Thursday, February 28, 2013

The future of gaming, micro-transactions

Article first published as The Future of Gaming: Micro-Transactions on Technorati.

Star Trek Online, Lord of Ultima, Dungeons and Dragons online and The simpsons What's the common thread? You can play them but if you want to see the closing credits you're going to need to peel off some green.

It's become a very lucrative space with $25 million made by EA in the last quarter of 2012 just on their  Simpsons mobile  game alone.   EA and other large publishers like Activision have been actively exploring  new revenue models  to  offset declines in traditional boxed sales.

It's a trend that's gradually finding its way into the traditional gaming space of PC's and consoles.  Subscriptions, upgrades and DLC  have become more commonplace but game publishers see an opportunity to push the model even further. 

236405_GameTap GameTap Games on Demand 125x125The typical triple-A game title now averages $60.  DLC is usually around $15 with upgrades usually a fraction of that.  If you were to take advantage of all the extra content you could  essentially pay for the game twice when you were done.

Of course you don't have to purchase the extra content but your experience will be diminished compared to those that do.  EA's Blake J. Jorgensen thinks that's where the money is.

"The next and much bigger piece is micro transactions within games...  we’re building into all of our games the ability to pay for things along the way, either to get to a higher level to buy a new character, to buy a truck, a gun, whatever... and consumers are enjoying and embracing that way of the business"

I'm not so sure consumers are "enjoying "micro-transactions as much as they're just tolerating them at this point.  The model  can work if your upfront investment is minimal but the future may not be so certain if we're still paying triple-A prices. 

It's not unlike going to a movie, paying your $15 admission and upon arriving in the theater finding very few seats all of them occupied.  You inquire of the management and find that your ticket only entitles you to see the movie not to sit down unless you pay an additional charge.  Thus starts a chain of events that eventually ends in your $15 movie costing $40.  That doesn't even include the popcorn! 

It's not as farfetched as it seems.  EA's own Battlefield 3 already employs such a model that disenfranchises those who don't purchase a "premium" subscription or additional DLC.  Even franchises like Need For Speed aren't immune with Most Wanted getting paid DLC in the next few weeks.     

It seems the trend of "micro-transactions" is at least a part of the immediate future.  Time will tell if gamers will tolerate all the extra tolls along the way.

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