Thursday, May 12, 2022

Pearl Abyss Q1 2022 Earnings Call

Some view the world like the glass is half-full. When looking at the results of Pearl Abyss' first quarter 2022 earnings call, an optimistic person might say the South Korean game maker did better than expected. Two analysts wrote their expectations for the call on BusinessKorea last week:

Pearl Abyss is expected to have posted sales of KRW88.8bn (-12.0% YoY,-24.7% QoQ) and operating loss of KRW1bn (negative swing YoY and QoQ, operating margin of -1.1%) for 1Q22. The company should have swung to a loss owing to sales drop and labor cost hikes from new hires, despite declines in marketing spend and other expenses. Sales likely fell QoQ due to high base effect created by Pearl Abyss Capital’s one-off investment gains booked in 4Q21.

Pearl Abyss didn't do quite that poorly, as the slide below shows.

Okay, Pearl Abyss brought in ₩91.4 billion ($75.5 million), beating expectations by 3%. But after the one-time revenue claim from Pearl Abyss Capital at the end of 2021, revenue was expected to plummet from the last quarter of 2021. And while drops in operating profit and net profit fell off a cliff, at least PA had profits to claim.

Gaming revenue rose in the first quarter, up 4.3% from the Q4 2021 total of ₩85.4 billion ($72.7 million) to ₩89.1 billion ($73.6 million). Before continuing, I need to explain why the U.S. dollar total only went up 0.1% instead of 4.3%. The South Korean won is weakening against currencies like the dollar, British pound, and Chinese yuan. In the rest of the article, the won to dollar valuation is calculated using the exchange rate on the last working day of the quarter as found on Xe. So as we can see, the dropping value of the won is boosting Pearl Abyss' profits.

We can do the same with Black Desert IP revenue. Year-over-year, Black Desert revenue dropped from ₩82.9 billion ($73.2 million) in Q1 2021 down to ₩70.9 billion ($58.6 million) in Q1 2022, a 14.5% decline in revenue. The Black Desert IP did post a quarter-over-quarter gain of 5.8%, from ₩67 billion ($56.3 million) up to ₩70.9 billion ($58.6 million).

The EVE IP revenue looked very steady over the last year, with revenue rising 3.4% from Q1 2021's total of ₩17.6 billion ($16.2 million) up to last quarter's ₩18.2 billion ($15 million). Oh, oh. Now we can really see the effects of the weakening won. If converted to U.S. dollars, the 3.4% year-over-year gain turns into a 7.4% revenue decline. 

Continuing on, EVE revenue remained "steady" from Q4 2021 to Q1 2022, only falling 1.1%. Even doing the won to dollar conversion doesn't show a big drop, as EVE brought in ₩18.4 billion ($15.5 million) in the final quarter of 2021.

At this point the pessimist takes over. With revenues inflated by the steadily weakening won, what are Pearl Abyss' plans to increase revenue? The April launch of Black Desert Mobile in China was disappointing not only to the analysts on the call, but to Pearl Abyss as well. From the tone of the call, the real possibility exists that Pearl Abyss will launch no games in 2022.

The analysts tried to get the Pearl Abyss leadership to let them know if Crimson Desert would launch in 2022. The answer was basically, "You'll find out when we tell the public." Listeners on the call were also told that the studio was concentrating on Crimson Desert, which means DokeV most likely will launch after the Black Desert spin-off. One analyst even asked about the upcoming Black Clover mobile game mentioned on the February earnings call. Despite telling analysts three months ago the game would launch in the second half of 2022, the analyst could not get Pearl Abyss to confirm if the timing still held.

About the only big news that might happen in 2022 is Pearl Abyss self-publishing Black Desert Online in South America. The move would mean the South Korean studio would now self-publish around the globe. Perhaps more importantly, every time Pearl Abyss self-publishes BDO in a region, its revenues increase for a time.

New Pearl Abyss CEO Jin-young Heo did answer a question about the future of Pearl Abyss. Below is a transcription of the translated answer.

You also asked us about the direction of our new business going forward. And we are planning many things. For example, we have DokeV that uses the metaverse platform as well as others that use the web 3 platform so we are seeing the market trends. And to successfully launch Crimson Desert in line with the Western biggest market, the console market, and also to make DokeV into a metaverse platform and to showcase this to the market. And to have a new project which I have before mentioned, using the current market trends of blockchain and web 3.0 using the EVE IP. So we believe as a game development studio we are going to focus more on these and that will be our task going forward. 

I would love to get a transcription of the Korean language portion, as I believe subtle but important differences exist. For example, in the passage above, the translator used the term "EVE IP", while the CEO used the actual term "EVE Online." Korean and English speakers may walk away from the call with two impressions of what Pearl Abyss plans for the future. 

In today's trading, Pearl Abyss stock declined 6%, finishing the day at ₩57,500. So far in 2022, Pearl Abyss stock has declined 57.1% in value.

Thursday, May 5, 2022

Feeling Down About Fanfest

Today is the 19th anniversary of the launch of EVE Online. I have held at least one subscription to the game since August 2009. That's right, I have played through two-thirds of EVE's history. Between the subscription fees and all the EVE meetups and conventions I've attended, I estimate spending between $35,000 and $40,000 on my hobby. While CCP received less than 20% of the total, I have spent quite a lot over the years.

Speaking of travel, I have gone to Iceland to attend Fanfest seven times. I went every year from 2012 to 2018. CCP did not hold a Fanfest in 2019, and my trip in 2020 was cancelled due to the emergence of COVID-19. I started a new job in February so couldn't get the time off to attend this year.

I do have to say, that in all my time playing, this year is the most underwhelmed I've felt at the thought of the news about to come out of Reykjavik from CCP's flagship convention. I started the year wanting to play more EVE following completion of FFXIV's Endwalker expansion MSQ in December. That lasted until March and the news of Prospector's Path and the Prospector Pack that sold Retrievers in the cash shop. Looking back, that was a gut punch. I still fiddle around with planetary interaction, but I really need CCP to come out firing at Fanfest to rekindle my interest in New Eden.

The only problem is, I don't see any indication that we will see CCP release a major content patch following the convention. Or that CCP will make any major announcements over the weekend at all. If they do plan on doing so, they are keeping the news secret.

I find the lack of news disturbing. On 11 April, we have seen a promise to not bring blockchain technology to Tranquility. Two days later, CCP revealed "Siege Green" on the Singularity test shard. So we see some numbers change on Upwell structures. Big deal. Okay, removing the hull reinforcement timers may wind up a big deal. But I don't see an expansion level patch in our near future.

So, what would get me excited? First, that CCP is about to incorporate Hadean's Aether Engine into EVE to allow a huge increase in the number of players who could participate in fights. Did I mention in the last test, the Aether Engine used Unreal Engine 4? Maybe at the same time the developers increase server capacity, they can port our current characters into Unreal Engine and finally get rid of the last vestiges of the Carbon engine.

Next, a full revamp of the mission agent system. Making the PvE in EVE much better would benefit any plan to turn EVE into a play-to-earn game. Forget players like myself. Such a move would make Pearl Abyss investors very happy. The financial world knows our Korean overlords in Anyang could use the boost.

Finally, in this "in case of emergency, break glass" moment, I would love to see a way to finally reach Jove space and run into another race. Not a human-type race like we have today. An actual, alien race. Barring that, I would love to see Triglavians become a playable faction.

Those are my hopes and fears for what we will see tomorrow during the Fanfest keynote address. CCP needs something big. I can hope, right?

Monday, May 2, 2022

Another Record Breaking Sales Month For Cloud Imperium Games

Last week the gaming industry experienced a lot of bad financial news. Everything from Activision Blizzard missing its expected sales of $1.8 billion by $320 million in the first quarter, to a 30% drop in stock price for Pearl Abyss, the news was poor. But the week ended with Cloud Imperium Games bringing in historically high revenue for the month of April.

The figure on the Roberts Space Industries funding page increased by almost $7.7 million in April, finishing the month at $454.2 million. The figure was the best April for CIG in its 10-year history, surpassing 2020's $4.1 million. Total revenue for the first four months of 2022 was $27.7 million. According to the unofficial Crowdfunding Development Spreadsheet, CIG raised nearly $97.5 million from 1 May 2021 to 30 April 2022 for the development of Star Citizen and Squadron 42.

Readers have asked why concentrate on the funding amounts. What about the game play? The features? The vision. Let's face facts. All of those things are nice to know when a game is about to launch. But currently we are looking at a possible release of Squadron 42 in 2024 and Star Citizen in 2026 or 2027. We don't know the development status of Squadron 42, and Star Citizen is still in early alpha.

One thing we do know is that CIG does not have enough money in the bank to complete development of the project. Here is the amounts raised by CIG so far.

  • Ship/equipment sales and game packages: $454.2 million (thru 30 April 2022)
  • Subscriptions: $22.8 million (thru 31 December 2020)
  • Other income: $44.7 million (thru 31 December 2020)
  • Outside investment: $63.2 million (thru 31 December 2020)

At the end of 2020, CIG had $63 million in the bank, but had spent $80.8 million that year. For all the dreams of players to come true, the company needs to continue cranking out ships to sell at very high rates. Currently, CIG is on pace to reach $100 million in sales in 2022. Hopefully that is enough to forestall layoffs until the company can open up another revenue source by launching Squadron 42. But watching the coffers fill up in real time is a bit of slow motion drama I find interesting.

Thursday, April 28, 2022

Pearl Abyss Stock Take Beating For Last Two Days

Investors in Pearl Abyss put a lot of stock in the news that Black Desert Mobile would soon debut in China. The initial news surrounding the commencement of BDM's open beta in China led to a massive sell-off of the Korean game company's stock.

Pearl Abyss officially released its mobile version of its popular Black Desert label in China on Tuesday with commencement of open beta test (OBT), nearly one year after it gained permit from Beijing authorities in June last year in a rare acceptance of a Korean game label in recent years.

"Black Desert Mobile" zoomed to the top of the Chinese app store game charts, becoming the No.1 downloaded game in the country upon release. It also led the charts of Tap Tap, an app market run by Tencent that is jointly marketing the game with iDreamSky. Black Desert Mobile is a mobile version of Black Desert Online, the blockbuster published in 2015 with cumulative downloads of more than 36 million worldwide.

But the fanfare quickly fizzled out, with the rank sliding to 75th later in the day and recovering to 29th Wednesday morning.

The result? The price per share dropped from Tuesday' opening price of ₩97,000 ($76.25) down to a closing price of ₩74,100 ($58.25). The 23.6% loss was followed up by another loss of 9.7% in trading Wednesday. Pearl Abyss stock closed at ₩67,000 ($52.67) per share for a two day loss of 30.9%. 

Pearl Abyss ended 2021 on a high note, with its stock worth ₩138,300 ($116.28) per share. While the company's stock is still 26% above its 52-week low price of ₩53,100, Pearl Abyss stock has declined by over 50% so far in 2022. With Pearl Abyss' biggest hope for a success in 2022 fizzling out, the next earnings call in two weeks should prove interesting.

Monday, April 25, 2022

EVE Online Prices Break A Historical Barrier

Well, the mad lads at CCP headquarters did it. In the run-up to Fanfest 2022 in less than two weeks, they became the first to break the $15 per month barrier for a basic one month subscription price for a major MMORPG. Sure, I pay $21.99 per month for my FFXIV account, but included in the price is $8/month for my 4 extra retainers. But on Friday, CCP announced the price of a standard one-month subscription (known as Omega time) would rise from $14.99 to $19.99 per month.

Includes the weekend's sale

For those wondering, the price changes are below.

  • 1 month: +33.7%
  • 3 months: +23.5%
  • 6 months: + 21.3%
  • 12 months: +14.1%

The 2 month and 24 month options are new.

The new PLEX prices

The price of PLEX, the item used in EVE Online's cash shop to purchase Omega game time as well as digital goods, will experience its first price increase since May 2017. The price hike is partially obfuscated by the changes in the number of PLEX offered in each package. The only offering that remains constant is the 500 PLEX amount, which is increasing by 25%. 

The two big questions are why, and why now. First for the why. In my opinion, the announcement news article was horribly written. Here are the reasons in CCP's own words.

To continue investing in EVE Online’s evolution and growth, and to realize our mission of EVE Forever, we are updating the price of all existing Omega and PLEX. This adjustment reflects global trends impacting general production costs and accounts for years of inflation, amending the 1-month USD subscription rate for the first time since 2004. These adjustments will have an impact on other currencies.

1. To continue investing in EVE Online's evolution and growth. I think a lot of players are going to wonder about that claim. How many expansion level patches have we seen over the last few years. I doubt many people even noticed Tuesday's article on the history of EVE's database server hardware. With the announcement, the motivation for publishing the article goes beyond fan service to a bunch of computer geeks.

2. "...to realize our mission of EVE Forever..." What? I believe that marketing campaign came out in 2013. Does anyone give it any credibility anymore?

3. "...reflects global trends impacting general production costs..." Having lived through Square Enix' failed attempts to beef up its servers before the launch of the Endwalker expansion, I can sympathize with the increased costs and lack of availability of computer infrastructure and other associated IT costs. Plus, inflation is going to raise the price of labor. The cost of living in Reykjavik is high in the best of times. I don't want to see the staff not able to eat properly.

In addition, CCP Paragon went to Discord and spent 40 minutes talking to players and trying to explain the reasons for the price hike. The big takaway was that the sanctions on Russia due to its invasion of Ukraine really is hurting financially. I remember how an 8% loss of subs in 2011 helped lead to major layoffs in October 2011. I imagine a sudden drop in players from a country that supplies approximately 10% of its player base could hurt financially.

Finally, for the question of "why now?" My question is, if not now, when? I was at Fanfest in 2014 and saw the aftermath of The Rouge Wedding, when CCP told DUST 514 players about the effective death of their game. At the time, I think everyone agreed the devs should have told players before Fanfest to avoid learning the news thousands of miles from home.

CCP also couldn't tell players after Fanfest. The convention ends on 7 May, only 4 days before Pearl Abyss' Q1 2022 earnings call. The price hikes are bound to come up on the call. Best the news comes from CCP than from a blogger who listens to all of the calls live.

The above reasons dictate that the announcement come before Fanfest. However, the stakes for Fanfest and the upcoming May patch just went through the roof. CCP really needs to knock Fanfest out of the park. 

Personally, I have three EVE accounts. With the price hike, I will unsub one account whose subscription runs out in December and use part of the money to add two more retainers to my FFXIV account. For those interested, that will bring the cost of my FFXIV account up to $25.99/month. My Omega time on my other two accounts runs out in March and August of 2023. I'll keep those at a cost of $25.98/month because I buy my Omega time in 12 month chunks. I think spending $52/month is a pretty good price for entertainment. I just need to rearrange my spending, because a third EVE account is no longer worth the cost.

Saturday, April 16, 2022

Star Citizen Reaches $450 Million In Sales

Early this morning the counter on Roberts Space Industries page surpassed $450 million. That's right, Cloud Imperium Games has sold $450 million in virtual good in order to fund the creation of Star Citizen and Squadron 42.

The funding page for Star Citizen and Squadron 42

The total amount of revenue received since Cloud Imperium Games' founding in April 2012 from known sources is:

  • Pledges/Counter: $450 million
  • Subscriptions: $22.8 million (thru 31 December 2020)
  • Other income: $44.7 million (thru 31 December 2020)

Not too bad for a company that showed a negative net cumulative position at the end of 2019.

At its current pace, Cloud Imperium Games will reach $100 million in revenue in 2022. The only question is whether we will see the mark achieved from watching the funding page or if we will need to wait until CIG's 2022 financial statement comes out, probably in December 2023.

I'm not sure these $50 million figures are even newsworthy for CIG anymore. But for now, I think the event is worthy of a post.


Tuesday, April 12, 2022

Hilmar's Change Of Mind On NFTs In EVE Online

Currently we are seeing _very predictable feedback_ on what we are doing. Having the perspective of having done this for a decade, I can tell you that this is one of the moments where we look at what our players do and less of what they say. Innovation takes time to set in and the predictable reaction is always to resist change.

CCP CEO Hilmar Veigar Pétursson, June 2011

In 2011, a leaked internal email from CCP CEO Hilmar Veigar Pétursson contributed greatly to the event known in EVE history as The Summer of Rage. I use the quote above often, as I believe the events led to an era of distrust between the developers and the players. One of the many concerns were CCP's plans to monetize the game.

Move forward almost 11 years. Players are still worried about monetization efforts that would negatively affect the game. Today, the issues involve non-fungable tokens, the metaverse, and play-to-earn mechanics. On 5 November 2021, CCP announced the company was giving out NFTs for prizes in Alliance Tournament XVII. Six days later, Pearl Abyss stated CCP's parent company was looking for opportunities to introduce NFT into both EVE and Black Desert Online on a quarterly earnings call. Also starting on that November call, analysts began asking about the possibility of introducing the play-to-earn model into EVE. Perhaps more ominously, Pearl Abyss invested $3 million into Hyperreal, a metaverse company whose software can create NFTs the day before CCP announced the introduction of NFTs into EVE Online via the Alliance Tournament.

Of course, Hilmar looked excited about the move to embrace NFTs. 

He even went around to conferences joining meetings with NFT types.

Which leads us to yesterday. Hilmar made a much needed statement about blockchain technology before Fanfest in a few weeks.

There has been a lot of speculation around blockchain technology, NFTs and cryptocurrency and what that means for the future of EVE Online, so I wanted to address it.

At CCP, our mission is to have the EVE Universe outlive us all: EVE Forever. One huge part of this is exploring new technologies and new possibilities - something EVE players know that I’m always fascinated by. This philosophy is rooted in EVE Online’s inception; when we created EVE, it was seen as too radical and ambitious, yet here we are about to celebrate EVE’s 19th anniversary.

Many of us at CCP have been following the new frontier that has been developing around blockchains and cryptocurrencies for the past few years. We’ve read your feedback and we also see what you see - blockchain tech has both a lot of untapped potential and a lot of work needed before being ready for EVE-scale games.

On that note, we have no plans to add blockchain technology into EVE Online’s global server Tranquility for the foreseeable future. For the coming years, development for Tranquility will focus on building exciting new opportunities on top of the robust foundation that has been laid over the past two decades.

While we remain intrigued by the technology, for us, NFT stands for “Not for Tranquility”. Overall, the EVE IP will continue to push the boundaries of digital economies and virtual worlds - and we will continue to explore that outside of TQ.

Fanfest is a month out and personally, I’m very excited – it’s been two-and-a-half years since our last in-person meet, in London during the EVE World Tour. I look forward to seeing many of you in the flesh again and talk about EVE and our future!

CCP Hellmar

Honestly, I don't know how much to trust the statement. The fiscal quarter ended two weeks ago. I have to ask how much did all the talk of NFTs and selling fitted ships do to EVE subscription and sales rates. One thing I've observed about Hilmar over the 12 years I've played EVE Online. He starts changing his opinions when he starts losing money. When Hilmar stated 11 years ago "where we look at what our players do and less of what they say", he was really talking about how much money players were spending. The next Pearl Abyss earnings call should prove interesting.

Wednesday, April 6, 2022

Cloud Imperium Games Reaches $20 Million In Revenue In Q1 2022

Cloud Imperium Games, the maker of Star Citizen and Squadron 42, recorded $20 million in sales in the first fiscal quarter of 2022. For the month, March's total of $5.8 million in revenue from ship and equipment sales fell 20% from February's $7.3 million in sales. 

I stumbled across a Google Sheet that tracks funding for the project on an hourly basis. I have seen the file referenced on a couple of Star Citizen videos, so I decided to use the data myself. The results might surprise people.


Remember the stories at the beginning of the year about immense dissatisfaction over CIG changing the amount of detail the developers shared on the roadmap? About that dissatisfaction. In the first quarter of 2022, revenue publicly updated every hour on the Star Citizen website is up 50.8% compared to Q1 2021. As a reminder, CIG had its best year financially in 2021, bringing in $86.4 million, not including subscriptions and other forms of income. 

Last month I speculated that CIG was on pace to receive $100 million in revenue from ship and equipment sales in 2022. With major sales event like Invictus Launch Week, CitizenCon, and the Intergalactic Aerospace Expo still to come, I feel more confident in stating CIG will raise $100 million in 2022.

Thursday, March 31, 2022

Axie Infinity Related Blockchain Ronin Network Hacked For $540 Million

On Tuesday, the Ronin network, which powers the play-to-earn game Axie Infinity, publicly reported a major security breach.

LONDON, March 29 (Reuters) - Blockchain project Ronin said on Tuesday that hackers stole cryptocurrency now worth almost $615 million from its systems, in what would be one of the largest cryptocurrency heists on record.

The project said that unidentified hackers on March 23 stole some 173,600 ether tokens and 25.5 million USD Coin tokens. At current exchange rates, the stolen funds are worth $615 million, but they were worth some $540 million at the time of the attack.

This makes it the second-largest crypto theft on record, according to blockchain analysis firm Elliptic.

Ronin is used to power the popular online game Axie Infinity, which uses non-fungible tokens (NFTs) and is the biggest NFT collection by all-time sales volume, according to NFT market tracker CryptoSlam.

Ronin said in a blog post that the hacker had used stolen private keys - the passwords needed to access crypto funds - to make off with the funds.

A lot of reporting is using the higher number over $600 million, but I will use the valuation on the day of the hack. According to Axie Infinity publisher Sky Mavis Ltd., the funds are still in the hacker's crypto-wallet. The publisher also stated the hack occurred due to social engineering, not a technical flaw in the Ronin network. But reading a blogpost from Ronin leaves me wondering exactly the social engineering involved. To me, a little bit of human error was involved, leaving an attack vector open to potential hackers. For those interested in the technical details, the blogpost included details of the attack.

Sky Mavis’ Ronin chain currently consists of 9 validator nodes. In order to recognize a Deposit event or a Withdrawal event, five out of the nine validator signatures are needed. The attacker managed to get control over Sky Mavis’s four Ronin Validators and a third-party validator run by Axie DAO. 

The validator key scheme is set up to be decentralized so that it limits an attack vector, similar to this one, but the attacker found a backdoor through our gas-free RPC node, which they abused to get the signature for the Axie DAO validator.  

This traces back to November 2021 when Sky Mavis requested help from the Axie DAO to distribute free transactions due to an immense user load. The Axie DAO allowlisted Sky Mavis to sign various transactions on its behalf. This was discontinued in December 2021, but the allowlist access was not revoked. 

Once the attacker got access to Sky Mavis systems they were able to get the signature from the Axie DAO validator by using the gas-free RPC. 

We have confirmed that the signature in the malicious withdrawals match up with the five suspected validators.

The blogpost detailed 6 steps the company took as a result of the security breach.

  1. We moved swiftly to address the incident once it became known and we are actively taking steps to guard against future attacks. To prevent further short term damage, we have increased the validator threshold from five to eight.
  2. We are in touch with security teams at major exchanges and will be reaching out to all in the coming days. 
  3. We are in the process of migrating our nodes, which is completely separated from our old infrastructure.
  4. We have temporarily paused the Ronin Bridge to ensure no further attack vectors remain open. Binance has also disabled their bridge to/from Ronin to err on the side of caution. The bridge will be opened up at a later date once we are certain no funds can be drained. 
  5. We have temporarily disabled Katana DEX to due to the inability to arbitrage and deposit more funds to Ronin Network. 
  6. We are working with Chainalysis to monitor the stolen funds.

The Washington Post reported that the breach was noticed days before Ronin became aware of the hack. 

Since tokens fluctuate in value, breaches can have an effect on trading. The crypto community on Tuesday was abuzz about the action of “Cobie,” an enigmatic crypto figure (real name: Jordan Fish). He generated an intense back and forth on Twitter when he said he had taken short positions on a large number of NFTs from the game last week because he perceived security flaws.


Since The Nosy Gamer is a blog dedicated to video games, I should at least mention a little about a game I have only recently heard of. The Wall Street Journal gave a description.

“Axie Infinity,” launched in 2018, is part of a small but fast-growing number of so-called play-to-earn games. Also known as blockchain games, they largely center on the buying, trading and selling of virtual assets backed by nonfungible tokens, or NFTs. The games are considered an early foray into the metaverse, a more immersive future version of the internet where people are expected to work, learn and be entertained.

“Axie Infinity” had more than 1.7 million daily users in February, according to Sky Mavis. In it players collect digital pets called Axies that they use to compete in battles. They can sell and trade the creatures for digital currency. Some Axies are worth more than others.

Finally, since I haven't written any posts explaining what NFTs and play-to-games are, I'll conclude this post with a video put together by the Wall Street Journal. Enjoy!

Friday, March 25, 2022

EVE Online Taking Two Steps Forward

I want the services hinted at to investors in South Korea proclaimed to the world at Fanfest. Services that the player base will love. Services that don't include selling ships in the EVE Online cash shop. Hopefully in the run-up to Fanfest in May CCP will start dropping information showing I'm completely wrong. But I have my doubts. I really, really do.

The Nosy Gamer, 15 March 2022

I really want CCP to make the first live Fanfest in 3 years something to remember. In past times, the run-up to the event involved hearing and reading about a lot of the content the developers planned to introduce at the yearly event. Hopefully Tuesday's news item is a taste of things to come, listing five areas of change coming soon to New Eden.

The first area involve nerfs to Upwell structure defenses. The nerfs are:

  • Standup Point Defense Battery: Will now require ammunition along with a longer reload time.

  • Standup Guided Bomb Launcher: Will hold fewer bombs and have a longer reload time.

  • Standup Anti-Capital Missiles: Damage to be reduced.

  • Standup Arcing Vorton Projectors: Will no longer have the ability to target subcapital ships. The projectors will lose the ability to headshot fleet commanders in a subcapital ship such as a Monitor.

The one buff involves increasing the missile speed of Standup Missiles to allow them to catch and damage subcapital ships.

The second area involves mining. After years of nerfs, the Rorqual is receiving a buff in the form of a new module. The industrial capital ship will soon have the ability to conduit jump 30 mining ships next to them, giving mining fleets greater operational range.

The third area involve buffs to subcapitals. The Proteus Tech 3 cruiser will receive more fitting room to allow for a better tank and full rack of blasters without the need to sacrifice a slot for a fitting module. And in response to recent battleship buffs, the Tech II bomber will receive reduced cooldowns for their bomb launchers.

In addition to the ship and module changes, CCP is introducing the Feature Preview system. From a separate dev blog published Tuesday:

As a part of our ongoing efforts to lay the foundations for EVE Online’s third decade and continually improve the world’s largest living work of science-fiction, we're happy to introduce the Feature Preview system – allowing players to opt-in and engage with complex features still undergoing active development, test driving them directly in the EVE client.

Our aim is to more fully incorporate feedback into our prototypical process by allowing you access to these features early while we design them. Your invaluable feedback on past features has already allowed us to improve and shape them into better additions to EVE – and this new way of testing will allow far more exposed development, enabling earlier chances for players to express important feedback while also allowing our team to gather information on how you play EVE and what will best aid you in that pursuit.

The preview system is available on Singularity and comes to Tranquility in April. The debut preview feature will be a UI unification project, aimed at improving consistency, creating a better onboarding experience for new players, and reducing cognitive load for all players. The features offered in the preview system are temporary and can be easily turned on and off. Your participation is optional, and it is important to note that the features you will be given access to will not be in their final form. We look forward to learning from what you, the players, think as we introduce new features and build the future of EVE Online hand-in-hand.

Finally, CCP will work on blueprint changes to faction ships, dreadnoughts, and capital ships, releasing their work in April before Fanfest.

Not everything is promising. We still have the specter of the developers introducing new RMT systems at Fanfest as we discovered in a Friday night news dump.

One of the topics for Fanfest is a new project that we’re in the middle of developing, that will transform these and any future packs - a paradigm where packs of this type will be supplied by players, ensuring that any ship we offer to new players through sales, will have origins from actual player work in New Eden: Made for new players, by veterans. This feature will also not only supply each ship from the player base but allow the community to influence which ships will be put in these packs.

Still, CCP seems on its way toward ... something. Hopefully, we continue to hear good things until CCP reveals all at Fanfest in the first week of May.


Monday, March 21, 2022

The End Of The Prospector Pack ... Almost

Last Friday evening my time, CCP removed the Prospector Pack from the EVE Online cash shop. I thought I'd record CCP Swift's post on the official forums for reference in the future.

Capsuleers,

We hear your concerns about the Prospector Pack.

As all EVE players know and remember, being a new pilot in New Eden has many challenges. Some players are lucky enough to make their way into player corporations quickly, where they are shown the ropes and supported by our veterans. For others, however, this path can be hard to find or feel intimidating, so they go it alone. We’ve spent much of 2020 and 2021 devoting resources to researching these players and trying to find ways to help them through early content barriers. Recently, we added a whole new chapter dedicated to mining in New Eden to the New Player Experience (NPE), as well as a new tutorial on Invention and T2 Production to our regularly updated EVE Academy.

Part of our experimentation in the new player journey has included the introduction of various packs and sales that give new players strong but limited options to jump forward and catch up with their peers. The destroyer-themed starter packs showed that there is not only an appetite for this kind of option but that these pilots transition into bona fide EVE players; they have aspirations, desire to interact with others, and contribute to EVE’s thriving ecosystem – they become tenured and impactful citizens of New Eden.

The prospector pack expands this concept to offer a more significant upgrade for young pilots in theme with our updated Mining NPE. We hear your worries about the continued escalation of this kind of sale and want to reassure you that our design will remain directed towards new players finding their footing in New Eden.

Economic impact and the integrity of the player economy are a top priority. We have limited this pack to one per account and are closely monitoring its effect on the player market. One of the topics for Fanfest is a new project that we’re in the middle of developing, that will transform these and any future packs - a paradigm where packs of this type will be supplied by players, ensuring that any ship we offer to new players through sales, will have origins from actual player work in New Eden: Made for new players, by veterans. This feature will also not only supply each ship from the player base but allow the community to influence which ships will be put in these packs. Additionally, the CSM will now have a quarterly meeting to discuss specifically these types of packs and other commerce topics. Not only to be in the room and have discussions on future packs but also to share feedback that the community desires.

On that note, we have removed the Prospector pack from secure.eveonline.com until this program is in place, intending to introduce a career-entry level option for mining in the future.

I should add that as of 0600 UTC today, the Prospector Pack was still on sale on Steam. So the pack isn't quite dead yet.

On Friday, I stated that a protest on Twitch was not going to change CCP's mind about selling the Prospector Pack. I stand by the statement. I am reminded of an infamous leaked email from CCP CEO Hilmar Veigar Pétursson in June 2011 at the start of the famous Summer of Rage. I think the key paragraph fits today's situation.

Currently we are seeing _very predictable feedback_ on what we are doing. Having the perspective of having done this for a decade, I can tell you that this is one of the moments where we look at what our players do and less of what they say. Innovation takes time to set in and the predictable reaction is always to resist change.

Things like the open letter from the CSM and the Twitch Blackout protest are just talk. What does CCP react to? When players begin to vote with their wallets. Back in 2011, the result was a layoff of 20% of the CCP workforce. I have to believe something similar happened over the past week. A wave of players unsubscribing combined with a lack of sales for the package would definitely result in pulling the promotion quickly. And after what happened in the fourth quarter of 2019 after the developers allowed Blackout to run too long, upper management possibly is more open to reacting to a situation before it festers into a large loss of revenue.

I have to make one more comment. I realize last week I wrote I wanted CCP to wow me with news at Fanfest of new services. But this section of CCP Swift's response makes me worried.

One of the topics for Fanfest is a new project that we’re in the middle of developing, that will transform these and any future packs - a paradigm where packs of this type will be supplied by players, ensuring that any ship we offer to new players through sales, will have origins from actual player work in New Eden: Made for new players, by veterans. This feature will also not only supply each ship from the player base but allow the community to influence which ships will be put in these packs.

I can see this effort going horribly wrong with plenty of player backlash. On the other hand, this could wind up a play-to-earn feature not involving NFTs. That would be good, right?

Friday, March 18, 2022

The EVE Partnership Program And The Prospector Pack

Events surrounding the sale of the Prospector Pack are slowly spreading. The latest move was made by a member of the EVE Partner program, New Eden Post. Run by Redline XIII, the Twitch channel was known for hosting a talk show and podcast, Trash Talk Tuesday. Now, the channel and site is more famous for streaming a site called EveBlackout.com

The website is the work of Manic Velocity, someone historically opposed to the type of primary market RMT the Prospector Pack represents. When given the choice between streaming EveBlackout.com or remaining in the Partner program, Redline chose to keep streaming and removed himself from the program. Redline confirmed this on Ashterothi's stream Thursday.

Of course, the drama arrived on the EVE sub-Reddit with a post titled, "CCP remove Trash Talk Tuesday's partnership over the eve blackout protest." A member of the community manager team, CCP Convict, tried to correct the record.

I just want to address an error in the title which is that we didn't remove New Eden Post from the partnership program. Instead we made an announcement to partners that if they chose to participate in the campaign they would not be able to remain in the program. We also gave a grace period until midnight UTC for partners to curtail any activities like this. We weren't even going to take action retroactively against partners who had already been involved.

New Eden Post then chose to withdraw from the partnership program of their own accord.

Doesn't seem like much drama, right? CCP Convict puts out what really happened. The next day, Redline confirms the story. Of course, the stories over at MassivelyOp are much juicier and more in-line with the contents of the Reddit post.

The purpose of this post isn't to laugh at a gaming news site so credulous as to take what happens on the notoriously inaccurate EVE Online sub-Reddit at face value. Instead, I want to discuss a little bit about the EVE Online Partnership Program.

In the interests of full disclosure, I am not a member of the EVE Partnership program. My blog does not receive enough traffic to qualify. Bloggers require a minimum of 5,000 monthly readers to qualify, a number I haven't come close to achieving since the program was established from the ashes of the old EVE Affiliate program in November 2020. In the heyday of The Nosy Gamer, I would garner 15,000-20,000 page views a month, but those days are long gone.

I should also add, I was never a member of the EVE Affiliate program either. Back then, I had a concern about tying myself too closely to the company. If I said nice things about CCP or EVE Online, I didn't want people to think the company was paying me for those views. My fellow blogger and long time EVE University director Neville Smit used to laugh at me when we'd meet at Fanfest about my integrity as he walked in with a paid ticket to the event. I'd then laugh at Neville when CCP invariably had a screwup with the badges of the player affiliates. Paying a couple of hundred bucks to ensure I didn't have to wait 8 hours for my badge wasn't that high a price to pay to get into the event venue.

What are the benefits of membership in the program? First, a nice little payment in game time and PLEX.

As a partner, your main character is on us! All partners will receive free Omega on their account plus an additional 500 PLEX per month to use however they see fit. This should take the pressure off PLEX-ing your account a little so that you can keep on creating awesome content for people to enjoy.

If one uses the monthly value of the game time and PLEX, a partner receives $179.40 in game time and $239.88 worth of PLEX. 

Perhaps something more valuable than game time and PLEX is the promotional opportunities.

As a partner, we will work to spread the word about all the awesome stuff you do! You’ll have the chance to be featured on CCP promotional channels including the EVE Online official website, social media, Steam, and possibly even in the EVE Online launcher!

One of the issues with the Blackout protest is that EVE Partners participating in the protest could wind up viewed on the official CCP Twitch stream. Having a negative message playing on the official channel for a couple of hours is probably not something CCP is eager to see.

More important than showing up on the CCP Twitch channel, especially for non-Twitch streamers, is access.

As a partner, you’ll get an invite into a secret enclave of partners and CCP developers where you can chat with us about your content, ask questions, trade tips and tricks, and more. You’ll also get priority access if you’d like to have a developer join you for a stream or come on for an interview!

Another benefit is receiving exclusive in-game items.

To help you draw attention to your work and engage with your audience, we’ve developed a new line of SKINs which will be available only through our partners. Every month we’ll give you a big bundle of SKINs to use for giveaways, contests, or other creative ways of rewarding your audience while hopefully encouraging more people to check out what you make. Our initial lineup has a SKIN for a different hull every month to keep things fresh and to keep people coming back!

Of course, not everything surrounding the SKINs has gone smoothly. I wrote about a little bit of drama back in February 2021.

Finally, CCP offers access to some additional advertising revenue.

CCP has recently become a part of the Admitad global affiliate network that offers incentives to websites, content creators and talents promoting EVE Online. Admitad is open to everyone but EVE Online Partners will receive better affiliate rates! 

In addition, EVE Partners will probably receive tickets to CCP-run events. These tickets run into hundreds of dollars. Tickets to Fanfest 2022 cost $295.

CCP does have some rules for participants in the program. As of today, they are:

  • Maintain a friendly and welcoming atmosphere. Even if you do not necessarily like a certain playstyle or group, keep any chiding friendly and playful.
  • In the case of contests or giveaways for CCP-provided in-game goods, you should provide all viewers with an equal chance to win. Such giveaways should not be restricted only to subscribers or patrons. For more details, please read the official EVE Online Content Creation Terms of Use.
  • Avoid behavior which could be construed as racist, bigoted, harassment or otherwise exclusionary to any persons in or out of the game.
  • Avoid negative or disruptive behavior towards other content creators.
  • Try to keep discussion of EVE features or development constructive (you don’t have to pretend you love everything about the game)
  • Try to avoid your content being predominantly negative. We do hope you’re having some fun too!
  • Not promote any violation of EVE Online’s EULA or Terms of Use.
  • Not contain or promote illegal, racist, sexist, hateful, pornographic or other offensive material.

Now, the Blackout protest might violate the points about keeping "discussion of EVE features or development constructive" and trying to "avoid your content being predominantly negative." But CCP Swift made a Reddit post that brought up a third issue.

Hey, just want to chime in on this too since this was directly my doing.

I saw the EVE Blackout site linking to Manic's monetization manifesto (probably not the official name, but it should be) this morning. Through the course of the day, a non-insignificant number of the EVE Partners reached out to me directly and expressed concern that an EVE Partner was promoting this and how they viewed this to be potentially damaging to their content on Twitch. I agreed, and was something I was thinking about all day.

I can believe some EVE Partners would oppose the protest. When I visited the EVE Online categories page yesterday, the protest, at least from the outside, had grown.


I can see why streamers trying to get some views might find a bunch of streams telling potential viewers the game may have some issues irritating.

I thought looking at the background of the story might provide some useful information. As far as I am concerned, the story is a big nothing-burger. As I mentioned in my first story on the Prospector Pack, Pearl Abyss needs the money to make up both for its financially underperforming keystone franchise and inability to launch Crimson Desert in a timely manner. Potentially looking bad on Twitch, especially with how few people actually watch EVE on the platform, isn't going to deter CCP from selling this type of content.

Tuesday, March 15, 2022

The Latest RMT Kerfuffle In EVE Online: The Prospector Pack

Once CCP announced the Prospector's Path, I knew anything I wrote would upset a fair number of people. Within the announcement was a link to a new cash shop package called Prospector Pack. The package includes 30 days of game time, 100 PLEX, and a "ready to fly Retriever". The following description of the ship made people lose their minds.

A Retriever mining barge with everything you need to fly it including skill books, modules, and tokens to redeem for Skill Points and ship insurance.

After watching HateLesS_Gaming's review of the pack, I think CCP at a minimum should be mocked mercilessly for thinking a good fit for a mining barge includes fitting both an ice harvester and a strip miner in the high slots. But community sentiment ran a little deeper.

On Wednesday, CSM member Brisc Rubal posted an open letter from the CSM on both the official EVE Online forums and the EVE Online sub-Reddit. I will quote a long portion of an extremely long letter to present the main complaint:

One issue that has been a perennial player concern is that of monetization. As EVE transitioned from a subscription-based game to free-to-play, and with the introduction of cosmetics and skill extractors, players have focused heavily on how CCP monetizes EVE. From the 2011 “Summer of Rage” to the monthly complaints from players over different ads and new monetization schemes, no one can argue that the core player base in EVE Online cares deeply about monetization and is highly skeptical about the direction CCP monetization has been going. Core players have deeply held fears that there is a slippery slope at play when it comes to EVE monetization, and what was treated before as something that CCP should never do (for example, directly selling skill points to players) is eventually accepted. The CSM and CCP have had a constant stream of communication on these issues over the years. As a group of current and former CSM members, many having served on multiple CSMs so far, we can say from personal experience that every single one has seen in-depth, constant discussions between the CSM and CCP on these issues, and we’ve brought them up with every single person in senior leadership from the CEO on down.

The one line we have always said should never be crossed is the selling of fitted ships. This has been consistent. It has been long-held, and passionately held, by most core players. None of us have talked with any of our fellow CSM members who believed that selling fitted ships was an acceptable means of monetizing the game. Any sale like this would have a negative impact on the in-game economy, for a variety of reasons, but most importantly because it would both set the in-game price for ships (as a function of the real-life cost of the sale, as we see with SKINs) and because it would edge out producers by introducing “free” ships that did not require in-game time and materials to produce.

What led me to writing and discarding a couple versions of this post is determining how many people I want to upset. Unlike Brisc, I am not a trained lawyer who lobbies the Congress of the United States for a living. I don't like using politically correct terminology like Brisc used in his letter. I have written about real money trading in EVE Online for over a decade, and that is the angle I will approach the latest kerfluffle. So put on your sunglasses and bow ties, I'm about to go down the "monetization" rabbit hole Gangnam style.

The term "monetization" is a polite word used to describe when the publishers of video games engage in the practice of real money trading. Since search engines like Yahoo! (#1), Google (#2), and DuckDuckGo (#2) list me as some sort of expert on RMT, I will list the definition I came up with in 2013.

I'm #1 on Yahoo! search results

So what is RMT?  At the most basic level, real money trading is the exchange of virtual goods, including in-game currency, and services for money's worth. Early pioneers in the economics of video games divided real money trading into two markets: primary and secondary. The secondary markets involved those breaking the terms of services of games by selling in-game items and currency for real world value. Primary markets are endorsed by the game publisher. As I wrote back in 2013:

Where players come to disagreements on RMT are on those activities that fall in the primary RMT market. The HIIT's Tuukka Lehtiniemi in 2007 defined the primary market as trade "in which the operators of certain services sell virtual items to users for real money. Such services are usually free to use. Typically players buy the service’s own internal currency with real money, and use that currency for microtransactions inside the service." Services like this include the cash shops that often appear in games today. Sony Online Entertainment's Station Cash and ArenaNet's Gem Store for Guild Wars 2 are two obvious examples of game operators becoming directly involved in selling in-game items. A growing model is the PLEX-model, in which game companies sell items that players can either redeem for game time or sell to others on the in-game market in exchange for in-game currency.

Since 2013, I have replaced "real world currency" with the phrase "money's worth". Governmental bodies such as the United Kingdom's Gambling Commission are prosecuting people based on the concept that people who play video games can derive more than cash as value from a game. The term is interpreted very broadly and simply means something which has a financial value to the player. The UKGC laid out three criteria for determining if the prize or winnings of a game is considered money's worth:

  • Can they be converted to money via third parties?
  • Are they tradeable with others to obtain goods or services?
  • Can they be used as virtual currencies to pay for goods or services?

If the answer to one or more is yes, then the prizes or winnings is money's worth. For example, games like Axie Infinity that allow players to extract NFTs from the game to sell are engaged in a form of primary market RMT.

EVE players do not consider all primary RMT activity CCP engages in negatively. A popular action is the periodic PLEX for Good campaigns the Icelandic studio conducts when humanitarian disasters occur. Since 2005, the PLEX for Good campaigns have raised over $700,000 for various relief efforts around the world.

In general, EVE players approve of the PLEX system, the biggest driver of activity on EVE's primary RMT market. Introduced in November 2008, the Pilot's License Extensions allowed players to purchase ISK for real world currency to use to purchase ships, ammo, skill books, etc. Players would purchase a PLEX, sell it to someone else for ISK, and the ISK seller could then pay for another month of game time. The ISK buyer is happy, the ISK seller is happy, and CCP is happy because they were able to charge someone more than $14.99 for one month of game time. Everyone won.

CCP expanded the PLEX system in May 2017, changing PLEX into the currency used in the EVE Online cash shop. The move expanded the amount items and services players can purchase using currency earned by playing the game. I believe the interest in adapting play-to-earn features to EVE heard from analysts on the Pearl Abyss quarterly earnings calls is due to the existing PLEX system. How much development is needed to add NFTs to the New Eden Exchange?

How successful is the PLEX system? The answer is found in The Forge, home to EVE's largest market hub. Over 70% of PLEX exchanges between players on the market occurred in the region. In 2021, players spent 1.176 quadrillion ISK to purchase PLEX in The Forge. An amount so large is incomprehensible, so let's break it down. The average amount traded per day equaled 3.2 trillion ISK.

How much is 3.2 trillion/day? Let's put the amount into context. In 2021, I tracked 15.7 trillion ISK in sales at the real money trading site Player Auctions. In other words, 5 days of sales matched what was sold at a very large secondary market RMT site for an entire year. Looking at recent war activity, the Battle of M2-XFE in February 2021 where 257 titans died resulted in 29.1 trillion ISK lost. In other words, the ISK value of PLEX sold in The Forge would have paid for the losses for both sides in that battle in 9 days.

A more understandable way to picture the size of the primary RMT market involving PLEX is converting the ISK to the U.S. dollar. Doing that conversion, the value of the ISK traded for PLEX in The Forge in 2021 was $16.8 million. Since close to 30% of PLEX is traded outside The Forge, that puts the figure for the entire game to over $20 million. To put those numbers into perspective, using the South Korean won to U.S. dollar exchange rate at the end of 2021, EVE Online and EVE Echoes combined for $61.2 million in revenue. CCP most likely didn't sell $20 million in PLEX in 2021, that is just the value of the market.

With so much real life money spent by players on ships, skill books and skill points, implants, etc, what is the big deal about selling a mining barge? Especially since CCP has sold fitted ships in the past.

Doing some research revealed eight starter packs sold from 2013-2015 with ships with all the fittings. I even found a YouTube promotional video for the packs with exploration frigates.


The packs I found were:
  • EVE Online: Starter Pack – Amarr Explorer (Magnate)
  • EVE Online: Starter Pack – Asteroid Miner (Venture)
  • EVE Online: Starter Pack – Caldari Bounty Hunter (Condor)
  • EVE Online: Starter Pack – Caldari Explorer (Heron)
  • EVE Online: Starter Pack – Gallente Explorer (Imicus)
  • EVE Online: Starter Pack – Minmatar Arms Dealer (Rifter)
  • EVE Online: Starter Pack – Minmatar Explorer (Probe)
  • EVE Online: Starter Pack – Plasma Planet Command (Epithal)
The big difference between the packs sold years ago and the one introduced last week was the ships back in 2013-2016 were only available on either freshly created accounts or trial accounts a player was converting into a subscribing account. Theoretically, a player could decide to purchase the Prospector Pack every month for the 30 days game time, 100 PLEX, and a new Retriever, ship insurance, and possibly an indeterminate amount of skill points. I'm not sure who the tokens used to redeem skill points works.

I should also point out that CCP already sold "fully-fitted ships" before the Prospector Pack arrived in the cash shop last week. The company currently sells the four racial frigates with fittings in the following Expert System packages:
  • Amarr Explorer Pack
  • Caldari Explorer Pack
  • Gallente Explorer Pack
  • Minmatar Explorer Pack
These packs, selling for $2.49, did not raise any concerns before now. As far as I know, they still don't.

Do players need to worry about a slippery slope? Brisc in his letter thinks so.
We cannot, in good faith, tell any player concerned with this sale that this is as far as the line goes, because we have seen, twice now, CCP willingly cross a line that we were confident was strictly off-limits. The concerns that players have that CCP will begin selling cruiser, battleship, carrier, dread and even supercarrier and titan fitted ships for cash - concerns some of us would have said were unfounded just yesterday - are legitimate now, and should be listened to.
Beginning in February 2016, another big source of income for CCP involved the sale of skill points. Whatever the pros and cons of the decision from a design perspective, I thought the implementation was horrendous and about as blatant of a money grab as one would ever find in gaming. Here is the list of items required for a character designed to sit in a skill point farm for 1 month.
  • 30 days of game time (500 PLEX).
  • 2 Multi-Pilot Training Certificates (485 PLEX each)
  • 9-12 skill extractors (140 PLEX each)
Now multiply by 100 and that is how much PLEX people needed to purchase from CCP for a skill point farmer to run a 100 character farm. Add in that players often purchased ISK to buy the skill injectors off the market (which is additional PLEX sold) and pretty soon one can see CCP was raking in a lot of cash off their primary market operation.

In order to sell the idea of skill point sales to the player base, CCP published a dev blog in January 2016 making the following statement:
"It’s very important to note here that this means all the skill points available to buy on the market in EVE will have originated on other characters where they were trained at the normal rate.  Player driven economies are key to EVE design and we want you to decide the value of traded skillpoints while we make sure there is one single mechanism that brings new skillpoints in to the system – training." [emphasis in the original]
The statement remained true until June 2019. At that point, players noticed a starter pack that included 1 million skill points. We know the pack was aimed at new players due to the inclusion of an item only usable on accounts younger than 35 days. However, 1 million skill points for $4.99 was a steal.

The timing of the introduction of the starter pack was interesting, coming 8 months after the sale of CCP to Pearl Abyss and 3 weeks ahead of the financially disastrous Blackout. At the time, the inclusion of the 1 million skill points in the package was explained as a simple mistake. Fast forward 2 1/2 years, and 7 of the 10 packs in the cash shop contain skill points.

At this point, I normally would conclude my post, passing judgement on the subject. But in the long run, what I think just doesn't matter. Something said on the Q4 2021 earnings call about how the EVE IP will raise more revenue now makes more sense.
In the case of EVE, we will strengthen service in China through holding Fanfest with Chinese users and through other ways. In addition, we are preparing for new types of service through taking into consideration the changed preference of users and the diverse ecosystem changes. [emphasis mine]
Now, we know that one of the changes designed to bring in additional revenue in EVE Echoes occurred in February with the ability to purchase ship insurance with PLEX. That's right, mobile game players can recover expensive ships they lost by spending a little real life money. If players in EVE Echoes can replace lost ships by swiping their credit cards, why not allow EVE Online players to purchase fitted ships the same way? Two weeks ago, I would have considered the thought absurd. Now? I don't see why CCP wouldn't inch their way into making the practice accepted. 

Looking at Pearl Abyss' revenue going back to 2019, I see cause for desperation coming from the offices in Anyang. Since 2019, game revenue from Pearl Abyss' two major intellectual properties has fallen 32.8%, from ₩539.5 billion in 2019 down to ₩362.8 billion in 2021. Crimson Desert, the company's next big game, was supposed to release in the Winter of 2021 but still has no release date. For now, the South Korean game maker is relying on the launch of Black Desert Mobile in China sometime in Q2 and a mobile game based on the Black Clover IP in the second half of 2022 to boost revenue. Anyone who thinks our overlords in Anyang are not encouraging CCP to squeeze every penny possible out of EVE Online has probably borrowed a tankful of copium from a World of Warcraft player.

Honestly, this article took a much darker turn than I originally imagined. I want the services hinted at to investors in South Korea proclaimed to the world at Fanfest. Services that the player base will love. Services that don't include selling ships in the EVE Online cash shop. Hopefully in the run-up to Fanfest in May CCP will start dropping information showing I'm completely wrong. But I have my doubts. I really, really do.

Thursday, March 3, 2022

Player Counts In EVE After The Russian Invasion Of Ukraine

On 24 February, forces of the Russian Federation began an invasion of Ukraine. The Nosy Gamer is not a blog about real world war. Unfortunately, real world events intrude into our virtual worlds, and such is the case with last Thursday's invasion.

EVE-Offline.net data for the last 30 days

One of the countries imposing sanctions on Russia is Iceland. Compared to the fishing industry, I expect the impact on CCP is not so great. But Tranquility is experiencing approximately a 10% drop in average concurrent users. 

EVE-Offline.net data for the first week of the invasion

The average concurrent data on EVE-Offline.net showed an average of 19,000 concurrent players over the past week. The drop is somewhat in line with the number of Russians and Ukrainians playing EVE. But the number is rather imprecise, as the average number of concurrent users varies by plus or minus 500 users.

Jester's Trek Average Concurrency numbers

The last place to check for numbers is Ripard Teg's old site. He usually updates the average concurrent user numbers at the end of the month. Apparently he was curious about the effects of the invasion, because the chart above was updated yesterday. The 7-day average for the ACU was just under 21,000 before the invasion, dropping to under 19,000 on 2 March.

Looking at the data sources, login activity is down approximately 10% since the invasion. I have to wonder if the same holds true for a lot more games than EVE. The big difference is, with EVE, all players play on a single shard, so we get to see the effects of an event affecting players from other parts of the world. Most other games have geographically segmented servers, which hide any drops. Should make for an interesting round of investor calls in 2-3 months.

Tuesday, March 1, 2022

Star Citizen On Pace For $100 Million In Sales In 2022

Following the announcement of changes to the Star Citizen developmental roadmap at the beginning of February, a lot of haters decided that players would finally abandon Cloud Imperium Games. Not I. As I wrote a month ago, "Until I see evidence to the contrary, I see the CIG money machine continuing to roll on for the foreseeable future." And I still hope Chris Roberts is able to raise $1 billion, even though I wouldn't invest in a company he runs, or pre-order a game he develops. But despite the hopes of many, the CIG money machine rolled on.

The RSI Funding Page at the beginning of the day on 1 Mar 22

During the first two months of 2022, CIG raised slightly over $14 million. The figure is more than CIG received in sales in the first 3 months of 2021, a record year for the company. As a reminder of how well the company is doing financially:

  • 2020 - CIG received $88.2 million in revenue from all sources, posting its first profit since 2014.

  • 2021 - CIG recorded $84 million in revenue in virtual sales as recorded on it funding page. Other revenue sources will likely push the number up around $95 million. The public won't know until the financial report for 2021 is posted sometime in December.

With CIG already ahead of its revenue generation by $5 million after two months, I would say the company should reach $100 million in sales in 2022. And I'm still rooting for Chris Roberts to collect $1 billion before all is said and done.

Monday, February 21, 2022

Final Fantasy XIV's Naoki Yoshida On NFTs

On Friday, Final Fantasy XIV's producer and director Naoki Yoshida (aka YoshiP) hosted the 68th Producer Live Letter. Before the actual stream, the technical staff conducted some testing, during which Yoshida told a story about an interview with a Japanese business publication. Anyone following my coverage of Pearl Abyss earnings calls can guess the subject. That's right, the metaverse. The lack of NFTs was a surprise.

Of course, Twitch chat was opposed to the idea of NFTs in Final Fantasy XIV. But what about Yoshida? I figured I'd transcribe what I see on YouTube. The first quote directly relates to the interview and starts at 25:16.



We're hearing things. We're seeing the comments in Twitch saying, "No NFTs! No NFTs!" But just wanted to clarify like NFTs and the metaverse are like unrelated to each other. And what we're discussing here [the metaverse] is a bit more interesting that that.

There's no way we are going to be including -- we're not going to be including NFTs in 14. So please, I think we can drop the subject. We need to calm down a little bit.

A few minutes later, Yoshida returned to the subject (at 30:58 of the video).



We did notice a lot of reactions from, especially from the western users about the NFTs. Many comments about how you are opposed to NFTs. I do understand that our CEO Matsuda had commented on the concept of NFT in his New Years greetings, in his messaging. There may be a bit of sensitivity, a little bit of nervousness happening around the topic.  

I did mention it earlier but basically how Final Fantasy XIV is designed, we don't intend on incorporating any sort of NFT element in the game at this point. So if anybody is worried or concerned about it, I can clearly state at this time we do not have any intentions to incorporate that into the game. 

But looking at how people are reacting to the subject matter, there also seems to be a good amount of people who may have misconstrued that this is something like a mining effort that is something you are digging up. And there might be some misconception of what exactly an NFT is. 

If there is an opportunity to speak to the subject of NFTs in an interview that is completely unrelated to Final Fantasy XIV. Because it is an opportunity for a new business model and I do believe that the vehicle itself could potentially be something that makes the concept of a video game a little bit more interesting. But that being said, we would need a specific game design that would accommodate for that concept of NFTs. So if there ever is an opportunity to go into it in deeper detail I would  like to talk about it. There's a potential of utilizing it without going in a wrong direction or a bad direction. 

With any sort of video game, I think before we even talk about the financials or monetary discussions, we need to make sure the game itself is fun. Are there fans of the game? That is a very important piece that we need to keep in mind with games. 

Again, no NFTs in FFXIV so don't worry. 
Honestly, I'd rather write about happier topics like the renewal of the free trial of Final Fantasy tomorrow. Did you know starting tomorrow, you can play through the entirety of A Realm Reborn and the award-winning Heavensward expansion up to level 60 for FREE with no restrictions on play time? Or course, for those wishing for a more solo-friendly experience, they might want to wait until patch 6.1 drops sometime in April. But that's a subject for another post.