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Opinion: Virtual Items, Digital Snake Oil?
by Brandon Sheffield [PC, Console/PC, Exclusive]
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December 18, 2009
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[Virtual items are the subject of much contention. Are free-to-play games devaluing retail products? Are they changing the industry? In an editorial originally published in the December 2009 issue of Game Developer magazine, editor in chief Brandon Sheffield weighs in.]
Early this month, I was having a discussion about free-to-play games and virtual items with Raigan Burns of Metanet Software. He was arguing that virtual items represent the equivalent of digital snake oil -- you’re paying for a few altered lines of code.
It’s a question of degrees, because all games are lines of code after all, whether they be many or few. And in fact Metanet’s latest game, N+, is primarily sold via digital distribution on Xbox Live Arcade. In many ways it's a larger, more involved virtual item.
But I understand his point very well. The idea of paying money for something that a designer maybe spent an hour tweaking, or which an artist only adjusted the colors on, just doesn’t sit well with me.
This is rooted in our consumer-oriented society. Ultimately all value is perceived. Why is a diamond more valuable than cubic zirconia? Mostly because we say so. As a society we’ve decided that between these two similar subjects (though the latter is synthetic), one is worth more, and the other less. Meanwhile both are worth more than food, which we actually need to survive.
Food, air, and water have intrinsic value, because we can’t live without them. Aside from those stand-out examples, our entire value system is fabricated -- so depending on one's desire to have these things, they're worth as much as or more than anything else. It’s quite relative, and in a society in which most of us actually do pay for the water we drink, this perception of value is very important to a lot of people, including, I’m dismayed to say, myself.
Dr. Sheffield’s Cure-All
For me, if there’s an object I can own versus a digital version, I’ll go the ownership route every time. I still buy CDs, DVDs, and records, and prefer physical copies of games I really enjoy over digital ones. Over time I’m letting go of this -- after all, my enjoyment of these media is not based on their physicality, but rather the data contained on them. Still, I find much more value in a full game I can purchase that has physical weight than I do in a game that must be purchased in bits and bytes.
For a lot of people, that need for the physical simply isn’t there, and that’s why the individual is the most important part of perceived value. For someone playing MapleStory who really wants that purple sword because it matches their outfit, that sword is possibly one of the most important things that person could buy.
Raigan’s point was this: "Goods like a paperback novel, a pen, or a shovel might have a resale value that's close to zero, but they still have some sort of ‘functional’ value in that they can be used for some purpose. For example, I can read or write or dig a hole.
"In comparison, most virtual goods are purely useless. Of course, I'm referring to Animal Crossing 'cool yellow shirt'-type goods; something like a really good sword in WoW would actually be useful, because it will allow the owner to farm gold more effectively and then sell the gold on the black market or whatever. But even that is a contrivance, the developer could easily modify a variable to let the player do a lot more damage, they don't 'need' the sword -- it's an artificial constraint imposed by the developer."
"This is typically benign in ‘normal’ games because it's done in the service of gameplay, but once you enter virtual goods land though, the rules are designed to extract more money out of people rather than to provide people with an enjoyable experience. This seems very different and possibly awful."
A book or a physical version of a game may lose its value after it’s completed once, unless you plan to go through it again, much like a virtual item. Still, I do agree with Raigan mostly, and my discussion of perceived value was partially to be contrary. But perceived value is also exactly the reason this model is working. There are people for whom the physical element of the purchase isn’t important. They’re paying for added fun, and if that fun is in the form of a yellow shirt, so be it.
That’s perhaps the most important part: For those who play these games, these items aren’t perceived as designed to extract money, they’re part of a fun experience. For instance, I’m not a religious person -- but what seems to me to be a method of controlling a populace appears to others as a way to approach the divine and achieve personal fulfillment. It’s all a question of perception.
Gimme That Olde-Tyme Religion
While the concept of paying for something so virtual initially seemed alien to me and my experience, I thought back to good old La Val’s Pizza in Berkeley, where I grew up. How many quarters did I scam out of my parents so that I could get a few more lives in Final Fight, or another go at Rampart? In essence I was renting time with the game -- the virtual items I was paying for were lives. In practice, these free-to-play games that run on microtransactions (even moreso subscription or pay-per-play games), which many core or old-school players decry, extrapolate from a revenue stream that comes from the very source of electronic games.
Anyone who’s been reading my editorials and interviews for some time (more the fool, you) will note that I’ve covered the free to play space, especially in Korea, rather extensively. In the two years since I wrote my editorial titled "Why You Should Care About Korea," that country and its business models for games have been more and more on the minds and lips of game developers around the world. One might presume I would be happy to see this model continue to gain traction among consumers, as microtransactions bleed into Facebook’s social games, and iPhone apps. I am not.
Like Raigan, I am curmudgeonly reluctant to admit the value of the piecemeal experience over the whole, finished one. But the fact is that more and more people see that free-to-play experience not as piecemeal, not as incomplete, but rather a living experience that can grow and change. Or perhaps a new kind of experience with a low required investment and barrier of entry.
And some of us fogeys may do well to recall that this model is not so different from that on which we were raised, or for the fogey-er amongst us, the games we created. The trick is how to make these virtual items actually worth what the users pay for them. But that’s a yarn for another day.
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Actually, you're paying for game design, not for lines of code. There's people who pay for lines of plot, for a bunch of poligons, for some achievement points. It doesn't matter how long it took to make.
For example let's say there is a game that costs upfront $10. Then it has 5 additional costumes you can buy for $2 each, 1 spiderman costume, 1 yellow shirt, 1 princess costume, 1 Burger King costume, and 1 Tony Blair costume. Let's assume the fair market price, taking into account economics, manpower, profitability markup, etc. is $1 per costume. So if the company was gonna sell the game with all 5 costumes and no virtual items they would have sold it for $15 upfront.
Maybe I really like spiderman but I don't care about the other costumes. I would buy the game and only the spiderman costume for $12 total. Now I've payed twice as much as fairmarket value for the spiderman costume ($2 instead of $1), however I'm playing less total than if there had been no virtual item option and because I wouldn't have used the other costumes anyway I'm getting the same experience as I would have for $15. In this way the company is making more money ($2 for $1 of work) and the player is paying only for the experience they want.
The big caveat to this is that the virtual items need to be things that some people may want but others don't and are therefore not central to experiencing what the game has to offer. If you have to pay extra for all the cool levels in your game and everyone who buys the game will want those levels than you are effectively making everyone pay more for content that is core to your game experience and that everyone expected to have access to when they payed the upfront cost.
My personal opinion: Keep access to the core game experience in the upfront cost of the game and only make virtual items out of things that change how you may play through those core experiences (costumes, items, lives, etc.).
There's an established price point that almost all retail games launch at regardless of their length, which makes it difficult to answer the question of what the market value of an hour of FPS is. In that sense, the only thing holding DLC and microtransactions back is that their pricing isn't in line with the majority of the content out there. Because though I cannot say what the price of an hour of gameplay is, I do feel that $5 for 2 hours is too much.
I agree with Alec in that core aspects of the game shouldn't be stripped out and sold separately, as that compromises the game itself. Instead, they should be things that contribute to the experience but are non-essential. That is where the ire over Battlefield Heroes pricing changes has come from.
Get over it.
Developers try to charge for the thing which costs them the most to make (usually levels). However, gamers want to pay for being different, or special, or for an advantage. That means they want to play for free in the areas that are expensive to make and operate, but will pay meaningful amount for items which add status or power.
And developers need to accept this.
It's more true in the online world than on console at the moment, because console gamers are accustomed to paying for content.
But it's coming, and developers should embrace it rather than fight it.
(I elaborate in this point on Gamesbrief at http://www.gamesbrief.com/2009/12/developers-stop-trying-to-sell-levels-the-publ
ic-dont-want-them/)
why would all AAA be sold at the magic number of $60? I seriously doubt that every game made at that price point had the same budget.. just like blair witch was the same price as seeing any multimillion dollar film at the time..
comparing a AAA rpg to a caual game is apples to oranges.. some people don't want to get too deep into a full blown 60-80 hour game.. just like we pay $4 for a gallon of milk at a gas station because it's easier than going to a store if you're in a hurry.
$5 for 2 hours of gameplay not worth it? what's a movie go for these days $10 for 2 hours and you leave with nothing but a memory.. at least for the $5 you can go back and play more.. that would be like going to the theater to watch a movie and leave with teh dvd to watch over and over.. now that would be some value. :)
But, even if we do adopt an object measure for the amount of homogeneous/comparable content in a retail release vs. DLC, the pricing model must be much more intrinsically tied to supply and demand than to a cost model. In that context, it's easy to see why a retail release is proportionally cheaper than a DLC release, a retail release has orders of magnitude more sales than DLC. Amortizing the costs over a larger quantity of deliverables (thanks to the higher demand), and appreciating the much larger market with a very high elasticity of demand, one can make the better profit with lower margins..
DLC, with it's much lower sales numbers and lower elasticity of demand, must have a higher margin to remain equally feasible.
I really like the fact that the goods that I make are delivered digitally and aren't going to end up in a landfill one day. When you drop $10 to catch a 95 minute movie you don't walk out with some plastic gizmo - hopefully you had a good time and feel like your 95 minute ride was worth the money.
1. "Virtual items have no real value." This is the "wait -- I'm spending money on stuff that's not real?" recognition, which as Brandon points out is usually followed by the "wait -- *all* this stuff is not real!" moment. It just feels odd to repeatedly buy things that aren't things. A one-time purchase can be put out of one's mind, but hitting the "buy" button repeatedly makes it impossible to avoid the knowledge that we're trading real money for ones and zeroes in the forms of virtual swords or clothes, and there's just no way we're going to be able to explain that to spouses or acquaintances.
2. "Microtransactions lead to class warfare." Some find it upsetting that Player A can be more powerful in the game sooner than Player B because Player A can afford to buy power-enhancing items and Player B can't. The reasonable response -- "then Player B should get off his backside and get a job" -- just exacerbates the us vs. them effect. As an observer, it's natural to wonder whether the value of a microtransaction model outweighs this predictable financial envy consequence. Is it really worth it to have players in your game treating each other like this?
3. "Microtransactions are just developers/publishers being greedy." This argument gets harder to make when the initial game is free-to-play, but it's guaranteed to be heard for any game that charges for the initial game and then charges for virtual items as well. One or the other may work, but a hybrid model just looks like naked greed.
4. "Microtransactions break the 'magic circle.'" When a game is designed to be complete in one purchase (other than major expansions), it's relatively easy to play through one's character as though one were fully inside the world of the game. It's also fair to expect other players to behave when they're in the game as though they're inside the world of the game. A complete game supports immersiveness. But when the game is designed such that there will be constant interactions between the real world and the game world through microtransactions, this destroys the magic circle.
Of these objections, the last seems the most potent to me. I don't like the idea that fewer gameworlds are being made that can be enjoyed as immersive worlds. But that may be a reflection of my natural playstyle interests -- a more practical person may be likely to have the "where's the value?" reaction that Brandon describes.
So are there other distinct objections to the practice of designing games to unlock virtual items for real money?
If your game sucks, and it needs exposure, free to play is the way to get it, but if it's as good or better than the status quo, people will pay.
"If your game sucks, and it needs exposure, free to play is the way to get it, but if it's as good or better than the status quo, people will pay."
Seriously? So any game that is offered for free is automatically inferior to a retail game?
The point about $10 to go to the movies... well it costs a lot more then that in Australia and for that very reason you have a global shift to home cinema where people buy the DVD for $20 and watch it multiple times with numerous people, skewing the dollar to hour ratio waaaay down.
If you're going to market something in the AAA belt or the MMO space then individual justification of money versus hours spent is a very valid metric when we know not all games are created equal but everyone can place a value on the money they had to earn. The user knows by convention what to expect when they buy and its up to them to decide if it was money well spent based on their perception of experience (immersion) versus the individual cost to them be it in time spent and dollar - this varies from the unemployed stoner on CS:S to the GP dad who wants something to play hobby with his son (etc. etc.).
On the topic of film versus games its a convention the user expects a higher quality of immersion from film than games as a larger cathartic experience while gaming can be incredibly tedius at times (grinding anyone?), therefore the quality of experience derived is valued lower than a filmic experience. And yes of course there are exceptions but this is all about broad generalisations.
Free to play usually does mean inferior quality of production (not in all cases, just the general rule of thumb), because if it were good enough developers would have attached a price tag upfront as a sign of confidence or are probably plotting how to get the price tag up there in a later revision of the concept. You get what you pay for. People still play free to play or cheaper games but that's a different audience with differing expectations. Standards massively drop in terms of quality and expectation when it comes to mmo versus a AAA, just as standards decline again when comparing a pay-by-the-month mmo to a free-to-play. By exploring such genres you are inherently signaling your acceptance of a longer endeavour at a lower quality. A subscription mmo post release official community is a plague of malcontent as low standards not met plus the fact the user has outlayed money grant them a feeling of entitlement, of embitterment and the right to scream for attention until issues are resolved. By comparison a free to play update is usually counted as a blessing because it is well... free. A step further down the chain is community created games, mods - often some of the best most immersive, innovative ideas boil out of derivatives of base products yet this signals you are prepared to be a lot more patient, a lot more accepting of faults and genuinely prepared to try something new out or maybe even chip your little bit in to help out. Its the age old problem, a triangle with 3 product features: speed, quality, cost and you can only select 2 of them.
On the topic of Dragon Age I was happy to buy the cheaper Steam edition at $55, having already spent 70 hours in there and not finished but I was quite unimpressed with the DLC system that if conservatively average developer estimates with their actual play speeds with other gamers similar to myself the maths tend to work out at around $7+ for 40 minutes - and that is not acceptable because while the quality of experience is high by gaming standards it's not that immersive. DLC in my experience has never ever been worth the money, usually it's a gimic that plays on aesthetic sensibilities. If you are prepared to build and unleash a community on your product, odds on the hive conscious will be able to produce content faster and at higher quality than most DLC - hence the strong push for control. This system on the one hand keeps users dependent on developers, developers dependent on funding and the game dependent on short high frequency bursts of sales or face total destruction. I really miss the expansion model, sure it was slower but it was more cost effective for the consumer and it was a signal that yes consumers did like the base product and are prepared to pay for more of it. A good expansion was an extra half or third more gameplay expanding what was given at three quarters the price of a new release so the developer made a larger profit margin and the consumer got an enhanced game - win win.
For the past decade I have played disproportionate amounts of MMO versus other games to the point where I'm now suffering the "...and it's a lot like X, really." "I actually haven't played X..." "WHAT?! How could you not have played X?!" As one saturated in that environment so heavily, I feel it is snake oil if you want to believe it is snake oil.
MMOs are a different kind of game. There is no anticipated duration until completion. No "60 hours of gameplay" selling point on the box. It goes on and on and the unit of measurement playing is spent in days, not hours. (24 hours = 1 day, obviously)
So to be so heavily invested into a game that you could derive 100+ days of entertainment out of it, while paying $50 for discs and then $15 a month after the first month means the ratio of entertainment to money spent had is pretty phenomenal, actually. When you look at that ratio... that's when you start perceiving virtual items as not-snake-oil.
Gold, for example, is the most commonly purchased digital item. It's so big every MMO expected to draw audiences to it will always have gold spamming sites trying to sell it to you, even on launch day. (Hi, Aion) But is it worth it?
If you abstract it to the point where you look at it as something not real that you're paying for, then you're going to say no. But when you look at the amount of gold you would acquire and begin calculating what you could get (or you have a premeditated idea of what you want to buy the gold for) then it becomes more plausibly worthwhile.
I have a friend who bought gold and I couldn't figure out why. It's not like we didn't have time to earn the gold in game or that we had something REALLY pressing to buy with the gold, so I gave it a bunch of thought. His methodology I greatly agreed with, it fell in line with the sort of thing I used to do before the internet existed and you had to find your own answers by crunching your own numbers.
He got a sample of how many herbs he could pick out in the Eastern Plaguelands (this was pre-BC) in the span of an hour then calculating out how much that sold for in the market at that time. Then he went and spent an hour picking only the most profitable herb in the most rich places the herb could be found. (Dreamfoil at the time, a near insatiable demand for it, and since it was found in the level 45+ areas of the game, led to a nice profit per stack and pretty much a guarantee it would sell within a day)
In the end he determined that he could spend hours grinding herb picking to fund his in-game antics or he could work 4 hours at work and make a substantially larger amount of gold than he could peddling herbs. So he bought gold.
And even though I was totally anti-gold buying/selling at the time... It was a lot of food for thought. He was right, you could spend less time working IRL and make a substantial amount of gold more than in-game and instead use that gold to fund fun activities you want to do rather than adding in a mandatory grind if you really want to do that instead.
That gold paid for his warrior, whom he had a lot of fun playing. He regularly hit the Auction House every night and seemed to have the greatest equipment every 5 or so levels, always wearing the new pimp threads and even bought epics once he got to his mid 30s and could finally start equipping them. In short, he went from being a priest who worked hard and spent a lot of time developing that character to having a decked out warrior whom excelled through the areas he previously tread with great ease. And he was having a blast doing it.
It was basically twinking. In EverQuest, when you gave a Flowing Black Silk Sash and a Fungi Tunic to a level 1 with any level 30+ weapon, that character dominated content like some uber badass out of a superhero universe. And to play that uber badass instead of saving and scrimping felt luxurious and extravagant. It was a completely different experience, one that you would often just roll new characters to give them that gear and do again. His gold purchase gave him that experience without spending who knows how many hours doing the boring stuff (grinding gold) to get to the fun stuff (wrecking face).
It became hard to disagree so strongly with gold buying and selling after seeing him do that. It made a lot of sense and was tempting for even myself. In the end, he wasn't buying snake oil, he was buying additional fun.
And if buying the perceived snake oil makes your experience more enjoyable, then enjoy it. Isn't enjoyment why we're playing games to begin with?
Actually...the diamond is worth more primarily because of false scarcity. The DeBeers cartel effectively monopolizes and controls the world supply of diamonds, creating scarcity and pricing that are not reflective of actual supply -- so by analogy they are doing very much what you're suspicious of in the games biz.
(There are some gems which are truly rare, including rubies.)
Now I realize there are game developers out there who make games for the sole purpose of making money but I know there are also plenty who see game development as an honest quid pro quo exchange. I put in honest time and effort to make something good, you pay me, the end. I would agree with the sentiment that a microtransaction is snake oil. At the very least, it corrupts the game development process. If you can get a more enjoyable experience by buying gold, then that's not a level game.
To those who would say "get over it" and quit worrying and love the bomb, well i say no thanks. I wouldn't sell pet rocks to people no matter how much some people found them cool and desirable, I wouldn't sell $10.00 sweat shop sneakers to people for $120.00 to satisfy their attachment to swooshes, I wouldn't make a brain dead action movie like Transformers and then tell people to shut up, sit back, relax and enjoy their lobotomy, and so I wouldn't try to milk my players selling them digital junk.
Yes, this is about values... the developer's values, my values, your values. Most of the discussion i see in favor of micro transactions isn't about how to make the game BETTER it's about business models (aka how can we make money off of a product that we can't sell traditionally) and competing for dollars.
However I now see two issues that, if targeted directly at the MMO market, could be argued rather effectively with this “digital-snake-oil” approach to compensation. The first deals with direct compensation for the development of the game. This is probably the hardest to drive home because of what I call the “Napster Effect”1. Developers have the right to compensation for the work they do as well as a reasonable profit margin that allows them to develop their next game. This is the same for every product out there be it a box, or an aircraft carrier. In my mind, that means a fee for service on the order of cost plus 15%+. Anyone who is willing to claim that a developer, or artist, or composer, or writer should be doing it for the betterment of the community is hell bent on making our world a grey miserable place. How this compensation is achieved is altogether up to the developer and the market.
The second issue is in game effect. How does the method of compensation effect the environment of the game? In the traditional compensation model, those players who did not have a job, or a family, or a life, could park their 500 lbs. butt on their chair and play for 26 hours a day. This would make then very powerful very fast. So often I have heard the argument, “They need to stop punishing players who have other things to do in life and let us be just as powerful as the guy who can play for 100 hours on s stretch”. Well, digital-snake-oil does that. It allows people who have jobs, to really enjoy their game rather than having to deal with the 13 year-old who’s out of school for the summer, made level 90 in 3 days with all the fat loot and is “owning” everyone.
In the end, this really is about compensation. Men and women work days to create the images that we enjoy. This is a value added product. And these men and women have a right to equal compensation with profit. This issue does affect the immersive quality of the game but in the end, it’s really a decision for the game designer and the market to make. And from what I can see, the market is making that choice rather boldly by playing MMO’s in record numbers no matter what the compensation type is.
1The Napster Effect is a belief within the general population that all creative art from music to literature to fine art to entertainment is the rightful property of the general public and thus should cost the general public nothing. I came to this opinion base on the political position of The Pirate Party of Sweden. I’ll let you look them up and review their position.
As this article points out, virtual goods differ from their physical counterparts in a fundamental way - they do not exist outside of the game context. In this manner, they share more in common with add-on cable packages than they do with their physical counterparts, like shovels.
In all likelihood, when you buy a cable package, someone is setting a bit in an account database somewhere - exactly what happens during a micro-transaction purchase. One could easily argue that a cable package has no functional value (technically, no form of entertainment does), yet many people happily accept that a sports package adds value to their lives. That, as the article points out, is a subjective call just like any other case of valuation.
I think the real reason people argue digital goods are snake oil is that they either:
1) Feel the cost of the digital item is disproportional to the effort of its creation, or
2) Fear the publisher is forcing them to buy something they would have otherwise gotten for free.
These may be valid fears for console downloadable content, but not for most respectable, true F2P games. Why?
1) The true cost of producing a virtual good in a F2P game is a lot higher than just producing a few lines of code / an art asset, particularly in the PC / social network space.
First, you have to design the game and engine to support dynamic content (usually no easy task).
Second, you have to create and run an virtual store, which means additional accounting, customer support, and operational (database administration etc.) staff. I have heard rumors that as much as 50% of Club Penguins staff works outside of the game development team.
Third, each piece of content needs to be proposed, designed, QAed, priced, and uploaded to content servers or released in a patch. Then, the in-game economy need to be continuously monitored and rebalanced depending on in-game trends.
All these costs must be amortized into the item prices, not to mention the development of the core game itself. When you do all this analysis, $1 isn't too much to ask for a virtual item.
2) F2P publishers understand the games as a service model. Most prefer to release games quickly with a small feature set (compared to console products), and allow the community to influence the development of the game. They are also very cognizant that their business model relies on reputation, word of mouth, and the feeling of fairness within the game.
While there is no doubt F2P game developers look for opportunities to monetize their games, they usually plan for this in their initial designs. They rarely ever retroactively charge for previously free items, as doing so creates an enormous public backlash. In fact, they have to be extremely careful about changing pricing, as EA recently discovered with their Battlefield franchise.
I hope this post has given you some food for thought, and explain why some of us value the F2P business model differently.
Thanks for raising people's actual fears. I think they are the most honest reasons why F2P has a bad reputation in certain circles.
I would like to point out that 2 of the issues you raise ("Microtransactions lead to class warfare", and "Microtransactions break the 'magic circle") are not really fundamental to the design of microtransaction games, but usually result from design decisions made by the game developers.
For example, consider Magic the Gathering. Purchasing card packs is not necessarily outside of the Magic Circle even though it involves money; in fact, the chance of randomly purchasing a valuable card is a major part of the experience of that product. Similarly, in MtG, spending more money that your opponent does not guarantee success; many successful tournaments were comprised entirely from common cards.
"If the game is good, people will have no issue paying for it."
This is the crux of the issue -- actually Tom, the reality that this statement is (sadly) becoming a complete fantasy.
Case in point: iPhone, Facebook games, plunging console games sales. Virtual goods may or not be the answer, but like it or not, devs need to accept that awesomely designed, hyper-shiny, premium priced games are not guaranteed to mint money at 60 bucks a pop. There are just a lot of choices out there now. Therefore we have to try new approaches.
There's room for multiple ways to pay, and this trend won't wreck games. Bottom line is that players vote with their dollars, look at the numbers, the changes are black and white: http://games.venturebeat.com/2009/10/14/virtual-goods-sales-to-hit-1-billion-in-
2009-as-social-games-pay-off-big/
Consumers didn't complain when albums started selling songs individually. Games are getting broken up too, albeit in a different ways. Seems weird now, just like selling individual songs seemed weird after years of selling "albums" -- but these trends don't happen in a vacuum, consumers demand it and forge it into shape with their choices. You can choose to reject these types of changes, you can think that players just don't know what's good for them -- or you can accept it, understand changes in your players and flex your toolbox a little.
Sorry man. It bums me out too. But your statement is a naive and unrealistic viewpoint that ignores actual changes re-shaping this industry every day.
Damn, R$400 for a pet! it's the price of a new XBOX360 or PS3 tittle here. Yet retail games are often pirated, the microtransactions seem to make money.
Also, some people are forgetting that when you lower the barrier of entry for a game, you expose that game to a lot more people who would otherwise have never played it - let alone try the demo. This is primarily the reason why companies like Nexon, K2 etc are making a killing on F2P games.
F2P games and microtransactions are *huge* outside North America, to the extent that the risk of even operating a subscription based game is monumental.
If you release an F2P game, even with micro-transactions, you have to hope that there are those who will pay for in-game items, special features etc in order to keep operating the game. Some gamers will gladly pay for items or features if it means that they are a) unique/different or b) reduce the grind
The value you place on a game or an item is what you think its worth to you. So if you want pay to run around in diapers in BF Heroes, thats all on you - so have at it.
Given that the profitability of the PC market is continuing to decline, my guess is that as time goes by, most - if not all - games will go a F2P + micro-transactions model in some form or another.
I would be in the 40+ demographic group.
@Luis:
I think you have brought up a very valid point. Game accounts are still vulnerable to hacking on an almost daily basis. On the monthly pay for access model. developers have a strong legal position that protects them for repercussions of illegal access of a players account. All digital property is solely owned by the game developer and thus nothing could have been stolen from the player.
However, when a player spends money on a designated item, it could be argued that the player was paying for permanent legal access to that item. If that item is then stolen from the player, it might imply that the developer willfully established methods to defraud the player of his purchase, thus forcing the player to repurchase the item. This could become a very slippery slope.
Mind you, this would not apply to such games as as Wizards 101 because you purchase access to given levels. On the other hand such games as D&D Online might be very vulnerable .