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Buying Shelf Space

Retailers treat an online game like any other game client. This is both good and bad. On the good side, if the title sells well, like EverQuest and Dark Age of Camelot did, then you can count on shelf space being available. On the bad side, retailers will want what they always want for a retail game package, namely Marketing Development Funds, or MDFs.

MDFs are the retail world's version of the old organized crime protection scheme; if you want prominent (or even any) shelf space, room for an end-cap, or to have the retailer show your product box cover in their omnibus newspaper ads, you pay MDFs. MDF costs for a Class AAA project can easily run over $300,000.

Retail chains get away with this because shelf space is limited in most stores to 200–300 spaces and publishers send over 1,500 games to the shelves each year. That makes it a seller's market, and chains are always willing to sell. It is part of the cost of doing business, especially in the U.S.

Another challenge is keeping that shelf space over time. With Persistent Worlds (PW) today, and at least for the next three to five years, until we see how the growth of broadband connections in the home plays out, having a unit on the shelf is critical to the acquisition of new subscribers. PW games tend to settle out at low, but consistent, sales rates. Retailers are accustomed to a three- to six-month shelf life for a product that is selling well; getting them to retain your unit on the shelf after that can be difficult.

This is also a problem you might face with a publisher, who is also accustomed to that three- to six-month shelf life and may not see the need to keep a (relatively) low-selling game client on the shelves.

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