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by Adam Holisky 
Feb 5th 2009 at 9:00AM
GamePolitcs had an interesting news brief about Michael Pachter, a financial analyst with Wedbush-Morgan, who contends that MMOs will not be impacted in the current economic downturn because the majority of people who play them are "addicts."The full interview with Pachter is available from Reuters.
Besides the negative stereotypes and sweeping generalizations that come with statements like "people who play [MMOs] are addicts," Pachter does make a good point. He notes that "Losing their jobs makes them more likely to play because they have more time to play."
I thought about this for a minute. If I were to lose my job here at WoW Insider, I would no doubt start looking for new employment almost immediately. I would scale back my expenses – probably get rid of cable TV (Hulu is my TV now anyways), I'd eat out less, I'd use the library more and Barnes & Noble less, and I would generally be more frugal with my spending.
But I don't think I would cancel my WoW subscription.
WoW is as much of a social activity as a game for me at this point, and I often find myself logging on to just catch up with people I've been friends with for years. Of course they're on AIM and have my phone number and everything too, but there's nothing like having a sociable time playing a game with them.
Now granted some people might not see it that way, however with that said I don't think I'm alone in this regard.
And when you look at it in terms of dollars spent over time, I play WoW recreationally (over being on it for work related purposes) about 50 hours a month, all for $15. That's $0.15/hr. Now take something like the new Kevin Smith DVD I picked up yesterday at Best Buy for $16. Since I'm a Kevin Smith fanboi, I'll probably get about 12 hours out of that DVD in the end. That's $1.33/hr. WoW is nearly 9 times as economical for me to play over buying a DVD I really like. If I were to buy a DVD I'd just watch twice for $16, getting say 6 hours out of it, WoW becomes nearly 18 times more economical.
In the end I think the above cost analysis is much better than "I don't think (online multiplayer games) get impacted at all, because people who play them are addicts, Losing their jobs makes them more likely to play because they have more time to play."
Filed under: Analysis / Opinion, Economy
Reader Comments (Page 4 of 4)
Gryph667 Feb 5th 2009 10:45AM
In my experience, high speed, cell phone, and other household infrastructure greatly increases a person's ability to get hired. Here's a for instance: I'm an audio/visual/communication engineer. Having cell, hard line, broadband (for potential vpn access needs) is effectively required as a job candidate. Why? Because employers _expect_ you to have it. If you don't, then your lifestyle is no different than that of an entry level person, ergo, that is the perception that will be projected during those all important interviews.
There's the hypothetical. Here's the actual. Three yrs ago I was in the job market, with a hardline and basic cable tv for the kids. I had put the cells on hold, thinking "zomg 150 bucks a month for all those minutes? NEIN!"
I didn't get a call for three months.
I had four interviews the week after I turned the cell phone back on.
Internet being bundled into the wow subscription isn't practical. If you're a professional looking for a professional job, have the professional utilities, because an employer doesn't want to wait a couple weeks for you to turn everything on AFTER your first paycheck.
And let's face it, everyone. WoW is a hell of a lot cheaper that drinking yourself into a depressive stupor multiple nights a week. And healthier. Especially if you end up in the depressive stupor without the alcohol because you think you're being "responsibly thrifty."
Cedia Feb 5th 2009 10:47AM
"I don't think (online multiplayer games) get impacted at all, because people who play them are addicts," said Michael Pachter, an analyst at Wedbush Morgan. "Losing their jobs makes them more likely to play because they have more time to play."
Wow, that guy just lost his career.
Jintz Feb 5th 2009 11:02AM
Yea i feel the same way yea it 15$ a month but compare that to going out to eat? or to go see a movie? The price value of both of those separate are more then 15$. So I think more people are going to subscribe more to WoW because of this.
Rudolphe Feb 5th 2009 10:51AM
No, wow players will sell their children before they let their accounts lapse.
Twowolves Feb 5th 2009 10:51AM
I don't pay to play. Since I put all our large expenses; travel, home repairs, new car down payment, holiday shopping, on my WoW Visa, I haven't had to pay for WoW for a year and I'm good for the rest of 2009.
It's actually a good card to have if you are a self-proclaimed
WoW addict and are able to keep the balance paid off.
Gryph667 Feb 5th 2009 10:54AM
Good thinking. Fractal budgeting.
Konchu Feb 5th 2009 10:58AM
I echo what a lot of people say here I play wow to save money. It is addictive cause there is so much to do but 15 dollars a month gives me near limitless entertainment were as a 60 dollar games gives me 10-60 hours normally. There are some exceptions where some give more online shooters etc if that is your thing.
Peaches Feb 5th 2009 11:47AM
Yeah I'm in agreement with the people saying WoW is their cheap form of entertainment ... gives me something to do during the week that keeps me from going to bars with my friends or something else equally as expensive.
jurgen Feb 7th 2009 7:37PM
I'd want to spin this article around and ask the question does WoW negatively effect the RW economy?
Having more reasons to stay home and not spend is good for the consumer during a recession but doesn't that 11 million player base all carry a small impact on local and world economy by not consuming equally with there non WoW counterparts?
(This isn't to say we should endorse buying from gold farmers to indirectly do are part XD)
Dobmeister Feb 5th 2009 11:57AM
I pay £50 per 6 months for World o' Warcraft. Even on the meagre student finance system, this is still a drop of water in the ocean, when weekly budgeting is £20-30.
Tis hard to believe financial analysts telling me I'm an addict, if they couldn't even spot the rollercoaster was dangerously close to its peak.
stabbington Feb 5th 2009 12:02PM
If I ever got into a desperate financial situation, WoW would be the first thing to go. It's just not that important in the grand scheme of things. But it's inexpensive fun. Definitely cheaper than when I go out drinking with friends.
Ilnara Feb 5th 2009 12:49PM
It will survive for two reasons.
One, people value internet access more than previous forms of entertainment, and media. We saw this shift happening in media already, before the recession really took hold. People are foregoing TV, News papers and magazines because the internet on a pound for pound basis is CHEAPER than those other forms of entertainment.
Typical internet packages are half as much as most cable TV packages these days. I for instance pay roughly $40 a month for internet, and after introductory rates, over $75 JUST for the TV signal. You can guess which one is going to get dropped first with the ability to view most shows on their station web sites, if not 3rd party sites like hulu.com.
Second, WOW's cost is measured in 'pennies a day' compared to most 'addictive past times' . $15 a month for nearly unlimited entertainment is something thats hard to come by these days.
So in the grand scheme, WoW won't hurt that badly from the player base standpoint, where they may end up hurting is more from a provider stand point as Blizzard / Activision will no doubt have to scale back production and staffing to stay afloat in operational costs as the value of the dollar continues to deflate.
Thunderbuck Feb 5th 2009 7:35PM
This has been a facinating topic, actually. I agree with your points. Internet has become a near-necessity for a great many of us now (I'd kill cable first), so, no, I don't think the entire cost of broadband should be factored in.
Even so, I can imagine the WoW subscriber profile changing quite a bit in the next while, and that may carry some implications for Blizzard, and for subscribers.
1) I can imagine many subscribers cutting back to lower tiers of broadband as a way to save pennies; how will this affect the overall game performance?
2) Multi-boxers will fall off dramatically. Easy to justify $15 a month. Not so easy to justify $30, especially when you might sell a box to help with rent.
3) Might just see a resurgence in the Internet cafe/gaming cafe.
Murdock Feb 5th 2009 1:23PM
My GF and I are cutting expenses, not because we have to, but because we want to be prepared. Given the current job market, etc. we want to make sure we have the savings to survive if needed.
At any rate, we had a discussion on what to cut and why. Basically WoW/Internet was the LAST thing I would give up. It provides waaaaay to much entertainment for the $.
So far we have (savings):
Cut Cable and gone to OTA reception - $60/month
Trimmed back the cell phone plans - $25/month
Chanced Netflix to a lower tier, mainly because we stream most things on the TiVo/Roku - $10/month
Dropped XM in both cars - $20/month
Thats $115/month right there we are saving, yet we still have hours of entertainment available with WoW, Hulu, Netflix Streaming, etc.
MadMac10 Feb 5th 2009 1:48PM
Bunk!
I cannot believe someone as allegedly important in his industry sector as this ignored what is so totally obvious to my layman's eyes (well, it might also explain how we got into this mess in the first place-- who woulda thunk it?!)
In the creative arts sector (that includes books, films, music, etc.), the industries that are being hit the hardest are the ones relying on advertising revenue. Since Activision/Blizzard derive very little--if any--revenue from advertising, they will skate past this hurdle. The next biggest hit to media industries are those who stupidly dumped all of their assets into real estate or the shady derivatives markets. Did Blizzard do that? I doubt it, but if they did, they deserve to be hit just as hard as the newspaper industry for their greed and malfeasance (please don't blame the web for the death of newspapers.) The last, and least important impact on the creative arts sector was in distribution (revamped postal rates did more to hurt magazines this year than advertising! And we all know how well the music industry is doing these days, thanks to iTunes et. al.)
These three reasons are excellent bellwethers for Activision/Blizzard's future. Add that to the fact that they are staffed with some of the most brilliant artists and developers in the history of gaming, well, I think I'll just go buy some stock right now!
Salacia Feb 5th 2009 2:12PM
Well, I just lost my job about a week ago and I have to admit I am strongly considering canceling my WoW subscription.
george Feb 5th 2009 3:03PM
I go to the movies, and matinee ticket prices were about 7 bucks last time I was out. Thats about half my wow subscription, and only got me two hours of entertainment where I couldn't interact with my friends that much or I'd get thrown out as a disruption.
Just getting into some bars and nightclubs, just getting in the door, can cost nearly as much as a month of WoW. Hell, a bottle of dirt cheap bourbon(the stuff you suspect is really just colored antifreeze) to drink at home costs as much as a month of WoW.
Console games are a much higher startup price, and if you get more than 3 or 4 games a year, a much higher ongoing cost as well. Replayability is very likely lessened as well. Single player computer games have a similar cost issue, though to be fair some fo the free to play online games such as Counterstrike can challenge WoW on this front.
Books. You read enough to match the amount of playtime 15 bucks gets you in an MMO, and you are easily spending far more than an MMO would cost. Again, to be fair, if you've got a decent library this can change, but you still lose out on a convenience factor and possible gas/parking fees.
All in all, compared to other forms of entertainment, MMOs can actually be very competetive on price, to the point I wouldn't be surprised to see some people come into them during a downturn because of that.
Trevin Ward Feb 5th 2009 3:45PM
I'm currently unemployed. I chose a horrible time to graduate from college. I've kept my wow subscription. It's pretty much the only thing I haven't cut out. I still have netflix but I'm likely to cancel that soon too. WoW is cheap and gives me something to do with all my time.
It also gives me an alternative when friends go out to do things that cost money. It's pretty terrible being the guy at the bar that is just getting water all night. This way I have something to do when I don't go.