Is World of Tanks creating a world of money ?

For anyone who doesn’t know, World of Tanks is the hard core PC game that is blowing the doors off the the F2P (free to play then monetized thru virtual goods sales) world.

I won’t go into great detail, but the game is basically a big world (or worlds via many different maps) tank combat game where players get into the world with other players and engage in tank battle. It is highly realistic, fast paced, action packed, and fun!

A couple days ago Venture Beat posted this article on World of Tanks, so you can read a lot more about it there. Venture Beat article on World of Tanks

While it was clear to me before that these guys were killing it from a F2P monetization model perspective, now based on some comments in the article (rather than whispers in the industry) I can try and deduce by just how much. It is clear they are in great shape on multiple metrics including two key ones, monetization level per paying user and the percent of total users that are being monetized. I have come up with the following “back of the napkin” model.

* From article, ARPPU (average revenue per PAYING user) is $30-$40 PER MONTH!!!

* From article, 25-30% of users are paying. (I had heard 18%…so even higher)

My calculation, 3 million MAUs, which is my best guess based on the comment regarding maximum concurrent users, and some gossip around the industry.

So using those numbers…
3m monthly users,
of which 27% are paying (midpoint of 25% and 30%),
and those pay $35 a month (midpoint of $30 and $40)….

Which pencils out at…. $28 million A MONTH in revenue. That is a lot of vodka!

One additional note, a game like this can have a 4 to 6 months for an average life of a user, so that is well over a $100 life time value per customer. Not only is that very impressive, it enables a very strong customer acquisition effort.

Let me know if you think I have this right or any feedback.

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