MMO Business Models: Subscriptions vs. Free To Play

Gamasutra has an interesting look up at the MMO free to play/micro-transaction vs. traditional subscription model up - talking with SOE's John Smedley, Three Rings' Daniel James and EA Mythic's Mark Jacobs. Unsurprisingly, there are differences in opinion on the utility of the micro-transaction model, with some participants in the discussion coming down on the side of the traditional subscription model:

"You know, everyone thinks it's just so cool to say that the subscription model is passé, that it's dead", notes Mark Jacobs, general manager and VP. "They love to talk about their new models and how they are going to revolutionise the MMOG world. But MMOG publishers are spending a lot more on their games than anyone thought they'd be spending five years ago".

"If your game doesn't have the production values of a leading-edge game, if they are two-dimensional and not three, if they have lower system specs, okay".

"But if you're investing as much time and money as we are on our MMOGs, if you need to pay for the servers and the customer support, if you want to make a real profit on your game, subscriptions are the only way to go".

Snap! Certainly, there are times when the subscription model works well, and times when it doesn't - Chinese players are increasingly moving away from WoW in favour of the domestically produced micro-transaction games. I can't foresee subscriptions ever going away, but companies are increasingly seeing the benefits of the micro-transactions.

MMOG Business Models: Cancel That Subscription! [Gamasutra]


    One thing that I'm staunchly against is "buying power". Thing is, not all microtransaction systems are built around that. Puzzle Pirates, for one, has (successful) microtransaction servers, but the things that are purchasable in the game don't really affect any PvP or even PvE play. They are either purely visual customizations, or ways to unlock gameplay. (Like purchasing the Officer Badge that allows you to sail a ship.) Gameplay is based very much in skill, and the industry mentality of "time=progress" is only true inasmuch as the player themselves is getting better. It's possible to enter the game, never spend a dime, and still be one of the top players.

    Those with more money than time subsidize the play of those with more time than money. That's the essence of microtransaction play, and trying to shoehorn it into the leveling/loot/gear treadmill just doesn't fit.

    Alternatively, to allow casual gamers in, why not an hourly rate with a cap? Say, a typical subber pays a monthly rate of $15, and a hourly customer pays 50 cents an hour, but the charge is capped off at $17 or so. That player can keep playing past that without further charges. That way, subscribing in advance is a slight discount (like the six-month, 12-month or lifetime discounts), but casual players can play as little or as much as they can make time for, with the slight penalty of paying a bit more per month (if they max their hours) for the freedom. Increase the granularity to 15 or even 10 minute intervals (or even tighter), and prorate the charges, and you've given casual players a great deal of freedom at little cost to you (just some database management), and you get more players... without taking huge advantage of the addiction factor of the hardcore or alienating those for whom the cost is a barrier to entry.

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