, but ArenaNet and NCsoft relied too much on their “Western” research.

Subscription MMOs is still the preferred choice and is the future of the Online Gaming Industry, not free-to-play games, box-selling, not even “Item Shops”.

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