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Instant Relevance

King of Match Three

King

Yesterday morning was the Activision Blizzard earnings call for investors, and much of the focus has been on one particular tidbit of information.  They announced that they are acquiring Candy Crush maker King Digital for the sum of $5.9 Billion dollars.  The reaction to this announcement has been pretty varied, because in truth…  many “core” gamers loath the concept of games like Candy Crush.  First off there is some confusion to clear up.  Activision Blizzard is not the same thing as Blizzard Entertainment, so early reports I saw talked about Blizzard buying King Digital…  which caused some outrage.  Activision Blizzard is the big parent company that pulls all the strings of the various products from Call of Duty to Skylanders to of course the Blizzard franchises.  At first I have to admit I was taken by surprise by the announcement but that pretty much went away immediately when I thought about it.  In doing this deal ActiBlizz is essentially buying instant relevance in the traditional mobile gaming market.

Now you might be saying to yourself… But Bel, Activision and Blizzard already doing mobile gaming.  Sure they do… but they do it in a way that attempts to appeal to “core” gamers that are wanting something on their phone to play when they don’t have access to their normal gaming platforms.  This is a vastly different market than the one that King Digital generally focuses on which are for lack of a better term “casual” and “mobile exclusive” users that would never in a million years… consider themselves gamers.  Essentially King Digital targets people like my wife, that spends plenty of time playing games on her iPad but does not in any fashion think of herself as a gamer.  So in essence with this one… albeit expensive acquisition, they now cover a market that they did not serve in any fashion.  Sure Hearthstone is a great mobile game… but it really only draws in people who already are in the fold of “gamers”.  The big thing is all of these “non-gamers” have prove time and time again that they are in fact willing to spend money on micro-transactions.

What This Means

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In truth I doubt for the short term it really means anything.  Activision will continue releasing big budget shooters like Call of Duty and Destiny… and Blizzard will continue flirting with e-sports while still not quite certain what to do with World of Warcraft.  Another big chunk of this earnings report was a note that the WoW subscription numbers have more or less stabilized from their post Warlords of Draenor free fall.  I feel like there is some fuzzy math at work here, but according to the official figures they have dropped from 5.6 Million to 5.5 Million.  There was a strange little definition that was released to explain what they determined a subscriber.

Subscriber Definition: World of Warcraft subscribers include individuals who have paid a subscription fee or have an active prepaid card to play World of Warcraft, as well as those who have purchased the game and are within their free month of access. Internet Game Room players who have accessed the game over the last thirty days are also counted as subscribers. The above definition excludes all players under free promotional subscriptions, expired or cancelled subscriptions, and expired prepaid cards. Subscribers in licensees’ territories are defined along the same rules.

This makes me think that these subscription numbers are in fact counting WoW Token players… seeing as how that would count as “prepaid” access.  So the actual month to month subscription numbers would be a bit lower.  To some extent I wish they would have broken those numbers out separately… since a monthly sub is semi-guaranteed income, and a token is a one time purchase.  The other big news however is that they plan on this being the last month they actually announce subscription numbers.  Instead they have a new sort of engagement number formula that they are working on to determine the health of the game.

At first glance this sounds a bit odd… and maybe like they are trying to hide losses within the cloak of mathematics.  However… we are just days away from Blizzcon and it makes me wonder.  Will this finally be the year that they announce World of Warcraft going to a free to play model?  Cutting the ties of relying on subscriptions to convey the health of the game… would at least be one step in that direction.  If I were Blizzard I would be seriously considering it… because honestly Free to Play seems to work.  With the recent high publicity relaunch of Wildstar… that game is doing significantly better now than it was, and the same was essentially true with Star Wars the Old Republic went to the model.  Free to Play has been the salvation of otherwise dying games… and even though World of Warcraft is far from dying…  I still think they would benefit from the switch.  It would be a massive shift in methodology and would probably change the way content is delivered, but it would also bring back a bunch of players that want to dip their toes in the game every now and then… but not feel like they are chained to a subscription.  Heroes of the Storm and Hearthstone are both wildly success as Free to Play experiences… and with Overwatch starting to ramp up and following that same model…  it just seems like Blizzard has wrestled with how to make it work.

What I Hope Happens

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So while I don’t think anything will change for a bit… my hope is that through this deal there is some cross pollination of skillsets.  I would love to see better integration of mobile platforms and traditional games.  As you know I have been playing a lot of Destiny… and quite honestly the way that game works is just not as clean as it should.  There are a lot of things that you can do through the website…  slightly different things that you can do through the mobile app… and even a different set of things through the game itself.  The entire process feels cludgy as hell… but an attempt to move in the direction of giving players access to tools outside of the game.  Now if you take that basic desire and match it with a company that has proven that they can spin the same old match three schlock into infectious gold…  you can maybe create really interesting experiences that span traditional platforms and mobile gaming ones.

What I would love to see is a better mobile app for World of Warcraft.  Why can’t we fish on our mobile phones and have it grant skill-ups and materials for our characters in game?  Why can’t we do the normally tedious action of Archaeology in a mobile mini-game?  Garrisons themselves were essentially the same sort of thing as a tiny tower like mobile game…  why didn’t exist on mobile platforms allowing people to do the upkeep and maintenance activities when they couldn’t otherwise play the game?  Why can’t we have a significantly better auction house integration system?  Essentially…  give players a reason to stay in the game by making them feel more connected to it.. on their own terms.  A big part of my frustration with Garrisons is that I knew I had a one to two hour ritual waiting on me every time I logged into the game, before I could feel like I was free to do interesting things…  like slay internet dragons.  If I could do Garrisons while walking to my car at night, or on my lunch break… it would take some of that burden away so that I knew once I got home… I could do the fun stuff without having to worry about the “paperwork”.  Essentially we live our lives on our phones…  and the games that integrate better with how we live our lives are going to feel more “real” to us.

 

 

4 thoughts on “Instant Relevance

  1. ‘This makes me think that these subscription numbers are in fact counting WoW Token players… seeing as how that would count as “prepaid” access. ‘

    It’s worth pointing out that if I buy a WoW Token from you, what has happened outside the game (not counting the gold) is that Blizzard has still got two players, and actually has made more money from the deal (because you will have paid more money for the Token than I would have for a regular subscription). Not only is it right for Blizzard to count WoW Tokens, they are almost certainly making more money at 5.5 million players than they were at 5.6!

  2. The King acquisiton doesn’t make a lot of sense because the games in question are dirt cheap to create, and companies in the space have a poor track record when it comes to being relevant in the long term.

    Remember the Words With Friends acquisition? That was a near total write off.

    Game companies that make games relying entirely on exploiting addictive tendencies of whales don’t have a good track record at making new games that can keep doing that in the long term.

    As for the sub numbers… they probably don’t want to report them anymore because they showed that WoD was a massive failure. No company has a PR department that likes to be embarrassed. Making up their own metric lets them control the message, and also lets them avoid questions like how many of the 5 million that are left are actually over in China on a different payment model.

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