How is the changing business model affecting game design?

A recent thread about retro vs. modern gaming got me thinking about another recent trend I'd like to throw out for discussion.

Basic thesis: The recent "freemium" trend (game is free, supported by a combination of ads and in-app purchases) is ruining the design of modern games.

Example 1: Plants vs. Zombies (the original) was an amazing game, which I think I paid $5 for, and the whole family (including my wife!) played the game through several times over the course of several months to a year, loving every minute of it. PvZ2 was "free", and sucked. My wife put it down after about 5 minutes; the boys and I stuck it out a little longer, but gave it up after maybe a week or two. The constant pestering us for money, with the difficulty tuned to give us a choice between tedious grinding or spending real cash, was a major turn-off.

Example 2: Bloons TD, an amazingly fun series; we bought every game through Bloons TD4. IIRC, Bloons TD5 may have been free, but its ads are minimal (the occasional icon for one of the developer's other games), and the IAP really is optional. I still play this game often. But this week I tried Monkey City, which seems like a great concept (do TD levels to claim land in which you build a city, which gives you more units or upgrades for the TD). But with its unskippable full-screen 30-second video ads, and (according to user reviews) difficulty tuned to be pretty much unplayable without spending money after a certain level, I deleted it after a couple of days.

The interesting thing to me is that these are not newbie game designers... their older games are among my favorites of all time; exquisitely balanced for hours and hours of fun. But clearly market pressures have driven them to make their newer games in the freemium model and... they suck. Or so is the claim I'm throwing out for discussion, anyway.

What do y'all think?

 

There is evil freemium and normal freemium.

Evil freemium is a free game that either pesters you for money constantly, uses some stupid ingame currency like gems that you can buy in large packs, forces you to buy stuff because its too hard using the free toolset, has an upgrade system that allows you to pay to speed up or autocomplete or has basic stuff locked behind a pay wall which should be free. Lots of TD games are like this. Mobile is saturated with this crap.

Normal freemium is something like Hearthstone. It's possible to get a vast majority of things by playing, the addons are not required to win and it doesn't pester you for money all the time. It's fair, fun and enjoyable enough to make you feel like you don't feel bad buying something from it.

 

@LaneFox, that raises a really good point. I'm certainly not against game developers making money! And I'll even admit that the old, traditional model of expecting gamers to simply pay once for a game up front may simply not work any more. (EDIT: though I'm hoping that is not the case, as it is exactly the model we're following with High Frontier... but maybe it works better on desktop than on mobile.)

So then the real question becomes: how can we design a game to make money, without ruining the gameplay?

Hearthstone may be a good example of that, though I don't think it's fair to call it "normal" — I've seen a number of design analysis pieces about it touting its very unique structure (though unfortunately I'm unable to find the one I'm thinking of in particular at the moment). So, what can we learn from Hearthstone, and what other approaches should we be considering as game designers who also need to put food on the table?

 

@JoeStrout It is definitely more common on a desktop market to have a flat one time cost model. Lots of free games are coming to PC but cost structures vary a lot. Mobile seems to have the bulk of the moronic f2p structuring and I think that is where the bad blood comes from when people hear a game is 'free'. My friends have a joke when we're looking at new games to play: "Oh its free though, I don't think I can afford another free game dude." because in reality we've spent more money in "free" games than we have in flat cost games.

I haven't really felt any buyers remorse with Hearthstone. I also play it regularly which is weird since most f2p games I quit playing after a few months. I think this is mostly attributed to these points:

• The expansion cards are paid-only, but there are still plenty of fun card options besides them.
• Earn the in-game currency simply by playing the game, then use it to scoop up new cards regularly
• Those costs never go up, you are regularly given currency to unlock new stuff with a static cost.
• You can pay some cheddar to instantly get 5 or 500 cards if you want.
• Grinding isn't rewarded, you get one daily quest and 10 gold for every three wins so you cannot effectively grind for ingame currency. Burnout ratio probably much lower because of this.

The game rewards you in a fair way for playing and the only thing you can buy with that is really cheap. Every couple of days you can buy a new card pack without using any real money so it feels like you're getting the best thing in the game for free.

Also the Dust crafting system is very locked by playing, if you want to craft a specific card you can only get it by dissolving other cards to craft it or by doing Arena to get more dust. You cannot insta-craft a bunch of legendaries because you cannot buy Dust.

Overall I think the system is good because it rewards you for playing in a fair way and by playing more you see more depth in the game and have incentive to get more flexible decks. The quests encourage deck diversity too but that also means card diversity which is attained by more playing so its just one big happy circle.

 

Good points, but you have this backwards. There is normal freemium and non-evil freemium.

Unfortunately evil freemium has become the normal model.

 

Yeah, i guess you could look at it that way considering which one saturates the market.

 

The best evil dead/army of darkness game I ever played was actually a freemium one (and maybe thats because the other games were so bad). Look at DOTA 2 which I played over 100 hours of, its completely free and you just pay for skins, or new voice packs

 

It's too early to say. Very few developers are making that much money from freemium games. Plus there is a certain amount of backlash in the EU over the business model and legislation is already starting to be introduced. Then some companies have jumped on the band wagon to no avail, attempting to use the same model for genres that don't fit or work with it such as hidden object games. It is self-defeating in many ways and is promoting the sort of game eco-system that flash publishers have where really only hobbyists make the vast majority of the games and sell them to a publisher for buttons. Those that made a career in that busiuness spent most of the time selling the same game to many different sites and never made that much money anyway.

The freemium business model especially of a game such as Candy Crush is virtually the same business model as a carnival razzle board and in most countries the latter are illegal. The freemium model has gotten through the cracks of legislation somehow because the old farts that run the place are clueless about computers and generally can't see what is before their eyes, but when it starts to come to the notice of legal authorities and someone breaks it down into idiot speak and it dawns on them finally, good chance in a lot of EU countries the legislation will come crashing down and some of the freemium business models might go out the window. Here's hoping anyway.

Not likely to affect freemium models like DOTA where one just buys cosmetic stuff, but something like Candy Crush where a player is encouraged to purchase extra lives etc because it isn't really possible to finish a level with what one begins with and the design is done in such a way to hit emotional triggers to encourage spending, these business models should go the way of the dodo really.

 

Business will always be impacting design. As I stated in some other threads, for PC games the ability to get refunds from Steam will likely affect what kinds of games get made, specifically story driven but short games will see a decline. Always be ready to roll with the punches!

 

The monetization of games has always had an immense influence over the design. One of the clearest indications of this can be found in one of the earliest commercial business models for video games, the arcade.

The nature of arcade games, and how you paid to play them, dramatically influenced the design of arcade games. Thousands of examples exist for this. Everything from difficulty to aesthetics were designed from the ground up to work hand-in-hand with the quarter-munching business model of the arcade.

This is part of the reason why I like the concept of hobbyist developers. The game industry has been so entrenched with monetization of one form or another that it hasn't had all that much chance to spread its wings outside of various business models. Most other creative disciplines have educational institutions to fill that void. (financially bolstered by grants and scholarships) But games never really have. We could actually use a larger scene of experimental developers who aren't being driven by the need to make money.

 

Yes, arcade games were very much geared toward short plays, at least until the invention of "insert coin to continue." They played a very delicate balancing act between being hard enough to prevent the best players from hogging the game for too long, but easy enough to keep new players trying again.

Then along came home games, which initially followed a very similar design, but quickly changed to provide the player with hours of play. That was, perhaps, the golden age of video game design.

Now things have changed again... I feel like we (as an industry) haven't yet figured out how to provide well-designed gameplay while still making money in the modern market. Though Hearthstone is on the right track, maybe... but the techniques it uses seem rather particular to CCGs.

 

It's not that the freemium model is ruining modern games. It's more that the freemium model is being abused in very cynical ways. Any business model can be used properly or improperly. The freemium model is being brow-beaten by a lot of business types to maximize profits at the expense of design.

While one could argue that this is the purpose of corporations, one would be wrong. Bending this business model in half in order to wring every cent that you can out of it is a very short-sighted goal. Utilizing such a strategy kills the long-term potential of a product or service. And you can make more money off of a development effort through long-term sales and support.

EVE online is known for having some very strange monetization strategies. But they are also known for maintaining the stability and community of their game. They approached their slightly out-there business model with an eye for the long-term, and recently celebrated their ten-year anniversary. A prime example of thinking long-term instead of trying to squeeze as much money from a product as quickly as possible.

The problem is the numerous companies who haven't learned the right lessons from their predecessors. Focusing on short-term gains instead of long-term strategies is an issue in many more industries than just game development. It's the same reason why there are commonly lay-offs just before end-of-year financials get posted.

 

I'll guess that you like Hearthstone, which is an important piece of this puzzle. HS is not really doing anything groundbreaking for its monetization. Its paygate is pretty much normal freemium style. However, if you like a game you can easily forgive it, but it literally costs hundreds of dollars (or a serious assload of time) to get a top ranked competitive deck for regular play. The lesson is really that these "evil" freemium models are only evil when you dislike the product. If the product is "worth" the price you end up paying, you can't even see the "evil" side.

In no way, for the record, do I think any of these designs are evil Hence the air quotes.

Anyway, long story short is the business model, the hot genre, the graphical/aesthetic requirements, are always in flux for games. You may be naming, in hindsight, what were a couple major turning points in games, but the reality is they were always changing. Many early NES releases were basically arcade ports. The first freemium games used a variety of tools now banned by facebook and so on.

I believe there's a great value in recognizing where the winds of change are blowing and I do believe you are correct that we're not out of the "Freemium" world yet, or even in the middle yet. It will pass though, just like time limited demos are nearly extinct now (outside casual games) and I have to drive 60 miles to the nearest Arcade... there will be a new model eventually!

 

Agreed. But, here's a chance to play with our crystal balls (so to speak). Peering into the future, what do you think is the next model?

Certain realities are unlikely to change:

1. Creating games is now relatively easy, and there are essentially no gatekeepers to limit the number (or enforce the quality) of games released.
2. People are cheapskates, particularly in the short-term (and tend to discount or ignore long-term costs).
   
3. Games have become a dominant form of media, played (in some form) by a large and growing majority of the population.

It's fairly easy to see how our current situation is a result of the above factors — people being cheapskates, and there being so many developers cranking out so many games, resulted in a rapid race to the bottom on price, bottoming out at zero, forcing developers to find other ways to get money out of people.

Possible futures I can see:

1. We all just accept it, and put up with ad-filled, money-begging games forevermore.
2. We go to some sort of subscription model, where you pay $8/month or something, and get a selection of ad-free, IAP-free games to play as much as you want (as long as you maintain your subscription).
3. The gamer community (or some subsection of it) organizes and demands a return to the pay-once model, boycotting freemium games, and has enough buying power to support a small selection of paid games.
4. Um... other ideas?

Not saying any of those futures are likely; I'm just brainstorming here.

I left off this list a return to the pay-what-you-want shareware model... I think we've been there, done that, and found it didn't work (due to reality #2 at the top of my list). I guess I also left off the crowdfunding model, where enthusiasts actually pay in advance for a game, in exchange for certain extra perks. Not sure how well that will scale up (or how long it will last).

Then I suppose there's the "patron of the arts" model, like is going on with artists via Patreon. I suppose that could be attempted to support indy game creators as well, though it seems not too different to shareware to me.

Any other ideas?

 

The subscription model you bring up is already in place. For quite a while Sony had the monthly sub model that for $20/mo you could play any of their mmos. I participated in that sub to play EQ2, but had access to any of their other games. On the XBox One I saw that EA is now coming out with a similar sub model (I think it's 29.99/year).

Look at how software creators are using the sub model. Allegorithmic now has their Indie Live package for $20/mo. It ends up being more expensive than buying it outright, but it allows many more people to purchase the software over the long term. The same thing is happening with Unity and other game engines.

I can't say where exactly the future is headed, but I can say I like the direction some things are going. I have always preferred the sub model. I like knowing the cost I am paying to get access to all content. I also believe that there is a difference between turning a profit and greed; which is how it was described above about wringing out every cent.

It was mentioned about EvE's model of PLEX, and in just the last 6 months I have seen articles on WoW trying to implement something similar, and have seen other yet to be published games try and do the same thing. I would consider this a smart move for MMO type games. Use a subscription model for all core gameplay, but then allow the whales to purchase in game gold/credits via the game. It is often said that we value what we pay for. I can bring up many examples, but then this would be too long; the underlying concept is that people are more willing to see value in something if they have to pay for it.

 

This topic interests me as I find myself responding to similar models in different ways. My family play bonza, we liked it & kicked in $ to buy extra packs which are cheap & provide varying playtime dependent on how hard the problems are & how stupid I am when doing them. They went to an ad model where you can watch a free ad to get a hint as well as being offered an ad for some in Game currency which you can use to buy extra hints or unlock extra puzzle packs. I think the ads may have been mandatory but they quickly made them optional. I'm happy with this & watch the ads even if I don't need the hint or gold as a way to kick the devs an extra $0.00005.
Other games put the ads up mandatorily & I deleted those games as they got annoying.

Thinking logically about it I'm probably watching more ads on bonza than I was made to watch on the other games yet I happily put up with it. Now you could say maybe I prefer to play bonza over the other games but in many cases this wasn't true. I believe it was the removal of the option that annoyed me. Same with TV, when an ad is on I go do something else if I can't skip through it, yet when watching recorded shows I often find myself watching ads. This is just me, & I wouldn't classify myself as normal, but it must have something to do with the psychology of being offered a choice.

As to what's next? That's something that interests me as I've just started a game design course this year & I personally think the revenue model has to be something given deep thought before you go too far down the path of designing & building. The cynical part of me thinks that devs will find a way to deliver 50% of the ads to the player while triggering the system to believe the other 1/2 were delivered & watched (run them in the background so the player just notices a slight slowing of the game?) so they double the revenue & halve the player angst. Maybe product placement when you need food/drink etc as an in game item for health or something? Paying a fee to get an ad free version might work sometimes but perhaps it could be combined with a subscription system so you can pay for 1, 3, 6, 12 month/s ad free? Maybe 3rd person games have ads on the backs of the players clothing (like sports sponsorship) that changes? maybe endless City runners pass by stores for advertisers, or billboards, or electronic billboards (just change the window the ad is delivered in). If ads could be smoothly integrated so that players don't even notice I.e. A bit more subliminal, it could work. The complication with most of these, apart from any technical ones, would be ensuring you meet the delivery requirements of the contract. TV has moved into the combination of product placement ads & interruption ads & games will probably have to move in a similar direction if it can.

 

I was terrified of the freemium model and DLC push becoming the norm, but a lot of indie developers still think mods and community involvement are a good thing. Not to mention steam refunds just kicked WB in the pants. AC Unity will never happen again. Or rather it can, but without excess cash to burn, the studio will die :3

 

You can still make a pay-once game if youd like, its just harder to get it visible by the audience with all the fremium games all over the place. Unless you got a well known publisher though.

 

Out side of the freemium stuff, I will say that most games have really started to gut out the filler because there is just too many games to play for the hours in the day to take the player's time for granted.

 

the ad system in games is interesting because some countries have laws about marketing gambling to kids yet most freemium games with ads have ads for poker games, poker machine games etc, or in some cases you win a 'free spin' to win an unlock & the graphic that appears is basically a poker machine.

I'm not sure if some countries that do have laws against it have even looked at the app store games or if they have just given up. I'm actually surprised that some of the bigger gambling companies haven't complained.

 

I'd like to point out that despite the rise of freemium, ad support, and subscription models... the model that is most popular is still one price premium. Not by a little, by a LOT. Every console, most PC games, and a small chunk of mobile games. Mobile and social games are the only places where freemium and ad support have succeeded- largely because their audience simply isn't all that savvy and the games you can put on these platforms cant really be premium.

Excellent premium products on mobile are rare, but they DO sell well (Look at Infinity Blade).

So using my crystal ball I see freemium and ad support LOSING traction over the next decade. Like subscriptions they'll be forever a part of the business of games, but like subscriptions they'll become a subset of certain genres/styles. As mobile devices become stronger and gamers more savvy, we'll see an uptick in truly excellent games that people will gladly pay 5-10 dollars for, a huge upswing in price from the .00 -.99 standard of today.

Anyone else want to pull out their crystal ball?

 

Well more and more game engines are supporting mobile platforms, so... it'll depend strongly on the indie crowds. If AAA produce some high quality mobile games that follow that model, you never know, it could turn out to be a good thing. But the business model right now seems to be about making a minimal effort game that is made slightly more fun when people buy things.

I always find it interesting that the gaming industry can continue to grow despite being so flooded.

 

Well, keep in mind part of what is fueling both the growth in population AND the growth in game developers is we are backfilling populations into gaming.

25 years ago nearly all gamers were teen-20 males.
10 years ago there were all the + now people into their 30s (gamers grow up like every else) and casual games begin picking up steam, adding a huge population of women age 30-60.
7 years ago the % of young women who play games was 50/50 split with males.
5 years ago there's a huge uptick in international gamers, especially in emerging markets like China & India.
Today game players are both male & female equally, with gamer ages ranging from pre-teen to late 70s with a growing % of all age ranges identifying themselves a game players. Emerging markets continue to add gamers at a record pace.

So with that timeline in front of you, is it still really a surprise that the gaming industry is growing both in release quantity and sales volume?
It probably has another 10 years before it reaches its carrying capacity- The point facebook is at right now where everyone who CAN have a facebook account does and the only growth it can get is from overall population growth and the growth of new people with internet. ~10 years and we'll be there with games, every person on the planet will play games sometimes. (Not that every person will be a hardcore gamer).

The idea of a gamer being an outcast of society is gone. Good news for me, as it makes dates way less awkward

 

Are you measuring by numbers, or by revenue? In terms of numbers of games played, I'm pretty sure that mobile dwarfs all other types of games combined. And in terms of revenue, mobile will surpass console games this year.

It may be true that premium titles still net more revenue than the free-to-play model... but it's by a little, if at all. And with current trends, it won't be true much longer.

(Unless you have some references that contradict mine, in which case I'd be glad to see them!)

 

My brother just married a chick he met playing various MMOs. So there is hope for you yet.

 

Well I guess considering all of those points, not at all. People can only work for so long before they retire, but 'gamers' can be just about any age. Just in definition it's totally expected that the audience will out pace the developers. I'm surprised I was surprised. You get a like!

I have a memory like that. Tragic story. Twas my first relationship, yet it was 6 years long! And then it ended the worst way possible on my 18th birthday I would blame it for the split, but 'blame' has negative connotations. Going a little insane has made life a lot more interesting.

 

Well as you probably know getting an accurate read on the entire market is not quite easy. Lets do some quick numbers as I dont have a lot of time to really do a ton of research and get exact figures:

As you can see in the graph on http://www.gamasutra.com/blogs/TimM...forecast_revised_with_24B_exits_last_year.php

The console + PC segment, which is primarily premium pricing products is larger than mobile which is primarily IAP freemium products.

The problem is a chunk of both are in eachother's soup (DOTA, LoL, etc being a giant example of that). Same for Online. Lots of subscriptions but a couple (Guild Wars) being premium pricing and plenty of free to play with iap.

So despite being "clearly" larger, the PC + Console Software is a tricky mix.

What I am predicting is not that PC + Console will remain the dominant player platform by revenue, but that the mobile segment will shift away from freemium and towards premium pricing. I have nothing to back that prediction up other than my gut feeling though

 

Well, I sincerely hope you're right!

 

to answer th initial OP question.....
the plethora of free stuff and accessible technology has allowed the exponential rise of indie devs...
but at the same time, to me it has led game dev to a mono-type of games : retro or mobile games..
consumer games, micro-games... and somehow made more complex games hard to rise