What is the Best Business Model for a MMO?
Micro-transactions are Satisfactory for Developers and Players
Sep 3, 2009
Most Massive Multiplayer Online (MMO) games that exist today fund themselves with one of three business models. These business models are either Buy to Play (B2P), Pay to Play (P2P), or Free to Play with Micro-transactions (F2P). Micro-transactions are items you buy in a virtual world, or game, that you pay for with real money. These items usually range from prices of a few cents to tens of dollars.
Advantages and Disadvantages of the Three Models
The Buy to Play model isn't seen commonly in the MMO genre. This is because the income that the developer would receive from the buyers/players doesn't equal the cost to operate the game's servers and pay the staff. A popular B2P game is Guild Wars, which was developed by ArenaNet and published by NCSoft.
Advantages of the Buy to Play (B2P) Model:
- Gives the consumer a feeling that they get their money’s worth out of the product, as they’ll continue to get additional content.
Disadvantages of the Buy to Play (B2P) Model:
- Unless the game has instanced areas, the server costs will be higher than the developer can manage (For instance, in Guild Wars, a popular B2P game, when a player leaves town, it creates an instanced area for that player and their party. This means that the player can only minimally interact with other players outside of that area. This lowers the amount of server connections, which lowers costs.)
- Unless the developer can come up with a means of additional income or new products quickly they will not be able to afford to operate.
This model is one of the most satisfactory to players. It allows the players to feel as if they are getting their money's worth, while at the same time supporting the developers. Unfortunately, for most developers, unless they have an instanced game and can quickly release products to sell, they will not be able to afford running on this model.
The Pay to Play model is one of the most common models, with its main competitor being Free to Play with Micro-Transactions. This model is used by popular games such as World of Warcraft and Final Fantasy XI.
Advantages of the Pay to Play (P2P) Model:
- Brings in the developer a constant source of income.
- Players spend more hours in game to get their full money’s worth (this is a disadvantage to the player, as sometimes they will play more than is healthy. Games try to discourage this behavior by adding in phrases such as “There’s plenty of loot to go around, get some sleep” (EVE, a popular Science-Fiction MMO.)
- Because of the developer’s reliable stream of income, content can be released frequently
Disadvantages of the Pay to Play (P2P) Model:
- Players spend more money for the product, and when they stop paying, they cannot access any content of the product.
- Can sometimes leave the player with an unsatisfied feeling, due to frequent monthly payments.
- Players spend more hours in game (See P2P Advantages.)
This model is the most supportive of developers, allowing them to run their game as long as they have players. Unfortunately for players, this model is the least satisfactory for them. The monthly fee makes them feel as if they won't get the most out of their money unless they play continuous, and no player can or should do that.
The Free to Play with Micro-transactions business model has become increasingly popular in recent years. The model became widespread with the popularity of "Korean Grinders", as some gamers refer to them. These are games that were primarily developed in Asia. Often times, the games have a Manga (Japanese Graphic Novel) art style. They received the name "Korean Grinders" because usually players must grind (kill repetitively and often) to achieve a higher level.
Advantages of the Free to Play (F2P) Model:
- Grants players the ability to play for free, forever.
- Attracts large numbers of players who don’t wish to pay a lot of money.
Disadvantages of the Free to Play (F2P) Model:
- F2P games usually have weaker communities, because players won’t feel the need to help each other, as the game doesn’t feel like an investment.
This model is the most satisfactory for the players, and, at the same time, manages to be satisfactory for the developers. Because of the ability to play for free, games that use this model often reach a wider audience. This audience will also tend to include younger players, as they won't need to ask their parents permission to use their credit cards and/or Paypal accounts.
It should be cautioned to developers that if they wish to have a tight community for their game this is not the model for them. The F2P model allows players to easily create many accounts to hide their identity from other players, so they will also act as if there are no consequences. If developers have a very active Moderator team, they can weed out these players, but, because of the wide audience, this often times becomes impossible.
Free to Play with Micro-transactions is the Most Satisfying
Out of the three models, the F2P is the most satisfying for both developers and the players. The developer can maintain their project, while having a steady stream of and the player has the ability to play for free.
The biggest mistake a developer can make is to make their micro-transaction items affect game-play. If you have to pay to win or access areas of the game, this will isolate a part of the player-base and will hurt the company’s reputation.
Micro-transactions, if done correctly, tend to be graphical or customization options. For instance, in the game Maplestory, players can buy different clothes, hair options, and pets to change the looks of their characters. “Why would someone buy something that doesn’t make them better?” is an often asked question. Players do it to become unique. Oftentimes, in F2P games, the basic options for a character are limiting. Characters tend to look the same because of this, and users don’t like this, and they are willing to pay to fix it, as the popularity of Maplestory’s Cashshop (where they buy the micro-transactions) shows.
Related Information:
 |
