SuperData and the Curious Case of the Missing WoW Money

SuperData Research released its 2017 report looking at how much money was spent on video games, sliced up into different segments.  You can download the report from them, it is free, unlike some of their other reports. [Edit: Link removed, SuperData has been shut down.]

Yes, I know, SuperData’s numbers are flawed, though probably not in the way you think.  As a market analysis firm, they have relationships with the companies on which they report.  They are not some group of rando outsiders om Spokane making wild guesses by looking at Steam charts and trying to get data out of the App Store.  They get financial information directly from most of the companies they track.

The companies cooperate because there is a quid pro quo in play.  SuperData only covers a limited number of companies generally, but those companies tend to be publicly traded… or have aspiration to go public some day… or are in bed through licensing with another company that is public… and they want analysts to say nice things about them because that may boost their valuation and, thus, their stock price.

The flaw in the data often comes from what the companies choose to give analysts and how they package it.  I speak from experience on this.  I recall one year the marketing director at a company coming to me to ask me about what new features we were working on for our main product.  He was working on our annual puff piece for Gartner to tell them how great we were.  So I listed out the key items from the road map and he gave me a sour look and said that we told Gartner we did all of that last year or the year before, he wanted something new!

So yeah, the analyst is only as good as the data they get, and companies will lie… though when it comes to financials, they can’t make stuff up if they’re a public company.  They can, however, withhold data or refuse to break things out in a way that the analyst would want.

All of which brings us back to SuperData and their 2017 report.  They have several nice charts which, unlike their monthly reports, have dollar amounts attached.

SuperData 2017 Mobile Market Chart

There is a lot of money in mobile games.

Then there is the free to play PC games chart.

SuperData 2017 F2P PC Games Market Chart

League of Legends dominates that with over $2 billion in revenue in 2017, something I am sure Tencent wants its institutional investors to know.  But the low end of that chart is a lot lower than the low end of the mobile chart.

Then there is the Premium PC chart, the traditional “buy the box” model, though the top end of the chart has DLC and other additional revenue streams.

SuperData 2017 Premium PC Games Market Chart

Hey, look, Guild Wars 2!  Shipping a new box in 2017 no doubt helped them to get there.  Also, you can probably go back and look at the first three quarters of earnings reports for NCsoft in 2017, add up the GW2 revenues on those, subtract that from the number on the chart, and have a good guess at what the Q4 number will be. (Should be about 46,560 on the GW2 section of their usual chart, which is measured in millions of South Korean Won, if I calculated that correctly. That would be a big boost from Q3.)  If that is on the money, then there is only one possible source.  And if it is different… well, then we’ll have some evidence of something else.

I am dubious about Minecraft. That seems like a lot for just the PC market, though that may be because I focus on the Java Edition, which is its own beast.  The other, unified cross platform edition has all sorts of DLC, even on Windows 10.  And, again, who knows how Microsoft packaged up the data.  They might have said, “This is the Minecraft number,” declining to break it out.

And, finally, there is the consoles chart.

SuperData 2017 Console Games Market Chart

Consoles seem to be about shooting people and playing soccer.

There are no billion dollar earners on either of those last two charts.  GTA V on console is worth a quarter of League of Legends when it comes to annual revenue in 2017.  Then again, half a billion dollars is still nothing to sneeze at, and it is a hell of a lot of money for a game that shipped on consoles back in 2013.  But, then again, League of Legends showed up in 2009, so being new doesn’t have much to do with revenue I guess.

Anyway, interesting charts to look at and compare.  Each of the numbers are probably true in the right context, but the chances of us knowing that context is pretty slim.

But in looking at all of that, there was a glaring omission in my book.  World of Warcraft is nowhere to be seen.  After all, it has appeared on every monthly SuperData chart in 2017.  Why would it not appear in the final report?

My first thought was that it just didn’t fit nicely into any of the categories.  And I suppose that might be the case, but I doubt it.

My gut says that Blizzard wants it this way.  As noted above, analysts are at the mercy of those providing the data, and I think the only way that SuperData would have skipped WoW is because Blizzard held back that data or told them they couldn’t use it in a publicly available report.  I back this up with how Blizzard has tried to obscure information about WoW in their financial reports.

At first that was because of the subscription drop panic.  But later, when it became more thorough, I began to suspect another reason.

I think that this is all because Blizzard is trying to remove the idea that the company is dependent on WoW for the bulk of their revenues.

There was a time when that was the case, when it was WoW paying the bills and a few people buying Diablo II or Warcraft III battle chests bringing in what amounted to some spare change.  But Blizzard has moved on from then.  As noted in the past, BlizzCon is now about more than just WoW.

When WoW went through its post-Warlords of Draenor subscriber dump, I think Blizz realized that they needed to shed the image that Blizzard = WoW and nothing else.  They don’t want people to think that if WoW dies, Blizzard dies.

As part of that Blizzard began to pay a lot more attention publicly to the other titles in its catalog, which has expanded quite a bit since 2008 or so, when WoW was pretty much it.  So in the charts above you see Hearthstone in free to play and Overwatch in premium PC games.

But you don’t see WoW, not because it didn’t make enough money to place, but because Blizz doesn’t want that to distract from its other titles.

I also think this is the reason that WoW got split into East and West earlier in the year, so that other Blizzard titles would be seen to have passed WoW.  That wasn’t some rando analyst choice.  Analysts don’t do that, they like their data to be consistent over time.  That gives it a greater sense of validity.

And I know WoW would make the charts.  We can derive that from past data.  Throughout 2017, World of Warcraft was on every SuperData monthly chart, and for 10 out of 12 months it was ahead of World of Tanks, which did make the chart.  WoW was also ranked ahead of World of Tanks at the first six months of 2017 summary from SuperData.

So I think we can safely say that WoW made more than World of Tanks, which itself brought in $471 million according to the charts above.  And WoW making even a dollar more than that amount would put it well ahead of Overwatch ($382 million) and Hearthstone ($217 million), the next two highest earners in the Blizzard stable.

We don’t know how much World of Warcraft actually made in 2017, but it was likely in excess of half a billion dollars, and could be a decent chunk more than that.  I could probably find out if I wanted to spend two grand on SuperData’s MMO and MOBA report, but I am not so inclined. Still, even my guess is not bad for a game from 2004.

And it seems likely that WoW will pop up a bit in SuperData’s monthly charts for January and February with the Battle for Azeroth pre-orders having hit on Tuesday.  The payment system was bogged down from the effect of people trying to throw money at Blizzard.

So World of Warcraft isn’t dead.  It isn’t even resting really.  It seems to me to be more a matter of Blizzard having the problem in not being able to create something to surpass WoW.   So rather than submitting their other titles to that measure, they’re trying to hide it.

Anyway, that is my working theory.

Meanwhile, a bonus chart from the report, and one I am sure Blizzard really likes, the esports viewership.

SuperData 2017 esports Viewership Chart

The measure on that chart is “average monthly unique viewers” for 2017.

(Also, as a side note, they chopped the market up into Twitch 54%, YouTube 22%, and everybody else making up 24%)

Blizzard likes that chart because Heroes of the Storm gets a mention, and it is the only place it is likely to get one.  StarCraft II is also there.  But Heroes of the Storm gets barely a tenth of LoL’s viewership, and less than a quarter of DOTA 2’s.  More interesting is that it also only gets a quarter of Overwatch’s viewership and less than 20% of Heros of the Storm’s viewers.

StarCraft II, son of the original esports champion StarCraft, seems a bit sad down at the bottom of the list.  But Blizzard does have four games on the list (and WoW isn’t one of them) which added together, had more average viewers than League of Legends.  Not bad.

Also, Hearthstone is Blizzard’s most popular esports game.  Imagine that!  We’ll see if the whole Overwatch league changes that in 2018, but for now that is how it stands.