Free for All: So how DO they make their money?
Each and every article I write will have at least a few comments from different points of view on the subject of free-to-play profits and cash-shop uses. Once again my wonderfully unique position as a writer for a large gaming website gives me some general insight into the mind of today's modern MMO gamer -- at least the type of gamer who comes to Massively for his information. As with any group, there are a lot of myths that are passed around, as well as many truths. Figuring out which is which takes time.
I decided to continue with this fascinating look at payment models by gathering even more information. Already I have collected some of my favorite comments from many of you for possible future use in a column, but I love asking questions for you to answer. This week I thought it would be fun to examine some of the different "truths" about free-to-play that get passed around.
For example: How do free-to-play publishers make their money? Do most free-to-play players really pay more than a typical subscription price? Do free-to-play games sell power?
Click past the cut and let's look into some of these items.
I've been looking up some different sources to find solid information about free-to-play publishers' numbers, but they are as hard to find as subscription numbers. Some companies post solid profit information and some don't. In fact, I have posed, point-blank, the question "How do you make your money?" to some of the largest publishers I can think of, but generally they do not release such specifics.
The most I got from many of them was the type of items they sell, and some told me the rough percentage of who was buying from the cash shops. I have also chatted over the phone or at conventions with developers who told me a bit more. Through all of this, I have learned one major truth: We will never hear specific numbers. In fact, most of the people I have the opportunity to talk to would not have access to that kind of information, anyway. The PR person or the UI designer simply doesn't do that sort of thing. The numbers guy does that, and he's not talking.
I remember the first time I asked someone from SOE about Vanguard's numbers. It was before I worked for Massively, but even then I was active with some developers. I asked simply out of curiosity and was met with a laugh. "I don't even know that; I would have to find out," the developer said. That might seem like information everyone in the company would automatically know, but that's simply not the case in many companies -- especially massive ones.
So if someone who does have some access to developers (like I do) does not know these specific numbers, then how do readers or commenters gain access to their "truths"? Why do many of you say things like "most players pay more than the average subscription" or "that game requires a lot of money for you to be competitive" without having access to a larger player database or defining the terms? How could any of us know who is paying what and how much? When I emailed a dozen or so major publishers about this very subject, only about half of them would tell me anything solid. I decided to not run with it -- so how would anyone else know something more?
How do they make their money? Many readers think that cash shops are a forced interaction, one that most players have to partake in. Of all of the developers who have sent me information, given me "hints" here and there, or laughed when I suggested that they were selling X amount of anything, the majority said that they were not forcing anything on their players. (Of course they would say that, you might think.) Since I have also played most of their games, I can see the cash shops and the items within. Most items in the 150 or so cash shops I have scoured are optional items that help the individual level faster or look better.
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That raises a new question: If an item that speeds up leveling suddenly exists for sale, does that mean that leveling without the item is, by definition, "slower"? Remember leveling in EverQuest? I do -- it was a nightmare, and it's still not as easy as in many games. What if SOE had sold the modern-day experience potions back in '99... would players have changed the way they talk about EverQuest now? Would the tales of slogging uphill in the virtual snow be replaced by tearful regrets over breaking down to purchase those irresistible consumables? After all, players these days talk about giving in to the cash-shop temptation as though they ate one too many donuts or snuck out on their spouses. Does the sudden appearance of a faster, newer train make the old scenic route useless?
Do free-to-play games sell power? Yes, it is true that overseas (and here as well), many games do sell power. I have heard the developers admit to it, and I know a few players in those other countries who have shown me the proof. It's a different culture, although not so alien from ours. Does money wield power in real-life America? Of course. It's not such a stretch to see it meaning something in our virtual lives as well.
The caveat here is that "power" can be defined in many ways. Most players, I imagine, would define power as something that affects in-game combat or combat stats. After all, what matters is how fast you can kill something. I hate that definition. When we place different aspects of gameplay along a spectrum of importance, we define design. If we say that killing stuff is more important than, say, crafting or exploration, we tell designers to keep churning out the same combat-based games as before.
If we define power as an ability to grind through monsters faster or defeat a PvP opponent more efficiently, then we will start to see those powerful items for sale in the cash shops even more. It has already proved successful for games like Shin Megami Tensei Imagine Online, Wizard101, Free Realms, and others. Players have shown that if combat effectiveness is what all the cool kids worry about, then many developers will sell those type of items. Still, the fact is that most free-to-play games -- even the ones that do sell some "powerful" items in their cash shops -- sell mostly cosmetic items, experience potions, and other similar items. The responses I got from developers all back this up.
Do most players pay more in free-to-play games than they might while playing subscription games? I would like to clarify once again and say that exact numbers are never, or very rarely, going to be released. I will simply refer to one of my favorite quotes from one of my favorite publishers: "You'd be lucky to break double-digits." This means that a developer would be lucky to see a double-digit percentage of players who spend money in the cash shop. I've heard this same basic thing from almost every developer I have asked.
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This doesn't mean that the minority of players paying into the system aren't paying a lot. Generally the minority pays for the majority by spending large amounts and possibly moving on, burning out, or continuing to play until the next shiny item appears in the cash shop. I have been told by certain developers that some players will even pay in the thousands for cash-shop items, especially in games that allow the trade of cash-shop items for in-game currency. Heck, I made millions in Mabinogi by selling cash-shop arrows and bolts in my in-game store. Those who couldn't gain access to the cash shop got their goods, and I got their in-game gold. Does this mean that cash shops are manipulative or apt to prey upon the weaknesses of those vulnerable rich players? That depends on your perspective and what you consider "shady developer behavior" to be.
In the end, we all have to trust our guts about free-to-play games and cash shops. I also trust my readers' guts. There are enough of you making comments, sending emails, and Tweeting me that I've gained a lot of insight. So what do you think?
How do free-to-play games make their money?
Do free-to-play games sell power?
Do most players pay more in free-to-play games than in subscription games?
If you answer, try to include any specific information you can. Try to name the game, the item, or the publisher. While I would love to have a specific list, I do not expect anyone to have that. If you just have an opinion based on your experiences, that's fine as well. Still, I would love to hear which games or cash shops led you to your opinion. If we're all lucky, we can take a few more steps toward the real truth of the matter.
Each week, Free for All brings you ideas, news, and reviews from the world of free-to-play, indie, and import games -- a world that is often overlooked by gamers. Leave it to Beau Hindman to talk about the games you didn't know you wanted! Have an idea for a subject or a killer new game that no one has heard of? Send it to beau@massively.com!
