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PlayStation Plus: Good for Players, But is it Good for Developers?

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PlayStation Plus: Good for Players, But is it Good for Developers?

May 9, 2013 Article Start Page 1 of 2 Next
 

It's been almost three years since Sony launched PlayStation Plus, a paid subscription program that will probably be looked back upon as the most transformative evolution in console business models this generation.

For $50 annually, members get perks such as cloud saves and automatic, scheduled system updates, plus deeper discounts on games. But the biggest draw is the "Instant Game Collection," launched about a year ago, which is a regularly-refreshed rotation of "free" games. The catch is if you want to keep the free games, you need to re-up your subscription annually.

A Reddit user recently posted what a full year of PlayStation Plus' Instant Game Collection looks like. It's a list that includes dozens of titles, big and small, like Borderlands, Infamous 2, Pac-Man CE DX, Uncharted: Golden Abyss, Closure, The Cave and so on.

PS Plus seems good for the players, and good for Sony, which wants to grow its higher-margin digital business. But with what seems like a lopsided value proposition, we had to wonder: Is this good for developers?

"A loyal customer base is a must for the survival of the consoles" 

Take Christofer Sundberg, founder and chief creative officer at Avalanche Studios, the independent company behind the sprawling open-world series Just Cause. The Square Enix-published Just Cause 2 was free for PS Plus subscribers last year.

Sundberg said Avalanche "hasn't seen a dime" directly from the promotion from Sony (Square Enix would've been the one to strike the terms of that deal). But he's perfectly okay with that, as that wasn't the expectation when striking the deal. For Avalanche, free promotions like PS Plus or free betas are an essential part of building a fan base. "From a PR and goodwill standpoint, [it's] most definitively worthwhile," he said.

"I don't know how much, if any, Square Enix has made from the game [on PS Plus], but we have only received a lot of great PR and gamer feedback," he said. "That's worth more than a few dollars in royalty to us at this point."

Sundberg said he personally subscribes to PS Plus. "With free giveaways, early releases, special demos and so forth Sony builds loyalty from their players. That is exactly what they should focus on. Most players won't have the money to buy both a PS4 and the next Xbox, and a PC, so a loyal customer base is a must for the survival of the consoles."

"For us, yeah, the revenue was worthwhile"

Developers negotiate PS Plus contracts with Sony on a case-by-case basis. Whereas Avalanche received the goodwill and positive public relations from a free PS Plus game (Square Enix, the publisher, presumably would've gotten compensation from that specific deal), some smaller developers we talked to did receive money directly from Sony when they made their games free.

Due to non-disclosure agreements, developers are tight-lipped about exactly how much, and how, Sony pays out. But we can at least get an idea of the effectiveness of a PS Plus free promotion.

In February, independent developer and Closure creator Tyler Glaiel put his game in the Instant Game Collection rotation.

"For us, yeah, the revenue was worthwhile," said Glaiel. "[Subscription models] are not a replacement for selling games traditionally -- Humble Bundle isn't either -- but it's super awesome Sony is doing this, because it absolutely helps in the end," he said.

As for the amount of revenue he got from the promotion, he was coy, saying, "I'd categorize it as a 'nice boost.'"

Jakub Mikyska is CEO of Grip-Games, developers of Foosball 2012, which was free in January this year. "The impact [of making the game free] was definitely worthwhile. Not huge, but worthwhile," he said. "I will also point out that putting our content on sale in PS Plus is important. Perhaps even more than going free.

"For the two games we had for free on PS Plus, the revenue from the free offering was between 10-15 percent of the overall revenue we made from each game," said Mikyska, who added that he would put his games up for free again if he had the opportunity.

"It is a great way to promote your game to the part of the PSN crowd that is most likely going to spend money and it is also a great way to give your game long tail sales," he said.

Mikyska noted that going with a free promotion isn't for everyone -- of course, if you have a hot game that everyone wants to pay you upfront for, then no, don't give it away for free on PS Plus. But, he said, "going free in the later parts of the game's life cycle can give you some nice revenue boost."


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Comments


Kujel s
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I'll wager a lot of the people who pay for ps plus don't actually buy a lot of games and just grab the free ones, the same issue applys to f2p games, and steam with sales. I wouldn't put any of my games on ps plus cause it only encourages players to either not pay or pay as little as possible.

Pablo Simbana
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I'm a PS Plus suscriber and yes, I buy lots of games too. PS Plus lets me to experience some games that I wouldn't have bought in the 1st place. This is my personal experience: I bought gravity rush in launch day, then it was added in PS+, all of my PSN friends who didn't buy the game tried it and guess what, finished the game and now looking forward to buy gravity rush 2 (i hope it gets announced soon) Also I didn't buy uncharted, wasn't interested but I tried it and liked it, so if they decide they are going to launch a new uncharted I'm so buying it on day 1. Sure there are people who will wait to pay less but that's how it works in steam too, some people will see a game its not worth 60$ but will buy it if it gets as low as 15 for example, either way the publiser wins

Matthew Mouras
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You should also consider the fact that many of the games released for free through PS+ are titles that have a large amount of DLC. I know that after I pulled down Uncharted for free on my VITA, I opted to spend some money on the extra downloadable content. I wasn't planning on ever buying the game, so the devs got something from me.

Kevin Clough
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I always assumed that Sony was losing money on PS+, but it sounds like they arrange pretty good deals so maybe they are breaking even or making a small profit on it. Another benefit I think publishers get is buzz for an upcoming game (i.e. Borderlands 1 was free right before B2 came out) and also sales of DLC for the free games (i.e. Guardians of Middle Earth).

Since Sony seems to be doing so well with this approach, I wonder why Microsoft and Nintendo don't adopt the same approach? I only have so much time to game and with all the games I get through PS+ I hardly have any time to touch my other consoles. PS+ could be a big advantage going into the next console generation so I expect another console maker to try and copy it.

I think it is smart for multiplayer games to go the PS+ route because it help to generate a robust online community for your game.

Mark Ludlow
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Given how many great games have been coming up on PS+, this is something I've always wondered about. It's interesting that they mention not encouraging people to "Wait until it's free" because I have been burnt quite a few times this year by buying games and then having them come up on PS+ a little later, so now I'm more hesitant to buy games just in case.

Pallav Nawani
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I suppose this is great for Sony - building up their customer base by giving away other people's content for free, but I can't help but think that this will devalue games on the Playstation in general. Sadly, this seems to be the first step in games slowly falling in value until they end up at $1.

This is the sort of thing publishers come up with, when they realize that building a loyal customer base is more profitable than treating their developers nicely, because, the developers have to go where the customers are...

Pallav Nawani
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It is a good idea to read the article before commenting on it. Check out how many $s the developers of Just Cause made.

Pallav Nawani
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I admit I didn't know my comment was so difficult to understand. Oh well.

Jeremy Reaban
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"Sundberg said Avalanche "hasn't seen a dime" directly from the promotion from Sony (Square Enix would've been the one to strike the terms of that deal)."

That's a rather odd statement, actually. Since they didn't publish the game, of course Sony wouldn't give them money directly. But presumably they gave some to Squenix, who was the publisher and presumably financed the development of the game.

But beyond that, it's really not free for anyone. It's basically like Netflix for games - while you are a member of PS+ for a monthly (or yearly) fee, you can play X amount of games all you want. You stop being a member, no more games.

Does the original creator of those movies Netflix show get anything direct from Netflix? No, of course not, they give money to the people who own the rights to the movies, who may or may not hand out money depending on the contract.

James Yee
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As a PS+ Subscriber I have to admit if it wasn't for PS+ my PS3 would just be a Blu ray player and Netflix box. I have slowly been moving away from console games in general but thanks to PS+ I have been able to play some games that I've looked at and never pulled the trigger on. Sure it's like a year after they came out (Just Cause 2, Sleeping Dogs, and Vanquish come to mind) but they got me playing and now those companies are on my watch list for future games. (Looking forward to a Just Cause 3 for instance)

So good to know Devs are getting something out of it. :)


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