funcom_feat

We’ve all seen gaming companies come and go. In the MMO space this is even more of an occurrence as employees are released shortly after a game’s launch, leaders come and go, and companies sometimes disappear. Hell, a lot of times, MMO development houses never even make it to release before closing down for one reason or another. For a moment though, let’s look at companies that actually launched a product and for one reason or another, closed shortly thereafter. APB comes to mind. The quality of the game was its most pronounced downfall, but certainly the behind the scenes fiasco with reviewers and Realtime Worlds certainly didn’t help matters.

Hell, I’m not saying that a bad game will certainly close your studio (although it can, of course) for sure. A look at Final Fantasy XIV version 1 and other titles tells you that a studio can recover, but when a studio has nothing but misstep after misstep across multiple releases, shouldn’t it close?

Let’s preface this a bit though. Funcom is in trouble. It has been before and is in what may be their most dire straits yet. Looking for a merger, acquisition, investment, or any combination of the above means the studio is in very real, tangible danger. I am not advocating that it should shut its doors immediately. There are real lives and real incomes at stake here and if the studio can find a buyer or partner, then great. I’m happy for the teams that get to remain employed in a volatile industry and in an industry they enjoy working in.

As a fan of The Secret World, and someone who has spent quite a bit of money on the title, I certainly don’t WANT it to close. But I think the question of “Should it?” is certainly a valid one given the many missteps the company has had through out the years.

anarchy_save_funcom

Back in 2001, Funcom released Anarchy Online. While many view the title as a classic these days (albeit one that is still running), Anarchy Online had what can only be described as a total disaster at launch. Server issues and gameplay issues rendered the game virtually unplayable at launch to the point where Funcom asked reviewers to hold off on official reviews. While launch issues certainly still plague MMO launches even today, Anarchy Online sets the stage for Funcom’s future rather than causing them to learn from their past.

Fast forward 7 years and Funcom’s next big release is coming: Age of Conan Hyborian Adventures (now the free to play title Age of Conan: Unchained.) Age of Conan had a two pronged problem at launch. First, the system specs advertised for the game weren’t representative of what was actually needed to run the MMORPG. Users, like myself, who had PCs above the recommended system requirements still had a difficult time (if not an impossible one) getting the game to run. Once in game, most players reacted to the game very favorably at first, but quickly became disappointed in the bugs, missing areas, and other issues with the game itself. Once outside the initial starting areas it became clear that Age of Conan wasn’t ready for launch. This was after delaying the game already from October 2007 until March 2008, then another delay from March 2008 until its eventual release in May 2008

What was going on behind the scenes at Funcom at this time, you ask? Well, lots of apologies. Ever since the launch of Anarchy Online, Funcom has seemed to make a career out of apologies. Apologies for launch delays and issues, apologies that even game updates were crashing servers, and, in general, just apologizing for many things.

aoc_save_funcom

Both Anarchy Online and Age of Conan: Unchained eventually underwent free to play conversions to a certain degree, although Age of Conan’s came much faster than Funcom had financially projected it to do so. In an interview with PC Gamer, Craig Morrison, then Executive Director for Age of Conan, stated that the free to play conversion of Age of Conan was, “something we been keeping under consideration for several years now.” At the time of the interview, Age of Conan had only been released for three years.

Fast forward to 2012. The Secret World is almost here. Players are actually looking forward to the game’s release. A AAA MMORPG set in a modern/future world full of conspiracy theories and 3 faction PvP? Hell yes! Sign us all up! The day before the big day though, former Funcom CEO, Trond Aas stepped down as the company’s CEO. While the PR spin tried to show that Aas was still staying with the company and had nothing to with The Secret World, many took it as a sign that the game wasn’t going to be exactly what Funcom’s financial plans had hoped they would be. It certainly didn’t help that Aas was also investigated months later for insider trading after allegedly trying to dump a great deal of Funcom stock after stepping down.

tsw_save_funcom

But hey! The Secret World launch went pretty well didn’t it?

Well, technically it wasn’t too bad. The game worked, reviews came in mixed (loved the atmosphere and the quest types but the combat is sketchy was the general rallying cry) but in the end, 2 months after release, Funcom announced that the game had only sold 200,000 copies and this fell well short of expectations. Funcom attributed the lackluster sales not to any miscalculations or missteps on their side, but instead to mixed media reviews and to other larger IPs launching (Guild Wars 2 and Diablo III specifically mentioned) at the same time. (Remember that line, we’re going to see it again.) Gamers were kind of stunned to hear Funcom say, “The Company still considers it likely that sales for the 12 months period following launch of the game will be less than half of what was presented in the Conan-like scenario in 1Q presentation.” Having a subscription at launch certainly didn’t help The Secret World, though. These figures resulted in a studio closure and layoffs.

Funcom announced, virtually at the same time, that it had begun development on the LEGO Minifigures free to play title, but we’ll come to that in a moment.

In January of 2014, the again financially beleaguered Funcom offices were raided by Norway’s Economic Crimes Unit as part of an investigation into allegedly shady bookkeeping and allegedly sharing false financial information regarding The Secret World. As a result, the company’s stock was temporarily delisted from the Oslo Stock Exchange. Trading of the stock did resume within hours and Funcom cooperated with the investigation.

lego_save_funcom

That brings us to the present day. LEGO Minifigures underwent a bizarre transformation from a free to play title to a buy to play digital only title and got a mobile version slapped on late. Predicatbly, sales didn’t go very well and new CEO Rui Casais puts the blame on everything from other titles (again) to badly estimated sales and revenue expectations. In an interview with GamesIndustry today, Casais says,”There are most likely many factors as to why LEGO Minifigures Online did not meet the forecasted expectations. That could include factors such as competition with other LEGO games tied to stronger and more popular IPs (such as Star Wars, The Hobbit, Marvel etc.), challenges related to the purchasing ability among the target audience and the fact that this was a pure digital title, not to mention the fact that the game had already been available in a free-to-play form the year before (where it then consumed a fair share of interested players). It was also our first mobile launch, and we most likely underestimated the work and overestimated the total revenue potential. When the project started, it was not meant to go mobile, but the changing market led us to switch from initially planning to be browser-based to going mobile.”

Really? You’re surprised that marketing a game directly at children who only have the buying power that their parents allow them to have might be a problem if you aren’t marketing your product correctly? And does that quote imply that Funcom thought they would make a lot of money for a little bit of work on a mobile version?

Basically, anything that could go wrong, did.

Today, Funcom is now seeking some serious help to stay alive. With some expensive loans maturing in late 2016, Funcom is in a bit of a scramble. Is the company itself worth saving though? As a third party, I could see the interest in the IPs and titles a bit. If Casais’ statement about the games themselves being profitable are accurate, certainly someone would want to at least buy those, including The Longest Journey. But would any large company want to invest or acquire a company that seems to have issues not just in production, but in things like marketing, sales forecasting, financial reporting, and with the stigma of multiple investigations into the company itself and some of its former higher ups?

It’s a tough sell for me. I play some of their games and certainly don’t want people to lose their jobs but there comes a point when you’ve made the same mistakes over and over as a leadership team that now you have to sleep in the bed you made, right?

Here’s to hoping the games and the development teams get picked up at the very least.

What do you think? Should Funcom be saved at all?

the author

Mike "Magicman" Byrne has been a part of the MMOBomb family for years and serves as the site's current Editor-in-Chief. His love for MMOs and gaming in general has led him to covering games for numerous websites including Gamebreaker TV and XIV Nation where he proudly displays his fanboy flag for FFXIV:ARR.

17 Readers Commented

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  1. Dexter Bavzee on October 15, 2015

    A possible scenario going forward is that the game will sell less than both of the two above mentioned scenarios the first 12 months following launch, but with high customer satisfaction, it will generate a more stable subscriber base than the game Age of Conan. Over time, this will enable Funcom to retain more customers and generate higher revenue. Funcom is currently implementing several cost-adjustment initiatives due to the expected lower initial revenues from The Secret World to secure future positive cash flows.

  2. Jinmi on September 12, 2015

    All they had to do was stand by there flag ship Anarchy Online, when blizzard released World of Warcraft, funcom should of made Anarchy Online 2 with updated graphics.
    I would even donated money if they would of done a Anarchy Online 2 kick starter but from what I read years ago, they really didn’t like the game enough to do another one .

  3. Demarcus Cauthon on September 2, 2015

    Now I m afraid I ll log in and see enhanced movement packs being advertised on a billboard outside Bag End. Funcom seems to have negotiated the transition to new monetization well.

  4. jellopy on August 28, 2015

    Valve should rescue them in exchange for steam only variation of the secret world with less content paywalls. AO was one of the firs mmorpgs I took seriously enough to play for an extended period of time and they do put a lot into keeping their games alive and interesting for the player bases. Multiple games in their ownership have been overhauled and updated countless times for their fan base which is a big part of their economic crisis. While they do have a pay wall on some titles the ones that have transitioned to free models are pretty decent models and unlike a lot of the big name companies newer on the scene if a game doesn’t hit with a million plus fans they always stick with it for the ones who do enjoy it(AoC is still alive even with the loss they took when the original release went poorly) Many other devs and publishers lately have scrapped games with that by most standards have a rather large player base because they don’t make millions over night. I say yes,bail them out and encourage them to open more doors to gain new players.

  5. MisInformed? on August 19, 2015

    1. Anarchy Online had a full overhaul and is brought into Dreamworld Platform after 14 years in the field. The game is F2P…??… *Hats off FUNCOM*
    2.TSW has a completely one of a kind approach to MMO. No levels,No Tank-DPS-Heal Bore, Yawn Yawn… What a bold move. Each issue in this game is expensive to produce, still FUNCOM crank out new issues year after year as promised * Hats off FUNCOM*
    3.Age of Conan. 7 years old, but still most violent best motion captured animation Combat done in MMO. Characters have more bones in their body than hardly any other game (even today). It’s so real.. And still FUNCOM patch in new content *Hats off FUNCOM*
    4. LMO.. ok that was a lame idea.. BUT, in the making the MMO design platform was expanded so that in the future any MMO they give out will be multiplatform.. Meaning that the guys playing Mac and Linux… Hell even Ipad would be playing on same server against the guys on PC… This is only platform in the world that can support this as fare as I know *Poor consept choice with the LEGOs and all, but technically again… Hats off FUNCOM*

    Much more could be listed above… But in summary.. FUNCOM have some pretty god World Class Directors, Artists, Programmers, Animators, Operations managers behind the scenes.. What they have pulled off over 20 Years, very few other organizations have managed to. BUT, the company have been riddled with a few idiot top managers and a good portion of bad luck. And seeing that, there is no doubt that heed should go to FUNCOM. Their next MMO will and must be the most awesome MMO of al times. Dreamworld engine is now Awesome.

    BTW: That loan is big (13 mill USD), but it’s really realy cheap in terms of interest rate (they have a very forgiving creditor that also happens to be the main shareholder.. Hence.. The risk is not so steep as portrayed in this article)

  6. A Kindred Spirit on August 19, 2015

    There are so many of us Vets who have stuck in there with Funcom for 7 yrs.. in Age of Conan.. with the bugs .. thro good times bad times.. we love this game.. I have been” as many are also” a paid player and also use the online shop for many things.. we love this game .. faithfully waiting.. we have bought each and every expansion that has been made… we stand united as a family .. ever waiting.. always hopeful .. that Funcom will pull through these trouble times.. I haven’t wanted to try any other game since I came here.. I found a home.. family and friends. If someday it is gone.. Then I have memories.. I can look back and smile and say “Oh baby what a ride!” Yet I do hope that will be many years from now.. Yes I am a dreamer… perhaps .. but a happy woman..

    • Aregadon on August 19, 2015

      Same but with TSW I played it since launch and I loved every bit about it from Combat to story and especially the atmosphere and community I’d be really saddened if they had to close the game down. I mean if they have to sell them fine I could propably deal with it or if they opened it to full F2P
      But Closing it would be really sad.

  7. hovsep56 on August 19, 2015

    just make the secret world f2p if you want a bigger playerbase it already has a cash shop.

  8. Draugen on August 19, 2015

    i think they should more becaurse of The Secret World probely the best mmo story there is in my opinion

  9. Todoran on August 19, 2015

    NO! FunCom is a cash milking machine whit freemium mmo games all freemium mmo companies should sell the games to good companies like EnMasse and shut down!

  10. voydd on August 19, 2015

    The company probably needs the same level of reshuffle on management level as original Square Enix FFXIV team had. Because, let’s be honest – their games have so much potential wasted!

  11. Detestt on August 19, 2015

    For the sake of TSW and AO yes, otherwise fuck em’.

  12. elli on August 18, 2015

    Having your big title go from free-to-play to buy-to-play (which literally never happens AFAIK) is about as stupid a move a company could do. Funcom’s issues seem to be entirely management related. Sure the game aren’t AAA blockbusters, but they’re at least competent. You shouldn’t be struggling this hard unless your games are actually bad, and I don’t think I can say that about any of their titles.

  13. ron on August 18, 2015

    if they just made the secret world free like they said they would in 2013 . they would be thriving . greedy idiots burn in the hell of dead game companies that wanted to milk the game community .

  14. Pilecki on August 18, 2015

    In all honesty I have no idea what you are talking about. I was actually talking with someone a week ago about how awesome it was that Anarchy Online was getting an overhaul update and in a day and age where games are put offline years or even months after their release funcom keeps all of its MMOs online for what seems like forever.

  15. Kess on August 18, 2015

    God I hope so, considering The Secret World and all… I’ve put a lot of time and money into that game and it’s SO good, it would upset me immensely if something were to happen to it.

  16. Player1 on August 18, 2015

    they better start updating Conan otherwise they’re done

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