Is the MMO dying?

[Henry]

It's possible that the faddish nature has died off, but "dying?" As Krug notes, that's doubtful. I've heard Ryan Dancey's talk at Paizocon on his "brief history of MMOs" and his business theory for Goblinworks, and he does make a lot of sense to me.

[ame=http://www.youtube.com/watch?v=llxtcmPBhWs]A Brief History of MMOs - YouTube[/ame]
[ame=http://www.youtube.com/watch?v=9obugyw4z3I]Theme Park vs Sandbox MMOs - YouTube[/ame]

 

[renau1g]

There is an oddity in commerce these days (not limited to MMOs, or gaming, but most anything) - any significant loss (and occasionally a less-than-significant loss) gets tossed around as "Is X dying?!?!!?1!" I have to wonder if the hyperbolic approach leads to added anxiety and negative speculation, and actually tend to drive the thing in question towards death.

Edit: I can add a fairly simple real-world example - the stock market. Value in the current market is really a matter of consensual reality, such that perception of value may in some cases be more important than the actual assets of a company, and talk about things begin unstable can lead to instability...

[tangent] Like RIM, the company was pretty profitable but not growing as quickly as Apple and Android-based smartphones. Suddenly RIM is dying, they're the next Nortel, etc, etc. Their stock prices tank to 20% of their high of around a year ago, all the while their global install base is growing and up until this last quarter of FY12 were making money. (They made over $1B in net income for the year). Their current market cap is less than the value of the patents they're holding. [/tangent]

 

[Umbran]

[tangent] Like RIM, the company was pretty profitable but not growing as quickly as Apple and Android-based smartphones. Suddenly RIM is dying, they're the next Nortel, etc, etc. Their stock prices tank to 20% of their high of around a year ago, all the while their global install base is growing and up until this last quarter of FY12 were making money. (They made over $1B in net income for the year). Their current market cap is less than the value of the patents they're holding. [/tangent]

Not a tangent at all - that's a pretty darned good example of what I'm talking about.

We seem to have allowed ourselves to get in the mindset that "didn't have stunning performance" is tantamount to failure. It seems to me that this outlook leads to boom-and-bust, rather than a sustainable business model for the long term. And we largely do it to them, rather than them doing it to themselves.

 

[Dannyalcatraz]

One of my fundamental assumptions about the business cycle and its relationship to the stock market when I was doing some work on the application of chaos theory to economics was that the irrationality of human beings is such a powerful force on the stock market that you don't want your company's performance in the market to be the main driver behind your business decisions.

(TL, DR: human irrationality distorts the economics of the stock market to the point that it can barely be called economics.)


In the intervening years, I have only seen evidence that makes me want to engrave that in stone.

 

[Janx]

I had a cow-erker who played Evercrack, and then City of Heroes. Where I balked at paying $15/month for a game I probably wouldn't play every month, he found that he saved money. He and his friends used to go out and eat every weekend. Then they switched to playing MMO's together on the weekends. They stayed in more, and spent much less money overall, making the $15/month a good expense.

As for comparing RIM to Nortel, that might be a bit off. Nortell was strip mined by chinese hackers for intellectual property and that technology later manufactured in china and sold in the US. The result being, nobody bought Nortell, they bought the knock-off stuff. NPR did an article on it.

RIM's case is more like what I saw in the long time I spent in a fortune 20-something company. Each quarter produces big numbers in sales (billions of dollars). But that's not what is compared to. Instead, it's growth quarter over quarter (and vs. last year). For a starting company, this might be OK, as you've only reached a fraction of your potential market.

But a mega-corporation HAS already reached everybody who might buy the product. I guarantee you have heard of the company I worked for, AND you can name our competitors. That's how big we were, and we were in number 1 or number 2 position for each technology we produced.

How can you expect to sell more iGadgets next quarter than this last quarter, when everybody who was going to buy an iGadget already owns one? Obviously, there's some product-turnover as folks upgrade their old stuff.

But you can't grow like gang-busters when everybody owns what you sell or your competitors' product. Once bought, until it needs an upgrade or fails, you aren't buying another one. So once you buy the competitor's, you're probably off the radar of potential sale for a while.

Yet this unrealistic expectation of growth in large entities, which is less likely than small entities (children grow much more than adults, who at best, get bigger ears and noses, barring weight disfunction issues).

That's some of what RIM is experiencing. Their numbers aren't increasing as much as before.

However, in RIM's case, there is also the issue that many business folks are replacing their BB for an iPhone or Android. We were a BB shop. Now we hand out Iphones and Androids. BB is dead to us.