monetization
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Neverwinter Days: Money and knowledge
If you've been following Neverwinter's development closely and combing the internet for every scrap of information about it, chances are that this week's column isn't for you. But if Cryptic's newest D&D dungeon crawler has arrested your interest as of late and you're trying to catch up with the rest of the crowd, I think we can be accommodating. Prior to a game's release, I like to bone up on the basics without crossing over into spoiler-heavy territory (especially guides and extensive video walkthroughs, but that's just me). It's a great time to get into dedicated podcasts on the game as well; I swear that podcasts at pre-launch are always more interesting than afterward. So this week we'll go over a few essential resources that all Neverwinter fans, current and aspiring, should include in their bookmarks, as well as a brief discussion about the game's monetization plans.
'Casual content' might account for only a small part of gaming industry's revenue
Monetisation of online games has been a hot topic for the past few years, fueled by the rise of the free-to-play business model and the undeniable accessibility of mobile gaming. At the Digital Game Monetization Summit in San Francisco, developers shared insights into the source of their revenue and recent development trends in social gaming. Rumble Entertainment CEO Greg Richardson argued that only 10% of the $50 billion spent on games last year was spent on "casual content" like social and mobile games. He believes that the tricks early Facebook and mobile games used to spread themselves virally may no longer work and that as a result, the future profit lies with people who self-identify as gamers. Online gaming website Kongregate revealed a detailed breakdown of monetisation and performance stats from its games, noting that its top games get the majority of their revenue came from people who spend $500 or more. Commitment was noted as the key to having successful game, with 84% of revenue coming from dedicated fans who played a game 50 times or more. [Thanks to Segun Adewumi for the tip!]
Facebook and Zynga agree to new terms, create potential for official Facebook games
Facebook and Zynga have worked out a new set of terms in their partnership, enabling both parties to make and promote their own games. Before the alteration, Zynga was required to use Facebook's monetization platform, and Facebook couldn't create its own titles to compete with Zynga's. The latest agreement undoes both stipulations and opens up both sides for more independence.At this time, neither side has announced that it wants to change the way things work, so Zynga will likely still use Facebook's payments system, and Facebook hasn't announced plans to make any official games. A spokesperson for Facebook reiterated that "we will continue to work with Zynga, just as we do with developers of all sizes." It's not a break-up, in other words, but they are free to see other people.
Blizzard's Pardo: Single-player games are an endangered species
Blizzard big cheese Rob Pardo recently revealed his doubts about the future of single-player games in a wide-ranging interview with GamesIndustry.biz. "It's really sad," Pardo said. "There's just a lot of elements out there that conspire to make those games difficult to make now. Between pirating or the ability for people to rent games, it's hard for publishers to pour millions and millions of dollars into a game and not necessarily see the return they need to make those budgets realistic." The interview delves into the pervasive social connectivity inherent in many current-gen games, and it also touches on everything from cloud gaming to monetization and business models. Pardo says he's a fan of game designers dictating the monetization models rather than leaving it up to a producer or an executive. "Someone that's more business-oriented or production-oriented will graft a business model onto a game because that's what they think is going to drive the most revenue, but the game doesn't really support it," Pardo explains.
YouTube heralds arrival of in-stream ads, built-in annoyance for mobile devices
If you've made it a habit of viewing YouTube videos on your mobile device in an effort to flout the site's pre-roll ads, your days of bliss are quickly drawing to a close. Today, the site implemented TrueView in-stream ads for the mobile platform, and like you've become accustomed to on the desktop, you'll begin to notice these commercials on your smartphone and tablet. Now, we get the need for content producers to make some coin, but the move certainly represents the end of an era. Fortunately, just like on the desktop, you'll have the ability to skip these ads after five seconds. Maybe now, you can take pride in making an independent producer rich beyond imagination -- or, at least helping them buy some lunch.
Gamescom 2012: SWTOR will sell statted gear, debating new planet monetization
How do you take a subscription title like Star Wars: The Old Republic and turn it into a free-to-play MMO? According to Executive Producer Jeff Hickman, you do it as carefully as possible. "Give the story away," he explained. "Make the casual player understand what that is. Don't try to monetize that. Monetize all the things around that. I think, actually, as we looked through it, it is not as complex as you think it is. It is very difficult." While plans for SWTOR's cash shop are not finalized, Hickman did admit that players could use it to purchase gear to help them level up: "I don't want to unbalance the game by putting things out on the store that somebody can walk in on day one, buy and be the winner. Having said that, there will be some things that we put out in the store that do enhance power value in some way, but not at the top end." Hickman nibbled around the topic of the planet Makeb, which is still under construction. With more story and more systems, he hopes players will be pleased with the final result. However, Hickman could not confirm nor deny that the update will expand the level cap, nor would he go into detail about whether or not BioWare is going to attempt to sell this to subscribers. [Thanks to Scott for the tip!] Every summer, the gaming industry descends on Cologne, Germany, for Gamescom, the world's largest trade fair for interactive games and entertainment. Massively's on the scene in 2012, bringing you all the best scoops, impressions, and interviews from the MMOs at the show!
ArenaNet president defends microtransactions and in-game RMT in Guild Wars 2
MMOs have to make money; that's a fact of life (and of business) ArenaNet President Mike O'Brien knows quite well. In an interview with VentureBeat, O'Brien explained how the studio is handling the monetization for Guild Wars 2 and blasts RMT companies for their practices. O'Brien addressed why Guild Wars 2 is being offered not as a straight free-to-play title but as a retail product with an up-front cost. "The answer is we're really focused on creating the highest-quality MMO, not the lowest-cost MMO," he replied. "I think Guild Wars 2 is one of the best values in gaming, period. Where else can you get this many hours of enjoyment, of content, of polish, of replayability, for $60?" He also took the opportunity to expand upon his own blog post covering microtransactions from a few weeks ago. "Creating a microtransaction system that doesn't upset or alienate your player base is straightforward, once you clearly define what's in-bounds and what's out-of-bounds," O'Brien stated. He says that ArenaNet wants to be "open and honest" with players regarding the in-game store options and promises that these will be "non-essential additions to the game and convenience services" only. O'Brien also had strong words about the shady practices of RMT companies, practices that ArenaNet is trying to combat by offering its own in-game RMT system. "Where there's a real profit incentive, someone out there in the world will lie, cheat, and steal to make that profit, " he said. "By letting players trade directly with each other, we take the power away from RMT companies and give it to the entire playerbase."
Facebook testing 'highlight' feature, lets users pay $2 to promote their status updates
Finding ways to throw money at Mark Zuckerberg is notoriously difficult, but a new 'highlight' feature could be just the trick. Currently being tested with a small population of users, it allows an ordinary member to pay $2 to ensure that their latest status update crops up in more of their friends' news streams. Ordinarily, the degree to which a status update is streamed depends on the number of likes or comments it has, which ensures that users generally only see the juiciest gossip, but paying this little premium would cause Facebook's algorithms to distort that in your favor. In other words, it's money replacing popularity, or simply -- sigh -- life.
YouTube hiring for next-gen console app integration [update]
YouTube is padding its ranks with next-gen gaming console programmers, looking to "build the next generation game-console-based TV experience with YouTube video content," a Google Jobs listing found by IGN reveals. YouTube already has an app on Xbox 360, but apparently it wants to build a presence across all next-gen platforms, seeking someone with "deep technical knowledge of Microsoft Xbox 360, Sony PlayStation 3 and/or Nintendo Wii."YouTube is seeking someone to "deliver a compelling lean back experience with monetization and e-commerce offerings (ie, pay-per-stream, ads)" and "develop leading edge User Interfaces and delight users with innovative media rich solutions." Looks like YouTube wants to figure out how to take our money, but wants to make us happy about it. That's better than wanting our money, but making us depressed about it.Now if YouTube would develop a PC app, it'd have all the important consoles covered. Oh... wait.Update: This is actually the same job listing Google posted a year ago. Please, someone go make YouTube's new app already!
Rumor: Microsoft 'to further monetize' Xbox Live this holiday
Microsoft will implement another way to take your money through Xbox Live this holiday season, according to a description on group product planner Praveen Rutnam's LinkedIn profile. It reads: "Developed strategy to further monetize Xbox LIVE subscriber base that will be implemented for holiday 2012."Without jumping to any rash, outlandish conclusions based on this vague statement, we can't help but consider what this change could be. One innocent possibility is a phasing-out of Microsoft Points, an event that was rumored in January and refuted in translation by Microsoft Switzerland. A more sinister possibility involves a console-based "online pass" and sacrificial spellwork.
YouTube gives live video streamers better production tools, ways to make money
It's been about a year since YouTube took the beta tag off of its live video streams and to celebrate it's flipping the switch on a few new features. One major way to pull in better content is to allow its publishers to profit from it, and now they can either by charging viewers pay-per-view-style or through instream ads. On the backend they have improvements like a guided flow to follow before events go live and real time data breaking down their viewership by geography and format. Finally, Google is also provided Wirecast for YouTube Live free of charge, a bit of software that it says allows partners to do all the production (capture, switching between sources, live effects and overlays and more) necessary for "professional looking" live events. There's more information available after the break, but as long as this means we never have to see another jump cut vlog then we're all for it.
GDC 2012: Publishing heavies weigh in on F2P conversions
Like it or not, free-to-play is rapidly coming to dominate every corner of the gaming industry. While that's good on the surface, it also blurs the line between business and design, and it creates a lot of tension for both consumers and developers who are increasingly faced with the challenges inherent in separating monetary decisions from gameplay decisions. One of the more interesting GDC 2012 round-tables featured Sony Online Entertainment executive producer Dave Georgeson, NCSoft publishing director Steve Levy, Perfect World VP John Young, GamersFirst monetization director Joe Willmon, and Digi-Capital Limited managing director Tim Merel, all of whom convened for a mind-meld on successfully migrating subscription games to F2P. As you would expect, the panel was heavy on business-speak, but it also featured plenty of insight into the pricing phenomenon that has become the rule rather than the exception.
Free for All: Comparing the payment models of Second Life and Pocket Legends
Over the last few weeks I have been taking a look at different free-to-play payment models in the hopes of showing just how much variety there is in today's market. The term free-to-play is open to interpretation, and every time I become involved in a discussion about what the term means, I come to the same point: Show me the game and I'll tell you how "free" it is. While more titles than not can be enjoyed completely for free, it's important to note that every game needs to make money, so every developer hopes some players pay for something. We also must note that the term "free-to-play" is almost like the term "rock-and-roll." It is a general term that can be broken into many sub-genres. In other words, don't be so uptight about the literal meaning of the word. If you are not sure, check out the game in question.
Lego Minecraft available for pre-order, one block short of $35 (video)
Dwarves of Minecraft, here's your chance to recreate your beloved virtual pits and earth-scars beneath the skies (or ceilings) of the real world. The long-awaited, fan-driven Lego Minecraft set can now be pre-ordered via the source link below for the fathomless sum of $34.99. Yes, you're contributing to a blatant monetization scheme (as illustrated in the frenzied comedy after the break), and yes, your imagination will be limited to 480 pieces in muted colors, but that's how things are when you leave the matrix.
Trion announces Red Door publishing and development platform
Trion is the latest development firm to try its hand at a large-scale publishing platform, according to a new company press release issued this morning. The beast is called Red Door, and it "will consist of a consumer platform and a full-scale publishing and development platform based on the proprietary technology fueling Trion's games." What games are those, you might ask? Well there's RIFT, of course, and the company is also developing End of Nations and Defiance. Red Door aims to allow third-parties to build and run games of similar scope via "fast real-time updates and versatile monetization models." Trion CEO Lars Buttler says that the company's goal is to "revolutionize premium games and help the industry realize its potential in the connected era." [Source: Trion press release]
Gabe Newell on monetization before game design (spoiler: it stinks!)
Valve Software's upcoming "Action RTS," Dota 2 doesn't have a business model just yet. Valve co-founder and president Gabe Newell says he hasn't even begun thinking about the pricing model. "The primary focus for us at this point is not worrying about monetization, and it's instead worrying about getting the game right," he explains in an interview with Gamasutra. Rather, he explains that his company's goal at the moment is "on building something that cool" for the legion of hardcore MOBA fans, "and then we'll worry about monetization ... we're not going to worry about that until later." Further pressing the point, Newell adds, "Premature monetization is the root of all evil." As the interviewer suggests, however, real world economics force many developers to consider monetization models from the design level. Newell sees this more simply. "I think not sucking is way more of an important thing to pay attention to first," he adds, referencing the Dota 2 model of extensive playtesting and iteration before discussing a financial strategy -- a development ideology that works for a successful company like Valve, but may not be possible (or of interest) to other studios. It is a position we can get behind, however.
Free-to-play overtakes premium games revenue in the App Store
The latest blog post from Flurry reports that free-to-play revenue has overtaken premium revenue in Apple's App Store. I think this was pretty much a guarantee at some point in the future, though it's happening probably a little sooner than most expected. Free-to-play gaming, where a game download is free and users spend money on extra content or convenience items using in-app purchases, has been growing on the App Store in a big way. Traditionally, premium app sales (in which a one-time purchase up front pays for the app download and any included content) have been the real money-makers. That's no longer true, however: in Flurry's analysis of the top 100 grossing apps, 35 percent of the revenue is now coming from premium games, with free-to-play titles making up 65 percent. Note that this analysis is for games only, but considering games make up most of the App Store's business nowadays, it's easy to expand these numbers out to the Store in general. What does this mean overall? It's not a new direction; we've already seen free-to-play titles get hugely popular on Apple's App Store and other mobile platforms, and that trend will definitely continue. But even with the success we've seen on free-to-play, developers are still only monetizing a small percentage (usually even less than a full percentage point) of their audience, with small amounts of customers basically paying for everyone. The next big advancement in this business model will be a game that figures out how to monetize a larger audience while still keeping that gigantic group of players that dives in on F2P titles.
EVE Evolved: Third-party development
When EVE Online was first released in 2003, it was a primitive beast from a small indie studio operating out of a tiny office in Reykjavik, Iceland. Although EVE has been expanded over the years, not all of that development has come from creator CCP Games. EVE players routinely step in to fill gaps in the game's functionality through the development of third-party applications, websites and tools. Early apps like the EVEMon skill planner were very limited in what information they could access about a player's character, but with the introduction of the EVE API system, a huge wealth of information became available. Since then, we've seen a resurgence of third-party app and tool development, producing impressive apps like Capsuleer and Aura for the iPhone. We've also seen some incredibly useful websites like the ICSC jump planner suite, gambling site SOMER.blink and the Dotlan EVE maps with regularly updating statistics. Most app developers work on the projects in their spare time, and until now they've relied on donations or advertising revenue to keep up with server costs or keep development worth the time invested. As EVE is CCP's intellectual property, it's illegal for anyone to make money from it without the company's permission. This week, CCP released the first draft of a contract that would allow developers to monetise their apps, but the proposal was not received well by the EVE community. In this week's EVE Evolved, I look at third-party app development and what's wrong with the proposed deal.
E3 2011: GamersFirst talks APB Reloaded's new features and player politics
We told you earlier today about GamersFirst's involvement with Fallen Earth. The company is, of course, more renowned for its All Points Bulletin resurrection project, and we sat down with both Darek Connole and Jon-Enee Merriex at E3 this week to discuss APB Reloaded's open beta as well as the progress that's been made through the extensive closed testing process. Follow along after the cut as we find out about what's new and what's coming, including a nifty iteration on the original title's witnessing system and an interesting player political experiment that evokes comparisons to EVE Online's Council of Stellar Management.
Android adds carrier billing option for Sprint users, just in time for them to load up the EVO 3D with apps
Keeping up with the AT&T&T-Mobile (future) juggernaut, Sprint has just added a direct carrier billing option for its Android customers. The same courtesy has already been extended to T-Mobile users of Google's OS back in 2009 and then to AT&T in 2010, and now Dan Hesse's crew is joining in on the credit card-hating action. Right now, this new payment option is only for splashing cash in the Android Market, however its availability ties in neatly with Google's recent acquisition of PushLife, a music store service that has carrier billing for track purchases as one of its core features. Another brick laid in the foundations of a Google Music service? Let's hope so.
