Tolkien's Virtual World Takes Off-1

The Lord of the Rings Online has enjoyed explosive growth since its April unveiling. And it'll probably keep doing so—if it remains true to Tolkien's vision

Jeff Anderson is not a nerd. The 40-year-old chief executive of Westwood (Mass.) video game developer Turbine is six feet tall, with the frame of an NFL linebacker. Nevertheless, he presides over a vast and rapidly growing virtual world of elves, orcs, dragons, and hobbits.

In April, Anderson's company took the wraps off the Lord of the Rings Online, a massively multiplayer online role-playing game (MMORPG) for PC, based on J.R.R. Tolkien's classic books. The explosive growth of the game—players have created some 4 million unique characters in just five months—has vaulted the company into the top tier of online game design companies and made it the largest privately held developer of massively multiplayer games in the U.S.

In the game, players create avatars based on characters from the books—hobbits or orcs, for instance—to pursue quests and battle monsters in an expansive virtual world closely based on the tales' locations and events. They can also chat with other players via an internal instant message system, or join groups to play collaboratively and virtually trade objects such as weapons or potions. A copy of the game costs $29.99, with an additional $14.99 fee per month for continued online access. Turbine also offers an alternative payment option: A $299 lifetime membership with no subsequent fees.

It's a good time to be introducing new products into the burgeoning online games market. In May, the NPD Group reported that a growing majority of all gamers prefer to play online. According to research firm Strategy Analytics, the worldwide online games market, which generates more revenue than other genres of games and either video or music sales, currently rakes in nearly $4 billion a year. Strategy Analytics reckons the online games market could triple in size over the next five years, ballooning to $11.8 billion.
Adept at Dealmaking

With the Rings game, Anderson is attempting to transform Turbine from an obscure game developer working on contract for big publishers such as Microsoft (MSFT) into a well-regarded gaming brand of its own, capable of competing with offerings from much larger companies such as Vivendi's (VIVEF) Blizzard Entertainment, maker of the current top MMORPG title, World of Warcraft, which has 9 million subscribers worldwide.

"We're more nimble than a larger company," Anderson insists of his team, which consists of about 200 employees including developers, designers, support, sales, and administrative staff. Inking agreements with European developer Codemasters and CDC Games for an upcoming Chinese edition of the Lord of the Rings Online, Anderson's team has proven adept at the dealmaking crucial to extending multiplayer games around the globe. Such deals allow the game to be operated according to national regulations and to be translated into the appropriate language.

The company isn't shy to outsource, either, offshoring to India the triage of support-related e-mails and the 3D modeling of some of the game's simpler objects. Nor has it shied away from hammering out technology deals, licensing a software-based physics engine from Irish developer Havok to make its titles look and play more realistically without having to rewrite code from scratch.
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