Official: Stillfront Q2, Record Gemstone Profits

[Drevihyin]

Savant's aren't being released soon? Thanks for ruining my day!

[Schoolin']

Err... I can certainly attest that Simu spent decades not putting much money back into the game, but now that the company has been sold, they don't have control of where the money goes. Also, while using "Slave Labor" for developement all along, never have I observed more new things being put into the game in a short amount of time as in the last few years.

I'm happy Stillfront is making money from the game and if people are willing to dump thousands of dollars into micro trasactions (Which I find quite amusing), and thats where the money is coming from so be it.

I have heard that the GMs get some cash from the upsells and thats all good in my book.

[Methais]

What evidence do you have that it's NOT working? You're crying that it's failing, and yet the company is seeing record numbers in terms of profit. Revenues are greatly outpacing expenses for the games and its a great quarter for stillfront. We have more active accounts than ever. I'm really uncertain what the basis for your assumption is. If you'd like to preach that it may not be sustainable, and eventually lead to a downturn, I would agree with you, but the profits based on the historical data and the Stillfront release show record numbers. That's higher revenue and/or lower expenses. I'm uncertain how you can take a higher gap between revenue and expenses as being a failing strategy.

Once the 13 people who spend fuckloads on paid events get bored, Simu is gonna be in a pickle.

[Kobold]

Once the 13 people who spend fuckloads on paid events get bored, Simu is gonna be in a pickle.

^This x1000

I know Wyrom's got a list, probably categorized them too. "Whales" "Big Spenders" "People with multiple pay accounts" "Pay accounts who spend RL $ for events" "Pay accounts who spend Silvers for events" "f2p accounts who pay for events" "totally free f2p who hasn't spent a cent" "people who post here but don't really play anymore."

It's all there, and I'm sure he'll tune this shit down when the top two start to lose their interest. What? 20 people, couple thousand dollars every other month each? 240 grand a year, that's a big fucking slice of total revenues.

[beldannon5]

I am on the doesn't pay a lot cash
wise but sure is doing all the events way overboard.

[Whirlin]

Semantics aside, it's pretty clear that for the most part, money does not go into GS, it only goes out.

I think the sentiment here is that while simu may be making money off its current business model, they could arguably be making much, much more of it if they wanted to re-invest a small amount and start looking to grow GSIV versus literally anything else. In addition, it would have the added bonus of not alienating their sole source of income. While this is a niche market, I think it could be much larger than it is with minimal effort on their part. We all love this game despite its numerous flaws but I hate to think of it ending because they eventually cross the threshold of milking their population dry.

Also, for what its worth, Destiny 2 has been getting hammered lately (https://www.polygon.com/2017/9/7/162...bright-engrams) because of the inclusion of small micro trans in the game relating to shading (coloring your gear). If <InsertGameReviewingWebsiteHere> looked at GSIV, they'd lose their minds. So little that goes on with this game makes sense when you step outside the tiny and fanatical bubble that is GSIV. It's depressing to hear you defend it

Well, no... it's not JUST semantics. This is not defense of Gemstone, and more about critically reading financial reports and extrapolating information, and the differences between PROFIT, REVENUE, and EXPENSES... there are some inherent assumptions being made about the two component values in the components of profit and that expenses have contracted or remained consistent to achieve a higher profit. Even if expenses increased 4 fold in the last month, if revenues increased 5 folds, they would still have an increase in profit, and it could still account for what was accomplished here. Given that we're now taking a look at a conglomerate of something like Stillfront group, for all we know we could see expense contraction occur with shared domestic hosting in a single Stillfront owned datacenter. An increase in the gap does not mean that the expenses have not increased, or that they're not investing more in the game, it just means that the revenue outpaces the expense growth. They could be doing exactly what you're saying... we've seen more development in the last two year than we'd seen in the five before it. They increased their expenses, and now their revenue is outpacing their expense growth, increasing profits.

This is more about critically reading and understanding financial reports. If we take a look at page 17 of the Stillfront report you can see a breakdown of anticipated expenses per studio/game... and you can see not only a marketing strategy of 4-8% PPC, but also a Liveteam allocation of 5-12%. But given the disclosure on the next page regarding UAT predominantly around new involvements, you can strike the 25-30% studio expense from Gemstone. Furthermore, Whatley apparently got brought into Stillfront according to the management listing on the annual report (and super low on the shareholder level, which I lol'ed about). But what's important about that transition is that even if we assumed that Whatley was paying himself a salary, he's now a centralized part of the Group environment, and not the Studio department, so that Liveteam allocation will be independent of him.

So lets do some math... Based on the chart on page 7, I'm estimating a return of about 110 m Kroner. 8% of that is derived from gemstone, which is 8.8m Kroner. Since Stillfront is only the majority stakeholder of Simutronics, they're only obtaining 52% of the profits derived from the game, which would imply that Gemstone generated 16.9m MSek. Now if we apply Stillfront's standard operating model on page 17, assuming 5-12% going towards live support, we're looking at 845k-2028k SEK per quarter invested into the live team. The conversion rate, based on last time I was in sweden was roughly 1 USD:7 Kroner, which would give us operating expenses of 120k-289k per quarter in personnel expenses.

Now that Whatley is out of the payroll, We know at a bare minimum Wyrom and Chris are still there. The rest are volunteers per everyone's assertions. However, I'd be surprised is Wyrom + Chris together were making between 480k and 1.1m a year. Per their operating model, and per their financials, we would see an increase in spending and allocation towards the payroll to Gemstone support to meet the group's objectives. Even on the low end, we still see sufficient leftover capital for at least one well paid full time Dev, and/or increasing pay to existing volunteers.

Don't misunderstand, I would love to see a full time, dedicated development person. However, based on just a profit number, there is insufficient information to state whether or not that is occurring. What you're looking to understand is their expenses, but based on the group modeling now that Stillfront is in charge, it looks like we are getting MORE capital reinvested into the game than we were enabled to under Whatley's "oversight".



In regards to Destiny 2... I think that's a separate incident because they're adding microtrans on top of a game with a full retail AAA blockbuster price. If they were marketing Gemstone as pay $50 and own it, and then they started adding microtrans, that's a different issue than a subscription based game. While it's not an apples to apples comparison, I also don't doubt you could find a writer at Polygon that would cry over the sub model.

[drauz]

Destiny also doesn't have a subscription, in 4 months you've already paid what you would for "full game". Or 2 months if you're premium.

[Whirlin]

Destiny also doesn't have a subscription, in 4 months you've already paid what you would for "full game". Or 2 months if you're premium.

Full priced game + microtransactions is Origin/EA territory!

[subzero]

Simu's......Cock... firmly... planted.... down... Whirlin's.... throat.

Dude, are you seriously arguing that they are putting even a decent portion of the money they make from GS back into it? The fucking new character creation screen still says "Savant: Coming Soon!" They can't even update their own fucking forums to have these tagging features that Wyrom was bitching about not being here. I mean, seriously.

You don't get it, bro. The forums are tied to billing.

[Tenlaar]

How in the world do you consider the highest monthly subscription cost evarrrrr + making the simustore part of every single thing they can to be anything other than a full priced game + microtransactions?

If those AAA game companies could get some people to pay a $40 a month subscription fee for their games and still hit up their micro trans store there would be a public health hazard from the amount of people jizzing in their pants at once.