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Mark Jacobs talks about the "lengthy battle" with Blizzard, the difficulty of setting up an MMO and the future of Warhammer Online

Massively multiplayer online games, or MMOs, are a growing market. People see Blizzard operating World of Warcraft and imagine bags of money and critical acclaim. Very few companies rise to the occasion of producing an MMO and fewer succeed in establishing it as a credible contender. But Warhammer Online: Age of Reckoning by Mythic, the MMO veteran behind Dark Age of Camelot, has recently burst onto the scene after a long gestation, complete with new ideas and an ambition to be number one. spoke to Mythic's CEO Mark Jacobs, about competing with World of Warcraft, the difficulty in establishing a new MMO, and the future of Warhammer Online. Are you worried about the upcoming World of Warcraft expansion, Wrath of the Lich King, diminishing your subscriber base? What have you done to prevent that?
Mark Jacobs

Are we worried about it? Not really. It's an expected thing, we knew when we launched that Lich King was coming out. We're treating it as we would any other MMO launch that was happening around the same time. One of the things about MMOs is that people play multiple games, that's one of the reasons I was very surprised by Paul's comments. He knows that people may play WoW and they'll play WAR and maybe even a third game at the same time.

We've done surveys on that, the industry has done surveys… so any comment along the lines of 'well if they're in my game they're not playing in another game,' flies in the face of all research that's been done among MMO players. Are you sure that's the message Paul Sams was trying to get across, rather than just suggesting that former World of Warcraft subscribers have returned irrespective of whether they're playing Warhammer Online or not?
Mark Jacobs

I think his message was 'oh look at these people they've come back and they're not playing WAR'. You'd have to ask him, but certainly that seemed to be the way he was coming across and I find that kind of funny. I play multiple MMOs... the idea that you only play one is really kind of silly.

In answer to what we're preparing to do for it [Wrath of the Lich King], again, we've known that Blizzard is going to launch in November. We just announced some of the things that will be going in our first major patch. Since we released we've done patches every week but we have a big one going in late fall, which will have two of the classes we cut out in July, new content, all sorts of stuff. That's one of the ways we're going to respond.

This is the beginning of a rather lengthy battle with the guys at Blizzard. We're in this space to be successful and, when you have a competitor that is as successful and important to the games industry as WoW has been, you don't go into this space unless you're willing to spend money and spend time and really compete against them. It's a marathon, not a sprint. We've got a lot of stuff going in, not only this fall but then there's spring and then after that. You recently put out a press release saying you've got 750,000 registered users. Do you think that will translate into a sizable subscriber base given that Age of Conan's figures during the same period were 800,000 users but has since fallen on hard times?
Mark Jacobs

Some companies have talked about what their conversion rate is... Back in the Camelot days if you got into the 70s [per cent] or above, in terms of conversion rates, then you were doing well. There is not a single MMO in history, certainly that I am aware of, that has a 100 per cent, no one does. People buy the box, they play it for 30 days and some decide not to continue. The closer you get to 100 per cent the better you are.

Blizzard, with WoW, never talked about specific numbers but the rumour was that they were on the higher end of things, other games, like Age of Conan, certainly did not have that conversion rate. So if we're successful, we'll have a high conversion rate and we'll keep the vast majority of our subs.

No one has been billed yet, so we wont' know this really for at least several months, in terms of how well we're doing, unless we start off horribly. Everything we've done internally, in terms of looking at internal polls, people posting on forums, e-mails from people, all we've seen so far is that we're well on track. Some analysts have predicted between 200-300 thousand subscribers, do you believe that is an accurate and realistic prediction?
Mark Jacobs

No. I don't think it's a very realistic expectation at all. I read that from one analyst and I think his numbers were way off for the industry. That kind of number, which I think he mentioned, was under 50 per cent [of registered users]. Those numbers are considered very low for the industry, very low. Do you believe it's possible for a developer or a publisher to launch a triple A MMO in today's market without the financial clout that a company like EA has?
Mark Jacobs

One of the things that Paul [Sams] said, that I think was correct, was that launching these games is really hard. It's always been hard, because if you look at the rate of failures in the MMO space it is unbelievable. Over the last 11 years there have been hundreds of MMOs that have been announced, just in North America and Europe alone, it's a lot more than one or two hundred... If you look at that same 11 years you can probably name only 10 or maybe 11 games that were financially successful, being defined as repaying the investment and make a profit for either the developer or the publisher.

Look at all the failures, games that were never developed, or were launched and were total failures, or were half way through development and were cancelled - Perpetual had two in development and went out of business. These games are incredibly hard to do, I don't think there is any form of entertainment that has a failure rate as high as MMOs.

What made it even more expensive, frankly, is Blizzard. One of the things that they did with WoW is that they raised the bar. They spent a heck of a lot of money and they spent at least six years in development. When we launched Dark Age of Camelot we did it for 2.5 million, that was our total development budget... but since WoW launched... players expect a level of polish at launch and players also expect so much more content.

If you're looking to compete in the fantasy space you're competing against a game like WoW, which has had the years of development plus post development, you're competing with Warhammer, you're competing with some other games and Sony as well, who continue to iterate and continue to spend to make their games better. So I think it is going to be exceptionally hard to compete in the fantasy space against these companies for a long time. You once said that you were planning to do yearly expansion for Warhammer. Is that still the case?
Mark Jacobs

I don't know. We're going to look at that. One of the things that Blizzard did change in the MMO industry was that nobody thought that you should do less than an expansion pack a year. Obviously the Burning Crusade came out a lot more than a year after WoW launched, so the industry looked at that and went 'ok, that's a bit different'. We weren't sure if it was going to work but that in case it worked spectacularly.

We're looking at 'when is the right time for this expansion for this game?' If it's a year we'll do it in a year if we think it's longer we'll do it longer. That's one of the advantages of being a part of EA, we have the deep pockets... if we need to take a bit longer to make it better, EA, just like they backed us with WAR, will back us with the expansion. Upon announcing your deal with GOA you said it would enable you to retake the lead position in the MMO space in Europe. Do you still feel that's the case or did the faltering launch of the beta hamper your chances?
Mark Jacobs

GOA had some issues initially. They admitted it and apologised for it and offered to make it up to the consumer and I believe they have. Everyone wants to launch perfectly, most companies don't. We launched fantastically in the United States, GOA had some issues but they candidly corrected them and they've been running very, very well since then.

Did it hurt our chances? No I don't think so. It certainly didn't get us off to as great a starting out as we wanted but then again this is a long race. If you look at the subscriber base of every successful MMO not one of them hit their peak in the first year, none. If you look at Everquest, if you look at Dark Age, if you look at WoW, none of these games hit their peak in their first year and none of them came even close to their peak in their first year. We're hoping to follow that pattern as well, that we will continue to grow, that we will continue to bring in new users just as those games did.

GOA did a really good job of making it up to the consumer they are continuing to spend money to not only market the game but also to continue improving on the areas that they did have some issues with. But the most important thing, no matter what, is that the issues they had were not game related. That's what the consumer won't accept.

The important thing is that they get to play the game as advertised... That's one of the things that has always doomed an MMO, is that if you advertise a game as being able to do certain things and it doesn't when the consumer opens the box to play the game you've lost the consumer. We've never done that. We've delivered on everything we've promised and we've delivered on everything on the box and even when we cut the content in July I promised the consumers that when we would put it back in we wouldn't charge them for it... We're putting them back in, no charge to the customer and that's something that we hopes resonate with them. Do you believe Blizzard's plan to introduce open world PVP into World of Warcraft is an attempt to position themselves against WAR?
Mark Jacobs

Oh absolutely. I think imitation is the sincerest form of flattery. You have a game that's been out for four years, they've never put in world PVP like ours, they've never been able to level through PVP like in ours.

I think it's absolutely a reaction to Warhammer. It wasn't like all of a sudden the idea of open world PVP or levelling through PVP came into their heads and went 'nobody's ever done this before'. I don't think it was accidental that they're talking about doing it when Warhammer comes out. Four years and suddenly, miraculously, at the same time Warhammer comes out that's when they start talking about these things... I think it was Jeff Kaplan who said they like to look at other games and learn from them - well, I'm flattered.

Mark Jacobs is the CEO of Mythic. Interview by James Lee.

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