NCsoft Q1 2020: Double YoY revenue thanks to Lineage 2M, Tencent to pub Guild Wars 2 in China

    
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Business is booming over in NCsoft’s world, though it’s not because of its western holdings. In this first quarter of 2020, the South Korean gaming giant doubled its revenue year-over-year (yes, doubled), from a combination of hopping mobile sales and “stable” PC online games – especially the Lineage franchise titles and specifically Lineage 2M (on mobile), which launched at the end of last year and blew up this year during the pandemic. Part of the huge boost is the comparison to a particularly shabby Q1 2019, but still.

Of course, it’s those PC games that you’re here to read about. Guild Wars 2, Aion, and Blade & Soul all did better in Q1 than in Q4 last year, but they’re all down revenue-wise since Q1 2019. Reverse that for Lineage and Lineage 2, which are up compared to this quarter last year but have suffered a bit since Lineage 2M took off (and presumably pulled away fans).

The investor call offers a few other tidbits, including the news that Project TL will finally enter testing in 2020 and that Blade & Soul 2 is still happening and will indeed come westward.

Analyst Daniel Ahmad also broke the news this morning that Tencent has picked up publishing for Guild Wars 2 in China “soon.” ArenaNet’s MMO launched in China in 2014 under Kongzhong, but Tencent will pub it through WeGame, which’ll put it before the eyeballs of a whole lot more people. And of course, we already knew that ArenaNet is now working on the Cantha expansion for Guild Wars 2.

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miol
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miol

After all these years NCsoft finally improved their charts for better comparison!

Yet I still think there is room for improvement! ;P

-In the first chart are the values stacked upon each other
(They don’t publish total mobile sales anymore,
but the other mobile games [seen barely in dark green] don’t seem to make a dent:
~ 5,000 million KRW per quarter)

-The second one is without the mobile numbers

click to zoom

1q20.jpg
1q20desktop.jpg
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Matthäus Wey

As expected, the Gw2 yoy declined quite heavily.
I also wonder if the Chinese audience is a reason for the sudden change of direction with a catha expansion.

Yangers
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Yangers

It’s interesting, because for all the games lifetime, people kept saying no Cantha xpac because it’ll offend the Chinese government or whatever.

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Emmanuel Carabott

Actually its a little bit more complicated then that. So you know divinities reach, at launch there was the great collapse. Right until launch there was a canthan quarter there but Anet was made to remove it because ncsoft was afraid of sensibilities the Canthan architeture might cause.

From my understanding the issue is as follows, Canthan architecture is a mix of several different Asian cultures. Some of those Cultures didnt get along with each other in the past. Asian culture tends to be very proud of its culture so the fear there from my understanding is some people might feel offended seeing parts of their culture being used in tandem with parts of someone else culture , doubly so if they had a history with that other party.

Now obviously this didnt change so its going to be an interesting question to see what happened here, if maybe they just redesigned the architecture or simply NCsoft will allow them to go forward despite their fear this might be not very well received by some.

Thing is I think they didnt really have a choice. For the past few months the community built a really negative narrative regarding gw2. While Anet essentially tripled the release cadence and even the amount of content released within the same time period A LOT of players were shouting to the 4 winds how Gw2 is now in maintenance mode. They got so loud that even some influencers on the various social media were repeating the same claims even though they were obviously false. Since 2016 Gw2 revenue was on average of 20 billion won a quarter. The quarter where the maintenance mode narrative went in full force it went down to 17b won, its all time low. I imagine Anet had to do some damage control and stop that narrative before more damage is done. In my opinion they had 2 options, either give that crowd what they wanted which was mainly from what I saw was a switch from the living world to raid / fractals. The problem there is it would have polarized the players who enjoy the living world and dont really like raids / fractals. Or option 2 was give the community what it has been asking for since day 1. that is take us back to Cantha.

This is all my theory ofcourse, could be totally off target but I think there are a lot of aspects that support my theory and well if that was the case it mostly worked because last quarter why it didnt hit the 20b won average it came pretty close at 19b won.

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Matthäus Wey

I’m sure the community would have been pleased with any kind of expansion as long as there is one. It being Cantha seems just to be the cherry on top.

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Emmanuel Carabott

For most of the community yes, but I think it would have been a toss of the dice with regards to the part of the community that was so angry as to use bad publicity as a weapon to get Arenanet to do what they wanted. Thing is that part of the community wants more challenging content and Path of Fire was already watered down in terms of challenge compared to Heart of Thorns so it was very possible A new expansion alone would not have made them happy, thinking that it wouldnt bring any new difficult content anyway. Now Cantha being the cherry on top like you said had a bigger chance of success since in addition to being an expansion, something that everyone wants, it is also THE expansion everyone wanted! Still not perfect, obviously if the person in question is not a gw1 veteran, Cantha doesnt really mean anything to them and it will not make a difference but short of giving in to the pressure and shift development focus to challenging combat I do believe this was their only card to play.