On why NCSoft is killing off City of Heroes

It’s the money, stupid.  The game is doing okay, but in context, it’s not in NCSoft’s interest to keep it up and running.

Based on their Investor Relations report (PDF) of August 2012:

1. NCSoft considers CoH an MMOG, which has a life cycle of 5-10 years.  Introduced in 2004, that makes CoH 8 years old, close to end-of-life. (p. 4)
2. CoH revenues are a tiny fraction of NCSoft’s income, vs. Aion and Lineage 1 and 2 — about 2% of sales. (p. 7 and 13)
3. North America and Europe sales are a tiny fraction of NCSoft’s revenue (p. 13)
4. CoH saw a tiny increase in sales over the last year, but as  The Escapist notes, that with the change-over to the blended business model “City of Heroes Freedom,” which was meant to significantly increase revenues — which didn’t happen. (p. 13)
5. NCSoft profit and net income is way down. (p. 20)
6. Company focus is on two big launches this year, Blade and Soul and Guild Wars 2. (p. 16-18)

Bottom line (so to speak), City of Heroes and, more importantly, Paragon Studios, was a distraction for a company in financial trouble and focused on upcoming releases. The revenue stream was small and going nowhere.  From a purely business standpoint, it makes all the sense in the world for them to pull the plug.

But it still sucks big-time for the players.