Free to Pay: the True Value of Free to Play Gaming

There was a time, not too long ago, when the term “free-to-play” was a four-letter word in video gaming. As put by Riot Games founder Brandon Beck in a recent interview with Joystiq, however: “In the end, free-to-play is just a business model,” and recent moves toward said model from companies like Valve, Turbine, Funcom, High-Rez, and even Blizzard are a clear indication that perceptions are changing.

Penny Arcade on LoL

This is great news for both consumers and developers, as there are numerous benefits to this model for both sides: low barrier to entry, viral growth opportunities, a chance to infuse older titles with a fresh community, and, lest we forget, the fact that players don’t have to pay a cent. Ironically, that final, ultimate benefit to players is the very reason that you’ll see more and more developers moving to this model as perceptions continue to change: free-to-play also means players are free to pay as much as they’d like for their experience.

The most recent proof point for this is best illuminated by, of all things, the recent launch of the latest Humble Indie Bundle: a limited-time bundled collection of five indie titles with a pay-what-you-want pricetag and the option to decide what percentage of your payment goes to the developers, the Electronic Frontier Foundation, and Penny Arcade’s Child’s Play Charity. By giving gamers the choice to pay virtually nothing ($0.01 as a formality) or as much as they’d like (a record currently held by Mojang’s Markus “Notch” Persson with $4,048), Humble Bundle pulled in over $500k from more than 100k purchases in less than 24 hours. While the bundle technically isn’t “free to play,” it’s certainly a testament to how much money gamers are willing to pony up when given a choice.

Thinking beyond the PC market, the benefits of microtransactions are also being thoroughly (and successfully) explored in the mobile space. A recent study by analytics firm Flurry found that the free-to-play model has passed premium game revenue on the App Store, now responsible for a whopping 65% of revenue generated, thanks to titles like Tiny Tower. As of this post, seven of the ten top grossing games on the App Store are free to download.

Just as any new business model, free-to-play gaming still has maturing to do before reaching full mainstream acceptance, but don’t be surprised if more and more developers start looking toward microtransactions as a viable foundation for new titles, rather than just a really clever way to rapidly grow the userbase and revenues of an older title. It’s been about a year since I last wrote on this subject, and EA has yet to confirm whether The Old Republic will use a subscription model only or have free-to-play opportunities. That certainly doesn’t mean they’re doing anything beyond keeping their options open, but to quote Emily Dickinson: “saying nothing sometimes says the most.”

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