Old Republic needs 500k subscribers for profit
Wednesday, 2nd February 2011 at 11:20 am
CFO Scott Brown says rumours of exorbitant dev costs are greatly exaggerated
EA believes that around half a million paid subscribers are needed for BioWare’s upcoming MMO, The Old Republic, to return a profit.
The dev budget of the upcoming MMO is rumoured to have soared past the $100 million mark – a claim that EA has called into question, but not flatly denied.
EA has not specified a number, but said the game is accumulating "significant” development costs.
Yet EA CFO Scott Brown says the game doesn’t need to break world records to be highly profitable.
“At half a million subscribers, the game is substantially profitable, but it's not the kind of thing we would write home about," he said.
"Anything north of a million subscribers, it's a very profitable business."
The wording here is key. With MMOs traditionally pulling in monthly subscription payments, the term ‘profitable’ may be one projected over a subscription period.
If The Old Republic cost, say, $100 million to develop, that would mean each of its 500,000 subscribers would have to pay $200 each to pull the project out of the red.
If the game cost half that to make – at $50 million – each of the 500,000 subscribers would have to pay $100 each.
Yet Brown insisted that the dev costs would "essentially turn on a dime" to profit on release day if 500,000 copies were bought.
He insists the dev costs have been highly exaggerated.
"There's been a fair amount of talk on various blogs describing spends that are vastly higher than anything we've ever put in place," he said.
Without providing specifics in reply, Brown said: "Don't read gamer blogs as having any substance. They bring a chuckle, but they also bring a frustration for those that are being responsible with the management of EA's R&D dollars."
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