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Do we get our money's worth from WoW?
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Post by
Eccentrica
Grats, you linked an article over 2 years old whose financial information is outdated to say the least, and which doesn't reference anything since the source article no longer exists.
Your serve.
Post by
44284
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Post by
238331
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Post by
367590
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Post by
44284
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Post by
Eccentrica
If you tried to understand a few basic of business and finance you wouldn't be angry.
The price of a subscription has not changed since inception despite inflation. Factoring inflation into the picture, you actually pay less to play WoW every year.
Post by
367590
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Post by
Eccentrica
Factoring in an increasing subscription base it actually costs them less per individual person to run WoW every year. The development teams stays roughly the same size while the amount if incoming cash increases.
False, an increased subscriber base translates into greater resources being required to operate/market and sell/administer the game, all the while, the value of the revenue stream decreases per player.
Total income may increase but not exponentially. And as I said earlier, which you fail to address, the purpose of any company is to earn income for the shareholders. Much as you may hate it, it's true; no income, no company, no game for you to complain about.
Post by
581897
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Post by
Eccentrica
If you tried to understand a few basic of business and finance you wouldn't be angry.
Again thats only if I gave a darn about Activisions bottom line and their other products. I don't. All I care about is WoW. If ActiBlizz cut all their other products and focused solely on making WoW, well that would be fine with me.
Of course you don't care about facts. If you did, you would see the holes in your arguments and that might prove embarassing. It is so much more convenient for you to argue from an emotional standpoint than a logical one.
So you are not engaging in discussion so much as in Soapboxing.
Post by
367590
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Post by
xaratherus
They can remain in their original size and as new users are added it costs less per user to pay each member of the team. Looking at other parts of the picture like customer support at the very greatest they grow equally with new subscribers meaning, other than inflation in never costs more per user than it did originally to pay customer support, server maintenance etc.
False. More people equals more servers equals more people to maintenance those servers. More people equals more robust connectivity equals more hardware to manage that connectivity equals more people to maintenance that hardware.
You assume a static amount of hardware and people. That is not the case. They've added large numbers of servers since the game began, and added additional people to maintenance that harder.
Post by
Eccentrica
On the contrary, the financial statements from the last quarter of 2009 work very much to my favour as I read them ALL, not just parsing them for one or two entries which seemed to support my arguments as you did.
Furthermore, research and development does increase in price, both in real and nominal dollar amounts and for a variety of reasons, one of which is the ever increasing scope of changes to the game. At the same time, because charges to players decrease in real dollar values, the graph of revenues would take the form of the graph of a root and not the graph of an exponent (ie, it would grow slowly over time, and not rapidly over time).
Post by
367590
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Post by
Eccentrica
You assume a static amount of hardware and people. That is not the case. They've added large numbers of servers since the game began, and added additional people to maintenance that harder.
If they weren't making more per person they would stop allowing new subscribers. It's as simple as that. You don't keep adding new subscribers for 6 years if you losing money by doing so.
They aren't making more per subscriber, they are making less per subscriber and increasing their subscriber base, thus allowing for continued net income.
Post by
xaratherus
You assume a static amount of hardware and people. That is not the case. They've added large numbers of servers since the game began, and added additional people to maintenance that harder.
If they weren't making more per person they would stop allowing new subscribers. It's as simple as that. You don't keep adding new subscribers for 6 years if you losing money by doing so.
Actually, it's not as simple as that. If you're satisfied with your profit margin, then you'll always be willing to accept new customers as long as your profit margin remains viable.
Additionally, you fail to understand that in years where most companies grow, they
lose
money. Growth costs. You spend to grow - but only if your analysis of the market shows that such growth will result in eventual gains.
I am willing to bet you my next paycheck that Blizzard has a team of financial analysts far more knowledgeable regarding financing than you and I combined, who have reviewed this and found that pumping more money into WoW will not result in what they would consider a viable exponential gain - and thus they don't do it.
Post by
367590
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Post by
xaratherus
They aren't making more per subscriber, they are making less per subscriber and increasing their subscriber base, thus allowing for continued net income.
So you are saying they are making less profit now than when they started? Excuse me if i don't buy it.
Uh, no, that's not what Eccentrica is saying at all.
Getting $1 from a thousand people is better than getting $5 from a hundred people. The numbers are not quite as clear in business when you factor in operating cost, but it's the same general idea.
WoW makes a lot of money. Activision hemorrhages money. I should be mad at Activision for their mistakes. I should be mad at them for not doing more to support the profitable side of their business. I'm sure the investors probably feel the same way with thier 9 cents a share.
Do you realize the incongruous nature of what you're saying? That 9 cents a share comes from that net profit. If Blizzard turned around and put more money back into the game, the gains of the shareholders would
drop
.
Post by
Eccentrica
You don't buy it because you don't understand it. You don't understand it because you don't want to. I don't know why you don't want to.
And they aren't realizing less net income than when they started, but it is not growing as fast as it did in the beginning. We have already tried to explain some basic facts of corporate life to you, go back and reread the posts.
If you are still mad, then it is based on emotion and not facts, and we really can't help you there.
Post by
xaratherus
Yeah, I'm done at this point. There is a barrier in communication here, and it stems from a lack of understanding of corporate economics.
You're angry. If you dislike what they're doing,
stop paying
.
At this point, you've derailed your own thread - or, more accurately, you mislabeled the thread, because what you're interested in has nothing to do with whether or not we feel we're getting our money's worth from WoW. If that were the case, Blizzard's profit would never enter into it, because "your money's worth" is what
you
get from it, not what they get from it.
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