Speaking at its GameFest event in Seattle, Microsoft has talked candidly about its Xbox Live service, specifically the Xbox Live Marketplace, which makes both free and premium content available for download for Xbox 360 users, and has been a notable success since launch.
Specifically, Microsoft's Marketplace Business Manager Rohan Oommen sketched out a detailed GameFest presentation on the Marketplace, which covered what has been accomplished since the service went live in November 2005 with the launch of the Xbox 360, as well as where Microsoft envisions it heading in the months to come.
New Marketplace Stats
Since the service has launched, the Marketplace has seen 40+ million downloads, Oommen revealed. In addition, Microsoft noted that three quarters of those players with a Xbox Live subscription have downloaded content from the service, and that on average a user has downloaded 20 or more items from the selection of more than 2000 downloads currently available over the Marketplace.
Microsoft noted that of those items, game demos have demonstrated the greatest appeal, and that these serve as a great promotional tool for the games themselves. On average, Oommen commented that when released, a demo will see an average of 250,000 downloads, though he noted that the demo for Prey, which rode a wave of anticipation dating back to the original game's announcement by 3D Realms in 1995, saw an impressive 300,000 downloads in the first week, following its debut on Xbox Live.
Microsoft also commented that the timing of a demo's release is critical, drawing attention to the fact that it saw a 40 percent conversion rate between those users who downloaded the demo for EA's Fight Night 3, and those who purchased the game when it was released.
Xbox Live Arcade Updates?
Looking to the service's popular Xbox Live Arcade, which recently saw the debut of a plan to release a new title for download each week, Microsoft confirmed an outstanding 22 percent average conversion rate, with ranges between 10 and 50 percent of those players who downloaded a demo later returning to download the premium product.
Oommen also intriguingly commented that titles released over Xbox Live Arcade seem to be less price sensitive, and that higher priced titles such as those costing 800 points ($10) and 1200 points ($15) have resulted in more total revenue over the game's lifetime so far than 400 point ($5) games.
Game Add-On Successes
Microsoft also indicated that downloadable add-on content for games was the “most significant” Marketplace engagement point, revealing that three titles had already achieved $1 million in sales of additional content.
However, the company conceded that such content has not been coming out as fast as it would like, and that companies should plan ahead and devote small teams to creating new content in order to meet the user community's demand early on, specifically within the first 60 to 90 days following a title's release.
Recent titles such as Chromehounds and Dead Rising saw additional free content released over the Marketplace immediately following their release, while Ubisoft released a premium 1200 point ($15) download for Tom Clancy's Ghost Recon Advanced Warfighter, titled 'Chapter 2', just over three months after the game was shipped to retail.
Another important part of Microsoft's online agenda is its focus on personalization through the use of Gamer Pictures and themes, to which the company noted it has seen a “surprisingly great response.” However, the company also quickly combated the notion that these sorts of relatively small downloads should be given away for free, noting their belief that personalization downloads should be looked "as a revenue stream, rather than a promotional opportunity."
Oommen also addressed the topic of community videos, which he categorized according to four specific types: Game tips and help videos; humor, parody, and machinima videos; videos for specific events such as those created for E3 and X06; and others that drive brand affinity, such as “behind-the-scenes” and “making-of” videos. He noted that such videos represent a both an incremental revenue opportunity (though none have yet been released with a cost attached), as well as a way to stay connected to a game's audience.
'Consumables' For XBL?
In the final and perhaps most interesting part of the presentation, Oommen revealed that Microsoft is planning a number of user interface enhancements, as well as the ability to integrate the Marketplace into games – such as role-playing games – so that, for example, rare items will be be able to be purchased from within a game itself. Though full integration into game interfaces is the long-term goal, for now, in the short-term, users may be able to create a list of items they need and switch back to Marketplace to purchase that aggregated list.
Also in the works currently is a new type of microtransaction called “consumables”, according to Oommen, which will allow a player to purchase items that can be used up and then repurchased at a later date. This feature would be used with items such as tokens to use within a game, or other specific objects which will actually decrease over time or with use, and specific uses of it will be revealed at a later date.