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World of Warcraft Loses 2 Million Subscribers in a Year

Activision Blizzard's online cash cow loses 800,000 subscribers, continues to decline as subs drop to 10.3 million worldwide.

World of Warcraft's eventual demise, at least as we currently know it, was probably inevitable. Even the most storied massively-multiplayer games have shelf lives. So to hear that Activision Blizzard lost around 800,000 subscribers in its latest quarter—a drop from 11.1 million to 10.3 million subs worldwide—shouldn't be a jaw-dropper. The game will be seven years old in just a few weeks (it launched on November 23, 2004), and it's been hemorrhaging players since October 2010, bringing total losses the past 12 months to around two million. Whether the decline continues as sharply or slows to a less precipitous bleed or the game even rebounds slightly when its next expansion arrives, the writing's on the wall.

The good news: Activision Blizzard said on an earnings call yesterday that it'll pull in more than expected this year thanks to first-person military shooter Modern Warfare 3, which launched yesterday. But that wasn't enough to allay investor unease as the company's nigh teflon MMO cash-cow took a serious subscription dive, a drop mirrored in its shares as the stock, which had been up after the improved earnings outlook, dropped over 3 percent in after-hours trading.

That drop's bad news any way you look at it, according to Wedbush Morgan analyst Michael Pachter, who notes that while Activision Blizzard blames the WoW subs loss on Asian defectors (where subs run $1 a month), he expects subscription growth in the West (where subs run $15 a month) "to be further challenged when EA launches Star Wars The Old Republic MMO in December."

"This trend is not good, especially when this business is their bedrock, their most profitable revenue-recurring business," Pachter told Reuters.

What's more, Pachter frets about Blizzard's reliance on franchises that may experience serious player fatigue going forward, noting the Call of Duty franchise has had "an unprecedented run," but that "nothing goes up forever." Indeed, user reactions to the game have so far been mostly negative on sites like Metacritic, the chief complaint being that Modern Warfare 3 is essentially staid, recycled content.

Activison Blizzard's plan to mitigate WoW subscription dropoff? Same as it was back in August: Develop more content, ideally with enough complexity and comeback appeal to prevent vets from signing up, gobbling it down, then unsubscribing again.

Next up for WoW: another content update, though on the earnings call, Blizzard CEO Mike Morhaine said (via Gamasutra) "it's really not intended to go out and drive new user acquisition, that's a whole other strategy. But it does drive engagement with the game, and so that will impact churn if we do it successfully, and will eventually drive winback, as players tell each other about the content they're enjoying."

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