A little while ago I wrote about what happened to City of Heroes 2.0 and how any new projects raised by Paragon Studios failed to get the interest of NCsoft needed for them to continue. I didn’t continue anything else in this area because pretty quickly a request went out to the source to please stop talking because it could damage negotiations and the future of CoH/V.
Given that it seems negotiations are off the table and NCsoft continues to push CoH/V towards the edge of a cliff, that doesn’t seem that is a factor any more. Going through other bits of info online, the first article stirred up a confirmation from another source.
Graham West was a programmer at Paragon Studios who was let go in last year’s 2010’s layoffs at Paragon Studios. Following an article repost elsewhere he made the following comments (which I’ve mostly cut’n’pasted here):
Problems can arise if you are pushed into or accept the position of wallflower – it makes you very easy to ignore.
“CoH 2 as an extension of the CoH universe didn’t really last that long. I was not working on it, so I had limited insight. The high concept was Heroes vs Villains vs Battalion so there could be shifting alliances. Matt really wanted to have ways for the two games to influence each other so it wouldn’t canibalise CoH 1 subscriptions and I believe he had a number of ideas how to do that.
The game as CoH 2 fizzled out in early 2009 if I remember rightly. Then it turned into, as someone mentioned [in the original link], a more contemporary, more gritty, less comic-book-y game set in a world which resembled Earth much more closely. You would be able to travel to cities which riffed very much on real cities – think GTA 4 and New York/Liberty City. The first prototype used a chunk of London. The game was targeted for 2014. Several things happened in a parallel; a good chunk of work was done on a fantastic graphics engine, a number of game systems were prototyped as board games (I only got to play one but it was a pretty fun and cheap way to explore concept), art prototypes and backstory were developed.
The real kicker in all of this is Guild Wars 2. The game was pushed back several times and ArenaNet had a large number of people working on it. That meant it was expensive. The later the game got, the more it impinged on Paragon’s game, and Carbine’s game which was before it in the queue, so to speak. Eventually, in mid-2010, Paragon’s game was 5 years out and it didn’t really make sense to keep spending a bunch of money on it. Better to wait a couple of years and take advantage of better knowledge of both technology and business models.”
Reading between the lines above, part of the reason for the delay appears to be to wait for Guild Wars 2 to launch so that more resources could be allocated to a Paragon Studios project. Hindsight is 20/20 and all, but that turned out to be a bad decision for the studio – it left them with all eggs in one spandex-lined basket.
And after Guild Wars 2 launched, Paragon Studios / CoH/V would then potentially have to deal with rabbit girls.
Since Guild Wars 2 didn’t launch until August 2012, it also delayed the large-scale start of any new Paragon Studios project (although there have been rumours of another title started a few months before NCsoft decided to close CoH/V). And if Paragon Studios’ next project delayed serious development moves until the launch of Carbine’s Wildstar… well, that’s a long wait between titles.
During this delay on seriously starting another title, the continued development on CoH/V failed to generate additional revenue growth for NCsoft.
I can’t help but see the parallel in this approach and what happened in the wake of Tabula Rasa’s development and launch. With such a large and important title like Tabula Rasa under development, other titles were left scrounging for resources and eventually were shut down. Of course, Guild Wars 2 appears to have been a success where Tabula Rasa wasn’t, so it appears to focusing of resources on ArenaNet’s title worked out well for NCsoft to date, but was nothing but downside for Paragon Studios / CoH/V.
EDIT 8 October 2012: Realised that Paragon Studios got attention for laying people off in 2010, not 2011, and adjusted that point.
World Class Villains 
I am reminded quite strongly of the fate of Looking Glass Studios under the publisher Eidos Interactive some years ago. They produced many critically acclaimed games with modest sales that were only marginal in their successes, but were dragged down by the spectacular costs of Eidos running the new studio ION Storm. Projects were cancelled or pushed back because of waiting on a return on investment from the publisher’s new flagship studio (which had yet to release anything of measurable value). In Eidos’ case, their gamble did not pay off as their new studio did not produce anything of significant value until many years later, to my knowledge the studio never even came close to breaking even.
It was a calculated gamble at the time that Eidos lost. It appears that NCSoft decided to make a similar gamble with ArenaNet, albeit with a studio that has had an excellent track record to date. Some people still won’t forgive Eidos for their part in killing off a famous and influential game studio in favor of the disastrous high-end studio they decided to front instead, but I figure the financial losses the publisher incurred did enough to satisfy most of them.
Publishers are often quite ruthless with studios that are critical darlings but only modest successes – chasing the big bucks is what drives their long term interests and we often forget that. Video games are art and entertainment but they are also business. NCSoft’s consistent focus on high-margin titles in all of their investor paperwork and offerings show that they would rather gamble big and win/lose big than make small and consistent profits. This is hardly a new strategy in video game publishing and I honestly wonder why people are still surprised by this business practice.
NCSoft appears to be a fairly traditional publisher of AAA titles – go big or go home. One wonders how they will handle social media and mobile gaming – their next hoped-for market segment. As maligned as NCSoft has been for torching games that aren’t profitable (or aren’t profitable -enough-) that basically is the cost of doing business with their model. They’re focused entirely on maximizing the next quarter which is a smart (and ethical, from a publicly-traded business perspective) model for a publicly traded company.
The only question for them and any other publisher with the same approach is how many big gamble failures are they away from falling apart. Any guesses as to what hurdles and costs they have to deal with for WildStar and Blade and Soul’s localization?
This approach isn’t particularly new for publishers and it makes a kind of sense – you only have so many resources and putting them into your biggest titles (or titles with the largest chance of success) is a very practical thing to do. But it leads to a lack of diversification in the market: wouldn’t NCsoft be better off with not just GW2, but also another Paragon Studios title (and Blighted Empires and the range of other titles that were shut down)?
Regarding Wildstar, one hurdle for them is that they to get over is launching as a F2P / hybrid title following a long development period. This year has seen MMOs try to launch themselves only to find the players weren’t that interested. I also wonder about its ability to attract players in 2013 and beyond when it seems that MMO tastes are changing.
As for Blade and Soul, it’s a very pretty game, but will it offer enough to attract the kind of player numbers NCsoft wants? The western market is heading towards MOBAs, MMOFPS (or lobby-based online multiplayer titles) and Diablo-likes. B&S looks like a bit of a throwback to the MMOs that the Western Market is moving away from (e.g. Tera)… but maybe they will have some fantastic features I’m unaware or.
So Guild Wars 2 really did take resources away from CoH/Paragon and help lead to its demise (among many complex factors). It just happened in a completely different way than people thought (the “They’re taking our servers!” idea was always ridiculous).
If CoH/V’s additions had been successful in growing its revenue, then it wouldn’t have been as much of a factor, I think. There would have been a better chance of Paragon Studios waiting it out.
In NCsoft’s eyes Guild Wars was a much more successful product than CoH/V (I’d have to check the revenue figures to see how much more) so that was where their focus would lie when it came to allocating resources to a follow-up title.
Pingback: City of Heroes / Villains: Putting Claims To The Test | Vicarious Existence
I was a longtime player of Coh since it began. I had 6 VIP accounts and loved playing the game, it forever will be missed. I do enjoy the reading on this site. As for who I am, myself and my associates are their thinking about putting an offer in to buy the rights to Coh. As I found out more about it, I will try to keep you informed.
If you can convince NCsoft to sell the CoH/V IP where others have failed, you’ll have pulled off a minor miracle.
Make sure you find out what happened to the film rights that were sold off a long time ago.