Blizzard Entertainment

Blizzard Employees leave to start MMO Game Dev Company

Recently, several former Blizzard employees who have been working on World of Warcraft left the company announcing that they had raised 18 and a half million dollars to fund their newly created MMO development company: Red 5 Studios.

Read the full story here:

>LOS ANGELES (Reuters) - Red 5 Studios, an online video-game developer led by members of the team behind the wildly popular "World of Warcraft" game, said on Monday it has raised $18.5 million in venture capital. > >The funding from Benchmark Capital and Sierra Ventures comes as a rise in high-speed Internet usage in the United States and elsewhere fuels interest in online gaming -- the standard mode of play in many Asian countries. > >"World of Warcraft" from Vivendi's Blizzard Entertainment provides an online world in which thousands of players compete simultaneously. Revenue comes from game sales of about $20 per unit, subscription fees of some $15 per month, and downloads of add-on content. > >The game has obliterated former usage records with a subscriber base of more than 6.5 million globally, and forced U.S. video-game publishers to rethink online gaming as development costs climb. > >In the United States, games for consoles like Sony Corp (NYSE:SNE - news).'s PlayStation 2 and Microsoft Corp.'s Xbox 360 are dominant. Top titles sell for $50 to $60, and play time is often measured in hours rather than months. > >Mark Kern, Red 5's chief executive and former team leader on "World of Warcraft," said his California-based game studio will create original games for online game operators and distributors -- much as Pixar Animation Studios did in the movie world with its animated films such as "Toy Story" and "Finding Nemo." > >"Pixar really showed that you can have a content-focused strategy," Kern said of the animated film maker that is now owned by the Walt Disney Co. > >Red 5 is already working on a massively multiplayer online game for Webzen Inc. The South Korean company is financing the development of the game, which Webzen will distribute. > >Online games are currently sold at retail outlets or via Internet download. > >Benchmark General Partner Bill Gurley predicted that massive online games like "World of Warcraft" will become a dominant form of entertainment. > >"Major media companies are paying attention in a major way," said Gurley, whose firm's investments have included "Second Life" virtual reality game maker Linden Lab and mobile game maker Jamdat, which sold to video game publishing giant Electronic Arts Inc. earlier this year for $684 million.

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  • Mon, Dec 11 2006 11:05 PM ()

    It's a hard business, Blizzard has the reputation and the right people leading the franchise and maintaining the vision. Unless those critical people leave, and i mean they ALL leave, Blizzard will continue to dominate.

    I say the newly formed Red 5 will just be a small company and possibly be bought out some time later.....sooner than later.

    Guild Wars, which was develope by some major players from Blizzard is finding it tough in the long run. With three expansion packs released already, there is a sense that the game is fading amongst customers.

  • ohGr said 
    Mon, Dec 11 2006 11:05 PM ()

    Guild Wars is also struggling because of the lacking content. The PvP end of the game is still amazing and highly challenging, but in that same regard, daunting to new players that get completely raped their first few runs into pvp until they find viable skill specs. And the PvE content is laughable at best. It's almost non-exsistant, instanced, and people would rather find ways to solo it all. (ie: The old 51 HP Invinci-monk build.)

  • Mon, Dec 11 2006 11:05 PM ()

    Well they're not even developing their own games, they're just developing games for whomever throws them the money. Which to me doesn't get me interested in anything they'll produce since all the work they're going to get are just going to be companies looking to make a quick buck by getting somebody to make them an mmo or the likes.

    Guild wars died off because the vast majority of RPG actions players are there for PVE, not PVP. Their PVE content is absolutely horrible and the character generation and evolution is so based around PVP play that it makes PVE a joke.

  • Meiras said 
    Mon, Dec 11 2006 11:05 PM ()

    All the employees leaved or just somes??? I hope wow doesnt get deserted like Guild Wars

  • Aldos said 
    Mon, Dec 11 2006 11:05 PM ()

    "Recently, several former Blizzard employees who have been working on World of Warcraft left the company announcing that they had raised 18 and a half million dollars to fund their newly created MMO development company: Red 5 Studios."

    ... Recently?

    The only new news here is that they had a round of funding for their company and raised $18.5 million. Red 5 Studios has been around for over a year now.

    http://www.red5studios.com/press/pr20050908.html

  • Shuoni said 
    Mon, Dec 11 2006 11:05 PM ()

    Exactly as Aldos Says Red5 Studios exist from 1 year that Employes left Blizzard Enterntainment Company around 1 Year and some months ago

    Actually theyr game will not be so much appreciated from the Pubblic in my opinion as they say they Develop Games for Online Gaming Brand and this mean they develop Games for other company and from my experience such game is usually one shot game not maked for the long time of playing..... this kind game is usually needed for raise the Year Financial Closure of a Brand with some more Money Entries after that they usually left the game die

    such small company Born every months from people lefting more big Videogames Brand such as Blizzard in the more happyest of the Conclusion the small Studios get buyed by a more big Company in the baddest one they fail and close

  • Meiras said 
    Mon, Dec 11 2006 11:05 PM ()

    What do you mean with: "Born every months from people lefting more big Videogames Brand such as Blizzard in the more happyest of the Conclusion the small Studios get buyed by a more big Company in the baddest one they fail and close"??? Somebody please explain me

  • GTez said 
    Mon, Dec 11 2006 11:05 PM ()

    What he means is that, it is common in our industry for Developers to leave the big companies and start smaller ones. Once they create a good title the larger companies such as EA, Vivendi, etc buy them up. Much like how Blizzard is today. They were once an independant company but now are a part of the Vivendi family.

  • epoxy said 
    Mon, Dec 11 2006 11:04 PM ()

    lol. Rick Romero says "Online games are currently sold at retail outlets or via Internet download." News at 11.

  • Meiras said 
    Mon, Dec 11 2006 11:04 PM ()

    So what u mean is Blizzard is gonna be bought or blizzard is gonna buy?

  • Coaldain said 
    Mon, Dec 11 2006 11:04 PM ()

    Hey, change is hard, but I'm all for it! GL to those who left Blizz!

  • Meiras said 
    Mon, Dec 11 2006 11:04 PM ()

    Still i dont know if Blizzard is gonna get bought can somebody plz answer thsi question :P?

  • Shuoni said 
    Mon, Dec 11 2006 11:04 PM ()

    no i mean that Red5 Studios is gonna get Bought or fail...... the money they gathered for theyr first game till now is Mile away from even the half of a games like WOW developing money requirement and take up theyr brand with the same money

    thaey also signed a Contract with Webzen some month ago.

    Blizzard will never Die till Much of theyr Hardcore Foundation member stay that ppl lefting Blizzard was 3 person....... Blizzard still have a crew of Developer that pass over the 50 unit (if i understood well what i readed). and Blizzard was still buyed several years ago from Vivendi and now is part of the Vivendi Universal Brand and i dont think atm Vivendi will sell Blizzard

    only think is that i hope Red5 Studios will find his path in the videogaming World/market and who know maybe we will ear of some fantastic game developed by them in some years

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