http://investor.activision.com/releasedetail.cfm?ReleaseID=575495
Blizzard/Activision has a big problem on their hands and despite the rosy predictions you better believe they know it. The issue isn't the 5% drop but the fact that the playerbase is tired of the game. This happens to all MMOs eventually and companies have two options -- release a totally new game or try to make your game an everchanging world. Everquest did the former option which gave the market to Blizzard. Blizzard is doing the latter and spent a majority of their development time redesigning the old world but it appears this isn't working as most players aren't doing anything other than the content from level 81-85. This wouldn't be bad if they were attracting new players but it isn't happening and most low level areas are ghost towns.
Keep in mind that last year 87% of Blizzard's income came from WoW and that was in a year where they released Starcraft 2. They do have Diablo3 and the Starcraft2 Zerg expansion on the horizon but given past history it will be a while before these games are released. Combine that with the 5% drop in playerbase and Blizzard/Activision is facing a Cataclysm of a different sort. Raising revenue is probably not an option so the only way Blizzard can duplicate their 2010 profit numbers is to cut costs. Considering that most of their costs are fixed I doubt this is possible either. Perhaps Activision's other divisions can make up the difference but it will be interesting to watch Blizzard and Activision's interaction over the next year (don't expect to get anything free this year that we haven't gotten previously).
Blizzard/Activision has a big problem on their hands and despite the rosy predictions you better believe they know it. The issue isn't the 5% drop but the fact that the playerbase is tired of the game. This happens to all MMOs eventually and companies have two options -- release a totally new game or try to make your game an everchanging world. Everquest did the former option which gave the market to Blizzard. Blizzard is doing the latter and spent a majority of their development time redesigning the old world but it appears this isn't working as most players aren't doing anything other than the content from level 81-85. This wouldn't be bad if they were attracting new players but it isn't happening and most low level areas are ghost towns.
Keep in mind that last year 87% of Blizzard's income came from WoW and that was in a year where they released Starcraft 2. They do have Diablo3 and the Starcraft2 Zerg expansion on the horizon but given past history it will be a while before these games are released. Combine that with the 5% drop in playerbase and Blizzard/Activision is facing a Cataclysm of a different sort. Raising revenue is probably not an option so the only way Blizzard can duplicate their 2010 profit numbers is to cut costs. Considering that most of their costs are fixed I doubt this is possible either. Perhaps Activision's other divisions can make up the difference but it will be interesting to watch Blizzard and Activision's interaction over the next year (don't expect to get anything free this year that we haven't gotten previously).
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