Thoughts on free to play games

Iwas thinking about writing some thing on here about free to play games and the benifits for players as well as devlopers IF done right. Turned out we where writing reports at uni and could pick from a wide range of topics- including free to play 😀 So here it is, because its for a uni assignment i written in a more formal style than i would have liked:

Introduction
Over the last 10 years free to play games are becoming more popular – but what are free to play games and how are they different from ‘free games’?
Free to play games allow the player access to a certain percentage of the game or certain content for free- the rest of the content is accessed either by paying or playing the game for large amounts of time (this is the most common system at the moment) –  in-game advertisements can also be involved in some way depending on the type of game. As the term ‘Free to play’ has yet to receive a standard definition i am going to use the wikipedia definition:

‘Free-to-play (F2P) refers to any video game that has the option of allowing its players to play without paying’[1]

If we compare that to the definition of ‘free software’:
‘Free software, software libre or libre software is software that can be used, studied, and modified without restriction, and which can be copied and redistributed… The word free in the term free software refers to freedom (liberty), and is not at all related to monetary cost’[2]

and the definition of ‘Freeware’:
‘Freeware (from “free” and “software”) is computer software that is available for use at no cost or for an optional fee’[3]

You can see that free to play does not imply that the users own the software or can modify it- only that they may use the service at no cost.

How free to play games affect revenue
Although free to play games use a wide range of payment methods, they all have one common goal which affects revenue. This common goal is to create as large a player base as they can – the more people playing the game, the more people paying for content. Often the percentage of players that pay can be as low as 2 to 3 %. But how does this compare to the revenue of sales from traditional distribution methods such as retail and digital distributing?

As an exambple, Lord of the Rings Online started out as a subscription based game (players paid an amount each month to continue playing) and went free to play in 2009. Since then its revenue has tripled and the game has a increased population and activity. ‘developer Turbine’s comms director Adam Mersky told the Ten Ton Hammer podcast, “This year – it’s still early, it’s only been a couple of months – monthly revenue has tripled for us.” [4]

If we look at this chart with data taken from the US app store top 100 we can see that revenue of free to play games vs traditional games is increasing:

Considering around 70% of all top 100 apps are games, this would make free to play the highest earner. But this is only considering a specific market place, below i will talk further about this.

Virtual Goods
So if free to play games are making a lot of revenue, what are players spending their money on?
In 2009 PlaySpan (who owned a very large amount of the free to play games at the time) released some statistics that showed what players valued most and what they would spend their money on most:
Considering in-game currency is used to buy all of the other things on the graph i will not be considering it in my analysis of the data. What is probably most shocking about this data is that the most traditional content (maps/levels) that is sold to players as expansions/down-loadable content is what players value the least. Another interesting note about this data is that 52% is weighted towards goods that have no gameplay significance at all- it would seem players care about self expression almost as much as how powerful they are in game.

How free to play compares against of genres
But if we look transactions and spend by genre of game- we might have a better idea of how free to play stacks up against other genres of game.
[6]
As you can see on the above graph, free to play games generate the most revenue for Playspan and have the most transactions. Things to note about this graph are: MMO players are also paying a subscription on top of the data in this graph, and although casual games comes in last, its marketing costs are much lower due to viral advertising and how facebook allows games to advertise.

So it seems based on all the data analysed so far that if you want to make money with a free to play game or post launch content then you need to sell items that allow players self expression and items which then improve in game performance. Maps and additional levels are not advised.

How free to play model could affect gameplay
So how does the free to play model affect game play, if at all? I will discuss a few different genres of free to play games.

Casual Games
As far as my experience goes with free to play games, the casual facebook type games (primarily from a developer called Zynga) seem to be mainly about money extraction from players. A lot/most of these games are designed from the ground up to make money and take money from the player. But how does gameplay make you spend money? Facebook games have a trend of enforcing wait times between actions; to circumvent these wait times players can buy currency/energy to keep playing.

“Even Zynga’s designers seem well aware that their game is repetitive and shallow. As you advance through Farmville, you begin earning rewards that allow you to play Farmville less. Harvesting machines let you click four squares at once, and barns and coops let you manage groups of animals simultaneously, saving you hundreds of tedious mouse-clicks. In other words, the more you play Farmville the less you have to play Farmville.”[7]

Any game which rewards you with playing the game less for playing the game surely means that the players are not playing Farmville for fun. So if people are not playing for fun then they must be playing for social reasons – the way Facebook games are set up means that the more friends you introduce to the game, the better you will do in the game – but these people you just invited to the game also want to do well, so they invite a group of people as well. And the cycle continues – which is probably why there are 5 to 1 Farmville farmers to real farmers! So it would seem that the vast majority of players play because of social obligations – people feel the need to keep their farm in a better state than their peers.

Core Games
I am now going to look at the game Tribes: Ascend. It is a free to play game for the core market. Tribes is based on three previous games before it, so we know the  gameplay is tried and tested (more importantly the developer knows these mechanics are liked). But how do 10 year old game mechanics fit into a newly developed free to play model? The answer is: awkwardly. This is true of a lot of new free to play games that are based on gameplay mechanics from before the time of free to play games. A lot of developers just want to take their existing product and cut it up into smaller chunks and charge for each of those chunks/have a subscription to access the content. This can affect a games balance a lot as players who have invested more money than other players are more powerful (this is especially true for a game like tribes which has been entered into NASL (North American Star League, an e-sports league) where game balance is paramount). So as an example I will use Tribes again. Tribes has a capture the flag system and two opposing teams. Each team is made up of different classes, but only a few are unlocked for new players (requiring MANY in-game hours or real money to unlock). So let us say a paying player has bought a new class and joins a game against some new players, the new players will lose as they do not have the required class unlocked to counter the class the paying player has. The current problems with Tribes will most likely be sorted out before release (it is in closed beta) but it still highlights the problems with trying to integrate free to play to existing game mechanics/games.

One of the most successful free to play games (from a revenue/gameplay/player activity perspective) is Team Fortress 2. Amazingly it didn’t start out as a free to play game at all. It slowly transitioned its way to where its now. From a player’s perspective as a free to play game is does a few things right: provides in-game items which players value highly but do not un-balance gameplay (no matter how much money you pump into the game you will never have a statistical advantage over a new player just starting), it is competitive (one of the most unique e-sports games at the moment) and just straight-up fun. But how did TF2 manage this whilst also being free to play? Its developer Valve believes in games as a service, and not just selling at retail and moving onto the next project. This goes hand in hand with most if not all free to play models – free to play games rely on money coming in from players constantly, but why would customers pay money constantly if they are not continually getting new content?

Free to Play and Piracy
Free to play also addresses one of the main concerns in the video game industry – pirating. Over the last few years developers have come up with lots of different ways to prevent piracy across all games platforms (mainly PC). This has been in the form of invasive DRM (Digital Rights Management), license keys, free content to players who bought the game at retail, etc. But the majority of this just hurts the paying customer and not the pirate as they have found a way to pirate it anyway. If you look at the reason why games are pirated, its often not because of the price. It could be to do with many things, including: annoying DRM, region-locked games, long download queues. Of course free to play games have no DRM, generally are not region locked, and on top of that are probably the hardest to pirate and operate (in the same way that subscription based MMOs are hard to pirate).

Now if we look at music and films (two medias that are more advanced than games and well known for being pirated) they are now at the point where piracy is actually decreasing:
‘Research firm Envisional has issued a study which cites a rise in UK game piracy of 20% over the last five years… Meanwhile, illegal downloading of music decreased’[8]
This is mainly due to the market maturing and distributors realising how people like to enjoy music and film. You now pay for a service, never a specific film or song. You pay X amount a month to listen to ALL music and film.  Games are different so the exact approach may not work (although OnLive is currently going down this route) but the idea as games as a service and free to play games will be what successfully combats video game piracy.

Conclusion
So what is the future of retail video games? No-one can say for sure, but next generation of console and this generation of PCs will definitely see a rise in free to play games and their popularity. If next generation consoles (especially Xbox) do not reduce some restrictions on how games are distributed on their respective networks, then we may see a lot more free to play PC exclusives as publishers realise the benefit of free to play. Free to play games have the ingredients to be beneficial to both developers/publishers and players if done in the correct way. How long we will have to wait until the majority of free to play games get this right I don’t know.

Bibliography

  1. Free-to-play – Wikipedia, the free encyclopedia. 2011. Free-to-play – Wikipedia, the free encyclopedia. [ONLINE] Available at: http://en.wikipedia.org/wiki/Free-to-play. [Accessed 15 December 2011].
  2. Free software – Wikipedia, the free encyclopedia. 2011. Free software – Wikipedia, the free encyclopedia. [ONLINE] Available at: http://en.wikipedia.org/wiki/Free_software. [Accessed 15 December 2011]
  3. Freeware – Wikipedia, the free encyclopedia. 2011. Freeware – Wikipedia, the free encyclopedia. [ONLINE] Available at: http://en.wikipedia.org/wiki/Freeware. [Accessed 15 December 2011].
  4. Gamasutra – News – Turbine: Lord of the Rings Online Revenues Tripled As Free-To-Play Game. 2011. Gamasutra – News – Turbine: Lord of the Rings Online Revenues Tripled As Free-To-Play Game. [ONLINE] Available at: http://www.gamasutra.com/view/news/32322/Turbine_Lord_of_the_Rings_Online_Revenues_Tripled_As_FreeToPlay_Game.php. [Accessed 15 December 2011].
  5. . 2011. . [ONLINE] Available at: http://blog.flurry.com/Portals/41620/images/AppStore_Top100GrossingGames_Freemium_vs_Premium-resized-600.png. [Accessed 15 December 2011].
  6. 2011. . [ONLINE] Available at: http://www.gamesbrief.com/assets/VirtualGoodsBuyerssmall.jpg. [Accessed 15 December 2011].
  7. Cultivated Play: Farmville | MediaCommons. 2011. Cultivated Play: Farmville | MediaCommons. [ONLINE] Available at: http://mediacommons.futureofthebook.org/content/cultivated-play-farmville. [Accessed 18 December 2011].
  8. Game piracy in the UK up 20% since 2006 | VG247. 2011. Game piracy in the UK up 20% since 2006 | VG247. [ONLINE] Available at: http://www.vg247.com/2011/11/11/game-piracy-in-the-uk-up-20-since-2006/. [Accessed 19 December 2011].
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