Ascaron announced to have filed for insolvency on April 14

[Cygnus 0]

I spotted this tidbit as I was surfing my regular sites. Dire news indeed...

 

 

Today the German game developer and publisher Ascaron announced to have filed for insolvency on April 14 at the local court Bielefeld. The Guetersloh insolvency lawyer Dr. Frank M. Welsch is authorized as provisional liquidator. Ascaron wants to take the chance to save the company and as many jobs as possible.

 

The executive board has already started negotiations with several well-known potential buyers which are now continued together with the provisional liquidator.

 

Ascaron executives thank their employees and all Sacred 2 fans. Simultaneously Ascaron and Deep Silver announce that Sacred 2 for Xbox 360 and Playstation 3 will be released as scheduled. Deep Silver confirmed May 29 as release date.

 

Currently the developers are working on a Sacred 2 PC add-on as well as on the successor Sacred 3. The legal steps Ascaron has taken this week were necessary after the development of Sacred 2 had been considerably delayed within the last four years.

Edited April 17, 2009 by Cygnus

[Knuckles 904]

Well that's a bit of news I wasn't expecting

[Spock 271]

Links:

 

http://www.pcgameshardware.com/aid,681916/...nsolvency/News/

 

http://www.4players.de/4players.php/spieli...n/7726/1887833/ - in German

 

Sure hope they are able to pull through OK ... for their sake as well as ours.

 

[Added]

and the official statement on their website:

http://forum.sacredeng.ascaron-net.com/sho...ead.php?t=58951

Edited April 17, 2009 by Spock

[Katran 0]

Who knows maybe they will get there act together now and start doing things like they should be done and not half ass finished.

[Spock 271]

I hope they are able to keep going and make many add-ons and future games for years to come.

 

 

If they don't manage that I hope they at least come out with a final patch that removes the protection and allows us to install our games without having to access their website for "registration" or verification. I have two copies of the game that I haven't even had a chance to install yet.

[Dobster 39]

Who knows maybe they will get there act together now and start doing things like they should be done and not half ass finished.

 

Sorry Katran but I don't agree. They are not a huge company like EA and don't have the same resources, which has now become obvious.

 

Yeah I know I'm a little biased but we should be getting behind them and support them as they do make great games that we all enjoy.

Edited April 17, 2009 by Dobster

[Cygnus 0]

If Ascaron guilty of anything with their Sacred titles it is simply being over ambitious. In my view not a bad thing at all, but with it comes with a tradeoff many little bugs and what not that takes time to iron out.

[Genenut 8]

can live with the bugs, they seem to be different in mechanics but about the same in terms of level of annoyance. The thing I'd like to see is the removal of the secure rom copy protection... with no ascaraon potentially the ability to play sacred 2 rapidly dimishes with the secure rom on it..

But I think this means that the servers wont be merging at all :-(

[Dobri 55]

Well... at least that's not bankruptcy. This means that the servers will keep on running for quite some time. The first time I read it it sounded really dreadful. I was ready to shelf the game, but on the SIF the community managers are trying to say that everything will be just fine. Let's hope so... Otherwise the only online play we'll be getting is through hamachi (but they would have to remove the ping problem first).

[Cthulhu 0]

Sigh... I had a feeling that this was going to happen. Why? After seeing the game's console dates continuously slip by and being re-stated, I knew something was amiss. I got a hint that Ascaron most likely bit off more than they could chew when I started to see all of the unfinished sections of their source code, the bad job they did obfuscating it, and the poor job they did of securing the game's assets. It reeked of a rush job done in order to get the game out on the market in order to give themselves a much needed cash infusion.

 

This was probably all a chain reaction started by Ascaron's failure to realize that they were stepping out of their area of expertise and embarking on making something that was arguably still new to them. Sacred 1, after all, was a game that they picked up from another company. During that time, they still had their revenues coming in from their real specalization - simulation & strategy games - to support them while they dabbled with Sacred 1.

 

Alas, it seems like Sacred 2 became a major resource drain in the end. The lesson learned is yet again: do not attempt product offerings that are not fully conducive to your corporate strategy.

 

---------------------------------------------------------

 

I hate being a pessimist about the whole thing, because I really do like the product and the companies sense of humor. Heck, it's German. That makes me like it plenty. But alas, we'll have to consider the possibility that we may not see any Sacred 2 expansions or a Sacred 3.

 

---------------------------------------------

Sadly, insolvency is still insolvency. The steps taken after filing it in a court of law differ from country to country, and as you may have guessed, the legal procedure's name can differ from country to country.

 

Bankruptcy and its various flavours are the United State's various instruments of handling insolvency via a court of law.

 

Germany in particular, which is where Ascaron had to file (since they are located in Germany), uses "Insolvency".

 

----------------------------------------------

 

I think you should read this, if you wish to read an explanation of Insolvency in Germany:

 

http://www.mayerbrown.com/publications/art...=2572&nid=6

 

 

And this if you wish to see a comparison of US Bankruptcy and German Insolvency laws:

 

http://findarticles.com/p/articles/mi_m413...25/ai_19161963/

 

----------------------------------------------

 

In the event you do not want to read those articles, I'll go ahead and give you a quick answer to: "What does this all mean?"

 

- Ascaron will have someone else placed in charge of the company during its period of insolvency. That means that whoever is in charge now will have their power transfered to someone else. And yes, that means the current management of Ascaron will no longer be in control.

 

- Ascaron's new management will not have to fulfill any outstanding contracts and or debts, and they will be able to continue to maintain normal operations... at least up until the creditor's meeting.

 

- The creditor's meeting (they typically take place 3 months after the filing of insolvency and its approval) will determine if Ascaron will continue to stay in business and undergo re-organization. If the creditors (the ones that Ascaron owes money) and the new management both determine that Ascaron is unfit to stay in business, they will chose to liquidate the company. And that my friends, will be the end of Ascaron as we know it.

 

 

- The cruelest part of Germany's insolvency laws (in comparison to the United States') is that they provide a lot more power to the creditors than the Bankruptcy laws of the US. To emphasize this, the new manager who is put in control of Ascaron will, to a degree, be a puppet of the creditors. This means that he will not have a very optimistic outlook nor evaluative perspective when looking over the company.

 

 

---------------------------------------------------

 

 

They still could re-emerge. However the writing is on the wall - their fate lies very much so upon the success of the console versions of the Xbox 360 and PS3 titles. If the ports do not pay off like the way Ascaron hopes, well, I don't think you need to see me write it....

Edited April 18, 2009 by Cthulhu

[Dobri 55]

Well... Although I'm an optimist at heart, I can't just dismiss what's happening here. I highly doubt that Sacred 2 for PS3 and xbox will provide enough income for the company unless they really put their heads to it and clean out all the bugs that are still present in this game. Nobody likes to play a buggy game. I'm certain the same goes for PS3 and XBOX users as well. And besides, my experience shows that things are usually a lot more different than what they appear - usually for the worse.

[Spyrus 0]

If they were in a hurry to make the console games, then most of the bugs will have been transfer there.

Of course, some of which they were fixed in PC version meanwhile, will not be there.

But, the bugs we found in 2.4 and beyond will be still in consoles.

For me, the time is 1-year not 3-months.

[Little Faith 24]

I, for one wasn't really surprised about this either. My own analysis is that they overestimated their own market reach based on their German experience.

 

Unlike most other countries Germany has a proper domestic video game market. Games can be absolutely HUGE in Germany while being relatively little known anywhere else. Ascaron as a company probably fit this bill to an ace. I mainly see their games appearing in bargain bins and the discount "take three for the price of one" shelves here and they aren't the company to receive the full-page treatment by the arguably quite horrible videogame press.

 

Take the whole Blind Guardian debacle. In Germany the band is absolutely HUGE. Elsewhere, well, they have name recognition but they're mainly discussed as "that cheesy old German power-metal band". Foreigners attending Wacken Open Air (huge German metal festival for the uninitiated) are consistently surprised how huge a crowd old Blind Guardian can pull and how many seem to know all their songs by heart.

I Germany the message that Blind Guardian will be making the soundtrack for Sacred 2 is met with awe. Elsewhere people will go "Oh, resorting to doing videogame soundtracks now are we?" when the fact is Ascaron probably paid through their nose to get them on board.

 

 

Personally I think one of the best things that could happen to Sacred 2 now was for the remnant of Ascaron to release a Securom-be-gone patch as a parting gift to a loving community. It's probably an easier operation than most of us expect, but I don't know the politics of it. Is Ascaron's alliance with Securom water under the bridge as well after the bankruptcy?

[Dobri 55]

Well... after posting a bit on the SIF, these are my conclusions

 

*****

JohnnyX wrote:

Originally Posted by Jonnyx View Post

Bankruptcy protection in Germany is much like Chapter 11 in the US...it provides breathing space for a company to restructure itself without the worry of creditors demanding payments that would, potentially, lead to insolvency.

There is a very good chance that this protection will let the company continue on a lower cost base and everything will turn out good for them.

 

Lets just look around the world and see whats happening in the economy globally, even the biggest of companies is struggling in these very tough times and problems often stem from banks and other creditors not continung to extend credit to perfectly good businesses because they themselves are worried about their own existance.

 

The game itself isn't going to suddenly close and shut the servers leaving us only single player so lets just stay a bit calm with that.

 

Finally lets stop thinking about ourselves for one second and think about the employees of Ascaron and their families who are facing a difficult time of uncertainty about their jobs and financial future huh.

******

 

 

Several things became apparent from this post. (JohnnyX's post)

 

1. Servers aren't going down... just now

2. The global crisis is a really good excuse for everything.

3. Even the creditors are reluctant to give a credit, because of the crisis.

4. That call for sympathy for ascaron's employees families sounded everything but reassuring. Just so I don't sound egoistic and cold-blooded, I've been unemployed for 4 months (even though I have masters degree education) and I know how it feels. So I feel for them big time.

 

Conclusions?

 

1. Unless Ascaron gets a serious financial injection, they're not going to make it.

1.1. That could be done if Sacred 2 for PS3 and XBOX is an outstanding success.

1.2. That could be accomplished if a strong company takes over Ascaron.

2. Unless Ascaron manages to do a successful restructure of the company and gets to a break-even point (for those who didn't study economics, that when Total Revenue = Total Costs), they're going down.

 

I don't see another option for now...

Edited April 18, 2009 by Dobri

[Little Faith 24]

Dobri, your analysis is absolutely on the spot, but I would add that point 1.2 is needed for point 1.1 to come to fruition.

Problem is when you buy a game such as this with the expectation of playing online on their servers, you want a guarantee that these servers are also there tomorrow. We have seen Hellgate: London and Tabula Rasa go up in flames leaving their customers with oh-so-expensive beer coasters.

The potential console playerbase needs this guarantee or they won't buy the game. (They also need to know the game actually exists, which is not a given outside of Germany, this too requires a strong backer that can pull off the necessary advertising).

 

Regarding point 2 might a restructuring entail cutting off the responsibility of maintaining this very game?

[Dobri 55]

That's a good question. However, in my opinion the company reconstruction will require firing most of the personnel, probably cutting down on the company's assets, selling real estate properties, reducing salaries and such. It's very hard to hit that break-even point when there's no one to sponsor you or give you credit. In order to get credit you have to show that you're... let's put it that way - "credit-worthy" - I'm not sure what's the proper term in English

 

The posts on SIF clearly show that Ascaron has been denied credit which cuts off the company salvation options a lot. On the SIF people keep on calling for a vote of confidence and such, but even though I WOULD ABSOLUTELY LOVE to see Ascaron rising from the ashes... They're not getting a vote of confidence from me.

 

I'm giving a 75% probability that the XBOX and PS3 versions of the game will be buggy in some way. They're rewriting the PC code for PS3 and suffice to say, the PC game is still buggy as hell. Combat Arts are still buggy, areas have problems, the garema warrior champs still turn ghostly and can't be targeted... There's a whole list of things. I doubt they'll manage to compile and do extensive testing on the PS3 and XBOX versions of the game, which will lead to some serious problems. If people start shouting around on the forums that this and that is bugged, the quantity of sale will decline rapidly. And if that happens... Ascaron is going down

[Cthulhu 0]

Heh, looks like no one read the links. :-/

 

 

------------------------------------------------------------------

 

I made a a couple of mistakes in my previous post.

 

 

1. Regarding Ascaron pouring all of their work into Sacred 2 alone....

 

Apparently Ascaron HAS made a few of their own titles aside from Sacred 2. They've also published several smaller studio's games.

 

I am a little perplexed at this since from the look of it, they've been releasing some fairly successful titles in Germany alone and in the UK.

 

This ultimately makes me a little suspicious that perhaps Ascaron is another victim of the over-blamed "financial fiasco"; however, I am still mainly under the assumption that they are in the mess that they're in due to over extending themselves grossly on Sacred 2.

 

 

---------------------------------------------------------------------------------------------------

 

2. The creditor's meeting that determine's Ascaron's fate / the day of reckoning...

 

This will occur AT THE LATEST, three months after the filing, not TYPICALLY.

 

That could be both good or worse... since the interim administration could go in and come back very quickly and tell the creditors that Ascaron is very capable of restructuring. However, on the other hand, things could drag out until the three month time limit expires, and Ascaron will suffocate.

 

 

-------------------------------------------------------------------------------------------------

 

let's stop thinking about ourselves.

 

...........I don't appreciate Johnny assuming that everyone who posts at SIF is selfish and/or inconsiderate.

Edited April 18, 2009 by Cthulhu

[Llama8 8]

Problem is when you buy a game such as this with the expectation of playing online on their servers, you want a guarantee that these servers are also there tomorrow. We have seen Hellgate: London and Tabula Rasa go up in flames leaving their customers with oh-so-expensive beer coasters.

The potential console playerbase needs this guarantee or they won't buy the game.

No, they don't, since the console versions won't have ClosedNet servers, so even if Ascaron did go under (and that's not as guaranteed as some people here & on the SIF think) & the Closed servers were shut down (bearing in mind that they're not paid for by Ascaron), that wouldn't affect the console players MP one jot.

 

Lets not forget that Ascaron have put all the work (& therefore costs/cash) into the console releases & now that they've received the ok from MS & Sony, they'll be published & cash will come in (which can be used to pay of the creditors).

 

I doubt they'll manage to compile and do extensive testing on the PS3 and XBOX versions of the game, which will lead to some serious problems

What do you think they've been doing for the past few months?

 

My own analysis is that they overestimated their own market reach based on their German experience.

Ascaron was responsible for developing Sacred 2, the publishers for publishing/marketing it.

[Little Faith 24]

Oh, I was really hoping you wouldn't say that.

 

Excuse me for shouting a bit but IT CANNOT AND SHALL NOT BE OUR RESPONSIBILITY AS A FAN COMMUNITY TO ACT AS A PUBLIC RELATIONS FRONT for Ascaron, no matter how much in the sticks they might be.

 

We'll be doing a disservice to both Ascaron and ourselves this way. People can smell fear, even through the internet, and if we allow this place to be come festering nest of self-imposed censorship we will be scaring away people faster than any publicised bug might.

 

Secondly bugs aren't the #1 problem for Sacred 2 sales in my opinion. If you look at it the only really game-breaking "bug" is the reflect-debacle and we don't even know if this is actually a bug at all, it's not that much crueler than, say, the Iron Maiden casting Oblivion Knights in Diablo 2.

In comparison with the two Diablos Sacred 2 really isn't any worse in regards to unfixed bugs and horrendous coding. It didn't hurt their profit margins because the game still had a lot of fun in it and there was a huge online playerbase.

 

No, our real responsibility as a fan community is to foster a vibrant playing community however big (hopefully) or small it might be in whatever way it might be possible. This is the way we can be of service for Ascaron, cause a multiplayer game without a playerbase ain't gonna sell anywhere.

[Cthulhu 0]

Problem is when you buy a game such as this with the expectation of playing online on their servers, you want a guarantee that these servers are also there tomorrow. We have seen Hellgate: London and Tabula Rasa go up in flames leaving their customers with oh-so-expensive beer coasters.

The potential console playerbase needs this guarantee or they won't buy the game.

No, they don't, since the console versions won't have ClosedNet servers, so even if Ascaron did go under (and that's not as guaranteed as some people here & on the SIF think) & the Closed servers were shut down (bearing in mind that they're not paid for by Ascaron), that wouldn't affect the console players MP one jot.

 

Lets not forget that Ascaron have put all the work (& therefore costs/cash) into the console releases & now that they've received the ok from MS & Sony, they'll be published & cash will come in (which can be used to pay of the creditors).

 

I doubt they'll manage to compile and do extensive testing on the PS3 and XBOX versions of the game, which will lead to some serious problems

What do you think they've been doing for the past few months?

 

My own analysis is that they overestimated their own market reach based on their German experience.

Ascaron was responsible for developing Sacred 2, the publishers for publishing/marketing it.

 

 

1. Heh, true indeed. You've gotta love how the PS3 Network and Xbox Live seem "immortal".

 

I think however there are a couple of caveat(s) with your statement relating to getting paid by the console manufactures: A) If the remainder of their advance does not cover what they need to get out of insolvency and B) if they do not get enough royalty kick backs from console sales in the event that A occurs.

 

 

2. Yeah, I was going to say something about that quote too... but got tied up in my self-corrections. Anyway...

 

Also, I'd like to add... judging from the far more stringent Q&A standards that which console manufactures impose upon developers versus PC games, I'd say that the chances are good that the console ports of Sacred 2 are going to be in the very least, much less buggy than what we've seen on the PC.

 

 

3. I think the international exposure still had something to do with the lack of anticipated revenue. In the very least, I'd have to say that the marketing for the game left... something to be desired. The trailers really did not do the game justice, if you ask me. :-/

 

 

Edit: Faith, I don't understand why Llama8's reply peeved you off.

Edited April 18, 2009 by Cthulhu

[Dobri 55]

QUOTE

I doubt they'll manage to compile and do extensive testing on the PS3 and XBOX versions of the game, which will lead to some serious problems

 

What do you think they've been doing for the past few months?

 

-> Llama, if they were testing, I would be jumping with joy. However, there is a wicked history since patch 2.31 of a lot of "testing" and coming up with a ton of bugs in the end

[Duey 0]

I'm having Hellgate London flashbacks.

[Katran 0]

*Waves around to everyone. Shows off his shiny mod badge!*

 

Guys I just want to give you a heads up in advance keep the topic clean. No one is guilty here no one wants this to happen to Ascaron. Be respectful easy on the caps lock and not every quote is intended as a conflict starter.

 

*Goes to polish his badge some more.*

[D-molisher 9]

Honestly I hope they come out of this mess OK.

And do some about the lame game bugs, before they make another update with new bosses / monsters & MORE BUGS.

Personally I think they saved money since christmas, by firing the bug hunters.

Edited April 18, 2009 by D-molisher

[Little Faith 24]

Of course we all want to see the Ascaron dev-team survive more or less intact and preferably still in charge of developing the Sacred title. If for nothing else than to see what they have in store for us in the expansion-pack. It wouldn't surprise me if it is almost finished by now.

 

And this could just be an unfortunate consequence of the credit crunch, but then again I began to worry about the company's health back when they pulled the Sacred UW servers. It seemed an odd time to do it on.