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Casual Connect panel on designing, balancing and managing a virtual economy August 3, 2009

Posted by jeremyliew in economics, game design, game mechanics, games, mmorpg.

Freetoplay.biz has raw notes taken from the session on Designing, Balancing and Managing a Virtual Economy. Some good quotes include:

On inflation:


  • did not manage economy when they started
  • want ppl to earn quickly for initial wow experience
  • down the line, someone who has been playing for months and months get really rich – what is left for them to buy?
  • need to manage these disparities correctly from the beginning
  • company has one full time economist balancing it

3 Rings

  • don’t screw up
  • mudflation – overinflation of currency is easy to introduce if you are not being rigorous about sources of attention currency
  • need to have some level of instrumentation… need to pay attention and be set to react when something goes awry
  • it is a discipline that is tough to master

On creating one time currency sinks to battle inflation:

3 Rings

  • incredible opp to take fantastic amounts of wealth and turn it into a one-time exclusive item
  • when we shut down alpha server we challenged people to throw Pieces of 8 into a hole… winning group got their name on top of a list


  • we wanted to redo our amazon-like stores within the site, so we created a fiction inside Gaia that stores were getting shut down because of recession… asked users to help donate to help build higher quality stores… we created a concept of leaderboards… where largest donating teams got their names in lights… they felt as though they were getting status within the site

On pricing and maximizing ARPU:


  • you want your players to spend all the money they have so they need to get another payment card, etc
  • you should offer your players lots of diff ways to spend their money
  • players are not buying 1 item at a time… they are batching… buying $10 of virtual currency at a time… so you need lots of options for purchase so people don’t have money just sitting there

2 Fish

  • i love pricing… counterintuitive in some places
  • barrier pricing… i.e. everybody wants one of the cooler cars
  • initial thought is that cars should be expensive
  • but really they should be cheaper as they are a barrier item
  • once they have a new car they can spend more on customizing it
  • think about what kind of behaviours you want and price to encourage that


  • we actually do sell cars for $10
  • we sold 120,000 cars for $10 apiece
  • agrees re: barrier
  • but barrier for ppl in game is not 10c, but $10 for initial payment… so you need enough items to justify that
  • if you have 100 ppl playing game, what % are going to pay and how much
  • what items can you create to get to a $15 ARPU


  • we do exactly that re: modeling an ARPU
  • interplay between getting ARPU up vs getting percent of people who pay up
  • clearly they should be complementary
  • but fascinating thing is that we are not really clear on which one matters more, we go with what is easy
  • getting dollars per player up is always easier
  • people who want to pay are willing to pay a lot of money
  • relatively easy to find small % of ppl who pay and pay
  • more interesting thing is how to get a higher percent of ppl to pay
  • that has more ramifications on long term business health
  • barrier is getting the money into the game via cc or payment card

On dual currencies and managing fraud and chargebacks:


  • we need to be clear… if you can get your money out, then it is a big issue
  • SL has a currency where you can invest your time and get it out in real dollars
  • as soon as you do that, you can run into regulation issues, but more primarily, people will try to game the sytem… bots, farming, etc
  • if you are going to go down that path, plan on having half your dev team working on managing exploits for the next few years
  • you have then become the best target for money laundering
  • we chose not to do that… greatly simplifies life… branding decision as well – is your site a place where you can spend time and earn money? a career? or is it a fun experience where you put in your money but don’t expect to get it out


  • ways to avoid hitting the 1% chargeback
  • not allowing you to purchase on day 1
  • maxing the amount ppl can spend in a month
  • making sure ppl can’t pull money out

3 Rings

  • we hit chargeback problems … we hadn’t switched on address verification… turned it on and problem went away
  • WoW has big chargeback isseus as people farm on stolen CCs

Quests are the new grind in social games, and that is why they are a good idea June 1, 2009

Posted by jeremyliew in game design, games, games 2.0, mmorpg, social games.

The first generation of MMOG apps on social networks rely heavily on level advancement as motivation for players to keep playing. In the Mob Wars/Mobsters/Mafia Wars genre, the grind is driven by doing jobs to gain money and experience, and hence to level up.

We’re starting to see the introduction of quests into the social network based MMOGs as a way of alleviating the boredom that can set in with a primarily level advancement based game dynamic. But this can lead to a different sort of grind. There are a couple of good recent posts that are worth reading for people building MMOGs on the social networks that look at “quests as the new grind” in World of Warcraft, Lord of the Rings Online and other MMOGs.

Wolfshead first raised this topic last August when he wrote about the unintended consequences of quest based MMOs, primarily that:

* MMOGs become much more single player experiences
* There is a loss of community
* When the quests run out, players find themselves at a loss for what to do

His post is much more eloquent and considered than this summary and is worth reading when you have some time. He bemoans that the addition of rails (via quests) dimishes replayability. He revisited and updated his thoughts on the topic in March.

Over at Brighthub, Michael Hartman agrees with Wolfshead and says that quest based MMOGs are anti-group, repetitive and immersion disrupting. He says that quests change games into simple to-do lists.

Psycochild examines the grind in light of these perspectives and finds something to like about the grind of questing. Firstly, repetition is not inherently a bad characteristic of games. As he points out:

…games are all about repetition. Playing a simple game of Klondike Solitaire is pretty much all about repetition: looking for place to play a card, flipping over more cards, finding more places to play cards, eventually trying to win. Boring, right? Except people are eager to point out that solitaire is likely the most played games in Windows.

The truth is that most games are about repetition, even offline and non-computer games. Games usually have a set of rules that intentionally limit the options in the game. Klondike wouldn’t really be much of a game if you could just go through the piles and pick out the cards you need. So, you apply the rules repeatedly in the game to reach the eventual goal. From this perspective, “repetitive” describes 95% of games out there.

Secondly, he describes ways that the negative aspects of grinding can be mitigated through game design:

* Encourage players to do varied things
* Discourage boring behavior
* Provide alternative gameplay
* Encourage socialization

His post gives more detail on each of these points.

Ultimately, I think that we’ll see a lot more quest based game design in social games. Wolfshead sees World of Warcraft as the epitome of the quest based grind and says in his updated post:

It’s evident that WoW was designed to attract non-MMO gamers all along. Here are a few points that demonstrate this:

the simplicity of the interface (as noted by one of the interviewers)
the focus of quests for herding the player into new areas
the lack of challenge in the enemy encounters
the story revealed to players via the quests

In retrospect it’s almost as if WoW was designed to be one big tutorial for gamers new to MMOs. A MMO so easy and attractive that it’s greatest strength would always be in attracting new players (defined in industry parlance as “churn”).

Yet here we are 5 years later and all is not well. Eventually new MMO gamers become veteran gamers.

He is right from the point of view of an veteran gamer. But WoW is the biggest commercial success that the MMOG genre has ever had and indeed the biggest commercial success that the game industry has ever had. It succeeded precisely because it could entice new players, non-MMO gamers.

The social networks offer an opportunity for a huge number of non-MMO gamers (indeed people who would not consider themselves gamers at all) to be converted into MMO gamers. The social games so far have raced to far higher player numbers than any MMOG has in the past, precisely because they have gotten non-gamers to play. As a result, quests will be a very important component of game design on social networks for some time to come. It will be a long time before these new gamers become veteran gamers and become dissatisfied with quests.

How to build an eldergame April 28, 2009

Posted by jeremyliew in game design, games, games 2.0, mmorpg.

Via Raph, Richard Bartle’s IMGDC keynote on how to build an eldergame is very interesting. He notes one of the problems with many MMOGs today is that once players have leveled all the way up, many of them quit. There is essentially nothing new to do. In a packaged software business that isn’t a big deal. But in a services business (whether subscription or virtual goods) you want to keep your best players around as long as possible. Bartle’s analogy:

• When you start off in a new mmo it’s like arriving in a foreign railway station on a backpacking trip

• With classes and races, The designers have provided trains that are guaranteed to go to interesting places

–You want to shoot fireballs? Board the mage train!

• Quests are the enginesthat pull the carriages along?

• However, trains run on rails

• if you want to disembark and go elsewhere, Well, you can’t!

• The design philosophy is all about controlling the player experience

• The same philosophy is applied for newbies and oldbies alike

• It’s consistent –but players aren’t!

Oldbies (experienced players) get bored when they’ve reached the end of the trainline and they want more to do. That’s where an eldergame can help.

Bartle thinks that many of the elder game options aren’t good, including raiding:

Well, the raiding game isn’t that good…

• Like quests, raiding content is fixed

–There’s only so many times you can run naxx before it’s samey

• Once, in fact

• Other attempts at the elder game also flop

• RvR (Realm vs Realm) is never resolved

–and therefore pointless

• PvP (Player vs Player) isbetter – if you’re good at pvp

–but the results are also pointless

• They provide burst fun, but no fun overtime

He says that to keep oldbies around, you need to let them create history:

• History is the player’s retelling of interesting events

• This means there must have been some interesting events

• No history means nothing interesting happened

–Where’s the fun in that?

• Problem: “interesting” changes over time

Bartle’s suggestion to solve this problem:

• Alice worlds are newbie-unfriendly but provide the depth and freedom that oldbies crave

• Dorothy worlds are very newbie- friendly but oldbies, who don’t want their hands held, feel disenchanted

• So: start off as a dorothy world and switch to alice for the elder game

Dorothy worlds are based on players who are like Dorothy in the Wizard of Oz, much like newbies:

… Dorothy, upon arrival in Oz, said: “We will go to the emerald city and ask the great oz how to get back to

kansas again”

• Dorothy is wary of the new world she has arrived in

• She wants a path she can follow to get through it

• She represents the modern, game worlds like wow

Alice worlds are based on players who are like Alice in Wonderland, much like oldbies:

When alice arrived in wonderland, her first words were: “curiouser and curiouser”

• Alice finds merely being in another world interesting

• She’ll go wherever fortune and fancy may take her

• She represents the old, balanced worlds like mud1

Barlte presents Eve as an excellent example of an Alice World, and hence an excellent model for an “eldergame”:

• although “user-createdcontent” and “user-generatedcontent” are often used interachangeably, there is a difference

–User-created content is created explicitly by the actions of players

–User-generated content is content created implicitly by the actions of players

• User-generated content is emergent

•Eve’s environment is so rich that interesting things just happen

In other words, allowing oldbies to indulge in freeform play is the best form of eldergame.

Crowdsourcing missions for MMOGs April 21, 2009

Posted by jeremyliew in game design, games, games 2.0, gaming, mmorpg, user generated content.

Really interesting post at Kotaku about City of Heroes experience with crowdsourcing story arcs.

In a letter to the community posted on the official City of Heroes website, Matt “Positron” Miller revealed that within the first 24 hours of the new updates’ existence, players in both hero and villain factions had created more than 3800 story arcs, each consisting of five missions a piece – more content than the development team had created during the game’s entire existence.

Players have been busy trying out missions and critiquing them in the forums as well. Out of the more that 20,000 arcs now available in game, 2,860 of them have been rated 5-stars by players, with only 582 rated at 1-star. Popular themes include the 5th Column, featured in 794 arcs; the super-heroic Statesman, starring in 134; and time travel, which is the subject of 112 arcs.

As an indication of volume, this is more story arcs that have been created by the game developers in five years!

One popular element was creating custom opponents notes the City of Heroes blog

70% of the arcs that are published use Custom Enemy groups. These are enemies created using our fantastic costume editor, coupled with a large sampling of the powersets that the game already uses. These unique enemies have proven to be extremely popular and sparked new life into the game. Players absolutely love fighting custom enemies for the simple fact that they no longer know what to expect. One of the biggest problems with MMOs is you eventually learn what all the critters you are fighting do, and the game can get pretty rote. Developers make new critters, but there can be months before you get new ones. Now players have the opportunity to be constantly making new enemies with new, interesting capabilities that can challenge and vex themselves and their friends, any time they want.:

I don’t play City Of Heroes, so I don’t know how directly applicable this idea is to web based social games. However, any of the social games currently available have very similar structures (e.g. the “wars” genre) which can get old over time. Perhaps this approach of crowdsourcing missions might add some interesting eldergame elements to these games.

Tips on designing layouts for games and virtual worlds March 23, 2009

Posted by jeremyliew in game design, game mechanics, mmorpg, virtual worlds.
1 comment so far

Raph Koster has some useful tips on laying out maps; some of these are probably not too different from urban design planning best practices in the real world. I’m repeating them here (aggregating and paraphrasing some of his points)

1. Always make sure users can tell which way to go.

Starting a newbie at a dead end and giving them only one way to go is a classic way to deal with early confusion. Large landmarks that can be seen from a distance can serve a similar purpose.

2. Don’t use invisible barriers. (Form should give an indication of function)

3. Mazes suck.

4. Make zones that have a sense of place

– Create characteristic qualities to a linked zone so that it is easy to recognize that these areas are related to each other
– Enclose these zones
– Create “gates” between places that visually convey a transition from one place to another

…moving from one pocket to another should feel dramatic: a tight passage revealing a wide vista, coming over the crest of a mountain and revealing a valley, discovering a door behind a waterfall, a big bold gate with guards. You want to signal that the user is entering a space with its own framework and rules. There are a lot of visual cues that are used, but most of them carry some sense of “gate” to them, even if it is as simple as a path that winds between two hills: a passage between two tall things.

– Build in modules. Connections to neighboring zones should be few and obvious.
– Have a defining activity.

ure, every city has to have the same amenities, and every zone must have monsters. But get creative. This wilderness zone has the pool you can swim in that is perfect for picnics. This other one has the great layout for ranged combat. This inn has the trivia game; that one has the chess board. Users will self-select into the spaces which feel culturally comfortable to them.

5. Watch where people want to walk, and put roads (and important places) along the well worn paths.

6. Social spaces point inwards. Keep the center empty to avoid a “ring” instead of a “plaza”

7. Adventure spaces point outwards.

In general, if you are exploring you want a horizon (or more than one) to head towards. Where social spaces create a sense of security, adventure spaces should create a sense of uncertainty and the unknown to prompt users to keep going.It isn’t about endless vistas; it’s about interest.

8. All this is fractal. Apply the same rules at each level of map layout.

As always, read the whole thing.

IMVU founder’s framework for digital goods: three key questions October 20, 2008

Posted by jeremyliew in digital goods, game design, game mechanics, games, games 2.0, mmorpg, virtual goods, virtual worlds.

Eric Reis, one of the co-founders of IMVU, posted last week on the three key decisions you have to make when thinking about virtual goods business models:

UGC or First Party content?

First Party – more control, but higher costs and harder to anticipate what users will want

UGC – Massive breadth of content, but have to put systems in place to deal with adult content and copyrighted content

Subscription or a la Carte payments?

Subscriptions – Greater game balance between rich and less rich players, lower fraud rates

A La Carte – Easier to monetize players without credit cards (e.g. teens)

Merchandising or Gameplay?

Gameplay – Virtual goods are functional, part of the core game mechanics, and confer benefit in the game. Demand is driven by game mechanics alone, and requires a delicate balance to ensure that players with money do not always beat players with time, skill and passion.

Merchandising – Virtual goods are not just functional, but also associated with self expression or attention in a noisy environment (see my previous post on the three use cases for virtual goods). This creates potential for greater demand for virtual goods, but requires the creation of a marketing and merchandising capability in the company.

Reis believes this framework can be used to describe any virtual goods business:

You can use these three questions to analyze existing businesses. For example, IMVU is a user-generated, a la carte, merchandising product. Habbo is first-party, a la carte, merchandising. Mob Wars is first-party, a la carte, gameplay. WoW is first-party, subscription, gameplay.

Read the whole thing.

How to take money from children (for your online game or virtual world) September 29, 2008

Posted by jeremyliew in games, games 2.0, gaming, mmorpg, payments, prepaid cards, virtual goods, virtual worlds.

Virtual Worlds News noted last week that:

PayByCash announced … that over 50% of its US transactions were coming from its Ultimate Game Card, a prepaid card that supports over 150 virtual worlds and games, like Club Penguin, Nexon America, and IMVU. Previously U.S. consumers favored PayByCash’s direct debit options…

I’d guess one explanation for the transition, and one to watch, is that adults are more likely to set up debit options… Kids and teens, who seem to be driving much of the consumer-oriented virtual worlds growth, simply pick up cards at retail.

It is an important statistic as it really underscores the importance of prepaid cards as a payment mechanism for free to play games. Min Kim of Nexon noted in his presentation at Austin GDC this year that:

“Retailers are taking notice of card sales, and support will grow. Retailers love the regular customer, and coming back for cards is a given. Once you’ve purchased one card, statistics say you’ll probably buy another.”

Target has certainly taken notice, with 26 gamecards available for sale now, including Nexon, Neopets, Gaia, Habbo, Acclaim, gPotato, Stardoll, Zwinky, Big Fish, 3 Rings (Puzzle Pirates) and Wild Tangent. A wider selection is available in their physical stores.

I’ve spoken to several free to play publishers with prepaid cards at retail and they have seen this payment mechanism come to represent from 20-50+% of their virtual goods revenue, which is consistent with the percentage that PayByCash has seen. As Virtual Worlds News speculated, it is the games and virtual worlds that skew towards kids and teens that have the greatest proportion of revenue coming from prepaid cards.

However, publishers tell me that their sales from their own-branded prepaid cards are many multiples of their sales from PayByCash. A Game X player is simply far more likely to buy a Game X card than to buy PayByCash’s Ultimate Game Card. In fact, many publishers tell me that even though they already took the Ultimate Game Card as a payment mechanism, when they launched their own-branded card into retail, they saw a sizeable, immediate, incremental jump in ARPU. Their existing players, who had previously wanted to be able to pay them but didn’t know how, now were able to do so.

Nabeel Hyatt, CEO of Conduit Labs, has previous noted that this could create more of a problem than an opportunity:

In all, there are now over 25 digital content cards being sold at retail. I’ve been tracking this and that’s over double what it was six months ago. That means that at least a dozen online communities, and probably a dozen more in the next six months, are going to be submitting themselves to the vagaries of the retail shelf-space business. That’s a business the online web folks have little to no experience in, and one that a lot of traditional gaming vets were excited to get out of.

I am more optimistic. Retailers love prepaid cards. These cards have no inventory carrying costs and no shrinkage (theft) problems because they are only activated at the checkout. Furthermore, the cards are small and high value, creating high $s/square foot, one of the key metrics at retail. In my local Safeway (picture below), there are 6-700 prepaid giftcards for sale (for everything from Red Lobster to Bed Bath and Beyond) – one indication of how much retailers love this product.

Nabeel is right though – getting retail distribution is not something that is core to the DNA of most online game publishers. Most of the publishers that I’ve spoken with work with one or more of Blackhawk, GMG Entertainment and Incomm to get their cards into retail.

For people interested in learning more about prepaid cards into retail, the Virtual Goods Summit on October 10th looks to be a good event, specifically the 10:30 panel ,”Making Virtual Economies Work — Lessons from the Leaders” where the CEO of Playspan (which owns PayByCash) will be speaking, and the last panel of the day, “Getting Paid – Build a Dominant Payments and Billing Strategy”, where the President of GMG Entertainment will be speaking. If you’re going, use “JEREMYLIEW” for 10% off of General Admission on registration.

Social games need endgames September 22, 2008

Posted by jeremyliew in endgame, game design, games, games 2.0, gaming, mmorpg, social games, social gaming.

At AGDC last week Bioware’s Damion Schubert spoke about end-game design in MMOs. Massively notes:

Endgame gameplay, elder gameplay, is a mandatory and compelling part of the genre’s equation. In fact, in Damion’s opinion complex elder gameplay exemplifies what makes the massive genre what it is…

In reality, says Schubert, MMOs are generally really easy to play. Comparing the learning curve of an MMO to a single-player game is ludicrous; MMOs are like ‘popping bubble-wrap’ in comparison. This is because of the challenge of tuning leveling to every class and every build. The result is an experience that’s fairly mundane. The real challenge, the ‘worthy experience’ is the endgame encounter.

While endgame may seem like a strange or meaningless thing, it’s actually really important for every player. Even low level players are aware of powerful guilds and raid progression. Damion references the cutscene that happens when Kael is killed and a quest is turned in; this feels, truly, as though the world is advancing and changing. That’s vital for a vibrant community.

The most thing about elder gameplay is that is one of the few things that is actually massive. Massive gameplay is the one thing that this genre of games has to offer.

IGN reports that Schubert considers there to be two forms of endgame, PvP and PvE:

In order to pull players through the sometimes dull leveling process, Schubert says it’s necessary to give an indication of what’s going on at higher levels. In games where the endgame revolves around player versus player territorial control combat, for instance, a good game will let players view a territorial control map. On World War II Online’s site, for instance, the main page prominently displays the line of contest between the two sides and which side, the Axis or the Allies, are pushing forward. It’s, in effect, an advertisement for the dynamic, high level activity that most new players might not necessarily be aware of.

He went on to talk specifically about the advantages and drawbacks of territorial control PvP and PvE raiding. For territorial control, you need a few basics. You need affiliated teams, either pre-set (World of Warcraft, Warhammer Online) or more freeform. You also need a physical location within the game world that players can fight over. Once that’s established, you need to consider the logistics of battle, like far do players need to run to rejoin the battle after death and how long the battles will last. Schubert says that having some way to actually schedule fights is a solid notion, but you should also have a way to specify when that fight will end. Whatever the structure of the PvP conflict, Schubert says it’s a concept that needs to be slowly introduced to players early on, like with the territorial map, to give a player an idea of what the strongest in the game world are up to…

[PvE] Raid encounters are another major form of endgame content, and center around the idea of players working as a team to essentially solve a puzzle. Raid encounters center on boss fights. The draw, naturally, is the loot, but Schubert says there’s also the draw of solving the puzzle of the boss’ attack patterns. Bosses can have a number of different attack routines, from predictable patterns to randomized attacks to the summoning of minions. These types of actions work to engage players in a number of ways. It requires those in the raid to coordinate their positions and movement on the field of battle, manage their health, and also generates different sub-types of player classes outside of the standard tank, healer, and damage dealers.

Gamasutra notes some specific observations about PvP endgames:

“If your endgame is PVP, you need to think about how PVP is introduced to characters at the low levels,” Schubert cautions. “If players decide along the way to the endgame that they don’t like your PVP, they will decide the endgame is not for them.” Argues that you should protect players more at the lower level, so they have a positive PVP experience.

“People don’t pay money to suck. People do not want to pay $15 a month to be the Washington Generals.” This is something he learned when making Shadowbane – “the winners now had lots of resources and the city could thrive, and the losers had nothing. So what happened is eventually the losers stopped logging on, and the winners eventually had nothing to fight.”

“We had one server where one guild was so in control, that they banned a player class so they’d have somebody to fight,” said Schubert. Players woke up in the morning and found that they were “wanted.”

The solution, he says, is to be able to hit a button, in the game (so to speak) to indicate that one group of players have won, and that they can begin again.

Many of the social games on Facebook and on the web today don’t have any endgame at all. The gameplay more or less stays the same no matter how long you play Texas Hold’em, Owned, Lil Green Patch or Bowling Buddies, to name just a few. This is going to create a challenge for long term retention. Even for free to play games, it is your hard core users who pay you the most money. So it will also create a challenge for long term monetization.

The good news for web based games is that there is no need to develop an endgame at launch. You can afford to wait until you have a critical mass of users before developing an endgame as there is no need to solve this problem until you have “elder players”. And since you are a web based game, you can switch on an endgame at any time without having to worry about updating a client.

Often times, endgame play will emerge organically from the users. For example, Fluff Friends endgame play has become more focused on creating elaborate fluff art. Friends For Sale endgame play has become about collecting “sets” of people and other quest like achievements, often challenges set up the players themselves. These social games have developed endgames that are neither PvP nor PvE, but are instead more social in nature.

While it is great when endgame emerges on its own, social game designers can be more proactive in developing endgames to keep their best players engaged, and give their new players something to aspire to.

MMOG nuggets from Austin GDC September 18, 2008

Posted by jeremyliew in business models, freemium, games, games 2.0, gaming, mmorpg, virtual goods, virtual worlds.

Some interesting tidbits about both free to play and subscription MMOGs coming out of the talks at Austin GDC. Min Kim of Nexon says:

Not just a Korean thing:

“South Korea is still a big market for us,” Kim admits, “but the split is now 50/50 with overseas markets,” which includes the Asian and U.S. markets.

On growth in North America:

In 2005, Nexon America’s revenues were around $650,000. In 2006, when they added Paypal as a payment option, sales rose to $8.457 million, based on item sales. In 2007, once Nexon released its Nexon Cash cards to retail stores, revenue jumped to $29.334 million.

On localization of games:

While many of the free to play games currently come from Korea, Kim feels that the market will eventually be dominated by Western titles. “We’ve seen this happen in other places like China,” he posed. “The big games now are from Chinese developers. I think the same thing will happen in the West, with Western-developed titles.”

On how game design interacts with business model design:

Focus on fun, not just on what items you can sell. “Have an idea about what your business model is,” he advises, but don’t go overboard laying out your business plan completely from the beginning. “Don’t have all your items and categories pegged out. Make sure you have a fun game, first.” 9 times out of 10 the ideas you’ll have at the beginning will be wrong. The players will tell you what they want to buy.”

From a panel on evolving business models in MMOs, CCP’s (Eve Online) Petursson notes that subscription MMOs mostly reward time spent playing (which is consistent with the business model):

All subscription-based MMOs are merit economies – those with most time, win. But the only thing you can’t buy is social merit. To be a purely subscription-based game, you should aim for social merit as it’s the only merit economy defensible against outside influences.

On when Free to play works and when it does not (a function of demographics, geography/ cultural norms and genre):

* Robert: The demographics in LOTRO etc are a lot older: 20-35, male. F2P games tend to be younger, more females, casual, less hardcore. 30 year old males are not playing a lot of F2P and have no problem paying monthly subscription. Younger people and kids are playing lots of games and want F2P for that flexibility. However, F2P microtransaction games can pull in more ARPU than subscriptions.
* Helmar – In CHina, it is illegal to have an automatic debit for sub based game – user always has to choose. For game operator it’s important to realize that most biz models will be implemented by user… better to implement them yourself and tune appropriately.
* Min – also based on genre…not many ppl shell out $15/month to play FPS. There are some F2P FPSs now in Asia. Biz model based on genre as well.

Turbine’s Ferrari notes that F2P games need low barriers to play

What we’re seeing is a shift that a lot of the f2p games are so much lighter than traditional MMOs. Heavy MMOs are beautiful, but that puts a barrier to entry based on min spec – younger demographics don’t have these systems. Global expansion doesn’t support those specs either. Our games are above 5gb in size, whereas Maple Story is close to 1gb now.

Nexon’s Min Kim has a contrarian view:

In S Korea, people have no problem downloading big client products as the web is so fast. I often wonder if browser-based gaming is an interim step until web speeds creep up and people can return to client download.

And multiple comments on the importance of letting your customers pay you how they can and want to pay you (including prepaid cards at retail):

* Min: Offering payment methods relevant to your target demographic is important. Over 20 years old, credit cards are viable. In the teen demographic, prepaid cards are still the dominant form of payment. Maybe SMS payments will come, but it is all about accessibility and convenience. In demographics such as Club Penguin’s, credit cards are a big part of their payment methods as parents are paying.
* Nicolay: I think Habbo has 140 different payment methods. The ability to pay has to be the lowest barrier to entry, otherwise you aren’t getting any money.
* Robert: SMS charges surrender so much margin to carrier, but retail cards may be more expensive just to get into channel.
* Hilmar: It’s puzzling why carriers aren’t lowering their surcharges. People would switch to it immediately, resolving credit card issues.
* Min: There is no access for our consumers to use credit cards. In 2006, we did $8.5M in the US in virtual item sales – in 2007 we did $29.3M in virtual items. Virtually all of that growth came from enabling people to pay.
* Robert: Companies like Turbine are looking at the console to expand their playerbase. Potentially we can use an xbox payment system, so we don’t need to do it ourselves. It’s about expanding access for players.

Using a virtual world newspaper to enhance in-world community September 1, 2008

Posted by jeremyliew in culture, mmorpg, newspapers, virtual worlds.

The LA Times notes the popularity of the Club Penguin Times:

The Club Penguin Times … is more widely read than New York’s Daily News, the Chicago Tribune or the Dallas Morning News. And it’s not even 3 years old.

But this weekly “newspaper” isn’t tossed onto driveways or sold at newsstands.

Rather, it’s an online publication distributed to the estimated 6.7 million monthly users of Club Penguin, a snow-covered virtual world visited by more than 12 million kids, who adopt a colorful penguin persona and waddle around, playing games and meeting new friends.

Though no one would suggest that the Club Penguin Times provides Pulitzer Prize-worthy coverage, it nonetheless attracts 30,000 daily submissions from children, who pose questions to Dear Abby-inspired “Aunt Arctic,” compose verse for the poetry corner, tell a joke or review a party or event…

As the main source of information about events within Disney’s icy, penguin-populated virtual world, it boasts the kind of reader penetration that mainstream newspapers would envy. At least two-thirds of the players turn to the Times each week to find out what’s happening, Merrifield estimates.

Club Penguin’s CEO., Lane Merrifield, notes:

…he was looking for ways to incorporate learning — what he called educational “fiber” — in the game. Publishing a “newspaper” seemed an obvious way to encourage reading by offering information that users care about, such as the latest igloo upgrades.

In addition, the Club Penguin Times helps create social norms and shared experiences for players – an important facet to creating and shaping a culture in the world. Most online worlds develop discussion boards where the world’s creators have limited ability to shape the discussion. By creating a user generated (but company edited) newspaper for the world, the world’s creators give themselves a powerful tool for controlling and shaping the conversation. People building MMOGs and virtual worlds should read the whole thing.

(Found via via Paid Content.)