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Life After Conan

Funcom CEO Trond Arne Aas on how the company is spreading its bets in 2010

When Age of Conan was first released in 2008 the game's initial sales numbers showed great promise. But as time wore on developer Funcom found it increasingly hard to maintain high subscriber numbers in the face of strong competition - particularly from perennial giant World of Warcraft.

At the end of 2009 the company announced exclusively to GamesIndustry.biz that it was launching a new strand of casual MMO games aimed at a younger demographic to sit alongside the existing adult MMO strategy, and here CEO Trond Arne Aas explains a little more about the company's present position and future plans.

GamesIndustry.biz Funcom's undergone various cost-cutting measures in the past year or so - have they produced the results that the company needs in terms of savings?
Trond Arne Aas

Going through cost reductions is never a fun thing, and unfortunately it's become almost a default thing for businesses in the last year it seems.

I think we've adjusted well to that - we've done several things to reduce our cost base. We've had several cost reductions, we've got an office in Beijing that's doing some fantastic work, and we've set up an office in Montreal.

All of that is with a keen eye on the cost position of the company - we're also specifically exposed to the Norwegian Kroner versus the US Dollar exchange rate, which has been a specific challenge to us. We're taking steps to make sure we're not as exposed to that as we used to be.

GamesIndustry.biz You've recently been promoting some free trials and other measures aimed at boosting the subscriber base for Age of Conan - have you seen numbers increase as a result?
Trond Arne Aas

Yes, we did, I think we had a very good run in the summer with the re-evaluation and marketing initiatives that actually grew the subscriber base. I think that was a positive experience. But then there are times when competitors launch, and they reduce our customer base - it's the way it works with this kind of long-term subscription business.

So when we've used those marketing initiatives they've worked quite well for us, but then you are exposed to that risk of competitors in the market.

GamesIndustry.biz It reminds me in some ways of the mobile phone industry, where the initial push is for news subscribers - but later that changes to a focus on cannibalising the customer base of competitors. It's very different from traditional publishing, isn't it?
Trond Arne Aas

Oh absolutely - mobile phones, or newspaper or magazine subscriptions... it's very much a subscription-based business, and you have the ebb and flow of those kind of businesses. You know that summer is usually quiet because lots of people go on vacation, and you know that January is actually a great time because people are finished with Christmas... they don't have too much money to spend on other stuff, so they return to their subscription games.

So yes - it absolutely has the characteristics of a subscription business.