It wasn't too many months into the development of Warhammer Online that the parties behind the development of the MMORPG, Warhammer licence-owner Games Workshop and developer and publisher Climax, were downright giggly about the game's prospects.

"It’s our intention to create a fun, dangerous, exciting and entertaining game that offers our players the opportunity for cooperation and competition in equal measure, all set against the turbulent background of the Warhammer world – a tall order indeed!” gushed Robin Dews of Games Workshop.

Climax founder and CEO Karl Jeffery reported that he was "extremely pleased with progress to date."

But somewhere between the optimism of 2002 and the reality of 2004, things bogged down. After more than two years in development, the joint venture between Games Workshop and Climax ceased all development on the project, citing the "costs involved in bringing the Warhammer massively multiplayer online game to market," were too high.

Both Dews and Jeffery released statements that reflected their disappointment with having to shut down development. Shortly after those statements were broadcast to gamers, Jeffrey spoke with GameSpot to shed additional light on the decision--and what it takes to compete in the MMOG space.

Based on limitations imposed upon him by the terms of the joint venture, he was reluctant to go into too much detail, but here's what Jeffery was willing to say.

GameSpot: As the MMOG market becomes increasingly crowded, what do new games need to compete with existing titles?

Karl Jeffrey: What they mainly need is unique and compelling gameplay. The MM market is still in its infancy and growing at an incredible rate – there is everything to play for.

GS: Some people feel that what a new MMOG needs to be successful are brand-new ideas and gameplay concepts. Can a game like that stand alone, or does it need top-notch production values and a big-name license to compete?

KJ: Clearly it needs at least great and innovative gameplay, but I believe gamers quite rightly demand cutting-edge production values and technology too. As far as a license goes I am not so convinced, there are recent examples of both licensed (e.g., Star Wars) and unlicensed (e.g., City of Heroes) MMOGs doing very well.

GS: It seems like Warhammer Online had the right formula: new takes on MMOG gameplay, excellent production values, and a popular tabletop license. Why were your company and the Games Workshop unwilling to commit the funds to carry the game through?

KJ: The cost was far higher than either party had originally planned for, in particular the cost of rolling out the infrastructure and support teams for the ongoing operation of the game worlds.

GS: Did other impending games, such as the ever-touted World of Warcraft pose a threat to Warhammer's projected success?

KJ: Every game in development is a potential competitor, of course, but we believe that Warhammer offers something different to everything else out there. World of Warcraft looks like it is going to be a great game but it has a very different game world and gameplay model to us.

GS: Why do you feel that MMOG's are becoming more expensive? Do you believe that costs will continue to rise or will begin to level out as tools, such as your Leviathan suite, make the process easier?

KJ: MMOG’s are getting more and more expensive to produce and roll out, but then so are all games. Reusing the Leviathan engine will mean a significant reduction in the cost of producing future MMO’s, also leveraging someone else’s existing infrastructure and customer support team is something we are considering.

GS: Your press release mentioned another game in the works. Is any of the work that has been done on Warhammer Online transferable to this new game?

KJ: Yes, much of the technology and tools will be reused, but not the design or art assets.

GS: Thanks, Karl.