NEW YORK - After a dramatic 95 percent reduction in traffic caused AOL to instigate a strict hourly pricing plan for its WorldPlay area, multiplayer gaming company Kesmai took its first - and necessary - steps onto the Web today with the launch of GameStorm, a gaming hub created with Engage, Heat.net, SegaSoft, and news site GameSpot.
Intended to appeal to all types of trigger fingers, the umbrella site, priced at US$9.95 a month, brings together "massively multiplayer" games in which many players inhabit fantastic worlds, and twitchy "fast action" games with insider gossip and product demos. The launch comes as a federal district court in Virginia decided today to reject AOL's motion to dismiss Kesmai's antitrust suit against the online service.
"We felt like it was time to build a market outside of AOL [for multiplayer games]," says Kesmai CEO Chris Holden. "Up until this point, AOL has been the only place ... where you could make a profit."
Centered around Kesmai's roster of multiplayer games like Air Warrior and MultiPlayer BattleTech, GameStorm will also feature the headline titles from Heat.net and Engage - whose only online offerings to date are on AOL - and share undisclosed percentages of revenue. GameSpot, however, will see no revenue from the licensing agreement. As GameSpot's Mike Hanley describes it, GameSpot will receive "that other Web currency - traffic."
Forrester analyst Seema Williams said Kesmai, which continues to offer games on AOL, has no choice but to bet the farm on GameStorm. Kesmai had long enjoyed revenues from AOL's free, booming games channel. But when AOL purchased competing company ImagiNation Networks this summer and shifted to an hourly payment plan, AOL relegated all others to ancillary positions inside the now revamped WorldPlay area.
With plummeting traffic, Kesmai, a subsidiary of Rupert Murdoch's News Corp., decided to move to the Web, but wisely conceded that strength lies in numbers. "[Kesmai] has to partner - they don't have the time to build a brand," Williams says. "It's the only reasonable way for them to go onto the Web."
Compared to the $1.99 hourly pricetag for AOL's WorldPlay area, Holden hopes that GameStorm's monthly charge will "resonate with consumers" and not seem exorbitant. But the landscape of Net-based subscriber game sites is still shaky. The largest subscriber service, Mplayer, has about 200,000 users, but not all are paying customers. The site charges just less than $40 yearly to join in its rankings and competitions, but users can also play on the spot for free.
The Total Entertainment Network has 30,000 users on its two pricing plans, $19.95 per month for unlimited play, or $9.95 a month for 10 hours with an hourly fee thereafter. Those member numbers, however, might have changed for the worse, says analyst Williams. "That 30,000 number was four or five months ago, and I haven't heard anything since," she notes. "And in this business, no news is bad news."
