Blizzard Entertainment had the largest Q1 online player community in its history, up a double digit percentage year over year despite no major launches in the quarter. As expected and consistent with our experience following prior expansions, we saw a decline in the World of Warcraft subscriber number. Subscribers ended the quarter at 7.1 million. World of Warcraft’s revenue performance at constant FX has been more stable, driven by continued strong uptake on value added services, and price increases in select regions, which partially offset subscriber declines, particularly in the East. World of Warcraft remains the No.1 subscription-based MMORPG in the world.
Activision-Blizzard Earnings Report for Q1 2015
The East is always letting World of Warcraft down. What is it they want over there?
Well, we knew subscriptions would go up when Warlords of Draenor shipped, though perhaps how early the number went up was a bit of a surprise. And it lasted through the end of 2014 as expected. The real question was how long the bad guys in Draenor could hold the 10 million subscriber number.
How can you leave these guys?
The answer is, apparently, less than six months.
Not that 7.1 million subscribers is anything to balk at. That is still a player base any four current MMOs could divide amongst themselves and each feel like a huge success. (And that same subscriber drop would kill any competitor.) But this is World of Warcraft and forever will that “more than 12 million” number dominate its destiny.
Of course, the money is still coming in hand over fist, though the strong dollar looks like it will be an issue.
Given the weakening of foreign currencies versus the U.S. dollar, the company’s 2015 international revenues and earnings are expected to be translated at lower rates than in 2014. This impacts the company’s 2015 outlook as compared to 2014 actual results given approximately 50% of the company’s revenues, and a higher percentage of profits, are generated outside the U.S.
So you have to have to wonder if the game will continue its “expansion about every two years” trajectory as subscribers bleed off during the between times. I won’t even say “the dead period” as there still seems to be a lot to do and more is coming up. But for some people, the leveling game is all she wrote, and those were a quick ten levels.
The report mentioned other irons that Blizzard has in the fire.
Blizzard’s slide from the deck
There was also a bit in there specifically about the WoW Token being launched. Though that might keep some gold-rich subscribers in the game longer, it isn’t any sort of revenue machine like the base subscription.
So are we going to see an expansion sooner this time around? Or will there just be more content released before the next box shows up?
The Ancient Gaming Noob 
Just as a thought experiment, what might happen to subscriber numbers with particular regard to post-expansion retention if the next expansion added 25 levels and each of those levels took the average player days not hours to complete? How about if all the expansion content was easy to access but took a very long time to complete? Would people hate it but feel compelled to complete it?
In other words, could Blizzard play more with the levers to control the subscriber flow than they currently seem to be doing? Or is customer loyalty predicated too firmly on instant (or very fast) gratification now for that kind of approach to play any more?
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I’m also really curious how many subs they lose from gold farming accounts now that Blizz sells their own gold. In the “old days” you would read accounts that certain farm shops would have 5000 accounts running. I know they swapped from gold farming/botting to account stealing.. still, curious!
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Chart post from in an age
3,000,000 subs gone. $45,000,000/month. Seems like that would be an incentive to make expansions more often… I know content is hard, but…
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@sleepysam – Yes, if all 3 million were month to month players in the West. If all 3 million were in China, where they pay a small fraction of that to play, and where Blizz only collects a percentage after expenses, that number might be much smaller. I imagine the number is somewhere in between.
And, as I said, when you’re bringing in a billion dollars a year in revenue, risking what you have to crank out less thoroughly vetted content is necessarily an easy decision.
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Yes, you are correct on my math being on the high side due to the East, although with the shop, etc, maybe it’s not so far off. Either way, interesting.
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@sleepysam – It is still a huge drop though, so I am curious to see what Blizz does, if anything. There was an implied promise not to have another 13 month content drought last year, so we have gotten the 6.1 updates and have 6.2 coming shortly. That seems to be their plan in progress, but I guess that was not enough for nearly 3 million people.
@Bhagpuss – Back to you! Yeah, I wonder what the real answer should be. Part of me is thinking about a new expansion paradigm where each expansion is its own world and as you move characters into it, you’re back at level 1 in that world sort of like… and I hate myself for using anything from Zynga as an example… the way they did with Mafia Wars, where each new location was a fresh start.
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Well, it’s now December and subscriptions have continued to plummet. They’re now down to 5 million and falling – to the point where Blizz has announced that they’ll no longer be releasing sub numbers. I call that sulking.
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