News : "World of Warcraft" has rivals racing for new worlds

By John Gaudiosi

REYKJAVIK (Reuters) - "World of Warcraft" has become a phenomenon among role-playing interactive online games with its unrivaled success leaving competitors racing to draw gamers into new virtual worlds.

Fans of the massively-multiplayer online (MMO) game by Blizzard Entertainment, a unit of Vivendi Games, lined up outside stores around the world this month to get the game's second expansion pack "World of Warcraft: Wrath of the Lich King."

"World of Warcraft," which creates a vast interactive world, has about 11 million people worldwide registered as players, paying around $15 a month to explore the fantasy role-playing universe of Azeroth.

The second expansion pack gives players access to the forbidding continent of Northrend where the malevolent Lich King Arthas seeks to end life on Azeroth.

Michael Pachter, videogame analyst for Wedbush Morgan Securities, forecast the new pack would sell about five million copies, cementing "World of Warcraft" as the dominant MMO game over about 150 rival games on sale or in development.

"'World of Warcraft' is probably 60 percent to 65 percent of the market in the U.S. and Europe, and a smaller percentage in Asia," said Pachter.

The game has become an obsession for some players.

Dr Richard Graham, a child psychiatrist at the UK's Tavistock Center, was reported as warning last week that some young people were damaging their social and mental development by playing the game for up to 16 hours at a time.

"The problem with World of Warcraft is the degree it can impact and create a socially withdrawn figure who may be connecting with people in the game and is largely dropping out of education, social opportunities," he told The Telegraph.

But its success among gamers has rival publishers struggling to get into the increasingly popular MMO market.

Brett Close, chief executive and president of 38 Studios, which is developing a new fantasy MMO game, said about 80 percent of MMO games fail but companies continue to try as the appeal is that players become part of that world and spend to stay there.

"You can either spend $20 million to $40 million on a traditional console game that well surpasses its cost over about a year, or double that to yield significantly larger annual profits for five-plus years with an MMO game," said Close.

Billy Pidgeon, videogame research manager at IDC, said it was tough to compete directly with 'World of Warcraft,' but Funcom's 'Age of Conan,' CCP Games' 'EVE Online,' and Electronic Arts' 'Warhammer Online' were doing fine.

CCP Games released its science fiction MMO game, "EVE Online," five years ago and the company has found a niche of 300,000 gamers which has grown with each of the eight free game expansions. The latest "Quantum Rising," came out last week.

"I expect companies to continue to try to get a piece of this growing market," said Pidgeon.

(Editing by Belinda Goldsmith )