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7x more interest in free to play games than subscription games July 25, 2008

Posted by jeremyliew in games, games 2.0, gaming, virtual goods.
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Worlds In Motion summarizes key findings from the new Parks report on gaming.

Of the 2,000+ online gamers polled, only hardcore gamers were found to be interested in subscribing to an MMORPG service, whereas “social, dormant, and leisure gamers all show significant interest in a free-to-play, microtransaction-based model.”

The study’s numbers show that 14% of gamers currently not playing MMORPGs would be interested in playing them if they could for free, while only 2% of gamers from the same group were interested in playing an MMORPG requiring subscriptions.

According to Parks Associate’s director of broadband and gaming, Yuanzhe (Michael) Cai, the barriers to entry with subscription-based MMORPGs, such as time and money, are too high for potential customers. Free-to-play models, however, offer flexibility and enable players to choose how much they want to invest based on interest level and play patterns. Thus, the firm believes that microtransaction models have the best potential to grow the U.S. MMORPG audience.

I continue to be very bullish on the free-to-play/digital goods model for gaming companies over the next few years.

Comments»

1. Alex - July 25, 2008

I continue to wrestle with this issue.

1) FREE: A start up can only offer this is if they a) raise a crap load of VC money as they drive towards critical mass. b) the company is started by 17 year kids living at home who don’t need money to pay a mortgage, rent or buy diapers for their children.

2) Subscription: People are willing to pay, but, there is a fine line here on how much you can charge. If someone pays for a service they should value the service a bit more than if it was for free…at least you’d hope. But, not to say this is customer loyalty. Loyalty is earned over a period of time.

2. Nathan - July 28, 2008

Sites don’t need to offer such black and white business models. Diversification of revenue streams can offset one stream lagging. Sure, offer a free service but allow users to buy the best stuff with microtransactions. Also offer tiered services (priority access to customer support, faster servers, injections of special content each month, etc) with subscriptions. Throw ads on the site and you have a much more solid offering to investors.

3. Wicked Interactive will launch online games from Korean publisher » VentureBeat - August 12, 2008

[…] popular Korean games and moifying them for the U.S. market. And here’s an interesting post on free-to-play games versus subscriptions. Tags: co:wicked-interactive, co:yedang-online SHARETHIS.addEntry({ title: “Wicked […]

4. fatfoogoo - August 12, 2008

@ Nathan – exactly! Offering a mix of different revenue models is exactly the platform that publishers should be investigating at this point. Free to play titles have had tremendous success in the Asian Market, but have a stigma against them in the North American market. Mixing a subscription based plan along with some free to play/micro transactions features could be the right mix to bring the North American market on board.

5. Rob - October 3, 2008

The North American market has been on board all along. Look at RuneScape – They are the largest free-to-play MMO in the world (see the Guinness book of world records, gaming edition) with over 135 million created accounts since 2001, and they currently have over 6 million active users. Over 1 million of those pay for the premium version of the game too, making it the world’s second biggest subscription based MMO, behind World of Warcraft.

All of that success, and that’s WITHOUT microtransactions, too.

It’s all very well discussing the merits of these various subscription models, but I’m afraid that there are plenty of companies that have already ‘figured out’ the conundrum you guys seem to be debating.

See also, Dofus, Wakfu, Club Penguin, and the forthcoming Free Realms.


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