monetization
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PAX East 2011: Will World of Warcraft ever go free-to-play?
It seems that every new MMORPG wants to bill itself as a "WoW killer." From Lord of the Rings Online to Age of Conan to (most recently) RIFT, everyone wants a piece of the most popular subscription-based MMORPG of all time. To date, World of Warcraft has weathered the competition. Its subscriber numbers have reached an all-time high (now over 12 million), with its latest Cataclysm expansion selling nearly 5 million copies in the first month alone. The game should remain popular and successful for years to come. Still, even Blizzard admits: It can't stay on top forever. So what happens when the game starts losing a significant amount of its subscriber base? If what happened to Turbine's Lord of the Rings Online and Dungeons and Dragons Online is any clue, World of Warcraft might move to a free-to-play model. Since switching to free-to-play, both of Turbine's games added subscribers and increased revenues. This past weekend, I sat in on the free-to-play MMO panel held at the PAX East 2011 conference in Boston. Afterward, I caught up with Robert Ferrari, VP of Publishing and Business Development for Sanrio Digital (Hello Kitty Online), to discuss WoW. We discussed the free-to-play industry and whether or not World of Warcraft could eventually find a place in it. "WoW has to be looking at a free-to-play model currently," Ferrari theorized.
Skype to start serving ads in US, Germany and UK ahead of upcoming IPO
It's a common problem, not having as much cash as you want to, and Skype's solving it with a common web solution: advertising. It may come as a surprise to hear that the eminently popular voice and chat service doesn't peddle stuff to its users already, but it's now formalizing a plan to introduce a carefully controlled measure of paid-for display ads on the Home tab of its Windows desktop client. You heard that right, there's no mention of Mac or mobile services here, and it's further limited to the nations of Germany, the UK, and USA. Anonymous data may be collected as part of the new scheme to target ads to specific audiences (you can, however, opt out), while Skype promises that user experience remains paramount to its future goals, though clearly that looming Initial Public Offering isn't too far from its thoughts right now either.
Saturday Night Live pokes fun at interstitial app advertising with 'Rescue Dogs 3D'
Monetizing your mobile phone app is all well and good, but there's a certain category of apps that should really just charge upfront. This message has been brought to you by Rescue Dogs 3D -- in theaters Friday. Video after the break.
Report: EA planning premium, pre-launch DLC for retail games at $10 - $15 [Update: EA explains]
During a recent visit to EA's offices, Wedbush Securities' Michael Pachter (and other analysts) got what he calls a "candid" view of the future for the publisher. Among the many glowing things that Mr. Pachter had to say in the report from the meeting, he reveals that EA group general manager Nick Earl told him EA has plans "to release premium downloadable content (PDLC) as a product for sale prior to the release of a packaged product." Comparing the PDLC to Battlefield 1943 -- a game for which we unfortunately have yet to see any post-release support from EA -- Earl revealed that the content will be priced at between $10 to $15 through Xbox Live Arcade and PlayStation Network, and will arrive prior to a "full-blown packaged game." That "full-blown packaged game" will of course still carry a "full retail price" when it does arrive in stores. Pachter expanded to Gamasutra, "I think that the plan is to release PDLC at $15 that has 3 - 4 hours of gameplay, so [it has] a very high perceived value, then [EA will] take the feedback from the community (press and players) to tweak the follow-on full game that will be released at a normal packaged price point." This is just one part of the digital effort EA is gearing up for in the coming year, according to the report, which details an expected "1/3 [growth] of revenues over the next few years" in the digital market. Between this and 'Project Ten Dollar,' EA's certainly taking an aggressive approach to new monetization routes on the digital frontier. It remains to be seen how it'll all pan out, but for now things are at least staying interesting. Update: EA's Jeff Brown explained the PDLC concept to us in more detail this afternoon, saying: "EA is working on a number of projects for delivering premium content to consumers before, during, and after the launch of a packaged-goods version of the game. EA SPORTS, EA Games and EA Play are each experimenting with download strategies that deliver fresh game content in formats players want to experience. To date, there is no set pricing strategy for the entire EA portfolio. And many of the proposals include free-to-play content on models similar to Madden Ultimate Team, Battlefield Heroes and Battlefield 1943. None of the proposals call for charging consumers for traditionally free game demos."
iPhone app ecosystem bigger than Facebook's app space
Last week at GDC, I joked that I really only heard about two things every day: Facebook and the iPhone. Of course, that's because I was mostly there to cover iPhone gaming (and certainly there were plenty of traditional game developers in the house), but those two platforms are definitely the hottest new frontier in gaming this year. Facebook offers a gigantic user base, and the iPhone offers unprecedented access (just $100 and a Mac), as well as a ready-made market place. But a new report says that there's a clear winner here: the App Store. The Flurry Smartphone Industry Pulse report says that both platforms are growing, but that the iPhone is growing faster, and they cite the App Store's "monetization possibilities" for the reason that Apple's store is now carrying twice as many applications as the Facebook platform. Facebook actually has more users (not surprising, considering it's been around longer and it's free, while you have to buy an iPhone to use its apps), but the iPhone has more developers and more apps available for sale. The report also looks at "iPhone developer DNA" -- where iPhone developers are coming from -- and it actually seems like iPhone devs are starting out from a good mix of places. Some iPhone developers have traditional development backgrounds, but up to 20% of the developer base is composed of individuals with no past experience. The iPad will probably be a big driver in application development going forward as well. Since its announcement, Flurry believes that the number of "in development" iPhone OS projects started per month has gone up 185%. The App Store is already one of the biggest platforms of the past few years, and it's only going to grow bigger. [via GigaOm]
Activision pursuing 'online monetization models' for Call of Duty franchise
For quite some time now, Activision execs have been hinting at the idea of MMO monetization being implemented in games other than Blizzard's behemoth World of Warcraft. Speaking at the BMO Capital Markets Conference this past week, another Activision exec – CFO Thomas Tippl – was tasked with the question of whether or not WoW's "successful online business model" (read: monthly subscription fees) would end up in other Activision properties. "It's definitely an aspiration that we see potential in, particularly as we look at different business models to monetize the online gameplay," Tippl says, according to an IGN report. "I think it's been mutually beneficial, and you should expect us to test and ultimately launch additional online monetization models of some of some of our biggest franchises like Call of Duty." He also notes that "there is demand from the core gamers to pay up for that," which likely means that many of you who got Activision's survey back in June supported this. Shame on you. [Via CVG]
Moore talks digital distribution; disc-based business model 'a burning platform'
EA Sports head honcho Peter Moore is all about digital distribution. During a panel on monetization at the PLAY Berkley Digital Media Conference this past weekend (as reported by IGN), Moore extolled the many virtues of a digitally distributed future, when discs are a long-forgotten remnant of an old business model. "I'd say the core business model of video games is a burning platform ... absolutely," Moore said.Thankfully for all of us disc-owning fools, Moore doesn't believe we'll be seeing a digital distribution–exclusive business model next week. "As an industry, I still think we may be as many as a decade away from saying goodbye to physical discs," he said, positing that Microsoft would likely be the first to release a download-only console (surely, not to be confused with a digital-format portable system or pc-based device). In the meantime, EA continues to ship 125-130 million discs each year while moving toward Moore's envisioned future.
Mythic's stance on monetizing cut WAR content
A thread/poll over at the Warhammer Alliance forums recently asked its denizens if they would be angry at Mythic Entertainment for charging money for the previously-cut Warhammer Online content via an expansion. The results appear to be drawn down the middle. While that may not be indicative of how the majority of players would feel about Mythic putting the previously talked about content in its first expansion, it's not the most important side to the story. The important thing to take from all of this is the post that Mark Jacobs makes very early on in the thread. He compares the cut content to a director cutting specific scenes out of a movie in order to make it a better experience and releasing said content at a later point on the DVD release.If that analogy doesn't make things quiet clear, Jacobs helps assuage possible fears by ending his post with, "if/when we bring back those classes and these cities (sorry for the if, don't read more into it, just being careful) that players will not have to buy them from us as part of a paid expansion but rather just part of the content updates that we did so well for DAoC." We're happy to hear it and hope for an expedient release of that content. We really had our hearts set on being a Blackguard.[via theGREENskin]
Is Facebook gaming 'the next big thing'?
Worlds in Motion recently covered events at the InterPlay Conference in San Francisco. InterPlay is devoted to social gaming, and is billed as 'the premier conference on the business of games on the Social Web.' Among the speakers at InterPlay were Charles Yong and Jing Chen, co-founders of Developer Analytics. The company offers a social networking metrics platform that provides a leaderboard of the top Facebook applications, where casual games predictably rank high. Their talk focused on the monetization of social games and the feasibility of adding greater depth to casual games, an opportunity that's drawing a 'significant surge of venture capital funding,' Worlds in Motion reports.On the topic of generating more revenue from social games, Charles Yong said, "Social gaming is where the really great monetization is at. You can prototype with little to no money down. The whole premise of this is that marketing cost is really, really low, compared to a real game, like Grand Theft Auto IV." Before casual gamers could take offense at this statement, Yong clarified that casual gamers can be hardcore about their chosen style of play, but "they haven't seen GTA IV, they haven't seen Half-Life 2, and real money is coming out of virtual goods and currency."
TGS undermonetized, but so what?
Advertising's omnipresence in Tokyo is so complete and thorough that we only take notice when it's missing. Like air, you only notice it when it's gone. It's therefore notable that most prime Makuhari convention center facades lack advertising of any sort, even though they were clearly designed to support large-format ads. There are a few possibilities that might help explain what's going on: Advertising's inneffective: Given limited budget, game companies appear to prefer to pour Yen into their booths, the babes that staff them, the bags the babes hand out, and other tangible improvements to enhance their show presences. Game promoters have other means of driving traffic to (and interest in) their booths and their games. Bad placement: Advertising plastered on lofty facades might be worthless if everyone's got his nose buried in a portable game device Operational challenges: Perhaps show organizers aren't too skilled at wringing money from companies in attendance (if there's one thing the E3 organizers did well, it's help companies shell out lots of dough). Small potatoes: in the grand scheme of things, this show isn't that important. It's just three days out of a 24-7, 365-day effort to woo gamers. That might explain why Nintendo's nowhere to be seen.
