F2P – Baseline Forward

There’s enough hullabaloo (I don’t get to use that word often) about F2P in the blogs today.  I don’t necessarily get the fervor so much but I suppose with RIFT swapping and Neverwinter “officially” launching, we’ve got new competition.  Here’s a thought for the day.

The theory is that in an open market, the market itself self-regulates.  This has a dependence on there actually being an open market, so no collusion (banks and gas) and no monopolies (Windows, Internet Explorer).  Movies are an almost an open market in that the price of tickets from theater to theater is relatively the same.  Cars are similar, since you can do an apples to apples comparison of features and price match between dealers.  Games are close too, since the upper cap for any game is going to be $60 and anything below that seems to be seen as “budget” title.

The new variants to this are the mobile space, DLC and F2P games.  Mobile space has 3 price points – free, 99c and $4.99.  Anything outside of that is an outlier.  DLC is seen as $5 as a price point for any given package, regardless of quality.  This makes season passes effective in that you pay 20$ for the promise of 5 packages (or more).   These prices are set because of market saturation and competition.  Why spend $7 here when I can get the same item for $5 there.  Subscriptions above $15 have never worked.

F2P games are approaching a baseline price model for various features.  For a long time only the East had a model and everyone on this side of the pond basically stuck their thumb in the air and guessed at a price.  Allods is the poster child for how pricing structures can destroy a product.  Up until a few years ago, we basically had Zynga & friends telling us the price for F2P.  DDO swapped with a decent package, then LOTRO, STO, AoC, EQ 1&2 and now a few more.  The market is still somewhat fresh and expectations for pricing points are still somewhat in flux.  That being said, I think we’re hitting the point of what’s acceptable.

A mount at $10 is acceptable.  Costumes and customization at $5.  DLC expansions at $10-$20.  The market is going to decide what is acceptable if you give enough similar choice.  RIFT, Neverwinter, LOTRO, EQ and SWTOR all offer extremely similar services.  Any new gamer looking at the field is going to try to find value for their dollar and right now, RIFT and Neverwinter are setting a heck of an example.  EQ recently (a few months back) increased what was available to the masses.

At the end of the day, each developer needs to make money to pay for servers and staff.  It does not get any simpler than that.  In order to make money, they have to sell something.  Consumers are now in a better position to compare products and value, and invest where they see fit.  This is going to drive the market moving forward.  Voting with your wallet works and is the only true way to make sure something changes.

Used Games and the Future

So, here’s an interesting post on the future of used games and Microsoft’s current approach (well, more than MS really).

If the secondhand market is not having a major detrimental effect on the primary market, then why would it need to be addressed?

If it were the case for movies and games, then yes, I’d favor similar measures by music/movie industries to protect themselves against it.

Well, this is the disconnect I guess. You admit you only hold this view because of the detrimental effects (you think) are impacting the industry. You are asserting that a fundamental aspect of property rights and consumer rights as it has existed since the beginning of trade should be adjusted and recodified on a per-industry basis, not because it’s inherently bad or unethical, but just because you think it’s a threat to the industry’s health. Which means you are essentially arguing for protectionism for corporations–consumers are free to exercise their consumer rights only up to a certain point, but if that free exercise is perceived to threaten the viability of the industry, then their rights must be limited in order to save the industry.

I don’t think I can put into words my disgust at this demeaning display of groveling at the feet of your game developer overlords. Even a die-hard laissez-faire capitalist would not be so subservient, because even a capitalist would accept that sometimes industries die and that’s the way the world works. As much as I enjoy games, there is no inherent good in this industry. The ends do not justify the means here; there is nothing that makes the gaming industry inherently worthy of preservation, not to the point that would justify carving out a special exemption for them where used games are somehow magically not OK when they are OK for every other packaged good on the planet. Just because your favored set of content producers couldn’t properly adapt does not justify rewriting the rules of what “property ownership” means and fundamentally removing the ability to preserve, inherit, pass on, lend, and share its products.

The industry does not come first; consumers do. I have no sympathy for an industry that cannot properly stumble its way around a viable secondhand market like every other mature industry in the world. Sometimes your old product just isn’t good enough, and the way you solve it is by making a better product, not by forcing consumers to adapt to your archaic and myopic business model with your dying breath. If this industry can’t find a way to make money off the primary market — even with DLC and exclusive pre-order content and HD re-releases and map packs and online passes and annualized sequels and “expanding the audience” and AAA advertising and forced multiplayer — then, if I may be so blunt, fuck itIt doesn’t deserve our money in the first place. If an entire industry has its head so far up its ass, is so focused on short-term gains, and has embraced such a catastrophically stupid blockbuster business model in the pursuit of a stagnant market of hardcore 18-34 dudebros that it thinks it has no choice but to take away our first-sale rights as its last chance of maybe, finally, creating a sustainable stream of profits, then it can go to hell. It doesn’t need your protection, it needs to be taken out back and beaten until it remembers who its real masters are.

I especially have a hard time having any sympathy because so many of the industry’s problems are of its own making. They chose to focus on shaderific HD graphics over long-lasting appeal and gameplay; they chose to focus on linear scripted cinematic B-movie imitations that were only good for one playthrough instead of replayability and open-ended design; they chose to pour so much money and marketing into military porn and fetishized violent shootbang Press A to Awesome titles, exactly the kinds of games that hardcore gamers, the most likely gamers to trade in games quickly were prone to buying and reselling; and perhaps most galling, they chose to give Gamestop loads of exclusive pre-order bonuses while they knew exactly what Gamestop would say to those customers once in the store. They kept making insanely lavish and nonsensical displays of spectacular whizz-bang, despite that being exactly the kind of game most susceptible to trading after one week because there was nothing left to do with it. And now they’re discovering that putting so many insanely expensive eggs into one fragile and easily breakable basket is maybe not the most sustainable business model ever.

So forgive me if I find myself not caring one bit when the industry complains that it’s just so hard to sell six million copies of Gears of Medal of Battle of Uncharted Angry Dudes VII in the first week and that’s why they need to take away used sales for the entire platform. No, the problem isn’t at this end.

There’s just something so precise about this rant that I can’t help but keep reading it over and over again.

It’s strange that the market is still aimed at dudebros, yet in the same breath complaining that people outside that scope won’t buy games.  How selling 1 million copies of a game is seen as a failure… the problem is clearly not on our side of the equation.

The Hiccup with F2P

If you follow MMOs, then you’ve likely noticed a trend in that F2P games are generally seen in poor light and a last recourse for subscription games.  People talk about the monetization of F2P games, while they only talk about the content of subscriptions.

Let’s get one thing straight off the bat, games need to make money.  It’s simple math.  A subscription model provides a stable income that you can project into the future with.  Generally, you don’t need to worry about your next week’s pay and as long as you don’t tick off the userbase, it’s pretty consistent.  F2P games, well, they require a continual investment to keep funding consistent.  Developers haven’t yet found the right balance of items to keep people pumping in money and have essentially devolved everything into lockboxes.

Would I play for free for 20 levels, then pay 10$ to get access to another 20?  Very likely if the game was good.  Would I do it for every character?  Maybe 2 or 3 of them, if the value/time equation made sense.  Once you have it though, you don’t need to buy it again.  Would I buy dungeon sets? Yup.   But again, that’s a 1 time purchase.  GW2 sort of worked this way, in that you buy the box, have access to everything.  B2P works when you have people coming and going.

Long-term though, this model doesn’t work as people have nothing to buy.  Paying 2$ to get a week’s pass to PvP makes sense if you PvP alot.  It doesn’t if you want to try 3 matches.  I think TOR did a pretty good job in this regard, where if you’re in the F2P version, you can buy passes for the high level content.  Since it’s consumable, it is a guaranteed money sink.  If I was planning on consuming a lot, the I’d go the subscription route.  Value for money and all that.

My personal thought is that all F2P games should have a subscription model for heavy consumers.  It should provide you with access to all the content with that subscription, including credits for the cash store.  If it means you wait 2 months to get the credits, then so be it, but it should be there.  All items that can be bought for cash, should be able to be sold on the AH.  Neverwinter and TOR do this decently.  All items that can be bought for cash and provide “power” should be 1-2 tiers below what can be acquired by in-game means.  Customization options should be consumed on use but allow you to save settings and try stuff out before you buy.

Personally, I think we’re on the breakpoint of a sustainable F2P market.  Lockboxes are not the future and are likely to be the proverbial straw on the camel’s back.  I am extremely curious to see Rift’s take on this, as they have always provided great value for money and understand the player’s perspective more than most.  It’s the reason I’ve kept subbed to them since launch, even if I don’t play as much as I’d like.  We, as a gaming community, have to move beyond the discussion of what payment models are good and which are bad and simply to the core of gaming – is this worth my time/money or not?

Free to Play Foibles

Since Rift is going F2P in June, quite a few people have voiced some concerns over the business model and the long term ramifications.  I think Wilhelm has the most sober approach to it all.  There are quite a few items I would like to discuss here that I think many people have either overlooked or simply not really thought much about.

A subscription game has a relatively assured income model.  You have X players you get X money.  As long as the playerbase is happy, you’re going to bring in money.  This part I don’t really get about RIFT since the quality has always been there but without Hartman at the helm, we all pretty much figured this was going to happen.  WoW makes about $50 million a month and can amortize/invest into future content development.  The thing about themeparks is that the developers determine the content and the players consume it.  Given WoW’s development cycle, you’re paying about $60-$100 per patch and then another $60 per expansion pack.  Take any other themepark F2P game and you can pay much, much less for content – sometimes nothing.  Sandboxes do not have this problem (hence UO still be subscription) and PvP games are pretty close to this.  This is rather clear if you take a step back from the actual game.

Where people tend to trip up a bit is two-fold.  First, a company needs to make money and people have to spend money.  I know, simple.  The thing about making money is that you have to consistently make it.  If you’re selling unlocks for an account, things that last forever, then after a while, people won’t be buying them if they’ve been there for a long time.  You need new players to buy that sort of stuff.  In order to make cash, you need to sell consumables.  In a level-based, gear-based system, what is consumable?  New content is one, but the price tag to develop it is high and you’re not sure to get the money back.  Character customizations work but again, unless you’re overwriting what was there before, you’re not going to have long term success.  Devs have yet to figure out this problem, instead they all rely on lockboxes, which is more or less gambling.

This is where it gets tricky.  As a general rule, people are stupid.  A person is smart, certainly.  Groups of people, in small enough quantities can show smarts – hence guilds.  Large groups, as is evident in any political circle, are as dumb as bricks – if not simply lemmings.  Neverwinter’s spam of who is successfully unlocking mounts in their gambling boxes invariably makes other people think “I can win too”.  Even the lottery is a tax on the stupid as you have a better chance to be hit by lightning twice before winning the lottery once.  People still buy dozens of tickets a week.

So you end up in the situation where developers have yet to find a consumable item that doesn’t make players feel like they are getting gouged (which is why we pay subscriptions right?) and resort to the lowest common denominator.  Which the public happily provides.

A third point that I need to bring up is the comparison to F2P in the Asian market.  The majority of those games are P2W, clearly.  And the majority only stay on the market for 12-18 months.  This is the polar opposite of the western F2P market.  For some reason I can’t yet figure out, our side of the ocean wants free games for years and years and years.  If you’re too cheap to pay 10$ a month for a F2P game, you shouldn’t complain that they are offering items to people who will.  If you’re unable to find things to buy at that price point, which I personally find issue with, then there’s simply a problem with the financial model of the game (*cough* SWTOR *cough*).

While I might think that RIFT could have continued for another 10 years with a subscription model, apparently they were getting enough feedback that F2P games were eating into their profits.  WoW is no different I’m sure.  Someone will have to make the tough decision of either guaranteed income and to weather the F2P storm while the market evolves or to jump into a pool of cannibalistic fish who will do everything to destroy their competition.

Is Free to Play here to stay?  Yes.  Is the current market deployment sustainable? No.  Did the exact same thing happen to subscriptions over the past 5 years?  Hell yes.