Activision Blizzard Trying To Scare Off Competition?

A few months ago, Activision Blizzard CEO Bobby Kotick said investing $500 million to a billion still wouldn’t be enough to compete with an MMORPG like World of Warcraft. The MMORPG space is a costly investment and you’d need to really burn a lot of money to start competing against the mega-giant, but Mythic VP and Warhammer Online lead designer Mark Jacobs disagrees with that quote.

Jacobs says $100-million dollars would be needed to start competing against the giant subscription generator that is World of Warcraft. Although few developers are sitting on $100-million USD, it’s a bit more realistic an investment for a studio to scrape up compared to a billion bucks! A billion dollars is a scary number when you consider that’s the start of an investment that may, or may not, pay off in the end.

Kotick may not be using complete scare tactics, he may be working off experience when dealing with MMORPG’s. A startup MMO isn’t a cookie cutter system, there is a lot of development efforts, $100-million dollars worth, but MMO developers slip dates many times. When you start slipping your dates you’ll start burning more money and, before you know it, you’re a billion in the hole. Jacobs thinks $100-million will cover development costs and messing up, so a billion is still way over budget.

Perhaps this is a bit of a scare tactic, assuming a developer will fail and slip their dates isn’t really a great way to start quoting prices. However, shooting too low isn’t always the best method of building your development assessments. The end result, scream ONE BILLION and you may scare off any potential startup MMO developers.

Warhammer Online lead designer did mention one big barrier to entry: the need for “at least half a million subscribers to be successful.”

(Thanks, 1up)

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It’s amazing how economies thrive on virtual worlds like Azeroth. One can buy and sell wares at an auction house to bring in money and spend money. Unfortunately, on my return back to Azeroth after a large siesta from the virtual world, many things seem to have changed… it costs an arm and a leg for almost everything. Perhaps the Burning Crusade expansion has set a new level of cost?

Here’s the deal. If you’re a brand new World of Warcraft player, you’re going to find yourself having to harvest the materials of the world (known as “mats”) for yourself because the auction house is way too expensive for everyday items. Inflation is out of control, imagine going to the store to purchase a leather jacket for the price of a car. You’d go cold wouldn’t you?

Once upon a time things were different, “low-bee” items (items between 1 and 15 let’s say) were a reasonable price, usually in the silver range of money. Today, they’re weighted in gold. The concept of supply and demand is at work but how is it we can purchase the supply at such a high cost? Because we’ve got friends or other characters with a lot of unused cash!

With Burning Crusade we saw basic quests tossing around gold as if it were common place. A character would save up thousands of gold for mounts and then horde the gold as if it were precious until they realized it was nearly infinite in supply and would start passing it around their guild or to other low level characters in their account. The end result, a low level character can go into the auction house with 100 gold in hand and buy whatever they need for basic materials no matter the price.

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Perhaps, over time, Blizzard will create a platinum piece to replace the common nature of the gold as it depreciates in value. Although that’s said more in jest, it’s unfortunate that brand new gamers to this MMORPG won’t be able to take full advantage of the auction house as they could years ago with the influx in gold deposits.

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