maybe game was profitable, but ROI was too low.
An alterntaive reason could be that cutting the game saves NCSoft money in the short term - for example, if the game costs 4 million a year to run, and makes 5 million a year, then they've made a 1 million profit - but if they axe the studio, their next financial report shows a 1 million loss of profits from the game, but a 4 million drop in running costs, so in the short-term, they'd have saved 3 million by shutting it down.
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Math doesn't work that way. They would lose 5 million on the revenue side of the balance sheet and 4 million on the cost side. Now they could show that they were reducing costs while white washing over the loss of revenue. After all our revenue was small potatoes compared to their big three MMOs and likely GW2 over the short term.
It may have been other metrics like player retention, # of new players, average $ per active player, average number of players on the servers per quarter. Something like that.
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According to some articles that have been found since the announcement, the factors like player retention etc would appear to have been of little import in this decision (CoH's performance was pretty 'flat' since Freedom launched, neither up nor down compared with others in the market who've been losing players) - what appears to have happened is NCSoft took out a massive 111 M Won loan, bought some stuff, sold a chunk of the company and found themselves looking at a $6M overall loss on it all, and something had to give. All their eggs are in GW2 and Aeion, and they are focused on Asia as their primary area of business: if anything was going to go to clawback that $6M it would be something they didn't expect to see huge returns on during the next quarter and whose core customers were outside Asia. Unfortunately CoH fits that bill.
If it's true that NCsoft needs to pay a license for the CoH engine, and if the license would need to be paid soon, then it would make sense for NCsoft to kill the game now, and not take that as a loss for next quarter.
NCSoft is full of retards seriously. They want to dominate in the Asian market but they try to do it on PC games? O.o LOLOLOL. Handheld game systems win by a mile over in Japan and China and other Asian countrys.
Just look at the Monster Hunter series they have an MMO but they also have 5 games for portable systems but only 4 other ones for consoles . NCSoft is ****** stupid as all hell go learn a thing of two from Capcom. Another thing I love Monster Hunter Tri for the Wii and I play online a lot but guess what it only has about 1000 people on at nights but they still manage to keep their servers on and even have event quests.
**** why couldn't they just put COX on maintenance mode and close some servers or something.
Originally Posted by ShadowNate
;_; ?!?! What the heck is wrong with you, my god, I have never been so confused in my life!
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Perhaps they figured out a way to harness the energy generated by burning good will.
The real answer is always more complicated, I suppose. Maybe the financials justified keeping COH around, but they just wanted to move on from this game. COH didn't fit into their vision of the future so it was best cut ties now while the game is still in the black, I guess.
It makes me wonder about this whole genre. 5 years ago NC Soft made a bet with the COH franchise, and while it was a success on many levels, it wasn't a run-away success like we'd always hope. On top of that, it gained no traction in their beloved Korean market. For a Korean company that has to raise alarm bells.
I look at a company like Perfect World International that made a similar bet with Cryptic. Several years later, the market has changed. Promise has given way to reality. The market is oversaturated. By some accounts the market is shrinking. Heck, even a very good game like The Secret World can't draw a decent sized player base. If TSW was launched 5 years ago we might be calling it the WOW killer. As for Cryptic, players didn't respond to CO and STO like they'd hoped. CO and STO are profitable now that they have a F2P model, but how long will PWI put up with the fickle American MMO market? Who wants mediocrity, albeit a profitable mediocrity, when you can place your bets in newer markets, like social media, that hasn't even hit its ceiling yet.
It makes me wonder...
At the end of the day, maybe COHs only sin was to be own by a foreign company that had an eye to the asian markets.
Between shutting down CoX and the GW2 permabanning players in the opening week NCSoft has earned a lot of bad will this week. They lost a Guild Wars 2 box purchase from me over this stuff; at least, for the time being, if I see if in the bargain bin beside EA's TORtanic I'll laugh and maybe give it a try.
I haven't played DCUO since it first came out so I suppose I'll see how much that game has changed in the 17 updates since then. Champions was an awful game, if the Cryptic rumor has any truth to it then Jack's hopes I would go play that as a CoX replacement were misguided.
The real answer is always more complicated, I suppose. Maybe the financials justified keeping COH around, but they just wanted to move on from this game. COH didn't fit into their vision of the future so it was best cut ties now while the game is still in the black, I guess.
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It makes me wonder about this whole genre. 5 years ago NC Soft made a bet with the COH franchise, and while it was a success on many levels, it wasn't a run-away success like we'd always hope. On top of that, it gained no traction in their beloved Korean market. For a Korean company that has to raise alarm bells.
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I look at a company like Perfect World International that made a similar bet with Cryptic. Several years later, the market has changed. Promise has given way to reality. The market is oversaturated. By some accounts the market is shrinking. Heck, even a very good game like The Secret World can't draw a decent sized player base. If TSW was launched 5 years ago we might be calling it the WOW killer. As for Cryptic, players didn't respond to CO and STO like they'd hoped. CO and STO are profitable now that they have a F2P model, but how long will PWI put up with the fickle American MMO market? Who wants mediocrity, albeit a profitable mediocrity, when you can place your bets in newer markets, like social media, that hasn't even hit its ceiling yet.
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I'm not trying to start any rumors about Cryptic, but the similarities to their situation are there for everyone to see. Maybe all it takes is just one bad quarter at PWI for Cryptic to get the ax too. However, they might be OK as long as Neverwinter Nights is in development. But if history is any indication of the future, NWN will fail to meet expectations, once again drawing the ire of the American MMO community, leading to bad things possibly.
An alterntaive reason could be that cutting the game saves NCSoft money in the short term - for example, if the game costs 4 million a year to run, and makes 5 million a year, then they've made a 1 million profit - but if they axe the studio, their next financial report shows a 1 million loss of profits from the game, but a 4 million drop in running costs, so in the short-term, they'd have saved 3 million by shutting it down.
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�We�re always the good guys. In D&D, we�re lawful good. In City of Heroes we�re the heroes. In Grand Theft Auto we pay the prostitutes promptly and never hit them with a bat.� � Leonard
�Those women are prostitutes? You said they were raising money for stem cell research!� � Sheldon
An alterntaive reason could be that cutting the game saves NCSoft money in the short term - for example, if the game costs 4 million a year to run, and makes 5 million a year, then they've made a 1 million profit - but if they axe the studio, their next financial report shows a 1 million loss of profits from the game, but a 4 million drop in running costs, so in the short-term, they'd have saved 3 million by shutting it down.
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I see this plan failing. Miserably. This is also why I hate executives so much.
"I have something to say! It's better to burn out then to fade away!"
I probably goes without saying that NCSoft is going to have a great 3rd quarter because of GW2, and that shutting down Paragon Studios may even end up costing them money in terms of severance packages and lost revenue. But because of GW2 being so successful, any cost associated with shutting down Paragon Studios will be easily absorbed.
I think NC Soft just stopped caring about COH, Paragon Studios and its players, and saw a perfect opportunity to finally get rid of us. I think people are making the wrong inferences from the Q2 statements. I think the real story is that GW2 is giving them the cover they need to go forward with this move.
I probably goes without saying that NCSoft is going to have a great 3rd quarter because of GW2, and that shutting down Paragon Studios may even end of costing them money in terms of severance packages and lost revenue. But because of GW2 being so successful, any cost associated with shutting down Paragon Studios will be easily absorbed.
I think NC Soft just stopped caring about COH, Paragon Studios and its players, and saw a perfect opportunity to finally get rid of us. I think people are making the wrong inferences from the Q2 statements. I think the real story is that GW2 is giving them the cover they need to go forward with this move. |
"I have something to say! It's better to burn out then to fade away!"
While no official reason has been released...and everything you've heard is merely conjecture and rumor....which Ghost Widow confirmed the NIGHT OF the shutdown...I was there to witness her words...
yes. The reason why is probably monetarily related. Because that's all that really matters to a corporation. If they're not making enough money so the CEO can't bathe in a solid gold tub.....they'll figure out some way to make it so.
Greed. Corportate greed. And because they have the money, they think they have the power. Except not.
How many gamer friends d'you have? Know? How many blogs/tweets/facebook friends can you tell about NCSoft and what it did here?
Then....how much power do you really think that corporation has? We can send a message to other corporations by taking down this one. Don't frell with us.
All it takes is unity.
And if you don't care or aren't upset by this? If you think we -can't- do anything about it? Look at my sig.
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It would be freeing up "$4 million" to use somewhere else (as opposed to the "$1 million" of profit), somewhere that they consider they could get a higher return on investment, or to handle the $6 million loss they suffered last quarter. It's freeing up resources.
We don't know what their actual motivation was, so we can't actually say whether it was a good decision or not (hell, it may have been the best of a bunch of bad options for all we know). Without actually knowing what's going on, you have no way of actually knowing whether it was a stupid move, or if it just saved countless more people their jobs.
Originally Posted by ShadowNate
;_; ?!?! What the heck is wrong with you, my god, I have never been so confused in my life!
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It would be freeing up "$4 million" to use somewhere else (as opposed to the "$1 million" of profit), somewhere that they consider they could get a higher return on investment, or to handle the $6 million loss they suffered last quarter. It's freeing up resources.
We don't know what their actual motivation was, so we can't actually say whether it was a good decision or not (hell, it may have been the best of a bunch of bad options for all we know). |
Still and all, I don't feel good about this. In any way, shape, form, or fashion. It's just a bum deal for everyone involved below the suits.
"I have something to say! It's better to burn out then to fade away!"
What if the game was making enough money to continue operations, but the biz ppl at NCSoft figured they could make more money investing in their other titles, specifically GW2. This is the only way this closure makes any sense to me.