Jasonbobdude
That's Mama Luigi to you, Mario!
- Joined
- Jul 16, 2007
- Messages
- 392
After their last attempt to prove VMK a contest and that closing it down would be somehow illegal, it seems they have a new argument that VMK is worth $2,000,000,000 - and it actually makes sense somehow. 
Have they mailed this in to Disney yet? It sounds pretty good.
EDIT: Forgot to mention article is from savevmk.com.
The Big Question: Why?
We have been asked hundreds of times -- by major stock holders, and by the very young -- the same, excellent question over and over: "Why would Disney want to close VMK?"
Some say, simply, Disney is being "greedy." They want more money any way they can get it, they say, and Disney appears to think few players will stay on VMK if they begin charging for it. Judging from hundreds of comments we've received, this is an incorrect notion. The players love and live for VMK, and some would gladly pay.
Further, if Disney is simply being greedy, why is Disney throwing away a $2 billion project? Especially when that value for VMK is calculated upon Disney's own valuation formula?
Here is the formula: Club Penguin had 700,000 players. Disney bought it in what could be a $700 million deal. Thus, Disney counts each ClubPenguin user as being worth $1,000 dollars. Disney assigned this value even though each player only pays between $58 - $72 per year to play. That adds up to about $50 million per year, which is what they reported making from ClubPenguin last year.
This brings up another question: how will Disney make money on the ClubPenguin deal? Perhaps Disney expects ClubPenguin to keep all their players signed up until the yearly amount equals the purchase price -- in another 14 years. This appears highly unlikely given the pace of technology.
Or, it could be that Disney hopes to recoup their investment selling ClubPenguin-brand products on the side. That doesn't seem very likely either.
Finally, Disney could be hoping to make back their money by getting many, many more people to sign up for Club Penguin. How can they accomplish this? The comments we've received suggest that the amount of people who can see themselves as penguins may be a limited number. So, Disney could be hoping to increase their Club Penguin (and other virtual worlds') membership by closing down other, free parts of their web sites, in hopes players will sign up for paid Disney sites instead. That sounds feasible.
Except there are some problems with that approach which -- judging from the comments sent here -- are becoming big problems. Kids are realizing Disney is ready to pull the plug on virtual worlds at any time, which doesn't build the trust needed for a successful virtual community, which is something built as much by the players as by the corporate sponsor. Meanwhile, experts are claiming Disney is being irresponsible, immoral and damaging the psyche's of its young audience.
Parents seem to agree, joining an ad-hoc boycott of all things Disney. And lets be clear here: this boycott is less out of expecting any real response from Disney corporate offices than it is based upon a growing dismay toward the Disney brand they once loved. They are cancelling their trips, throwing away their trip-planning DVDs, and changing the channel to Nick, because they are just sickened by the "whole, VMK-closing thing."
So, while the Disney-is-being-greedy theory seems partially valid, it doesn't appear to be accurate or working. Disney remains focused on providing extraordinary quality within their brand. So maybe, as others say, Disney is just being "dumb."
Look around VMK; the site has already lost it's many acquisition-minded players. Meanwhile, look at the other Disney virtual games: Are they suddenly busier? Overwhelmed with new players? Many say they are not.
By comparison the Virtual Magic Kingdom -- unlike Club Penguin -- promotes all things Disney, specifically offering a convincing promotional tool to get people to the parks. Could VMK itself have been promoted better? Perhaps. Yet the promotional potential of VMK is still there, and according to the comments we've received, is working very, very well. Do people who play VMK want to go to the parks? And actually go there? Absolutely, see for yourself (e.g., in the final comment).
Further, many agree that visiting the Disney parks is not cheap. So whatever their expenses for running VMK -- estimated at under $850,000 per year -- Disney has a clear way to recoup them in full, and then some. Here is where things take a surprising turn.
Also unlike Club Penguin, VMK doesn't have 700,000 players. Rather, VMK is said to have over 2 million registered players. Over. Two. Million. Players. And make no mistake, for many of these players, VMK is their primary entertainment, Internet and recreational avenue. They may have "Hannah Montana" playing in the background, but VMKers are leaning forward, focused on their real friends and real interactions within the virtual world of VMK.
So, going by Disney's own valuation -- with each player being worth $1,000 a piece -- VMK is worth $2 billion dollars. That's billion, with a "b."
Who would have thought Disney was doing so well that they could throw away a successful, growing, $2 billion dollar project? Meanwhile, every year, Disney avoids a potential $144 million dollars per year of profit, simply by not charging $6 per month to play VMK, which could, over time, push VMK to exceed it's $2 billion value, just as Disney expects ClubPenguin to surpass its $700 million value.
Perhaps Disney doesn't think VMK players are worth as much as ClubPenguin players. The rejected players seem to feel that way. Ask the seriously ill Madison Reed or any of the millions of other "fired," former VMK players. Let's say VMKers are worth only half the original amount, or $500 each. That still makes VMK worth $1 billion. So VMK is clearly a very, very valuable social network, virtual world, brand-builder, Internet property, and money-maker.
So, given the brilliance that is VMK (and its potential revenue-generating potential), the Disney-is-being-dumb theory doesn't hold water, either. Which leaves one theory left.
Some speculate that Sulake, the company which developed the underlying (outdated) technology VMK is based on, are the real ones closing VMK because they just signed a deal with Paramount. Plus, the contract had already run out and was merely being extended. Lastly, Sulake needs the staff to create the sure-to-be-uplifting "Mean Girls" world at today's presumably higher rates.
So Sulake appears to be playing the cards it was dealt wisely and carefully. Noted. After all, what does Sulake care about Disney? Or fans of the Disney brand? They're all just another client, as far as Sulake's concerned. And bonus points to Paramount for out-witting Disney (although they better be very careful in their own dealings with Sulake!).
And why did Disney sponsor a virtual world -- where children were supposed to grow and develop their (and Disney's) presence, property, and social networks -- by contracting with Sulake for such a limited time? The 10-year olds playing VMK all knew VMK was supposed to go on forever, so why didn't anyone at Disney appear to know this too?
Which leads back to the original question, one which, it turns out, no one but Disney can answer: "Why would Disney want to close VMK?" SaveVMK.com has a petition of over 16,460 people who would like to know.
And it suggests another, yet-to-be-answered question: Why are the Disney stockholders standing by while such a tragic mistake is made if VMK were to be closed forever?
The world may never know the answer. Or care, since other, non-Disney virtual worlds are likely to pick up that $2 billion value, while gaining the gratitude of millions of former VMK players and their families (formerly known as Disney customers) on May 22.
Have they mailed this in to Disney yet? It sounds pretty good.
EDIT: Forgot to mention article is from savevmk.com.
Yes, I would hope Disney would be above taking that attitude (though no one really knows), but you're right, they could have said it politely. A simple "unfortunately our contract with Sulake has run out and cannot be renewed" would go down better with most players than "oopsie, where did that darned anniversary get to? It was here last time we looked!". 
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