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.
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.
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.
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.
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?