Star Wars: The Old Republic - The End of an Era?
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As has been widely reported, it has cost EA around $80-100 million (excluding a probably greater amount spent on marketing) to make SWTOR into an MMO with a boxed-copy-and-subscriptions model - what some call pay-to-play. Following the similarly expensive flop APB, if SWTOR fails, then no publisher will want to finance a game using pay to play again.I don't think there's any doubt that the game will make a profit eventually, but you have to wonder what they'll do years down the road if the expense of fully voiced quests can no longer be justified.
Even Frank Gibeau, head of EA games, has expressed disquiet at the cost of the game. "I wish it wasn't that expensive," he told GamesIndustry.biz, "and I think everybody does." Sony Online's head John Smedley was more a little more vocal in his disquiet. "In my opinion this is going to be the last large scale MMO to use the traditional subscription business model," he said in a recent GamesIndustry.biz editorial.
Despite this negativity, it's unlikely to fail - but it might not succeed well enough either. EA has said that it needs 500,000 subscribers to make money on SWTOR. With a subs rate of $15 per person a month, that's a piddling $7.5m a month. That would take them at least 9 months to make their development costs back and probably over two years if you factor in marketing. We don't know what their monthly running costs will be, but they must be huge especially, as analyst Nicholas Lovell points out, "the fully scripted voice overs means that continued content updates are going to be very expensive".
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The thing is, given the amount of man-hours that EA has poured into SWTOR, to only break even isn't enough; this game has to be hugely profitable to justify the lost opportunity cost to their shareholders from all the other stuff those hundreds of developers and millions of dollars could have been devoted to. That is, why they're spending money on this instead of any of their other hundreds of underexploited franchises, such as Mirror's Edge, Dungeon Keeper, Ultima or Wing Commander...
