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Posts with tag 11-million

Activision-Blizzard September results reveals box sales paradigm

Activision-Blizzard released September quarter results yesterday. Most of the document is pretty dry and won't mean much to the majority of their devoted fans. They reaffirm the 11 million subscriber base of World of Warcraft and remind us that Guitar Hero's doing pretty well. Yeah, and they have an expansion coming up.

There is an interesting gem, however, to be found in their discussion of Wrath box sales:

"Revenues related to the sale of World of Warcraft boxed software, including the sale of expansion packs and other ancillary revenues will continue to be deferred and recognized ratably over the estimated customer life beginning upon activation of the software and delivery of the services."

That's a pretty packed statement. In summary, it means that the money Blizzard makes from selling the game box isn't immediately counted in their performance metrics at the time of sale. (There's no December "bump" to revenue directly from the 50ish dollars you pay for an expansion.)

Instead, they count the revenue gains throughout your customer lifetime. Doesn't sound like a big deal, does it? Let's talk about why that's such a significant notion.

Read more →

Filed under: Analysis / Opinion, Blizzard, News items

World of Warcraft hits 11 million subscribers worldwide


Even in the middle of zombies, nerfs, and Death Knights, World of Warcraft has continued to grow. Blizzard announced today that World of Warcraft has achieved 11 million subscribers. To help with perspective, that's as many people as had been employed by the construction industry last year, or just slightly under the population of Greece.

When WoW hit 10 million back in January, Blizzard acknowledged how big the holiday season had been for them. Now consider that we're going into a new holiday season with a brand new expansion on the way. Even if other games are looking to get a piece of the action, we should expect Blizzard to keep steamrolling with their great success. Word of mouth from the recent zombie event might be exciting older players to return, and programs like Recruit-a-Friend will keep growing their active base.

We should expect to see the 12 million landmark sometime in 2009. WoW had hit 9 million subscribers back in July of 2007. Like we said, 10 million subscribers was reached in January of 2008. It took a little longer to grow from 10 to 11 than it did to get from 9 to 10, but if they keep up this rate, we should see the 12 million announcement around February or March.

Filed under: Analysis / Opinion, Blizzard, News items, Expansions

BusinessWeek inside the world of Blizzard

BusinessWeek spent some time examining the indisputable success of our Blizzard overlords. At the very beginning of the article, BusinessWeek credits Blizzard's mastery of gaming to the often-spoken, often-hated "when it's ready." In a quote from Jay Wilson, Blizzard says that if "a product isn't good enough, we cancel it."

The BusinessWeek article talks a lot about the overwhelmingly involved culture of Blizzard employees. The developers play their own games, both on the clock and off the clock. Dedicated "strike teams" spend lunch cruising the games' latest builds. Players in beta provide instant feedback, which executives and designers hungrily consume to make the best possible decisions. And if a game isn't deemed "fun enough," it's sent off to black-can land, where it will never see the light of day.

According to the article, though, Blizzard still plans on releasing a new expansion every year. This is in addition to Starcraft II and Diablo III. While we can obviously expect these games to show up "when they're ready," it paints a very active, competitive future for the Activision Blizzard group. The article does credit a new milestone for our beloved World of Warcraft. According to BusinessWeek, the subscriber base is now nearly 11 million. With the Recruit-a-Friend benefits, I hope we see this number grow to 12 million by the end of the year.

Filed under: Analysis / Opinion, Blizzard, News items, Expansions

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