Microtransactions in Video Games

Freemium games allows users to play the game for free while also giving them the choice to purchase virtual items through micropayments.  These purchasable virtual items ranges from cosmetics to power boosts which allows the player to accelerate through the game faster. Many video game businesses have been adopting the “free to play” model with micro transactions over the standard premium paid games. “Huge games like Temple Run and Jetpack Joyride have transitioned from paid products into freemium.”(Davis, 2012) With large potential revenue in the freemium market it is no surprise that gaming companies are making this switch. Based on a research from a Mobile analytics, the revenue from freemium games surpassed the revenue generated from the standard one time paid games. (Valadares, 2011) Piracy also plays a large role for companies to transitions from paid games to the free to play model. In an interview with game designer Shazim, he revealed that there was a 90%-95% piracy rate for one of his game upon release. (Mimi, 2013) Especially for indie games, it would be very hard for developers to maintain the game at such exorbitant rates. With high piracy rate game companies are given two choices, to create a standard one time pay game where the revenue is being hacked away by piracy or go through a more economical route and create freemium games. Naturally with most companies being driven by profit, they will go through the more economic route and create their games around the free to play model with micro transactions in order to maximize their profits. While there are good benefits to micro transaction such as creating a higher player base, there are negatives about it such as giving an unfair advantage to players that pay real currency. Even though companies are profit driven, they should be taking advantage of the benefits of the microtransaction model and not abuse it as it will bring the quality and player’s experience up.

The right free to play model with micro transactions can be beneficial to the players and to the gaming companies.  During my childhood I grew up with console games being approximate $30. As I grew up the cost of a single console game grew to $40, then to $50, and now it is approximately $60 for a single game. It is hard to invest that much to a game not knowing if it will it be an enjoyable game or not. With the free to play model the players decide whether the game is worthy for their money. The players can choose to support the company whether it is a single or hundreds of dollar, it is entirely up to them. Players become almost like emperors of Rome deciding the fate of a game. While beneficial to the players, the free to play model also benefits gaming companies. The free to play model attracts more player to the game by the fact of it being free which essential gives one more reason for a person to play the game. It doesn’t restrict people that want to play the game but can’t afford it. When Team Fortress 2 (TF2), a team-based multiplayer first person shooter game, first came out many of my friends purchased the game while I had not. I believe that TF2 was not worth my money for its cost and that restricted me from enjoying the game with my friends. When Dota 2, a multiplayer online battle arena, was released I did not have to experience the feeling of being shunned by a game due to the high cost because the game had a free to play model. I was able the play Dota 2 with my friends and I very much enjoyed the experience. In fact, I enjoyed it so much that I even supported the game by purchasing their virtual items with real currency. If Dota 2 had been a standard paid product instead of being free, I would have most likely not played the game and Valve, the creators of Dota 2, wouldn’t have the extra ten dollars in their pockets. The free to play model can be a win-win situation for both the players and the gaming companies because players can play the game for free while companies can generate more profit by having a higher customer base.

Some microtransactions give an unfair advantages to those who purchases in-game items. In the game MapleStory, a 2D MMORPG, players can spend money to purchase vanity items, level boost, item enchantments to make items stronger, pets that loots on your behalf, and more. Players are the given two choices. They can either spend countless hours grinding in order to become strong within the game or pay money in order to become strong without grinding. In the game Cow Clicker, a social network game on Facebook, players are required to click on a cow in order to earn “clicks”. There is a six-hour interval between each clicks but the players can purchase the in-game currency in order to skip this interval. In the game Clash of Clans, a mobile MMO strategy game, the players builds a community to defend against enemies and raises armies to attack other players. Every time a player trains a troop or builds a building, there are wait times for the troop or building to be completed. The player is also given a choice to skip waiting for the troops by purchasing the in-game currency. Even though all three of the games mentioned above are of complete different genre of games, they all share the same trait of having a currency of the player’s time. Normally the top ranked players of each of the games will be someone who has heavily invested their time or money to the game. It is unfair that someone can easily become one of the top ranked players through money. It makes the whole ranking system’s merit questionable because the games are essentially offering the players to cheat on their game and save time in exchange for money. The difficulty curve of the game is then being dictated by the amount of money players that are willing to spend on the game. In effect, it also creates an imbalance in the normal distribution of current level each player is at when compared to one another. Normally in a game without a purchasable advantage there would a normal distribution of players within a certain part of the game. There will very little people who would still be in the beginning stages of the game. There will high number of players at the midpoint of the game. There will very little people who would be towards the end of the game.Games that allow players to progress levels faster through microtransactions will have players in levels they did not earn. The players do not fully experience the depth of the game by skipping the contents. Back when I played MapleStory, I progressed through the game without purchasing any in-game items. The hours invested in order to level up and gear my character has made my achievements so much more rewarding. However, at the same time it wasn’t such an amazing achievement because another player who played the game significantly less than me had a stronger and higher leveled character due to buying the in-game items. It is almost impossible for a player to be the strongest character without spending some real currency on the game. In effect, this creates an unspoken social rank between players that purchase vanity items and players that choose to not spend any money on the game. If a player in MapleStory does not have any vanity items they are viewed as a bad player. By having in-game vanity items, it tells your fellow players that you are able to afford strong equipment. Even though I was a high level character in the game, I was not given the opportunity to go to boss runs due to my lack of items. This frustration ultimately led me to quit the game. The experience of a game to a certain population of players are being ruined by the availabilities of microtransactions that allow advantages over other players.  

Some gaming companies desire more profit and have been exploiting micro transactions by designing the game to be to generating more money rather than focusing on the depth and entertainment aspects. Game companies are training their players to spend an exorbitant amount of money on their games. A data collected by Flurry displays the number of players who spend money in games with microtransactions “ranges from 0.5% to 6% depending on the quality of the game and its core mechanics. (Valadares, 2011) Some of the players that are part of this small percent are children. There are children that accidentally spend over thousands of dollars of their parent’s money in these free to play games. (Rougeau, 2013) Certain games are designed to be exploitable. The freemium games have become a large scale Skinner box. Players are comparable to the rats in Skinner’s operant condition experiment. The players are trained to perform certain actions within the game such as purchasing in game currency in response to a stimuli, in this case being flashy compliments. When the players correctly perform each task given by the game, they are rewarded with showers of flashy compliments to make the players feel good about themselves.  Freemium games have game loops to repeat the player’s experience with the flashy compliments. As said in the satire comedy South Park, freemium games are based on five principle: “entice the player with a simple game loop, use lots of flashing compliments to make the player feel good about themselves, train players to spend fake currency, offer players a way to spend real money on the fake currency, and make the game about waiting – but you can spend to skip the waiting”. (South Park, 2014) Game should be about the player being able to have fun and not being conditioned to press a button repetitively. When freemium games exploit their users the content of the game also suffers and innovation is shut down.

A great game will have people that would be more than happy to pay additional money in order to support the game. A great example is game called Dota 2. Dota 2 offers its players to purchase in-game items and doesn’t sell items that gives additional advantages over other players. Cosmetics in games changes the aesthetic experience for the player. Dota 2 allows the players to customize their own characters to express themselves. It also offers its users to create their own model item that could be used by all the players in the game. Even though Dota 2 did not make their game into a freemium it is successful and it’s thriving. Dota 2 “has generated around $80 million in microtransaction revenues in 2013, according to industry intelligence firm SuperData Research.” (KDrama Stars, 2013) Players purchase cosmetic items because they enjoy and love the game they are playing. They want to customize their own experience into something that will bring them even greater fun.

Microtransactions is business model that can both beneficial to the players and to the game developers. With microtransactions players are given more power to the success of the game. They can choose to support the game with however much money they want by purchasing in-game items. Companies are also able to reach a greater amount of customers due to the availability of their game.  However, game companies are exploiting their users in order increase their game’s revenue. By using the principle of Skinner’s box, players are trained into buying more in-game items. This exploitation only leads to a game with less content and depth for the players to truly enjoy. The free to play model that Dota 2 has should be followed by other games. Dota 2 doesn’t need to exploit their users in order to generate massive revenue for their game.  It shows that games could be supported by those who have the desires to enhance their aesthetic game experience. The microtransactions business model is here to stay, but it doesn’t mean that gaming companies should exploit it.

References

Davis, J. (2012, July 20). The Dark Future of Freemium Games, and How We Can Avoid It - IGN.

Retrieved December 8, 2014, from http://www.ign.com/articles/2012/07/20/the-dark-future-of-freemium-games-and-how-we-can-avoid-it

Dota 2 Vs LOL: $624 Million Revenue By Riot Beats $80 Million Earnings By Valve! (2014, January 23).

Retrieved December 8, 2014, from http://www.kdramastars.com/articles/14664/20140123/dota-2-vs-lol.htm

Mimi. (2013, October 11). Interview: Nexrage Indie - Piracy & Game Development.

Retrieved December 8, 2014, from http://www.8bitgamer.com/media/interview/interview-nexrage-indie-piracy-game-dev/

Rougeau, M. (2013, March 2). Kids Reveal The Real Flaws Of Free-To-Play Games.

Retrieved December 8, 2014, from http://kotaku.com/5988036/kids-reveal-the-real-flaws-of-free-to-play-games

South Park [Motion picture]. (2014). United States: Comedy Central

Valadares, J. (2011, July 7). Free-to-play Revenue Overtakes Premium Revenue in the App Store.

Retrieved December 8, 2014, from http://www.flurry.com/bid/65656/Free-to-play-Revenue-Overtakes-Premium-Revenue-in-the-App-Store#.VIUwMjHF91E