Boutique MMOGs

Imagine, for discussion’s sake, that you don’t have $50 million, so you can’t build and market a full-scale World of Warcraft massively multiplayer online game (MMOG) clone. Suppose, too, you don’t have rock superstar Bono on speed-dial, and unlike BioWare/Pandemic Studios, you can’t finance your new MMOG through his $300 million Elevation Partners holding company. To get still more outlandish, let’s say you cannot easily lay your hands on a paltry $3 million – no, really, work with me here – so you couldn’t even produce a smaller-scale “casual MMOG” like Puzzle Pirates or Gaia Online or Dofus. Assume, hypothetically, you – just you, together with maybe two or three other indigent programmers – have six months of savings and a budget in the low four figures. How would you create and market a full-featured MMOG?

Building a major game is hard, and there is no harder kind to make than an MMOG. At the 2003 Game Developers Conference, longtime producer Gordon Walton listed 10 reasons not to run an MMOG, including eight-figure budgets and teams of hundreds of people.

Nonetheless, despite this received wisdom, there are dozens, nay, over a hundred low-budget “boutique” online MMOGs. Some require a downloadable client; many others are browser-based. Some cost in the mid-six figures to produce; others launched for the price of domain registration plus 10 bucks a month for cheap hosting. Most are lame – it’s been a while since we’ve seen Commodore 64-style sprites – but some look startlingly professional. Many are run as hobbies, but some are intended to earn money. A few do. In fact, they earn a lot.

High-end developers might deride the boutiques as “not getting serious audience numbers” – until they learn about the games with more players than EverQuest. Onlookers, too, may sneer at these little games as “not serious money.” But there are different ways to define “serious” – for example, how much money a given developer personally earns as take-home pay. A rank-and-file animator or designer at Blizzard earns basically the same salary whether World of Warcraft has 2,000 subscribers, or 200,000, or 20 million. Revenue from a successful boutique MMOG would be a rounding error for Blizzard, but it all goes straight to the game’s small development team. With a player base in the low five figures, a single boutique developer can, over the medium to long term, earn personal income that dwarfs the Blizzard employee’s – and yours.

In for the Long Haul
Dave Rickey, a designer for EverQuest and Dark Age of Camelot, spoke in a June 2005 Corporation interview about opportunities at the small scale. “The economics of MMOGs under the standard business model are pretty simple: For each $1M [million] invested, you need 10,000 subscriptions to pay back the initial investment in a reasonable period (two years – investors have a different definition of ‘reasonable period’). A game that costs $5M to make and maintains a 50,000-subscriber level for five years will make an overall return of $7.5M (assuming 25% is skimmed off the top for the investors). A game that costs $50M needs half a million subscribers to do the same trick. Somewhere in there, anything untried starts to look like an unreasonable risk.

“But this math works better at a smaller scale,” Rickey notes. “A team of three, investing sweat equity for a year and getting 10,000 subs for five years, will clear over $1M each, over paying themselves reasonable salaries and hiring a few CSRs [customer service representatives]. Smaller teams have less overhead, fewer managers, less inefficiency in communication, less effort wasted on office politics. 10K is only a tiny, minuscule piece of the market.” Since giving the interview, Rickey has joined Shannon Cusick at Orbis Games to design a niche MMOG targeting young girls, Virtual Horse Ranch II.

In October 2005, onetime game developer Dan Cook wrote a widely noted post on his Lost Garden blog called “A Game Business Model: Learning from Touring Bands.” Dubbing these niche MMOGs “village games” – “quirky, isolated communities much like a traditional village or small town” – Cook drew parallels to evergreen bands like the Grateful Dead:

“They provide a service, not a packaged good. They sell to a dedicated fan base that, despite being small, provides enough additional revenue per user to make the venture profitable. The result is a self-contained community served by a small team of dedicated independent developers. … A typical customer will spend an average of $60 a year and stays on for an average of 18 months, with some players staying for years. The developer generally keeps all $60 in revenue. Making money is a matter of maintaining your current customer base and incrementally increasing that base over time. The viewpoint is almost always long-term and focuses on maintaining and extending customer relationships.”

Cook estimated the cost of developing a typical village game at $250,000; with 6,000-9,000 users, such a game reaches break-even 18 months after launch.

These figures are, in some cases, far too pessimistic:

” Two British college students launched Neopets for next to nothing in November 1999, and it became profitable by the following July. Six years later, having drawn 30 million users, they sold Neopets to Viacom’s MTV for a reported $160 million.

” Started in 1997, the Sweden-based soccer management simulation Hattrick now runs on 40 servers in 20 languages and claims over 900,000 users. Membership has doubled since 2004, entirely through word-of-mouth. Hattrick is free; some players become Supporters (25 euro annually) to gain minor perks. Rival Managerzone, also Swedish, has nearly 600,000 players. Rumor has it the Hattrick team is also responsible for Popomundo, a rock ‘n’ roll career simulator.

Cook correctly emphasizes the boutique operator’s long-term planning. A bad launch for a high-profile MMOG means disaster within months, even weeks. Again, the boutique works differently:

” Jagex Limited’s RuneScape launched quite slowly in 2001. Cambridge University undergrad Andrew Gowers formed Jagex with his brother, Paul, and Constant Tedder; the three stuck with the game, built it slowly, and now employ hundreds. An October 2006 Wall Street Journal story says RuneScape has over five million players and may gross $50 million annually. “RuneScape” is one of the 10 most-edited Wikipedia articles, surpassing “Islam” and even “Michael Jackson.”

” The Italian fantasy game Planeshift launched on a shoestring in 2001 using the free CrystalSpace 3-D engine. Planeshift currently has 300,000 registered accounts.

” Kings of Chaos was created in 2003 by four high school juniors and now has nearly 40,000 active players.

We gasp when World of Warcraft passes seven million accounts, but RuneScape, Hattrick, Managerzone, and Planeshift together (never mind Neopets!) almost match that total. And they’re just four of the hundred-plus boutique games you never hear about.

Bruce Woodcock tracks subscriber numbers at MMOGChart for WoW, EQ, Ultima Online, Lineage I and II, Dark Age of Camelot, Star Wars Galaxies, and all the best-known subscription-based MMOGs in North America. At the September 2006 Austin Game Conference, Woodcock estimated their combined player bases at around 15 million.

In all likelihood, the collected population of boutique MMOGs beats the pants off them.

Games of the Long Tail
The success of these and many other niche games illustrates Wired editor Chris Anderson’s Long Tail theory: In a networked age of cheap storage and easy “findability,” you can aggregate a profitable audience for topics of narrow interest. Alien Adoption Agency targets male tweens. Andrew Tepper’s venerable Egyptian-themed A Tale in the Desert proceeds in 18-month cycles called “Tellings”; Tepper has just commenced his third Telling, with almost 2,000 players in tow. Lots of virtual pet games let you raise dogs, cats, horses and cows. Raising animals in other ways altogether, Furcadia caters to furries, an anthromorphic fetish group.

Boutiques find niches even on the well-traveled trails of fantasy. Ashen Empires (nee Dransik), from Iron Will Games, was originally pitched as “Ultima V for 10,000 players”; they’re still working on their third thousand, but the game supports a modest four-person team. Tibia claims 100,000 players and has nearly 70,000 premium subscribers. Canadian programmer Gene Endrody is quietly creating a boutique powerhouse at Maid Marian Entertainment. Endrody outsources the art for his Shockwave-based online games, but otherwise works solo. MaidMarian.com attracts 700,000 unique visitors monthly.

Text MUDs are still popular; The Mud Connector lists over 1,600. Most are run as hobbies, but some professional MUDs pioneered a lucrative Virtual Asset Purchase business model. Matt Mihaly, CEO of MUD-runner Iron Realms Entertainment, posted a fascinating interview with a MUD player who paid $240 for a virtual cherry pie.

In boutique-scale science fiction, there’s Outwar, with 75,000 active players, and Star Wars Combine, which has somehow survived since 1998 without a Lucasfilm license. The German space strategy simulation oGame has two million accounts worldwide. And Cosmic Encounter Online, though not technically an MMOG, is worth mentioning because the Cosmic Encounter boardgame is my favorite game ever, so there.

Games Like E-Mail
Perhaps the most interesting design technique we see at the small scale is the passive game. You don’t immerse yourself in a passive game; you dip in sporadically, as you’d check your e-mail. Often turn- or tick-based, with asynchronous player interaction, a passive game engages you not casually, but lightly, like old-style play-by-mail games.

” Kingdom of Loathing is a simple browser-based fantasy adventure in which players spend turns (mouse clicks) to fight monsters and fulfill quests. The difference is in the tone – the art is ridiculously simple stick figures; monsters and items are chock full of pop culture references; and terrible puns abound. (There’s a Fallen-Arch Devil, and the Level 9 quest takes place in the Orc Chasm.) Players have created over one million characters.

” Similarly, players of the bloodthirsty humans vs. zombies game Urban Dead have created over half a million characters, most of which hangs on for a few turns or days. The UD statistics page claims about 25,000 active players daily. Noteworthy UD imitators include Nexus War and Shartak. Players in all three games have created browser-side Firefox extensions that handle housekeeping tasks or collate data for real-time status reports.

” Travian, with over 60,000 active players, is sort of a real-time strategy game in very slow motion.

” In the same way, Netropolis is a slow, multiplayer SimCity – “an online multi-player strategy game where you match your wits as a corporate gangster/tycoon against other real people. Buy some land, set up a few businesses and watch the money roll in.” Netropolis is one of several passive boutique business games. Others include Airline Online, Informatist, and ASX, an educational stock market simulation.

Show Us the Money
Most boutique games are free to play. How much do they make? It’s hard to tell.

Boutique MMOGs can definitely make money, but each game must find its own path. Small games can try out revenue models quickly and easily compared to high-end games. Many, like Swirve’s long-lived Earth: 2025 and Utopia, are ad-supported. Others use Virtual Asset Purchases. Kingdom of Loathing sells (for real money) a virtual item called “Mr. Accessory” you trade in at “Mr. Store” for limited-availability items. Several games have gained excellent results selling optional premium content – even purely cosmetic perks.

Some designers have other motives besides money; Australian novelist Max Barry started the offbeat political simulation NationStates to plug his 2003 novel, Jennifer Government. This is the most intriguing and encouraging aspect of boutique MMOGs: creators excited by an idea, or compelled to share a vision on their own terms and their own timeline. The boutiques that find success may, ironically, become more than their designers wished. Half a million people have played NationStates, which, according to Barry’s bio, “is currently causing him to drown in e-mail from people who want new features.”

But, you know, we should all have such problems.

Allen Varney designed the PARANOIA paper-and-dice roleplaying game (2004 edition) and has contributed to computer games from Sony Online, Origin, Interplay and Looking Glass.