Free-to-play or how to Spread Around $15 per Month

Posted by on Aug 8, 2012 in Blog, Rift, SOE, Star Wars: The Old Republic, World of Warcraft | 4 comments

How to split moneySo we are talking again about the free-to-play model, after SWTOR has announced they’ll be using it soon for their game. Syp started this with a simple list of various free-to-play models and others have thrown in their opinions. Ocho elaborates a bit more on the various pay models and Sente looks into the cost side of the business.

Guess I’ll throw my opinion in as well. If I look at my own gaming habit I see a couple of things, and I can assume being the average Joe, that many other games will do exactly as I do. I more or less have a gaming budget, as I have already dissected a while back. So does everybody else. That’s the MMO market, the sum of the budgets of all players.

Back in the days of Everquest and Ultima Online, that market was small, since so many people

  • didn’t know about MMOs
  • didn’t have the hardware
  • didn’t have friends who played
  • just found the game to hard.

Along comes Blizzard and blows up the market size from a wild guess of 1 million players for EQ and others to 13 million at its peak, say 15 million to add in the other games, hell make it 18 million. They were able to do this because they pulled in the player base from other Blizzard games and at some point it started to snowballed.

It’s different nowadays. Remember, each player has his budget. And there aren’t that many people left who don’t know about MMOs. There are probably only hardcore MMO deniers left. Each new game, in order to gain traction has to chip away from other games’ player base, or has to find a way to bring in their own fans. But that gets them usually only 1-2 million subscribers like Rift’s and SWTOR’s numbers show. SWTOR actually pulled in the Bioware fans, many of them solo offline gamers, while Rift probably had to steal their subscribers elsewhere.

So what’s a smart company to do if it’s so hard to get new people to put down $15 each month and other players hand their money to Blizzard or Sony? Answer: what every business man does, they ask for less. I think there was a company who actually had $9.95 subscription rates. But that didn’t fly. And even smaller rates won’t work to well, because the cost of handling those transactions eat up the money.

And that’s why the folks running the business end of the MMO’s had to come up with a way get their share of the market. Instead of having somebody play 30 days for $15, they end up with somebody playing 10 days and paying $6 (see what I did here?). The players love it, since they have so many games to pick from. By the way, that’s what it looks like from the players point of view: So many games, so little time. And many want to play them all.

In the end all those free-to-play models are business vehicles to be able to offer smaller pieces of the market to the buyers. Sony’s 3 day pass comes to mind. With F2P you get somebody to pay $20 for in game currency now and recharge 4 month later. However, one reality seems to be that many players have a main game where they are subscribed to, and many others were they drop by every now and then, leaving traces of money behind.

Makes you wonder if F2P is the right way to divide that market into more equal pieces. Plus, the $15 a month Blizzards have to let them chip away.


Photo by: Images_of_Money

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