Wargamer.com reports on GW's letter to shareholders Re: Warhammer+

[The Yncarne]

5 hours ago, Lord Marshal said:

The low number of views isn't a surprise. Pretty much everybody was dismissing it until they announced the 'free' model. To most people W+ is a glorified model-subscription service with some video/app extras thrown in.

 

I really wanted it to be a glorified army builder and rules reference with some video extras added in. They couldn't do that right, so I left pretty quick. Couldn't care less about the models.

[phandaal]

2 hours ago, Xenith said:

 

...would you like them to charge more?

 

Like this is mad. They made another $3.6m that they would not have otherwise got. Money is money and there are a lot of companies that will invest, work and succeed on smaller margins if there is a profitable business case.

 

To be honest, I'm amazed it has that many subs, and made that much money. 

 

Maybe people should ask themselves what about the arithmetic is eliciting such a strong response. If the numbers are just confusing to look at, as some emoji responses indicate, then fair enough.

 

For everyone else though, ask yourself - did Games Workshop launch this new service in order to potentially sell the equivalent of one box of miniatures per year to 115k people? Is that the result they were expecting from their production, advertising, promotions, special miniatures, vouchers, etc.?

 

Personally, I doubt it. These numbers, combined with the Amazon announcement and the fact that GW is already taking profit from W+ rather than reinvesting it into more content, tell me this service is not being kept around for its long-term growth potential.

 

My guess is the service is now a self-bankrolling sizzle reel for licensees. Like any good (read: successful) business, GW has more than one way to win.

[Marshal Reinhard]

4 hours ago, Xenith said:

 

...would you like them to charge more?

 

Like this is mad. They made another $3.6m that they would not have otherwise got. Money is money and there are a lot of companies that will invest, work and succeed on smaller margins if there is a profitable business case.

 

To be honest, I'm amazed it has that many subs, and made that much money. 

Being far too lazy to read the report myself, but someone in the thread listed the 3.6m as revenue, not profit. Meaning they made less than a million if that budget figure of 2.9m is all the expenses of wh+ (And assuming none of that would content/expenditure would have been made in any shape without wh+) 

 

So it hasn't really raked in the money, but if the real goal was to potentially land something like the potential amazon deal (potential because not contracted yet), then making money of it was a secondary concern. Heck if that was the main goal it breaking even, even, would just be gravy.

Edited January 11, 2023 by Marshal Reinhard

[Lexington]

I kinda doubt GW tried to woo Amazon with the fact that they already have their own competing product and that it only does mediocre numbers.

Really, I don’t think GW put the fairly significant amount of time, money and advertising into W+ that they did for any other reason than the fact that they thought they could make money directly through subscription revenue. They might end up using it in other ways, but if all they wanted was something cool to show off in meetings, they already have some amazing animations to advertise the current editions of 40K and AoS.

Edited January 11, 2023 by Lexington

[Halandaar]

31 minutes ago, Marshal Reinhard said:

Being far too lazy to read the report myself, but someone in the thread listed the 3.6m as revenue, not profit. Meaning they made less than a million if that budget figure of 2.9m is all the expenses of wh+ (And assuming none of that would content/expenditure would have been made in any shape without wh+) 

 

So it hasn't really raked in the money, but if the real goal was to potentially land something like the potential amazon deal (potential because not contracted yet), then making money of it was a secondary concern. Heck if that was the main goal it breaking even, even, would just be gravy.

 

The report says Warhammer+ has brought in revenue of 3.0 million GBP against development costs of 2.4 million GBP for the period (i.e. June-November 2022), so there's still 6 months to come but you'd think a chunk of the revenue is front-loaded as people pay their annual subs upfront to get early access to the minis.

 

It's still 20% profit which isn't terrible for something outside the company's core business and as you say, if the main goal was really just proof of concept to get a deal with a big studio then job done, any profit from the endeavour is a bonus.

 

My personal feeling is that this won't be anywhere near what they hoped for, but frankly given the relentless negativity it gets around the internet it's a bit of a surprise that it's profitable at all.

 

 

[Marshal Reinhard]

13 minutes ago, Lexington said:

I kinda doubt GW tried to woo Amazon with the fact that they already have their own competing product and that it only does mediocre numbers.

I assure you neither of them see each other as competitors.

Edited January 11, 2023 by Marshal Reinhard

[AppleCrumble]

I know I'm an outlier, but my only interaction with W+ is to log in once a week to the Vault, and honestly I'm pretty happy with what basically amounts to WD subscription, with a back catalogue. Subscribing to WD use to get you a 'free' annual mini, so it feels doubly comparable.

 

But as far as hours watched, I practically contribute zero. 

 

[Halandaar]

1 hour ago, AppleCrumble said:

I know I'm an outlier, but my only interaction with W+ is to log in once a week to the Vault, and honestly I'm pretty happy with what basically amounts to WD subscription, with a back catalogue. Subscribing to WD use to get you a 'free' annual mini, so it feels doubly comparable.

 

But as far as hours watched, I practically contribute zero. 

 

That's very similar to how I use it to be honest. I watched Angels of Death and the Exodite and have watched several of the Masterclass videos, but mostly I check it for the walk down memory lane that is the archive White Dwarfs and finding some of those cool old player armies and conversions that I remember but could never track down.

 

I was buying WD anyway so Warhammer+ is the same content as that - albeit several months later - for a lower price, and then everything else (animations, battle reports, tutorials, lore vids, vault books, voucher and the mini) is all "free" extras.

Edited January 11, 2023 by Halandaar

[Emperor Ming]

6 million on new webstore

 

Whats wrong with the current one

 

They could have hired me for one million

 

and I could have saved them 5 million

[Halandaar]

1 hour ago, Emperor Ming said:

6 million on new webstore

 

Whats wrong with the current one

 

They could have hired me for one million

 

and I could have saved them 5 million

 

 Presumably they didn't want 1-2 emojis after each line of text in the product descriptions!

[MegaVolt87]

21 hours ago, phandaal said:

 

Armoring of a Space Marine and the Horus Heresy Cinematic Trailer both surpass 5M views on YouTube, so even compared to other GW releases it looks bad.

 

Now we see why GW devoted a paragraph to their YouTube success in last summer's investor report while W+ got a blurb saying it still exists.

 

At least this finally puts the "have you seen the numbers???" retort to bed.

 

I think this is important, because myself and many others were expecting their series to have the production values across like these YT vids across entire series they have at a decent pace. Even a new ep every two weeks like higher production anime, aiming for a min of 12 episodes of 25 min each (23 min episode, 1min intro and 1 min outro). Also by the time the vault was populated with enough content like it has to date, took far too long and people like myself just got our own digital copies elsewhere of things. Also The vault scrapes all the old rules from the publications which limits the appeal of the vault greatly, where again, you can find the full version elsewhere. 

[Felix Antipodes]

Removing the old rules was one of the biggest missteps they made when they created the Vault.  I’m still mystified why they do it.

[Lord Marshal]

1 minute ago, Felix Antipodes said:

Removing the old rules was one of the biggest missteps they made when they created the Vault.  I’m still mystified why they do it.

 

They didn't want Lil Timmy's brain to melt when he saw rules to things that are no longer being produced, or worse still, they decided to buy a recast/proxy/third-party version of the same model.

[MegaVolt87]

9 hours ago, Lord Marshal said:

 

They didn't want Lil Timmy's brain to melt when he saw rules to things that are no longer being produced, or worse still, they decided to buy a recast/proxy/third-party version of the same model.

 

I will always disagree with this stance. GW chose to discontinue a model, they can't lose money on something they no longer make when someone buys a knock off of it. Money is only lost by them when its something they still continue to make in their product line. 

[2PlusEasy]

I subscribed to WH+ for a month recently as a trial. Mainly to watch Angels of Death. In summary, I can understand why the subscriptions are low: it doesn't offer alot of value when most of what it offers is done for free by the hobby  community on YouTube or twitch.

 

Suffice to say, there isn't enough content to keep me invested in maintaining the subscription.

 

[StratoKhan]

On 1/12/2023 at 8:43 PM, MegaVolt87 said:

 

I will always disagree with this stance. GW chose to discontinue a model, they can't lose money on something they no longer make when someone buys a knock off of it. Money is only lost by them when its something they still continue to make in their product line. 

 

With regards to lost revenue, yes and no, as the way a lot of companies approach 'who' is competition has changed over the years. If you consider that there's a finite amount of discretionary spending available to each current or potential customer, the goal is always to maximise the amount of money a customer spends on your products & services vs. what they spend on other activities, hobbies or interests. If someone buys a game for a game console instead of buying a 40k combat patrol, that still amounts to missed revenue. The same logic applies to a discontinued model or model range being offered by a 3rd party company. Admittedly, GW no longer offer that specific model so they've taken themselves out of the game. But it's very clear why they removed the rules, especially if a competitor could offer a model for those rules. Better for GW to focus on selling their current product. The reasoning is always going to be, to make decisions that reduce the amount of opportunities a customer has to go spend their money somewhere that is not GW.

[chapter master 454]

I mean, I might of been wooed into it if the whole digital system for their rules was "you can buy E-codices and browse them freely in our app, which hey, if you subscribe to warhammer+ is also an army builder". 

 

Just want to point out they still use Warhammer Digital to publish E-Pubs of their other game systems like necromunda. Just saying. It isn't they can't, just they won't because they want to try and push the failure of a system that is their army builder/codex thingy that isn't even a codex thingy and is just what an E-Pub reader is but worse.

 

I feel like the overall gist of the issue is that the idea seems solid, but the execution on all fronts has been incredibly inept and just outright insulting. From bad P.R. rap it got from the start due to the whole clamping on IP, down to the less than poor quality army builder on launch (not sure how it is now) it just doesn't redeem itself overnight and GW just don't seem to want to put the effort in to redeem it. Feels like they are sweeping it under the rug and trying not to mention it too much.

[Sky Potato]

The army builder app is still pretty lame. There have been no fundamental changes to it

[RWJP]

On 1/10/2023 at 11:12 PM, Flaherty said:

115,000 subs strikes me as quite a lot, considering there isn't a free tier! 

 

I'm curious, what would you consider a healthy number? Is there a widely accepted tally of people who play GW games? The 40K subreddit has ~571K followers. 

Little late to the party on this, but thought I could possibly add some info that people might find useful or interesting as I am the moderator of /r/Warhammer40k.

First of all, I would argue that WH+ getting 115k subs is a pretty decent success for GW considering it's a paid service. /r/Warhammer40k is one of the biggest communities for 40k out there in terms of subscriber/follower numbers, and obviously Reddit is an entirely free platform to use. The fact that the equivalent of 1 in 5 /r/Warhammer40k subscribers have paid for WH+ is huge in my book. Just as a slight counterpoint though, while /r/Warhammer40k has over 570k subscribers, it's viewership is actually significantly higher. On average the subreddit gets 782k unique users view the subreddit per month. We had a peak in April 2022 of 1019431 unique users. (Just FYI, if the same person views the subreddit on two devices that can count as two unique views, especially if they're not logged into their account on one device)

Just as an interesting comparison, Youtube reports it has 2.1 billion monthly users, and that as of November 2022, they had 80 million users subscribed to Youtube Premium. That's 1 in 26. Obviously that's nowhere near an Apples to Apples comparison, but it's an interesting data point when it comes to "conversion" of free users to paid users. I was going to look up stats for D&D Beyond, but after the mess WotC got themselves in I decided not to.

Views are where things get a little more murky. /r/Warhammer40k averages 12.8 million page views per month which makes 5 million views total for WH+ look extremely low. However this is a very hard one to compare because Reddit is a very different platform, with the biggest thing being interactivity. A reddit user might contribute several page views to the same post as they dip in and out of the comments, leaving replies, having conversations etc. It goes without saying that WH+ doesn't offer any interactivity like that!

 

I think though the massive disparity in views can be attributed primarily to content volumes, but also partially to the metrics GW is reporting. 

On content volumes: Reddit has WH+ beat in every possible respect for very obvious reasons. A user can visit reddit and post their own content at any time, which then in turn incentivises more pageviews as other users view the new content, but also check back regularly to see what else has been posted. WH+ on the otherhand will only ever generate a handful of views per user because content is only uploaded once a week.

On metrics: GW is only reporting video views, which means usage of the Warhammer Vault is entirely unknown. Personally, I imagine that my "pageviews" of the Warhammer Vault content significantly outstrip the number of times I have viewed the video content! I don't know if the software GW uses to run the Vault offers view tracking functionality so that may be why it hasn't been reported!

With all of that said, the real measure for GW is going to be money: Did WH+ break even or make a profit? Or did it cost more to deliver than it brought in. It appears the answer to that is "Yes, WH+ made a profit, therefore it's a success."

Edited January 31, 2023 by RWJP

[Cactus]

I wonder if some of the value to GW is in experience with producing video content. Obviously the animation is outsourced to specialists but the challenges in bringing a digital product to market are very different from  physical minis.

 

The agreement-not-a-contract with Amazon demonstrates that this kind of thing is part of their strategy and will have the board's attention.

Edited February 1, 2023 by Cactus