Into The Red

number 38 Governor Carcieri does not seem able to distinguish between jobs and the promise of jobs. And what does this man know about the video game industry?  Gubernatorial candidate Lincoln Chafee however is not blinded by celebrity and asks the RIEDC to slow down before  guaranteeing the $75 million loan to Curt Schilling’s 38 Studios video game company. Writing in Saturday’s ProJo Chafee expressed concerns that the product itself is not even getting good press.

. . . even more troubling, are recent reports that 38 Studios’ lead product, the video game “Kingdoms of Amalur,” received a guarded forecast of success from game bloggers and gaming professionals at the recent Comic-Con trade show in San Diego. Why has Rhode Island gambled so much for an unproven company that seeks to compete in a volatile, high-risk industry?

Chafee joins a loud and growing chorus of those wondering why — if this is such a great idea — we are the only ones in line for this deal.

7 thoughts on “Into The Red”

  1. Matt your right Big Huge Games has been successful with RTS games however are you aware that the game is being developed under the leadership of Ken Rolston, lead designer of the critically acclaimed RPGs Elder Scrolls III: Morrowind and Elder Scrolls IV: Oblivion along with Mark Nelson who’s design credits include the Morrowind expansions Tribunal and Bloodmoon, and the award-winning The Elder Scrolls IV: Oblivion. Most recently, Mark served as the Lead Designer on the Shivering Isles expansion.
    That’s why I have high hopes for this game but most people think 38 Studios is staffed by inexperience people.

    38 Studios is the team creating the MMO and they to have many experienced MMO veterans on their team as well but the impressions is that 38 Studios is all made up of non experienced people making their first game and nothing could be farther from the truth. Your right about WoW however you don’t have to get more suscriptions then WoW however to be a successfull money making mmo. Even if they get 10% of the subscriptions that WoW has that will generate 180 million an year in revenue alone. And believe it or not many MMO’s survive and make money even with the might WoW out there.

  2. i barely know anything at all about 38 studios. admitting that probably makes my arguments completely invalid but i’m okay with that.

    there is no doubt Big Huge Games has made successful high quality games but it’s been in the real time strategy genre which is a completely different animal than an RPG. that might prove to be a positive element in that they will be innovative and bring new ideas to the table but there is also the strong possibility that they will have no idea what they’re doing when it comes to the MMORPG. Todd McFarlane doesn’t exactly have a good track record with games either. plus they’re competing against World of Warcraft in this genre. Warcraft is a juggernaut of the industry never mind the genre. the game is going to have to beyond stellar to even get noticed by the gamers. good luck. to them. i really hope they can do something great. i’d love to see RI become one of the top states for game design and with RISD here there is the potential for some great talent to get involved.

  3. Zoinks! Actual, factual convo? In RI? About RI? Be still, my beating heart.

    Matt, I think you know more about the co. than you let on. If you know the industry as well as you seem to (and I do _not_), then you know that all the key positions are filled by deeply experienced leaders. The creative team is world-class. I found the G4 interview compelling in that Adam seemed giddy, and not about sitting next to a former player at sports game but next to the creative team.

    Also, let’s get a few key points down. Big Huge are not developing the MMO but the console game. From what I’ve read, the MMO is the in-house project. Also, this is a loan guarantee in the form of bonds sold to an already-lined-up group of investors. To be sure, the potential rewards are all for the investors and company folks and all of the risk is on our (taxpayer) shoulders.

    What everybody should be saying is not the company is unproven – all startups are by their nature – but that there is no existing revenue, no other revenue streams but this one title and, maybe, a second. That’s the risk.

    But a successful outcome would be return enough on our investment. As you both say, 38 could be catalytic for our economy. It certainly hits two crucial sectors for us: IT and arts.

    You both should note that the way the funds get distributed, RI’s likely downside is only about $25mm less assets (which will be an unpopular game and a lot of computers). My standing prediction is that the success or failure of the company rests not on the MMO but the console game. If Reckoning bombs, it’s all over. (Dean please note downside as “only $25MM”.)

    I don’t see Wells Fargo (lead investor) distributing the 3rd and 4th parts of the loan if Reckoning is bombing. The company will clearly be unable to repay, and WF would expose themselves to our civil action for gross negligence.

    Bottom line: it’s risky, but not as risky as some are saying.

    Question for Matt: This is not the first time I’ve heard strong doubts from the gaming community about 38’s ability to deliver a quality game. What’s the basis for this thinking?

  4. you said it, we know little or nothing about the game or the company.

    big huge games has had success in the RTS genre. i don’t see their extensive experience with MMORPGs. i don’t doubt they know what they’re doing and i’m sure they have an extremely talented team.

    as far as what 38 studios has accomplished in the last 4 years, well when you have millions of dollars like Curt Schilling you can accomplish a lot by throwing money at it. THQ was selling big huge games. they were going to shut it down unless someone bought it. i’m sure he got a good deal on the company. EA has the type of money to invest into a startup that just acquired a relatively successful design studio. as far as getting people to leave their companies to work at another one… well like i said, you can accomplish a lot when you throw money at it.

    fact is, this is a startup company. 75 million is a lot of tax payer money. this is a risky industry and that’s not just a buzzword this legitimately is a risky industry especially in this type of economy where people are really watching their spending.

    i’m not supporting Chafee for office in way but i am supporting his skepticism towards this deal.

    my hope for this deal is that the loan works out, 38 studios finds a great location and this game is very successful. 38 studios can be a catalyst for a new industry in RI, a state in desperate need of a new industry to provide new types of jobs. the more i think about this deal the more optimistic i am but one has to seriously take into consideration that RI is broke and needs to be very cautious about where they invest taxpayer money.

  5. Matt why would you not spend money on their game? If it’s because you don’t like that type of game then your opinion really means nothing. If you do like this type of game but would not buy it what are you basing that decision on? How can anyone make a decision about a game we know little to nothing about? Ever heard of Big Huge Games? They have a proven track record in the industry and are the ones making the game. Most of the people at 38 Studios have extensive experience creating games with other companies.

    I think the public has no idea who works at 38 Studios, all they hear are sound bites about this deal, like its risky and they have no product and no track record. I have seen very little on what the company has been able to accomplish in just under 4 years like buying Big Huge Games, getting a publishing deal with EA. Aquiring a huge talent pool of experienced game design people. These people could have stayed with proven companies but they chose to quit and come work for 38 Studios. I wonder why that would be?

    One last thing, Blizzard had no experience making a MMORPG and look how well that turned out. Also I have seen many experienced companies create a lot of buggy crappy MMORPG’s so were they safe bets and Blizzard risky?

  6. i wouldn’t even spend my money on this game nevermind loan it to the company to move to RI.

    odds are this game will come out, nobody will care, and the game will be in the bargain bin within six months.

    one positive thing to think about; as of July 2010 combined sales of console and PC games saw a 4% increase in sales from last year, although sales in July were down 1% for the year. console sales have seen a 12% increase from last year which is probably due to the new “slim” models of the xbox and PS3. the market is recovering but is it recovering enough to make such a large tax payer investment?

    Gov. Carcieri is calling this a political stunt. i’m sure that holds some validity but i think Chafee’s call for action is much more valid and should be taken into consideration. i feel like the public is very misinformed or ignorant to this deal.

    seriously though, i have debt and bills that i’m struggling to pay off. you don’t see me at the casino do you? no. this is a big gamble for a broke state. is it worth the risk? 38 Studios doesn’t have any sort of track record to even begin to answer that question.

  7. Why is Lincoln Chafee so against jobs coming to this state? If he protests all jobs ever, all he’s going to do is put Rhode Island at a disadvantage compared to neighboring states. Chafee really strikes me as a man who lives in his ivory tower, disconnected from working families who need jobs and tax relief. Why else would he propose a crazy tax ( that is focused on regressively taxing medicine, food, electricity, gas, water, heating, and education on working families?

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