The week of July 26, 2015

The meteoric rise and slow decline of Neopets

By Olivia Coy

On the morning of Sunday, June 28, 2015, a long-quiet corner of the Internet began to stir.

That morning, Neopians—“citizens” of the children’s gaming site Neopets—awoke and logged on to discover that, inexplicably and without warning, the formerly ironclad moderation system had fallen. There was nothing preventing them from filling the once strictly regulated Neoboards with obscenity.

Slowly, then quickly, this knowledge crept across Neopia.

Within hours, chaos reigned. In one thread, a user solicited casual sex. In another, an intrepid Neopian posted the entire script of Bee Movie, one paragraph at a time. Not satisfied with this accomplishment, the same user later posted the script of Shrek.

The Internet gawked at the mayhem: News spread across social media, collecting tens of thousands of notes on Tumblr, trending on Twitter, and inspiring coverage on BuzzFeed. That afternoon, a statement released on the official Neopets Facebook page explained, “At some point over the weekend, as a result of a facility move, the Neopets moderation and filter system went off line.” With moderators unable to do their job, a Neopets spokesperson also told Kotaku, “We just want to be clear that no mods were fired, and the issue was in no way related to staffing—rather, it was due to a move in facilities.” (This appeared an attempt to quell rumors that a majority of moderators had been laid off several months earlier.)

One game, aptly titled “Adver-Video,” simply consists of allowing the user to spin a wheel to win a randomly determined prize for every commercial they watch.

The message board meltdown was the culmination of long-building tension over the rapid monetization of the site to the detriment of the community. Neopets had unwittingly become a case study for the ways that ineffective community management can render immensely profitable websites obsolete.

• • •

Once, Neopets had been hailed as a digital entertainment behemoth. A U.K. couple, Adam Powell and Donna Williams, founded the site in 1999 on the idea that once people grew attached to their colorful, customizable pets, they’d keep coming back, offering ready eyeballs for advertisers. Impressive early growth attracted the attention of Doug Dohring, who bought the company and became CEO. Dohring brought with him management techniques borrowed from L. Ron Hubbard, founder of the Church of Scientology, which at least one former employee found off-putting, according to an email published by Kotaku in 2005.

But whatever drama went on behind the scenes, Neopets continued to grow. By 2005, according to Wired, the site had 25 million members—enough to persuade media giant Viacom to buy it for $160 million. According to the Wall Street Journal, it ranked as one of the “stickiest” websites of the time: Not only did the site receive millions of unique visitors daily, but they stayed for an average of 19 and a half minutes per day.

That time was important: The business model relied on what Dohring called “immersive advertising”—branded Flash games and activities with titles including “Spider-Man Cheese Nips Hunt” and “Orajel Kids Memory Match.” Around 60 percent of its revenue came from sponsorships. The company also harvested marketing data, monitoring player activity to construct trend reports it called “Youth Pulse” research. Advertisers clamored for access to information about the buying habits of millions of users, 39 percent of whom were younger than 13.

“Let’s just say we weren’t fans of most of Neopets’ resources being spent creating ‘wheel of spinbrush’ or some other sponsor game rather than actually on making the core game better.”

From the outset, marketing to young children drew heavy criticism.“They’re not smart enough to work out the packaging,” Kalle Lasn, co-founder of the anti-consumerist nonprofit Adbusters magazine, told the New York Times in 2002. “We are targeting kids before they are old enough to figure these things out.” (Lasn became something of an unofficial Neopets scold, appearing in multiple stories.) And as recently as 2013, Neopets was criticized by the Guardian for “exploiting children’s emotions for profit,” by monetizing the bond between children and their virtual pets “often with manipulative tactics worthy of a casino.”

The critics have a point, at least about the site’s unabashed commercialism. It revolves around caring for virtual Neopets with virtual goods obtained either by bartering with other users or purchased with a virtual currency, Neopoints. Points can be gained in a variety of ways—there’s a particularly complex trade system, stock market, and even a cobbled-together “service” industry—but the primary method has always been the heavily branded Flash games. One, aptly titled “Adver-Video,” simply lets the user spin a wheel to win a randomly determined prize for every commercial watched.

Every virtual purchase becomes a display of the player’s wealth; aside from providing for their virtual charges, Neopians could flaunt their affluence. But in addition to living out their dreams under Neopets’ quirky brand of Fisher-Price capitalism, users could pursue regular site-wide puzzles. Site events often prominently featured the staff members—colloquially referred to as TNT, “The Neopets Team.” The relationship between users and TNT was so amiable that one of the first site events was a Clue-style murder mystery featuring staff avatars as characters.

Later site plots involved virtual wars between one user faction and another, spurring players to arm their pets for battle—which meant spending Neopoints in the game’s shops, rather than bartering. Not coincidentally, that took Neopoints out of general circulation, coaxing users to go watch more ads to replenish their coffers. War was a racket, one some players began to suspect was designed specifically to line the company’s pockets.

The site events also moved away from the game’s original purpose and meant producing more sponsored games. Donna Williams later wrote in a Reddit AMA session: “Let’s just say we weren’t fans of most of Neopets’ resources being spent creating ‘wheel of spinbrush’ or some other sponsor game rather than actually on making the core game better.”

The flood of games created a flood of Neopoints, and you don’t have to be an economist to predict the result. Activity from one game could easily create 250 million Neopoints a day. By 2010, inflation in the virtual economy had become so severe that the company offered users prizes to remove as many Neopoints from the economy as possible. The not-so-subtle attempt at a deflationary policy did not sit well with many players.

“Do you want to play a game where anything worth doing costs more than you could ever dream of earning?” she wrote. “How is an 8-year-old going to learn how to restock draik eggs?”

Meanwhile, the unsponsored features of the site went neglected, and users complained loudly and often about site glitches, outdated content, lack of substantial community events, and archaic chat moderation systems hastily implemented in response to the Children’s Online Privacy Protection Act—passed in 1998—then never updated to reflect current legislation.

Neglect and overcommercialization frustrated current players, while, as one Neopian pointed out, inflation had made the game inaccessible to new players. “Do you want to play a game where anything worth doing costs more than you could ever dream of earning?” she wrote. “How is an 8-year-old going to learn how to restock draik eggs?” (Hyperinflation has plagued other virtual communities as well: On the GaiaOnline forums, one user laments that the monetization of “gold generators” has created a market in which even mediocre items cost in the billions.)

Neopets’ problems weren’t solely an economic blunder. The company had, like so many before it, failed to account for the effects each update had on the overall site dynamics. The features that drew users in the first place were neglected for short-term profits from sponsored games. Williams admitted as much in her Reddit AMA, writing, “The changing focus just meant that a lot of things that made the site unique had to be changed or removed.” That left longtime users frustrated—or spurred them to leave.

• • •

Williams writes in her AMA: “We knew that the lifetime of a simple HTML site that was relatively unchanged since its creation in 1999 was limited. The fact it is still going now has surprised us both!” Neopets is the product of a different Internet era, yet somehow it’s managed to cling to life in this one. Whether that’s a testament to the prescience of its early business model—ads everywhere! users voluntarily giving up their marketing data!—or the allure of its central conceit—virtual pets! that you can feed and clothe and love!—the site has outlasted what could have been simply another dot-com fad. How many sites can you name that were founded in the 1990s and are still around today?

In early 2014, more than a year before the message board meltdown, Viacom sold Neopets to JumpStart, an educational software company that usually caters to young children; the sale price was not disclosed. According to a former team member, JumpStart acquired the site with a specific interest in the older audience that makes up much of the community. Whether this is wishful thinking; whether JumpStart has the will and resources to revive Neopets; whether it can or will ever be what it once was—not just another marketing sledgehammer, but a game that genuinely engaged its players—all of these questions remain open.

Within 24 hours of the chat filters failing that Sunday in June, the forums were shut down completely, and the users were silenced once again. In retrospect, and despite all its juvenile provocations, the Neopets forum collapse looks like a digital-age, collective cri de coeur, a long-suffering community voicing its frustrations with all the rage it could muster. Whether Neopets succeeds in creating a renaissance under new management or withers away, it’ll have lasted longer than most and provoked the kind of bent passion that’d make someone post the Bee Movie script one paragraph at a time.

Illustration by Tiffany Pai