Microtransactions are still considered an emerging business model in the West, but EA Mobile's Oliver Miao argued that in a couple years, microtransactions could be a necessity for the most successful iPhone games.
"Make microtransactions core to your game," Miao said at GDC this week. "Going forward, I think most games are going to need to have them."
Miao is speaking from his own personal experience. Miao and Centerscore's mobile game, Surviving High School was a hit in 2007, which led EA to acquire the studio in 2008 from Vivendi following the Vivendi/Activision merger. By January 2009, EA wanted to bring Surviving High School to the iPhone's App Store.
But the process of bringing the game to the iPhone was fraught with difficulties. EA wanted Miao's team to create the game as fast as possible in order to beat the oncoming rush of competition on the platform. At the time, the App Store dominated by 99 cent-games, with a few bigger brands coming up the ranks.
"There was this fear that as all these larger brands started coming in, it'd be harder for a smaller game like Surviving High School would succeed," said Miao.
The game-changer for Miao was when in March 2009, Apple said it was bringing microtransactions to the App Store. Exactly how the team would incorporate the model - while appeasing EA Mobile execs - would prove to be a challenge.
For one, the App Store only allows for 99 cent microtransactions. If EA sold Surviving High School for 99 cents or $1.99 as originally planned, it'd be difficult to justify a "microtransaction" that costs as much or almost as much as the game itself.
Eventually, the development team thought of offering free episodes of Surviving High School, then charge for exclusive content. "We were rejected" by EA execs, said Miao. His bosses thought that the dev team wanted to give away too much content for free.
On the other hand, EA execs wanted to sell each episode for 99 cents each - they were completely at odds. "We thought by giving this content away, we could sell so many units of our game, it will more than make up for it."
But after that rejection, Miao thought that the dev team found a compromise with a TV-like model. The studio would release free weekly episodes of Surviving High School, but each episode would only be free for one week. If people wanted to download past episodes, they'd have to pay.
"We thought, this should be a really good compromise solution," he said. "But again, we were rejected. ... This is my opinion - EA Mobile makes mistakes too," Miao said, tongue-in-cheek.
By May 2009, EA execs were planning to make a trip to visit the team's studio - never a good sign, said Miao. The execs were not happy with the game's progress, and gave the studio a few days to come up with a new design. "So our studio was in a panic," Miao said. "People think that big companies don't care about quality, but obviously [these] execs did."
The Surviving High School team re-pitched the game in 2009 with another tweak. This time, EA would release episodes for free initially, and call it a "promotion." Meanwhile, the publisher would look at the game's progress over the first two months - if the TV model worked, then they'd continue with it. If not, then they'd sell episodes under a traditional model.
EA execs accepted the new pitch. The game eventually launched in November 2009, but it debuted at the bottom of the charts, and stayed there on the first day. But it gradually did move upward, and made it as high as number 16 on the top-grossing apps rankings. Since then, it's been seeing peaks and valleys, driven by new microtransaction content.
"It's pretty rare to see games that have been out on the marketplace for a while to have these up and down movements," Miao said. "But if you have microtransactions built in, you can control the place on the charts."
And just this week, the company released a "megapack" that added new content to the game, most of which was developed in response to fan feedback and reviews. In a day, the game went from 68 to 30 on the top-grossing ranks.
A final bit of advice from Miao: "Don't go head to head with EA." Going up against the mega-corporation is extremely difficult. "Instead find your own green pastures" on the iPhone.