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

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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4 Comments

  1. The issue with subs right now isn’t primarily players budgets though; for me it’s about value and I think that’s the case with most others too. by now we’ve seen so much that we expect new MMOs to either be very fresh and/or polished or else we consider a sub not good enough value. that did change greatly since 8 years ago.
    the average player can easily afford one sub or several a month if he really wanted to, if he had the time for all these games and was genuinely super hyped. but not many are – so, F2P is the best way to get people to try anyway. maybe you can still convince them, maybe they’ll get hooked because they’re friends are there too. on the upside the customer avoids the bad experience of buying a game that he turns out to hate. coincidence that TSW already launched a ‘free weekend’ (ye…anniversary ha-ha)? hardly. a lot more players have looked into the game now than would have, just thanks to this.
    it’s tough times, trying to convince the MMO veteran to pay for a new game. we scrutinize our personal value more than ever.
    Syl recently posted..Wanted: Your help to build my new PC rig!My Profile

    • Maybe I should have added that. It’s not only a monetary constraint, it’s of course a time constraint as well. In the end, it will limit the size of the MMO market as well.
      From the business point of view, it doesn’t really matter why the players won’t be playing more, be it money, time or personal values and quality criteria.

      Also, at the business end of things of course it is the grand price to pull an F2P player into a subscription, but it is my impression that it shouldn’t be the only goal. The business will have to function if they get only $5 out of a player.

  2. I think subs are now correctly recognised as a lockdown by customers, who prefer to pick and choose how and when to pay (and play), and I think this is just us all maturing, game companies and players alike. Maturity is possible now that more than just one or two good games. It’s grand how many variants on “make them pay” are being tried. Very diverting :), but I’ll stick with my own theory that in a mature diverse market, people will gravitate to what they want. What that is, payment-wise, we are in the exciting process of finding out by stretching and pulling at the payment models we already have. Maybe someone will even figure out a new one!
    Avatarsofsteel recently posted..… Thingie aka TWoFBMy Profile

    • Yes, we are pretty much in agreement here. Some players are perfectly fine with one or 2 main games where they happily pay the subscription fee, while the rest wants to have all the options.
      And now all the gaming companies have started an evolutionary process to find out how to extract less than $15 per month from the players pockets.
      How about metered access? Play 10 nights at 4 hours each and pay the $15 and the rest of the month is free. Play less and pay $15/40 = 37.5 cents per hour.

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