Cash Games: Activision Blizzard and Hearthstone

The “Money Games” section continues to talk about the principles of management and monetization of the largest and most popular game development companies and those of the games (“labels”) they release.

History reference

Fact 1 : Blizzard is an American computer games developer, publisher of the legendary “non-dying” series of Starcraft, Warcraft and Diablo (Lost Vikings does not count).

Explanation : Founded on February 8, 1991 by three graduates of the University of California at Los Angeles (UCLA): Michael Morheim, Allen Adam and Frank Pierce, before Blizzard the company was called Silicon & Synapse, after the merger with the game publisher Activision - Activision Blizzard. Before the merger with Activision, the company completely buys off Vivendi. What happened between these events is described in detail by Wikipedia :

In 1994, the company changes its name to “Chaos Studios”, but soon it turns out that this name is already taken, so the studio changes its name to Blizzard Entertainment. In the same year, the company was acquired by the distributor Davidson & Associates, for $ 10 million. Some time later, Blizzard launches its first hit, Warcraft: Orcs & Humans.
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Then the owner of Blizzard changed several times: Davidson was acquired with Sierra On-Line by a company called CUC International in 1996; in 1997, CUC merged with the hotel, real estate agency and car rental (eng. HFS Corporation) in the company Cendant Software. But in 1998, it was discovered that prior to the merger, CUC was involved in large financial frauds. Over the next six months, Cendant shares fell 80%. The company has sold software development subsidiaries, including Blizzard, to French publisher Havas. But in the same 1998, Havas was bought by Vivendi.

Each game of the company becomes a bestseller, an unofficial motto: "We make only hit games." The company is separately known for the struggle for "invisible" development, when, before the official presentation, no minute details are leaked to the public. And if it leaks out, the perpetrator of the leak is dismissed in disgrace (admittedly, this happened only a couple of times).

Headquarters: Irvine, California. Additional offices are San Francisco, Austin (Texas), Versailles (a suburb of Paris), Cork (Ireland), Stockholm, Seoul, Shanghai, Taipei and Sydney.

Fact 2 : Warcraft is the first “serious” Blizzard game. In many ways, it was Warcraft that shaped our ideas about orcs, elves, people and their interrelations (although, of course, the basics of these ideas were laid earlier by Tolkien, but the fact that they had already influenced Jackson, who made films), depicting the first original but brave warriors seeking an alliance with other races for the sake of their world.

Explanation : It was Warcraft that became the game that clearly showed the benefits to players all over the world: A. Real-time strategy; B. The semantic and ideological fullness of the virtual world, the background of its existence and In . Long beta testing of games and improvement of all the little things as the only way to sell the game successfully for many years.

Subjectively : Warcraft became the first "cash cow" of the company, showing competitors that this is possible at all - maintaining and developing the central game "idea" through the release of large-scale updates of the game world, without introducing (fundamentally) new game mechanics (about the largest representative of this tribe - Sims, we'll talk separately) for years.

Fact 3 : Hearthstone is the continuation of the ideas of Warcraft, and the second part of the name “Heroes of Warcraft” speaks about it directly, and the general “information background” of the game hints about it every second. The general “tone” (in English there is a convenient term “flavour” - flavor / taste, this complex concept refers to the perception of a particular “meta” (that is, a common “gaming environment”) and those individual actions that take place in it) was given still in the desktop CCI World of Warcraft Trading Card Game, which became the basis of the network and casual Hearthstone.

Subjectively : The keystone of any CCI is exactly the “flavor” (flavour), which it is capable of transmitting to players during events on the playing field. Blizzard, having a long history of Warcraft and a powerful environment of this brand as such, made the only correct conclusion - to use the most popular world to immerse players in a card "board" game at a computer or mobile device. You are a hero resting in a tavern playing cards.

Explanation : Blizzard knows its business well, its audience, and in the process of working on a real (that is, physical) card game, the Magic Gathering Pro Tour participants were attracted to its improvement (the MTG world championship is a prototype of all modern CCIs, whose connection with Hearthstone is explained below).

Excursion to the genre

Fact 1 : On the one hand, Hearthstone is a classic CCI that has managed to take all the best from Richard Garfield’s main creation, Magic The Gathering . Garfield, in turn, was strongly influenced by Harry Gyigex and co-created with Dave Arneson by the Dungeons & Dragons - in fact, the foundation of any modern role-playing game, its deepest foundation.

Subjectively : “Take all the best” is to abandon the mechanics that prevent, if one can put it that way, MTG itself. Initially, Magic: The Gathering did not conceive Garfield as a collectible game, namely card, in which the concept of a stack or a waterfall of events existed in the center of the player interaction model. All events fall into a logical sequence from top to bottom (packed into a stack), and the results of drawing each card separately (so-called resolve - “have consequences”) also occur from above. That is, the last card played first has an effect on the field, and not vice versa.

On the other hand: in Hearthstone, the concept of “stack” is absent as such. And each new move by default brings at least 1 crystal of "magic" (analogue of "mana") to their maximum of 10 units per turn.

Fact 2 : Another serious problem with the MTG concept is “manapul”. Lands (lands) are the source of the resource (mana) needed to draw cards of the corresponding faction (or color). If you have no lands, you will lose, no matter what. Just as you can be “flooded” (flood) with lands alone, so you will not be able to effectively develop the situation on your side of the playing field.

Fact 3 : The third problem, which, in fact, is not a problem, but a side effect is the collection of MTG cards itself. The fact is that due to the basic model of distribution of new cards through random sets (15 randomly distributed individual cards, but always an understandable structure within the framework of the in-game hierarchy of "significance" of the cards). At first, this problem almost killed Magic The Gathering, and after the publisher and copyright holder of Wizards of The Coast changed the tournament formats and “expanded” the field of using individual cards, collection became the main measure of success for any CCI. In today's MTG, the cost of entering a high level of a game (tournament) is hundreds of US dollars, and in an exclusive one, it is prohibitively high. The cost of individual, rarest, cards amounts to tens of thousands of dollars.

Explanation : In Hearthstone, as I have already mentioned, there is neither a stack, nor lands, nor mana, nor collectibility (if such a concept is generally applicable to the picture on the screen drawn on Unity). In general, this is what can be called, if not the reason, then the condition of the popularity of the virtual-online CCI. Since the absence of complex mechanics simplifies the interaction of players during the game, and on mobile devices, only such games receive the right to exist (as was proven by Zynga and other casual game companies by companies over the past few years) - Blizzard has found a recipe for success.

Fact 4 : The last thesis is proved back by the fact that Wizards of The Coast itself did not succeed in successfully porting its own "non-creeping" brand, mechanics and the world to the online, although there were several attempts - with standalone games of the Battle of the Playwalkers MTG universe, affecting scenario events), and with MTGO (O = Online). The game simply “did not take off,” largely due to the complexities of transferring complex mechanics 1. On the screen and 2. Online.

Product management

Fact 1 : Publishing is Hearthstone's forte.

Explanation : The term “publishing” in game devs means the entire set of actions for conveying game content to a user-player. This is a distribution platform, and a model for receiving, highlighting, winning new cards or getting new mechanics, and finally, the ability to spend real money.

Since Hearthstone is currently the only CCI that successfully spreads on mobile devices, and the first to succeed in doing so effectively, the number of players in this game is simply incomparable with the audience of other card games, similar or not. We can say with confidence that access to tablets and smartphones made Blizzard a big cashier and greatly increased the market ceiling in absolute consumers. Before them, this model simply no one dared to implement.

Fact 2 : Well, of course, there’s no bad luck - commissions of mobile app stores reduce the company's total revenue with Hearthstone, since the pricing policy cannot be different for the desktop and mobile phone, but Apple and Google take the commission for in-game purchases not going.



Fact 3 : But even this did not prevent Blizzard from coming up with a monetization strategy that differs from industry standards - these are large-scale additions. It's funny that the already well-worked out scheme (on Warcraft and World of Warcraft, Starcraft and Diablo) for the release of large-scale updates of the game worlds has proved its worth for KKI. Such experience among game publishers appeared only recently (as an example, Garfield’s latest creation - Android Netrunner, also exploiting the best of MTG mechanics, adding a lot of interesting “above” and not trying to build a collection market from individual cards, on the contrary - equalizing all additions (and hence, the individual cards, they are available) at a cost).

Fact 4 : So we got to the most important thing - money.
It is not possible to find official confirmations of this thesis - Activision Blizzard is a private company that does not publish either income data or audit results, so it’s impossible to find out what amount or at least the profit share obtained by Hearthstone. But it is possible, indirectly, in terms of volume, to approximately understand what is happening with the monetization of the game.

• The greatest number of players among all CCIs: the greatest platform availability of the game and zero entry cost work in favor of this hypothesis.
• A good F2P economy, allowing an active player to get results without spending real money, but time.
• Predicted check: no game can predict how many cards, boxes or boosters / decks (deck for the game) will be purchased by the consumer after the release. Warehouse resources of numerous resellers do not reflect the actual shipments to customers and the entire logistics of the collection market is extremely opaque. At Hearthstone, large updates have an average cost and come out at predictable intervals, the conversion of players into the purchases of these add-ons is most likely obvious to the company.
• Audience: Hearthstone is a game with vivid pictures and effects, rich dialogues and voice acting, and also, which is extremely important - the lack of the ability to run into negative (with an opponent you can "communicate" by 6 programmed phrases during a separate match / round).

And to paraphrase the famous: "Make love, not Hearthstone."
And what are you playing?