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Step back and look at the potential cost to EA/BW for them giving the free 30 days

STAR WARS: The Old Republic > English > General Discussion
Step back and look at the potential cost to EA/BW for them giving the free 30 days

Jim_usmc's Avatar


Jim_usmc
04.13.2012 , 08:30 PM | #51
I didn't get a free month so screw em

Daex's Avatar


Daex
04.13.2012 , 08:33 PM | #52
Quote: Originally Posted by sharpenedstick View Post
Fanbois never cease to amaze me. You think Bioware is giving out time because they're just a bunch of great people?

Bioware and EA are large companies. The only reason large companies do anything is to make money. Someone at Bioware/EA has crunched the numbers and guessed that they will make more money by retaining players upset with the pvp changes and otherwise wavering than they will lose from the free month.

It's the same reason they are giving out time to cancelled accounts. It's not charity, it's just a stunt to try and hook people.

It works out great for those of us who were planning on playing anyway, because we get free time. But don't kid yourself as to why this is happening.
Yep it's all a conspiracy to bring their dead game back to life.. A last gasp..

Give me a break

PostalTwinkie's Avatar


PostalTwinkie
04.13.2012 , 08:34 PM | #53
Quote: Originally Posted by lokivoid View Post
There is a major flaw with that, that number is inaccurate. It has not been updated sense the release in asian pacific, the number was posted right after the asian pacific release. As with all games you see a sudden surge at release. From current reports its doing vary poorly in that given region, all there servers are sitting on light during peak.

You are also not accounting for State/federal corp income tax, and the 20% royalties to lucasarts

You also have to account for
server upkeep and bandwidth
employee payroll
Upper management bonuses
Advertisement
Legal fee's

So the profit is no where near as high as you think it is.
I take it you didn't actually read what I said. I stated that I was using the last confirmed numbers, because that is all we have in terms of subscription count. You are also, based off what you have said, one of the last persons I would take business advice from.



Quote: Originally Posted by Daex View Post
It's been said many times that 200 million number for development cost was exaggerated.

It could really be that they are more profitable than they expected and therefore they have room to do this to attract people who quit and/or please people who stayed.

Also no small thing is the impact of you telling your school/work friend: "Hey, this Star Wars just gave me a free month!". Good marketing goes a long way.

No it hasn't been said. In fact based off financial reports, and other known development numbers, industry leaders are all in agreement that the cost was around $200 million. We know the number of people employed to make the game, how long it took them to make it, how many voice actors, etc. Don't believe me? Go back and read the End of Year reports from EA that they have to file.

As to the rest of what you said...

I will just grin and nod as I walk away.
Quote: Originally Posted by Blavatsky View Post
Problems of the First World.

"My Video Game Dev implements improvements to my gaming experience in a clandestine manner , this is costing me virtual money "

Daex's Avatar


Daex
04.13.2012 , 08:41 PM | #54
Quote: Originally Posted by PostalTwinkie View Post
No it hasn't been said. In fact based off financial reports, and other known development numbers, industry leaders are all in agreement that the cost was around $200 million. We know the number of people employed to make the game, how long it took them to make it, how many voice actors, etc. Don't believe me? Go back and read the End of Year reports from EA that they have to file.

As to the rest of what you said...

I will just grin and nod as I walk away.
There are no verifiable facts that say anything higher than 120 million IMO. Lots of speculation everything else.

For the rest of what you said.. I will print it and wipe my *** with. You are just one of those people who will keep saying that game is dying or whatever and then go like "I SAID IT'S GONNA HAPPEN" whenever it happens, being it months or years...

tacoknite's Avatar


tacoknite
04.13.2012 , 08:43 PM | #55
you don't give anything away for free unless you are hurting for revenue.

say there is this pizza join around the corner been there for years, everyone in town goes there over and over. Time passes by and people keep going but they want something different.

i decide to open a new pizza joint , big sign "coming soon" , something different, etc etc.

i open the shop but it's just another pizza joint. we have some people that like our style of pizza, it's got a few different flavors, but it's still ****** pizza.

so the new pizza joint offers buy one pizza get one free. Companies do this because they are not meeting their profit goals.

i use the original pizza company as wow, and the new pizza company as swtor, age of conan, warhammer, etc etc.


after a while people realize , it's still pizza.

people are kinda sick of pizza, they want something completely different. No matter how you slice it, swtor is a copy of a system that people are tired of. It is not a failure though, it will probably hold true to 500k to 1mil subs. Some people really enjoy the game. I have been sub'd since release but havent playe din about a month and a half.

I debate coming back , but then i just realize it's the same pizza.

personally for me,

i want something different, it doesnt even have to be a combat type game for me to enjoy . Econonmy driven, story driven, housing, i wish gaming companies would explore something different. I do not want to grind raids and dungeons for gear, only to replace the **** by grinding more dungones and raids.

i just don't get how people can be happy with the current mmo model. We are better than this as gamers, i'd really like a company to step up and think outside the box.

but yah back to top and tldr

they're hurting, investors want return, free sub for 30 days. games dont decrease in price unless they're hurting. No if's and's or but's .

PostalTwinkie's Avatar


PostalTwinkie
04.13.2012 , 08:52 PM | #56
Quote: Originally Posted by Daex View Post
There are no verifiable facts that say anything higher than 120 million IMO. Lots of speculation everything else.

For the rest of what you said.. I will print it and wipe my *** with. You are just one of those people who will keep saying that game is dying or whatever and then go like "I SAID IT'S GONNA HAPPEN" whenever it happens, being it months or years...
Since you obviously weren't able to comprehend a thing I said, at least that is the impression you gave with what you said, here.....

http://en.wikipedia.org/wiki/Financial_statement

As previously stated, the numbers that are generally accepted among industry peers is based off information contained in EA financial disclosures. These aren't faked, and have to be filed as EA is a publicly traded company. These numbers are further calculated based off other known industry costs as they pertain to other known factors of this games development. While it isn't 100% accurate, it is still generally accepted as close.

Oh, that also doesn't even count the initial investment from EA to actually purchase BioWare and Pandemic, which was another $860 million.

Secondly....

At what point did I say this game was "dying"? How in the hell did you get that from what I said? Please for the love of god go to school, I suggest 2nd grade. I believe that is when they really start focusing on basic comprehensions skills.
Quote: Originally Posted by Blavatsky View Post
Problems of the First World.

"My Video Game Dev implements improvements to my gaming experience in a clandestine manner , this is costing me virtual money "

lollermittens's Avatar


lollermittens
04.13.2012 , 08:58 PM | #57
You people need to take a class in accounting and a course in elementary micro-economics to accurately analyze how BW could provide such a promotion at the potential scenario of losing millions of dollars of subscribers money.

First of all, you simply can't take X number of subscribers and then multiply that number by $14.99 to approximate the gross revenue generated by a subscription-based service. You have to take in into account the initial sales of the game in order to get a clear picture as to how EA/BW could finance a free-month of play time for millions of users. This includes a segmentation of those who bought the game digitally, a hard copy in-store or online, and those who bought the Enhanced/CE editions (online or in-store). The generated revenue from this POS (Point of Sale) merchanside is going to widly differ from state to state (due to varying taxes), from country to country and their subsequent foreign exchange rate at the time of sale, and because of other factors such as licensing costs and publishing costs which all differ from country to country and state to state. Most importantly is to take into account the different subscription options available to the customer because under certain subscription plans, you are not paying $14.99 a month. Currently, you can purchase a one-month recurring plan, a three-month recurring plan, and a 6-month one. You can as well buy game cards which provide the same functionality but those cards are not pure profit since BW needs to reach out to manufacturers and contract the distribution of these cards to various convenience, grocery, and video-games stores. The revenue generated from the initial sale of the game and its various subscription plans could have already offset the initial cost of development for all we know hence why we could assume the reason for this promotional marketing ploy.

Second of all, the way subscription-based services are recorded in accounting ledgers is different from the way a wrench would be sold in Sears' tool department. In the latter, Sears can mark this as instantly recognized revenue. They adjust their inventory to reflect the sale of the item and record the sale of the item as direct revenue that is recognized the day of the purchase (or moment if they are using sophisticated supply chain managerial software) -- this ties into the process of Revenue Recognition but there's no need to go down that road for this example. In BW's case, once the POS event has occurred, their digital/physical product is essentially shifting into a service. Any business model which relies on subscription-based revenue to generate profits must record that revenue as deferred revenue. For example, even though you haven't paid for the month of May, BW registers in its book that you have paid for that month even though you may very well quit tomorrow. To put it theoretically, the transaction has not yet transpired but BW records it in its book in advance anyways. With deferred revenue, you have the capacity to adjust the increases and decreases in subscription numbers by retroactively changing your current deferred revenue. This is why when BW releases their quarterly numbers, you have to be extremely skeptical of their accuracy and validity because you don't know at which point in time they are referring their subscription numbers to. When they say that for the month of March we still have retained 1.7M subscribers, the EA CEO is not telling you that he is using the numbers from the deferred (now current) revenue obtained for the month of February. This is a typical tactic during quarterly meetings to boast about your numbers and other factors -- retention rates is a whole different beast.

Finally, to compute these numbers, we'd need access to much more than just a rough estimate of the current number of active subscribers -- and the definition of "active subscribers" is prone to abuse just as Blizzard released their criteria for what they considered as "active" which was quite interesting to say the least. We'd need: supplier/vendor costs; manufacturers/OEM costs; publishing costs; licensing costs; development costs; maitenance costs; salary costs; and most importantly the monthly overhead required to keep this game running. All of these factors will severly impact the monthly profit (Profit = Revenue - Cost) figures that we could estimate.

And last but not least, we are talking about EA. A multi-billion dollar international conglomerate that is extremely aggressive in M&A (Mergers and Acquisitions) and dominates the game industry in many, many aspects. BW has the full support of EA since like any serious, capitalistic management, the EA executives want to see a positive ROI (Return On Investment) of a heavily funded project in order to satisfy their shareholders: always remember that this goal is the main priority of any public corporation.

TL;DR: this is an exercise in futility. Your method to multiply X numbers of subscribers with the monthly cost of $14.99 is not valid. Too many factors must be taken into consideration to accurately estimate BW/EA's cost of providing a free month of play time.

Daex's Avatar


Daex
04.13.2012 , 09:04 PM | #58
Quote: Originally Posted by PostalTwinkie View Post
At what point did I say this game was "dying"? How in the hell did you get that from what I said? Please for the love of god go to school, I suggest 2nd grade. I believe that is when they really start focusing on basic comprehensions skills.
Simple search for your posts reveals very negative attitude towards the game. No rocket science really.

While I do agree that bad things about the game need to be pointed out.. There has to be a point where you either play the game, or don't play the game but you stop ************ about it

And for the school comment.. really? Couldn't come up with a better insult?

Kadin's Avatar


Kadin
04.13.2012 , 09:05 PM | #59
Quote: Originally Posted by tacoknite View Post
you don't give anything away for free unless you are hurting for revenue.

say there is this pizza join around the corner been there for years, everyone in town goes there over and over. Time passes by and people keep going but they want something different.

i decide to open a new pizza joint , big sign "coming soon" , something different, etc etc.

i open the shop but it's just another pizza joint. we have some people that like our style of pizza, it's got a few different flavors, but it's still ****** pizza.

so the new pizza joint offers buy one pizza get one free. Companies do this because they are not meeting their profit goals.

i use the original pizza company as wow, and the new pizza company as swtor, age of conan, warhammer, etc etc.


after a while people realize , it's still pizza.

people are kinda sick of pizza, they want something completely different. No matter how you slice it, swtor is a copy of a system that people are tired of. It is not a failure though, it will probably hold true to 500k to 1mil subs. Some people really enjoy the game. I have been sub'd since release but havent playe din about a month and a half.

I debate coming back , but then i just realize it's the same pizza.

personally for me,

i want something different, it doesnt even have to be a combat type game for me to enjoy . Econonmy driven, story driven, housing, i wish gaming companies would explore something different. I do not want to grind raids and dungeons for gear, only to replace the **** by grinding more dungones and raids.

i just don't get how people can be happy with the current mmo model. We are better than this as gamers, i'd really like a company to step up and think outside the box.

but yah back to top and tldr

they're hurting, investors want return, free sub for 30 days. games dont decrease in price unless they're hurting. No if's and's or but's .
And here I thought about ordering out for Pizza tonight as it's raining a good bit here and decided to make a turkey sandwich instead. It's as if this post was meant to taunt me...

Daex's Avatar


Daex
04.13.2012 , 09:08 PM | #60
Quote: Originally Posted by lollermittens View Post
derp...

TL;DR: this is an exercise in futility. Your method to multiply X numbers of subscribers with the monthly cost of $14.99 is not valid. Too many factors must be taken into consideration to accurately estimate BW/EA's cost of providing a free month of play time.
Not to mention when it comes to subs they are virtually selling thin air(it's often been said that cost of running the servers + staff is nowhere near 15$ per customer in a healthy game). Assuming we are ignoring initial costs or thinking as if they made it all back already.