Interview with Mythic CEO Mark Jacobs

by Mark Crump on March 3, 2005 @ 1:18 a.m. PST

This is a two-part interview with Mark Jacobs, CEO of Mythic Entertainment. The original interview was conducted at Mythic's offices last year just before the launch of Catacombs, EverQuest 2, and World of WarCraft. Since some things have changed since then, Mr. Jacobs was kind enough to answer some follow-up questions via e-mail.

Q: If there is one myth about your company (no pun intended) you would want to dispel, what is it?

Let's separate that question into two different groups. Among players I think the myth is that Mythic, like all the other MMO companies, only cares about its bottom line. You know, that's something you read about on the boards; every so often a player will complain about "Oh, all you ever care about is making money." I think that is obviously very untrue [and] is very easily disposed of if you look at Mythic's history. We've released two major expansion packs to our players for free. No charge, no nothing, just part of their subscription. We've taken a team that was at the time of launch only 24 and more than doubled it. If we were solely concerned about making the most money we could off the game, we wouldn't do that. So I think that's the myth among the players that is the most untrue.

Among industry developers is the myth that Mythic is just a small one-trick pony. We had certainly done a number of games prior to Camelot's coming out, and now if you look at what we are doing in [not only] Camelot but Imperator and potentially other projects, I think that myth will be very quickly dispelled.

Q: Looking back over Camelot's three years, what about the game has exceeded your expectations?

I think what's exceeded my expectations most was the loyalty of our customers. It's not a game feature, it's simply how many people who signed up, for example, in the first month and are still playing our game. That I think has far exceeded my expectations.

Q: Now the flip question: What great idea just didn't end up going over well at all?

Trials of Atlantis. I think that expansion, you know, we were so gung-ho on it and we thought that users would be very excited by it. Some were, obviously, it's not like it didn't sell; it sold very well. But I think that in the end, through a combination of some mistakes on Mythic's part, as well as some expectations of the players that were untrue. Now, whether it's untrue because they thought Mythic said this, which isn't true, or they expected us to do some things differently than we did, I would say that expansion wasn't everything we had hoped it to be.

Q: There are things about it that I really liked. I liked that you guys could put out another Shrouded Isles but instead went out on a limb and come out with the Master Levels. It's really, as a player, the only part that bugs me is I need to get 40 or 50 of my closest friends together to do some of them, and scheduling them is like scheduling a wedding.

I know, we tried.

We had such high hopes for it. We thought that doing everything in one area, instead of splitting things up into three Realms worth of content would go over well, and I think that mostly went over very, very well. We thought that the Master Levels were what a lot of people wanted. It's the same as with New Frontiers or even Shrouded Isles, we talk to the players. It's not like Mythic is sitting here without reading the Pendragon boards, without being on VN [Vaunt Network's boards], without soliciting opinions. We do. Probably more so than any major game company. Certainly the smaller games, the smaller MUD's and the stuff I grew up on, [have] much closer interaction. But if you look at the big companies and big games, obviously, EverQuest, Star Wars, us, Ultima (still), and City of Heroes, we talk to our players as much, if not more than any one of them.

Q: How to you separate some of the noise you get on the Vault Networks from complaints that are valid?

[laughs] Oh boy! You know, lots of different ways. We look at who it comes from, for example. There are a lot of people whose names we know no matter what we do, they'll complain. What we do is we read the boards, all the boards. We look for commonality among threads. You know, if there are a ton of people bitching about something, the odds are it's true. There are a number of times over the years where the VN people posting knew something before we did. God, do I hate it when that happens, but you know, it happens and there's no getting around it; it's the same with any game company, otherwise there would be no patches. The players find out things sometimes before the developers do. So, I think that is difficult to do, but I think we do it pretty well. I mean, we have enough people reading, and enough people who are in our community who are part of the private testing, [so] we're pretty good at separating the noise, Not always, but pretty good at it.

Q: Using the theory "it's easier to keep a current customer than find a new one," what are your goals or expectations to keep customers with all the new stuff coming out?

I think any time new games come out, you're gonna lose some customers; there's no question about it. How much is the question. We have never been hit badly by any single game release yet. WoW certainly has a lot of expectations around it. So do some other games. EQ2, same thing holds true. What we do is what we've always done, and we'll always continue to do it, and I've said this two years ago, last year, and say it a year from now: We don't care what the other games do; all we have to do is care about is doing the best games. So, whether it's WoW, EQ2, or God-only-knows-what-comes-next, we're going to do what we do now which is continuing the expansions — paid expansions. We're going to continue to look at free expansions. We're going to look at improving the game. From a marketing perspective, we're going to keep pushing the game. We have the free downloads, we have Catacombs coming out, which will help bring in some new players, we hope and more importantly give some new content for older players. If we allow our course to be dictated by the other games, well you're always going to be running around going from one place to another and most of the time that's leading to actually leave. If you look at the number of games that have been announced, and the games that have launched, and the number of games out of that that have actually been good, it's a small number, really small number.

Q: Where do you want to see the MMOG space to be five years from now?

If it does what I think it can do, you'll have two or three games in every genre [Fantasy, Sci-Fi, etc.]. You'll have more world-wide acceptance of these games. I think WoW, more than any other game to date, has a chance to do that. You'll see more publishers losing more money on this space. Because as always, publishers come in — some do it right; most don't. And, hopefully, continue growth in the "total subscriber" count on a yearly basis, and I think we're going to have that.

Q: Do you think a game like Guild Wars changing the subscription model?

Well, what is Guild Wars but Diablo with a slightly different spin? Can Guild Wars succeed? Absolutely. Can Guild Wars change the market? Absolutely not. Let's say that gets it 100% right and a lot of people play. Is NCSoft in this for the love, or are they in this to make money? Since Guild Wars is hosted by NCSoft, it's not even like a [Battlefield] 1942 where you have distributed hosting. If this thing is very successful, and is a long-term success, they'll find themselves in the same position that Blizzard, for example, is incredibly successful WarCraft, StarCraft and the Diablo series. But the longer you keep a customer for a free game, the more expensive that customer gets. So, they either then have to do expansions — which are paid — or they look to doing WoW. So the question is: will Guild Wars have free expansions? I don't think so.

Q: No. When I met with them at E3, they said their goal was to take the hit on the subscription costs and come out with expansions on a regular basis.

Exactly, now if you come out with expansions on a regular basis — meaning more than once a year—what's the difference between a free game that you have expansions every quarter, which the expansion price is about the same as a subscription. So, I expect Guild Wars will attract a lot of customers, absolutely, if they do it right. Do I think it will change the market, like a lot of people do? No; it can't, because in the end this is a business, it's not just about making games. And if they're very successful, they'll lose money unless they do a lot of expansions. And if they do a lot of expansions, then the player is looking at this going, "If I have to buy an expansion every six months or every quarter to keep up with my friends, why aren't I over there paying that same amount of money to be in a game that's updated just as much?" And I think the Guild Wars guys are going to find that it's a lot more difficult to take a game once it's live and continue to do expansions and improvements. You know, there's a myth that it's so much easier once the game goes live. No, that's actually when it gets a lot harder because now all of a sudden you have a lot of paying customers who are screaming bloody murder because you changed the damage of their weapon by .01%.

Again, Guild Wars is simply a Diablo-like setup, in that you have this wonderful game, potentially, hosted by a company where you can play against other people. Now, they have no content in terms of what they want to do for the MMO client, but in the end it's still a business, so NCSoft has got to make its money one way or another and if you at, for example, what we spend every month on bandwidth and servers costs, and customer service costs, and everything-else costs that goes into running one of these things, you look a subscription model and go, "I really need that, in other to pay for all these costs." So, if they are going to have great customer service, if they are going to use up a substantial amount of bandwidth, if they want to have a large number of servers, somebody's gotta pay for it; there is no such thing as a free lunch. If you say they are going to do an expansion every six months, lets say the box sells for $40. Lets say they keep $25 out of it. Well, if you're the guys who did Guild Wars — ArenaNet — how much of that do you keep? Because NCSoft is going to get a nice chunk, and ArenaNet is going get a chunk, and other people are going to get a chunk, and after you take these chunks out then what's left to pay for the bandwidth, the servers, the CS [Customer Service]? So, I look at the model and go, yeah, you know a distributed hosted game has a much better shot. If Guild Wars were like 1942, where anyone could host the servers, I would look at it and go: much better chance at success, because your costs go way down, but right now they are going to have all these costs.

Q: A year from now, where would you like to see Camelot?

Same place it is now: a constantly growing game, increasing subscriber numbers. We've established a path for Camelot, which is upgrades at least once a year. Hopefully we don't do anything incredibly stupid, and just happy customers. You look at our game, look at our numbers, and worldwide we still have a ton of subscribers. We have more in Europe than we ever had before, and those numbers keep going up. U.S. goes up and down.

There's a fairly lengthy to-do list, for example player-controlled horses, any idea when some of the things… You know, I thought last year that, for example, player-controlled horses were going to go in. We were sure they were going to in, and we hit some snags. But if I say again I'm sure they are going to go in, I'm sure I'll get criticized again. They are on the list, they are one of my big hot-button items, because I'm not used to telling players something that we can't pull off. If you look at my State of the Game, where I say I'm going to do something, even though I always have my disclaimer at the end of it, we've been pretty good about getting almost everything almost everything on those lists out there. The number one thing that we haven't: player-controlled horses. But, yes, that's something that we really want to do. Now, once we get done with Catacombs are we going to have a little bit of extra bandwidth to do things? Absolutely, because we don't have New Frontiers planned, and that took up a lot of bandwidth. We don't have another free expansion in the works right now — that doesn't mean we aren't going to do one, but we haven't shifted to do that. So I expect to see more coming out from us, after Catacombs, assuming Catacombs has the launch we expect it to.

Q: That's all I've got, anything else you'd like to add?

Just as usual, we thank our subscribers as always for continuing to show their interest in the game. We have nothing but good things planned going forward. From a corporate perspective, Mythic is in fabulous shape; we keep growing, we keep adding new people. Imperator is coming along beautifully. We've got some really cool stuff going in there an it's not going to be what people expect — we're not trying to do Camelot in space, or EverQuest in space. We're trying to do a lot of things differently in this game, so it will be an interesting attempt and hopefully we'll be right.

Follow up questions, February 8, 2005

(Since this interview was conducted before the price increase and Mr. Jacobs' "State of the Game 2005" address, he was kind enough to answer some follow up questions.)

Q: Recently, Mythic raised their prices for the first time in 3 years. Can you give us some insight into what forced the rate hike?

Three years is a long time for any company to go without raising prices on a labor-intensive product such as DAoC. Between the increased costs for personnel, hardware and continued additions to the game we had no choice but to raise prices. However, Mythic, as always, offered a number of options to the players to minimize the impact of a price increase.

Q: In the "Camelot in 2005" write-up on The Herald it was mentioned: "additional revenue will go to the continued improvement and evolution of DAoC as long as we have the support of the community." Can you explain what you meant by "support of the community?"

Sure, this is easy. :) If the community decides that they no longer wish to play DAoC (no matter what we do), we will not continue to add new content to the game. Luckily we don't expect that to happen anytime in the near future and as such, we are continuing to improve and add to DAoC. Based on our experience in the MMORPG market we expect that DAoC will be a successful product for years to come and our players can look forward to more expansions and additions during this time.

Q: You mentioned a new server coming on board soon that's geared towards the casual player. First, what's Mythic's definition of a "casual player?" Secondly, can you give more information as to how this server will different from the current rules set to make it casual-player friendly?

Sorry, I am not prepared to comment on this at this time other than to say that it will be geared to a more casual playing style than the current game as well as other MMORPGs.

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