MMO Money: Tencent’s $20 Billion Loss and Fortnite’s Decline

After having taken a little bit of time off for the end of convention season the weekly online gaming business article is back with more amazing news. We have Superdata’s latest gaming revenue charts, the UK’s weekly gaming chart, a little bit of lockbox news, and a company that lost $20 billion in value and is still going strong.

 

Superdata July Charts

Fortnite's Decline

Superdata released their monthly look at the gaming charts around the world with some interesting findings for July. First up, League of Legends drops down to second in terms of earnings on PC. It was overtaken by Dungeon Fighter Online which is massively popular in the east. In fact, only 2 of the top 5 PC games at the moment are from the West; LoL, and Fortnite. Speaking of Fortnite, the game’s earnings were only up 2% in July over June which is prompting many to say that the game’s peak is now behind us and Fortnite’s decline is imminent. However, it is still growing…for now. And, if they can get past all the security issues, Fortnite does still have the Android release coming which will be massive for the game’s population and revenue.

Overwatch, despite having a very stable player base is seeing revenue continue to drop month after month. In fact, the game is no longer charting at all but looking back as far as December, this isn’t the first time that has happened this year. It was also the case in February and April. In December 2017 and January it was number 10 on the PC chart. It hasn’t appeared on the chart for PC again since then. Looking at the charts for all of 2017 Overwatch ranked number 2 on the revenue charts for all Premium PC games. So, while it may not be on the charts right now, there is every chance for it to come back as it has done previously. On the other end of the spectrum, No Man’s Sky had its best month since it launched, and GTA V had its second best.

Fortnite still hasn’t managed to make it into the charts for Mobile games and in fact, the mobile chart changed very little from June to July. The one change was Fate/Grand Order overtaking Monster Strike. Until Fortnite has a global release on Android we’re unlikely to see it push into the mobile charts. Even then, the early security issues may have done enough lasting damage to make sure they don’t chart.

Source: Superdata

 

Tencent Market Value Drops by $20 Billion…but its ok

Tencent mobile financials - MMOGames.com - Your source for MMOs & MMORPGs

If any other company besides Tencent had lost $20 billion in market value the company would be done for. For Tencent though, that was just 5%. While they did lose a massive amount of money, the real story is why. China has been cracking down on games from other countries for quite some time. Tencent has been able to profit off of this. They know the laws better than any Western studio so they can offer to publish the game in China and deal with all the red tape themselves, but recently China has been making it even harder for game studios.

What triggered this massive loss for Tecent was China’s new regulation that will restrict the number of new online games that are released as well as implementing age-appropriate restrictions on games, including how long you can play them. The reason they give for doing this is the massive number of nearsightedness found in Chinese youth. Though there hasn’t been any scientific backing of the claim that screen time has any impact on vision. All of this puts Tencent’s current business model in jeopardy and they will have to make some changes if they want to continue. If you’re interested in reading more on this check out our recent news post that goes into more detail.

 

UK Charts Gaming Charts

Minecraft MMO Money: Tencent's $20 Billion Loss and Fortnite's Decline

The UK is one of the few countries that release gaming charts on a weekly basis. We’ve decided to add them to our weekly business article as they give us some idea of how games are performing, not just in the UK but among all western audiences. At the top of the charts this week was F1 2018, managing to hold out against a new game on the chart, PES 2019. In third is Grand Theft Auto V which actually climbed one place from last week. PUBG managed to climb up from 11th to 7th this week. Amazingly, Minecraft is still in the top 20, last week it was at 14 and this week it dropped to 20. Check out the top 10 for the week ending on September 1st below.

This Week Game Last Week
1 F1 2018 1
2 Pro Evolution Soccer 2019 New Entry
3 Grand Theft Auto V 4
4 Crash Bandicoot N.Sane Trilogy 3
5 Yakuza Kiwami 2 New Entry
6 Mario Kart 8 Deluxe 5
7 PlayerUnknown’s Battlegrounds 11
8 God of War 6
9 Monster Hunter Generations Ultimate New Entry
10 Fifa 18 10

Source: Press Release

 

Lootboxes

Overwatch Winter Wonderland - Christmas Loot Boxes

There hasn’t been a whole lot to talk about on the lootbox front. It seems like the world is slowly moving on and forgetting the topic altogether. Or maybe there’s a whole lot going on in the background that is going to take time to come into being. Either way, the big news recently is that Blizzard is disabling Overwatch and Heroes of the Storm lockboxes for Belgian players. Earlier this year Belgium was one of the first countries to investigate lootboxes in online games and issued threats to ban multiple games. Valve very quickly took action for CSGO and Dota 2.

Blizzard announced that they would be doing this on the official forums. In it they said…

“In April 2018, the Belgian Gaming Commission published a report that was endorsed by the Belgian Ministry of Justice in which they concluded that paid loot boxes in Overwatch are considered gambling under local law. While we at Blizzard were surprised by this conclusion and do not share the same opinion, we have decided to comply with their interpretation of Belgian law. As a result, we have no choice but to implement measures that will prevent Overwatch and Heroes of the Storm players located in Belgium from purchasing in-game loot boxes and loot chests with real money and gems.

No matter what, we want to make sure that our players around the world have the best entertainment experience possible. While players in Belgium will no longer be able to purchase paid loot boxes in Overwatch and loot chests in Heroes of the Storm, they’ll still be able to earn them by playing the games, and they’ll still have access to all in-game content.

These measures will be implemented shortly. We also remain open to further discussions with the Belgian Gaming Commission and Ministry of Justice on this topic.”

Source: Overwatch Forums

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Chinese Regulations Result in Tencent’s Market Value Dropping By $20 billion

There’s more bad news for the gaming industry that expands well beyond the borders it was intended for and has resulted in Tencent’s market value dropping by $20 billion.

Regulators in China have recently been putting a lot of strain on the gaming industry and they just hit the industry with a massive blow. China is cracking down on online games specifically in an attempt to combat screen-related myopia, that’s nearsightedness. There isn’t any scientific proof that online gaming has and an impact on myopia, however. In addition to this move to limit games, they’re also going restrict the amount of time young people spend playing games and they’re exploring an age-appropriate restriction system as well.

League of Legends

As you would expect this news didn’t go over well in the stock markets. This is where Tencent, a company that has been spreading its wealth far and wide to international game companies. These deals with them have also allowed Tencent to publish many of the games in China. But, since China will be restricting games…it looks like those deals aren’t going so well for Tencent anymore. The $20 billion loss is actually only a drop of 5%. In all though, Tencent has lost more than $160 billion in market value since January because of all of the recent regulation changes in China.

Tencent mobile financials - MMOGames.com - Your source for MMOs & MMORPGs

While the BBC speculates that Tencent will continue to invest in markets outside of China it is equally possible that they won’t given the fact that they won’t be able to release the games they invest in for Chinese audiences. This lack of investment could very well have a snowball effect that has a massive impact on the gaming industry as a whole. We may see Tencent and other Chinese gaming companies shifting gears to focus more on single player, offline games.

 

Source: Reuters, BBC

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Dungeon Fighter Online Celebrates 10 Years in China and $10bn in Revenue

Dungeon Fighter Online China has been a pretty successful venture for Nexon, apparently. The publisher of the side-scrolling beat-em-up MMO is celebrating a couple of major milestones in the form of ten years in the region and a lifetime revenue margin of over $10bn worldwide.

dungeon fighter online china

As many remember, Dungeon Fighter Online was first released in Korea by Nexon subsidiary Neople, with a launch to China three years after. Now, the game has made it to ten years of operation in the region and is thanking the region’s devoted fans with a celebration event to be attended by four thousand players that were selected from a lottery over the weekend. Nexon also announced plans to expand the IP in the region with anime, comic books, novels and music.

The long-running success of the game in China is part of DFO’s overall longevity, with Nexon proudly proclaiming the MMO has raked in over $10 billion in worldwide revenue over the course of the its lifespan. “This statistic demonstrates Nexon’s efforts to focus on creating long-term value for customers, rather than harvesting short-term returns,” remarked the statement.

As for the game here in the West, a “big picture” microsite launched with word of updates coming to the MMO over the summer months, including a new Agent character with new subclasses and Awakenings in July, and a collaboration event with the popular Vocaloid character Hatsune Miku in August.

Our Thoughts

Clearly, Dungeon Fighter Online has some staying power in China and has carved out its own action MMO niche worldwide. To that point, we’re glad that this one will apparently remain online for the long haul for fans of the game. Though we’re curious just what they’re going to do with Hatsune Miku…

Sources: GamesIndustry, official site

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MMO Money: Top Grossing Games of March and Tencent Breaks Records

Superdata has released their list of the top grossing games of March, and nobody knows what is going on with Daybreak Games. Plus there’s fantastic news for Tencent who are breaking records with money and there is a lot to talk about around the lockbox saga. Find all of this and more in this week’s MMO Money.

 

Top Grossing Titles in March

MMO Money: Top Grossing Games of March and Tencent Breaks Records

Superdata has put out their monthly list of the top grossing games for PC, Consoles, and Mobile and there has been a move in the top of the charts. Dungeon Fighter Online took the top spot from League of Legends who held it in February. This came on the back of their third-anniversary celebration and a limited event that challenged players to level up new characters. Fortnite and World of Warcraft both overtook PUBG which slipped to seventh on the list. Speaking of Fortnite, it is now the largest free to play console game of all time! This is in terms of revenue generated and monthly active users. Also in March, it increased revenue by 73% from February to generate $223 million across all platforms.

 

Daybreak Layoffs and Rumors of New Games

Everquest

Daybreak has been having an odd couple of weeks, to put it mildly, and no one really seems to know what’s going on exactly. It started with their (maybe?) Russian parent company being investigated. Then they came out and said that no, they weren’t owned by that company at all! Despite many documents saying otherwise…Massively has done an amazing job covering it all and one little paragraph wouldn’t do the whole scenario justice so be sure to check out what they’ve been saying. The most recent updates though have been that there are confirmed layoffs. Not long after the layoffs, a rumor came out saying that they were working on Planetside 3 and Everquest 3. Also part of that rumor is that both Everquest and Everquest 2 are getting their last expansions next year.

 

Dota 2 on the Decline

New data from Superdata shows that Dota 2 is on the decline. Ever since the 7.00 update in late 2016, Dota 2 has been on a slow decline in popularity. The downward trend picked up steam in the last few months though. The emergence of the Battle Royale genre could be one of the reasons for this decline. Dota 2 is also approaching 5 years old, at which point it’s perfectly normal to see a declining population. It isn’t the end for Dota 2 though, Superdata thinks that Dota Plus can provide a steady revenue stream for the game. This means it could keep going for some time.

 

Tencent is Breaking Records with Investments

Tencent mobile financials - MMOGames.com - Your source for MMOs & MMORPGs

According to data from Digi-Capital, Tencent was involved in 40% of all money invested in game company funding over the last 12 months. They were also part of more than three quarters of all industry mergers and acquisitions. Tencent’s largest acquisition was the $2 billion deal for Vivendi’s stake in Ubisoft.

2017 was a bit behind 2016 when it came to market investments and mergers and acquisitions. In 2016 the industry reached a peak with $28.4 billion invested, whereas 2017 saw only $22 billion worth, though $17 billion of that was in mergers and acquisitions.

Finally, Digi-Capital predicts that the software and hardware market revenues will reach $160 billion this year and be more than $230 billion by 2022, just 4 years from now.

 

Lootbox News

The biggest news in the Lootbox controversy in recent weeks was Belgium calling out Overwatch, CSGO, and Fifa 18. The Belgian government has even gone so far as to say that these companies are violating the law with their lockbox mechanics. An announcement from the Minister of Justice said in a press release that the loot boxes must be removed and… If that does not happen, the operators risk a prison sentence of up to five years and a fine of up to 800,000 euros. When minors are involved, those punishments can be doubled.” Things got serious, fast! An EA spokesperson spoke with Eurogamer saying, “We strongly believe that our games are developed and implemented ethically and lawfully around the world, and take these responsibilities very seriously. We care deeply that our players are having a fun and fair experience in all of our games, and take great care to ensure each game is marketed responsibly, including in compliance with regional ratings standards. We welcome the dialogue with Minister Geens on these topics, as we do not agree that our games can be considered as any form of gambling.” Belgium hasn’t set any deadline for companies to change their games so it may be some time before we see anything else come from this.

Meanwhile, in the Netherlands, four out of ten popular games they studied were found to be in violation of their Betting and Gaming Act. The Gaming Authority didn’t say which games they studied or which games were in violation but Dutch language news site NOS reports that Fifa 18, Dota 2, PUBG, and Rocket League are the four games in violation of the law. Unlike Belgium, the Netherlands has given the companies a June 20th deadline. The Netherlands is also pushing for EU-wide legislation on lootboxes.

Based on player feedback, Tera has revamped their lockbox system. They made sure each one will contain something the player will find useful and you can also find out what is in each box.

Then finally, there are what seems like conflicting reports from Superdata and Juniper Research on the future of lootboxes. Superdata is saying that game marketers will be pushing the idea of “no loot boxes” this fall more than things like “60fps” and “4K HDR.” While Juniper Research is saying that loot boxes will be a major factor in industry growth over the next 4 years. Juniper has also likened loot boxes to gambling, so it’s not that they necessarily stand behind the practice. Superdata, on the other hand, believes that the anti-lockbox sentiment will continue to grow and developers will find other ways to monetize their games. Specifically, they point at Fortnite: Battle Royale which brought in $126 million in revenue in February without selling a single box. Superdata also acknowledges that lockboxes aren’t going away anytime soon with games like Overwatch making over $600 million from them.

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Best MMO Halloween Event 2017

If there is one event MMOs love to take part in more than any others it is Halloween. That is why in this list you’ll find 60 different games with Halloween events! We decided to leave out the MOBAs and Shooters from this list but if they were put back in it would easily have a hundred games in it. But which is the best MMO Halloween event?

This poll is all about finding out what your favorite MMO Halloween event is this year. The winner gets a badge on their MMOGames profile and bragging rights for the entire year.

If your favorite isn’t on the list, or you know of a game we missed let us know in the comments and we’ll be sure to add it as quickly as possible.

 

MMO Halloween

To take part just find your favorite MMO in the list below and leave a vote. You can only vote for one game at a time, but be sure to keep coming back as you can place more votes every day.

Voting will continue until the end of October 31st when the top three winners will be declared.

 

Which is the best MMO Halloween Event? Your vote will decide…

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