NCsoft: The Cash Cow Report

No, that sound isn’t from Blizzard’s Caydiem!

It’s from the cash cows grazing about in the infamous secret cow level and I would like to thank them for that remarkable moo insight on allowing NCsoft to participate in the tipping of cash cows thus plundering their phat lewtz. I guess cow tipping is not an urban legend after all.

Before Blizzard released World of Warcraft, NCsoft had forged the golden throne for western developers to salivate and obsess over. Despite the hundreds of new mmogs in the market space coming from the treacherous and underground lava volcanoes throughout the planet NCsoft is still holding onto their foothold. In fact, the numbers speak for themselves, rev is up.

Source: Gamasutra.

Korean-headquartered PC MMO developer and publisher NCSoft, which publishes titles such as City Of Heroes/Villains and Guild Wars in North America, has released its financial results for the third quarter of fiscal year 2005, a three-month period ending September 30st, 2005. The net revenue for the quarter was 87.8 billion Korean won ($84.1 million USD), while the net profit was 20.4 billion won ($19.5 million USD). Compared to last quarter, Q2 2005, net revenue has gone down 10%, while operating profit went up 57%.

The successful quarter was mainly due to increases in the American and European markets, as opposed to the home Korean market, where the company’s presence remained essentially unchanged - though Asia still gives NCSoft by far its largest percentage of revenue. American revenue climbed 33% to 19.2 billion won ($18.2 million USD), while European revenue rose to 6.4 billion won ($6.09 million USD).

The MMORPG-centric company also revealed a breakdown of revenues by specific title. In the lead is Lineage II, one of the most popular online games in Korea and Japan, with 36% of revenue; it’s followed closely by the original Lineage, which generates 35%. After that is Guild Wars, with 21% of revenue, followed by a surprisingly distant City of Heroes, which accounts for a mere 8%. Its standing may change in Q4, however, given that the City of Villains expansion has just been released.

Gilder, the resident MBA guru @ plaguelands used his tactical skills in advanced chaos theory and deciphered that the 8% City of Heroes hauls in translates into a cool 6.728 million, or 2.24 per each month of the quarter. If the subscription rate is $15.00 it puts COH’s subscription base near 149,511 subscribers. We can’t forget the technicalities on any new subscriptions, but a total estimation puts the subscription numbers at more or less 150k.

History Time: Census Time.

City of Heroes launched back in April of 04 and quickly reached 180,000 subscriptions, towards the end of the year 04 NCsoft reports indicated that subscriptions had declined to 163,000. A staggering loss in spandex tights! It’s been a full year since the travesty began and with this newfangled data the subscription base has still been dwindling very slowly, I guess heroes aren’t so super.

Still the amount of heroes Shizizamamizlam nasty man in the back alleys of Paragon City is sustaining more or less, keeping even isn’t all that great with the huge influx of NA/UK mmo players the landscape has seen in the last year, but it’s not necessarily horrible. Keep in mind these figures don’t include the recent release of City of Villains, which will most definitely spike the subscription numbers, but from the reports I have read on City of Villains I predict this new growth will be a short term spurt and not longevous.

I predict bad things for the City of Hervilloes once Sigil’s Marvel mmo is released, but Captain Caps Lock still has a few years left before the death knell starts knocking on their door, better make the best of it.

Guild Wars had revenues of 17,660,000 for the quarter, which is 5,887,000 per month. Box prices vary, but units have been flying off shelves and hitting desktops on upwards of 200,000 a month.

The Lineage franchise is still making bringing in most of the money hats obviously and it still doesn’t fare all that well in the NA/UK market.