Financial Wizards Call World of Warcraft Activision's "Achilles' Heel"

[Brainst0rm]

I'm so glad we have these financial experts to tell us that a 25% percent drop in revenue may cut a number as high as 100 million by 25 million! Wow! And when you add the two numbers together, you get an even bigger number! Leaping lizards, what will they think of next?

Also: They don't really know what they're talking about. Subscriptions will start picking up in a big way the month before Mists launches, and since GW2 has no sub fee there should be minimal direct competition. There's no reason a player can't play both games.

 

[geizr]

I think some of you, in your rushed attempts to unleash some snide, cynical, caustic remark, failed to understand what is really being said here. These analysts are not saying that WoW is dying or that Activision is in anyway in trouble, currently. What they are saying is that Activision has too much dependency on a single product. (They could probably come to the same conclusion regarding the Call of Duty franchise.) Basically, they are saying Activision is not sufficiently diversified to be robust against any significant downturn or loss in the WoW subscriber base, should such an event ever happen, and nothing more. This leaves the company in the vulnerable position that it may not be able to adapt fast enough to mitigate the losses before substantial damage is done to the company, IF such a significant downturn should ever happen, at least before Activision has had a chance to find a replacement cash-cow.

 

[Nautical Honors Society]

So Activision is a bad company because they rely on one game...that is hardly the games fault, seems more like the responsibility of the company to produce better and more varied products.

 

[ZippyDSMlee]

EVERYONE stop playing wow!! Maybe it will force Blizzard to stop raping consumers and force activation to die a horrible death!

 

[SnakeoilSage]

WoW's already made more money than it probably deserved to. It's time to release an all-in-one pack so that players don't have to buy the game and 5 separate expansions, go free-to-play, and rework its micro-sales market so we're not paying $15 friggin' dollars for a NON-COMBAT PET.

Seriously, that's EA levels of greed.

 

[tmande2nd]

I HAD around a dozen friends who played it.

Now its like 2.
Seriously most people dont move onto other games, they just get bored.

 

[Evil Smurf]

I HAD around a dozen friends who played it.

Now its like 2.
Seriously most people dont move onto other games, they just get bored.

I would play it, but I was addicted to Farmville in high school for about three months so I don't want to be an addict to this.

 

[Sylveria]

Financial wizards call clothing Nike's "Achilles' Heel."
Financial wizards call drinks Pepsi's "Achilles' Heel."
Financial wizards call fighting crime Batman's "Achilles' Heel."
Financial wizards call being evil Darth Vader's "Achilles' Heel."

I'd say Darth Vader's is actually force lightning. *rimshot*

But, but, but, that would actually make some kind of SENSE and we cannot have that! ;-p

This game is played like this:
Financial wizards call [insert company X's core business here] [insert Company X's name]'s "Achilles' Heel.".

or,
for something that is not a company it goes something like this:

Financial wizards call heavy frontal turret armor, the M1A1's "Achilles' Heel."
or
Financial wizards call superhuman speed, the Flash' "Achilles' Heel."

They're calling it their weakness because hitting anywhere else doesn't really matter. WoW is their key point. If WoW is hit hard by something, it will cause extensive damage while hitting other areas will have a minimal impact. Likewise, if you can stop The Flash's speed, he becomes vulnerable as he has nothing else to rely on.

This isn't a complex comparison people.

 

[Ashley Blalock]

I don't see a single WoW killer dethroning the King. It will likely be more of a death of 1,000 cuts as WoW becomes the last holdout with the monthly fee model. With more choices in free to play games opening up at some point that will pull away the players wondering why they pay $15 a month to be bored.

As other people have pointed out this article isn't really about the death of WoW. It's a story for investors about why Activision might be a risky investment because it depends too much on one game. If enough players burn out on the next expansion then the stock price might go down because the company's income isn't diversified enough for a game company.

 

[Twilight_guy]

Yeah because its not like other game companies are worst off. I mean its not like other companies are completely reliant on there current project going well and if one of their games fails the whole company will go under.... oh wait.

This is just dumb, in relation to other game companies Blizzard is one of the most stable companies around. Yeah if WoW dies it will hurt them, but if everyone switches to Macs Microsoft would be really hurt too, that doesn't mean the company is in danger of failing.

 

[Charli]

World of Warcraft. "Dying" Since 2007!

I know seriously... And project Titan is still under tight NDA in Blizzard HQ.

Will have to see what could come of that before anyone sounds the panic alarm.

 

[iblis666]

activision was the worst thing to happen to wow and blizzard so it all evens out

 

[Callate]

I wish I had an "Achilles Heel" that made money hand over fist with a minimum of effort on my part. Something about the way the software industry works seems to knock financial people slightly goofy (Piracy=Lost Sales, for example).

Now, if no one at Activision has taken into account that revenues for WoW will, in time, decline, and that they need to start planning with that eventuality in mind (perhaps using that income to make investments into new IP and/or technology that will continue to carry the company, for example), yes, that's a weakness... but WoW itself isn't that weakness.

 

[Don't taze me bro]

So Activision is a bad company because they rely on one game...that is hardly the games fault, seems more like the responsibility of the company to produce better and more varied products.

Pretty much this. They have dropped almost all original IPs and instead have heavily relied on franchises that can turn yearly iterations. People can only consume so much of the same thing before they want something new.

That being said, it's only going to get tougher for Wow from here. I am a Wow player, but I'm not surprised at all that they just lost 1.1 million subscribers. With other MMOs going subscription free (GW2, Swtor), it's going to become harder and harder to justify paying a subscription fee, especially if people are forced to wait so long between new content being introduced.

 

[Kargathia]

Whoa, whoa. I thought they were profiting massively from yearly Call of Duty installments?

Correct, but even CoD doesn't rank up to WoW when it comes to shitting cash. ?13,- x 9 million x 12 months equals a lot of yearly revenue.

(Disclaimer: lazy and factually incorrect maths. Bite me.)

 

[Clive Howlitzer]

WoW still exists!? I am surprised.

 

[phatty500]

i have a hard time not laughing at this, WoW, the multi million dollar a year game, is its company greatest weakness, oh, the irony.

kinda what they get for putting all they're eggs in one basket though, thus i choose to sit back, nom popcorn and laugh when WoW final goes down and takes 2 worthless company's with it

i have a hard time not sighing when someone can laugh at the idea of hundred if not thousands of people losing their jobs in an unstable economy.

as for the news doesnt call of duty make billions of dollars where is all that money going?

 

[Lunar Templar]

i have a hard time not laughing at this, WoW, the multi million dollar a year game, is its company greatest weakness, oh, the irony.

kinda what they get for putting all they're eggs in one basket though, thus i choose to sit back, nom popcorn and laugh when WoW final goes down and takes 2 worthless company's with it

i have a hard time not sighing when someone can laugh at the idea of hundred if not thousands of people losing their jobs in an unstable economy.

as for the news doesnt call of duty make billions of dollars where is all that money going?

so? its Actvision and Blizzard, sigh all you want, but you and i both know they kinda have had this coming for awhile now.

 

[veloper]

Financial wizards call clothing Nike's "Achilles' Heel."
Financial wizards call drinks Pepsi's "Achilles' Heel."
Financial wizards call fighting crime Batman's "Achilles' Heel."
Financial wizards call being evil Darth Vader's "Achilles' Heel."

I'd say Darth Vader's is actually force lightning. *rimshot*

But, but, but, that would actually make some kind of SENSE and we cannot have that! ;-p

This game is played like this:
Financial wizards call [insert company X's core business here] [insert Company X's name]'s "Achilles' Heel.".

or,
for something that is not a company it goes something like this:

Financial wizards call heavy frontal turret armor, the M1A1's "Achilles' Heel."
or
Financial wizards call superhuman speed, the Flash' "Achilles' Heel."

They're calling it their weakness because hitting anywhere else doesn't really matter. WoW is their key point. If WoW is hit hard by something, it will cause extensive damage while hitting other areas will have a minimal impact. Likewise, if you can stop The Flash's speed, he becomes vulnerable as he has nothing else to rely on.

This isn't a complex comparison people.

Ask TOR, Age of Conan, LOTR and Warhammer what happens when you try to compete with WOW.
That's trying to do it the HARD way. Even Superman loses in a running match with the Flash.
Even with massive budgets the competition has failed and are now just trying to hang on in the F2P model.

IF A/B do have a weakness, it is that they are slow to innovate and come up with succesful new IPs.
The best way to beat Blizzard would be to come up with the next popular thing and exploit that. FPS and MMOs weren't always the most popular genres in gaming.
The problem with that is ofcourse that none of the big publishers have much truck with innovation, so Blizzard and Activision will remain the most succesful combination in this business by far. If years from now the WOW subscription based has halved, they will still be swimming in mega profits.

 

[PhantomEcho]

I love the ignorance of it all.

Here's these two men who do nothing but study businesses all day, every day, predicting based on solid business principles (which don't change so radically as folks like to imagine based upon the 'type' of business) that Activision/Blizzard have a serious financial pitfall on their hands.

And 90% of what everyone is saying is "No way! That can't be!" and "These guys don't know what they're talking about."

Yes, yes... of course they don't. But more importantly... the information all the folks ranting about HERE are using is coming from... *GASP*... can it be... the VERY COMPANY THAT DOESN'T WANT IT'S CUSTOMERS TO REALIZE THAT IT HAS A SERIOUS WEAKNESS!?

Now, call me crazy, but when the only numbers a company ever gives show it being the best... all the time... when everyone else fairly consistantly shows that they're losing ground... I'm going to go ahead and lump my bets in with the camp who call that an 'act of desperation'.

WoW won't die tomorrow. Probably not even after this new crap expansion... or the next. But it's been losing ground against the waves of job losses and reduced incomes. It's lost ground due to it's mediocre shoveled-out expansions. It's lost ground due to genuinely excellent MMO's which don't follow their cookie-cutter model and their broken-ass endgame scenario.

You can't lose ground on EVERY front of the battle you're fighting and act like you don't have a serious problem. The only numbers what don't show this losing battle? Why, those coming from Activision/Blizzard of course! That's ignorance in the most sublime degree. They're not even ADDRESSING the issue. They're categorically denying it, because they don't have the slightest goddamn clue on how to fix it.

I bought Diablo 3. I haven't played it in months. I don't intend to. Why? Because it feels like a cut-rate MMO without any of the FUN parts of an MMO. I've gotten BORED. The story is the only thing I found decent about it. All of the gameplay is so far gone from what made the first and second games great that I can't help but hang my head in dismay.

I've been a Starcraft player since the game came out. I've played Warcraft and Warcraft 2 since I was a kid. I'm by no means some outsider fanboy come to gloat in the failures of a rival company. I love Blizzard's old games. They're some of the best I've ever played. But their Post-WoW business model is going to be the death of them unless they come up with something outside their closed-minded MMO-Cash Cow box very, very soon.