A Game's Quest for Online Success

By Mike Musgrove
Sunday, September 21, 2008

"I don't think there's any other field where you can find a failure rate this high and still find people willing to invest," said Mark Jacobs, general manager of the Fairfax game studio EA Mythic. "The failure rate is unbelievable."

Jacobs was talking about his own section of the video game industry, the realm of online games where players pay a monthly subscription fee to participate as characters in a virtual world. In the past 11 years, by his count, fewer than 10 titles have met some level of financial success. The number of expensive flops is a lot larger.

Mythic's new title, Warhammer Online, went on sale Thursday after three years of development. The sword-and-sorcery game is the 13-year-old studio's first release after its 2006 acquisition by publisher Electronic Arts.

"This is what will determine how smart EA was when they bought us," said Jacobs, "or how dumb we are."

Jacobs declined to specify the size of the investment in the game but said, "you have to spend $50 million these days if you want to compete with the big guys." From talking to Jacobs and his boss at EA Games, it seems clear that Mythic is indeed aiming to compete against the big guys with Warhammer Online.

It's easy to see why a publisher would crave a success in this area. Most game titles bring in a one-time purchase price of $50, but games like Warhammer Online also typically bring in a $15 monthly fee for Web access to their virtual worlds. World of Warcraft, the phenomenally popular title in this genre, is a money-minting machine with a whopping 10 million subscribers. No other game has come close to hitting such a figure.

Frank Gibeau, president of EA Games, the division of the publisher that owns Mythic, said the mainstream popularity of World of Warcraft has shown this market's potential. "The game industry is only just starting to scratch the surface for the opportunity out there," he said.

Gibeau agreed this segment of the industry has had some expensive failures but said that if no other "massively multiplayer online" games have been hits in WoW's wake, it was because they haven't been good enough. "We're the first quality MMO to release since World of Warcraft was released," he said.

Mythic has been the successful underdog before. Years ago, when the local studio was a small start-up, Mythic's well-liked title Dark Age of Camelot competed against a Sony title called EverQuest for gamers' attention and dollars. Camelot had a peak subscriber base of 250,000, compared with a half-million subscribers for EverQuest, the dominant title at the time.

"They came out of nowhere and built a big and very successful business," said Gibeau of Jacobs and his team.

Until recently, Gibeau was a World of Warcraft player himself; in this industry, a hands-on familiarity with "WoW" is nearly a given. The executive says he gave up the habit two months ago and now spends his spare time playing Warhammer.

In Warhammer Online, players can take on roles as dwarves, warriors and elves, to list a few options. Players starting the game choose to side with one of two factions -- they can fight on the side of the "Empire," or they can pick a role as one of the sinister-looking members of "Chaos." Mythic's game designers figure they have put in enough quests and adventures to provide around 200 hours of content for the average player, not counting the time a player might spend socializing online with his or her fellow wizards and swordmasters.

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