Microtransactions from free-to-play games almost three times the revenue of paid game...

midian182

Posts: 5,859   +48
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With the Star Wars Battlefront II loot box saga, EA proved it was possible for the most hated company in the games industry to become even more despised. So why did it introduce a system that ultimately wiped $3 billion off its stock value? Money, of course. And while microtransactions may appear more unpopular than ever before, they continue to make billions for developers and publishers, especially in the free-to-play market.

A recent report from market research data firm SuperData shows that when it comes to free-to-play titles on the PC, the money generated from microtransactions is astronomical; this year, FTP gamers will spend $22 billion on in-game purchases. That’s double the amount spent in 2012, and almost three times more than the $8 billion revenue generated by all full game sales across PC and consoles in 2017.

Free-to-play titles do rely heavily on microtransactions, of course. The recent outcry is mostly over the systems that appear in full-price game offerings. But it seems this isn’t stopping consumers from spending extra money once they’ve purchased a game. SuperData’s additional content category, which covers microtransactions and DLC in full releases, is set to generate $5 billion this year.

“Walking a fine line between increasing content offerings and engagement (and of course revenue) and alienating gamers, the ongoing experiment of microtransactions has had successes and failures,” said SuperData.

“Although gamers are quick to complain that publishers are excessively monetizing additional content for games, players continue to support service-based monetization with their wallets.”

Battlefront II’s additional content—loot boxes—has seen the company become about as loved as Ajit Pai. The system is the "poster child of a new and uncomfortable growing pain for the games industry," as SuperData put it. But while this could mean changes to future loot boxes to avoid similar controversies, microtransaction sales aren’t slowing down. By 2022, they’re expected to generate $25 billion from free-to-play games, while additional content in full-price titles is predicted to increase to $7 billion.

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BSim500

Posts: 684   +1,405
"Although gamers are quick to complain that publishers are excessively monetizing additional content for games, players continue to support service-based monetization with their wallets."
^ This is the real problem. Not that cr*ppy AAA publishers will attempt it (a given) but that the sheep and the whales are basically fuelling it with zero sense of self-awareness / "can't see the forest for the trees". The gaming press shoulders some of the blame for being a little too reactive and not pro-active enough when the warning signs sprung up and people naively believed that was as far as they would "dare" take it, rather than correctly see it as the start of a slippery slope.

Likewise, it's obvious they're attempting to "normalize" this stuff to the extent that by 2020, kids under 15-16 will know no different vs the same place today's 25-35 year olds were at 10-20 years ago. We're already seeing that today with many unable to discern DLC that's genuine additional content vs DLC that was obviously intended as base game content but split off to inflate the price for thin-air. Likewise parents need to be a lot more aware and learn to say no to all the stuff that comes after "buying" a full priced game and then explain to their kids why.

It's something every generation says about the "Good Old Days" of the previous 20 years, but honestly I've lost a lot of faith in the modern "gaming community's" awareness of anything beyond "I want, I want, now, now, now" and will forever be grateful that I hit my teenage years in the early-mid 90s when the reaction to a whole host of new fresh games coming out was excitement about the future of gaming rather than the current dread & disbelief of today's AAA post-peak downward-slope shovel-ware and the general "Idiocracy" industry we'll have by 2025 if there's no serious ongoing push-back.
 

ShagnWagn

Posts: 1,297   +1,081
What are the microtransaction figures compared to macrotransactions (expansion packs)? Expansion packs also bring in more purchases of the original release. Civilization is a prime example.
 
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Stark

Posts: 147   +122
One important thing people are sincerely missing is, Free to play games are adding more user base. they are rapidly expanding into untapped markets and adding in new revenue sources. League spending has increased many a fold simply because of this one factor. instead of looking at the Total value we need a break down of that region wise and then the reality will emerge.
What EA is doing is more like current Net neutrality debate, people are looking to get more money/return but are not adding more value to the product/service.
 

wiyosaya

Posts: 5,321   +3,424
Battlefront II’s additional content—loot boxes—has seen the company become about as loved as Ajit Pai.
Love it!
I don't see expansions as a Micro-transaction. Should I see expansions as Micro-transactions?
Neither do I.

When I was avidly playing games like the first two Wing Commanders and also Strike Commander, they had extra mission packs that I was willing to pay for. You got what you expected, and there was no potentially continuous stream of money from your bank account to the game makers. To me, it sounds like a lot of people are in favor of going back to gaming like it was in those days.

As I see it, game makers these days have taken things too far. In some respects, I can see this as valid for "freeware" games especially if there is a limit to how much money they can collect (which I doubt there is).

However, paid for games are a different story. I do not follow the industry closely, but it sounds like there are those game makers that are far from financially hurting. If they can make a decent living without these in-game transactions, then do they really need them?

What EA is doing is more like current Net neutrality debate, people are looking to get more money/return but are not adding more value to the product/service.
And it seems like this is what is really driving the debate. Personally, I would find it hard to justify continuing the model without that added value. If there is some real value as opposed to some intangible value that is not apparent, then the game makers need to demonstrate that in a tangible way and not by some half-assed marketing spin.

This is why the mission packs for the games I mentioned worked, and IMO, worked well because it was tangible added value.
 
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Cycloid Torus

Posts: 4,649   +1,449
I see new business opportunities:
- a 12 step program - Microtransactions Anonymous (MA)
- game reviews which focus on games playability without microtransactions
- game reviews which focus on games playability with minimum cost key microtransactions
- microtransaction monitoring service (to give Dad a heads up before the CC bill arrives)
- carryover to billing of medical services, etc (10 cents to pick up the phone, $1.20 to make an appointment, etc) or your hotel room ($1 for a pillow, $1 for a towel, $1 for soap, etc)

Good luck WHALES!
 
B

Brock Kane

"Although gamers are quick to complain that publishers are excessively monetizing additional content for games, players continue to support service-based monetization with their wallets."
^ This is the real problem. Not that cr*ppy AAA publishers will attempt it (a given) but that the sheep and the whales are basically fuelling it with zero sense of self-awareness / "can't see the forest for the trees". The gaming press shoulders some of the blame for being a little too reactive and not pro-active enough when the warning signs sprung up and people naively believed that was as far as they would "dare" take it, rather than correctly see it as the start of a slippery slope.

Likewise, it's obvious they're attempting to "normalize" this stuff to the extent that by 2020, kids under 15-16 will know no different vs the same place today's 25-35 year olds were at 10-20 years ago. We're already seeing that today with many unable to discern DLC that's genuine additional content vs DLC that was obviously intended as base game content but split off to inflate the price for thin-air. Likewise parents need to be a lot more aware and learn to say no to all the stuff that comes after "buying" a full priced game and then explain to their kids why.

It's something every generation says about the "Good Old Days" of the previous 20 years, but honestly I've lost a lot of faith in the modern "gaming community's" awareness of anything beyond "I want, I want, now, now, now" and will forever be grateful that I hit my teenage years in the early-mid 90s when the reaction to a whole host of new fresh games coming out was excitement about the future of gaming rather than the current dread & disbelief of today's AAA post-peak downward-slope shovel-ware and the general "Idiocracy" industry we'll have by 2025 if there's no serious ongoing push-back.
BSim, you nailed it!
 

roberthi

Posts: 454   +139
Funny thing is the game wasn't fun at all. I tried the demo and realized pretty quickly that it sucked. Glad I didn't get caught up in this mess.
 

Duke Sparrow

Posts: 10   +6
People are way over-reacting to the micro-transaction issue. I would NEVER defend a giant corporation that's trying to milk customers, but it's important to keep in mind that video games are entertainment, not a necessity. As such, you have no obligation whatsoever to purchase or support games that feature heavy micro-transactions.

The Star Wars debacle shows that gamers do have a collective breaking point where tolerance ceases and outrage begins. Yes, over time, the push towards additional monetization will continue, but again, you have no obligation to support such games if you do not feel that there is sufficient value to justify your dollars.

I believe that what is happening now is actually good for gamers. These giant corporations are fragmenting the gaming landscape with their shenanigans, and subsequently opening the door for smaller developers to flourish once again. Small developers can deliver high-quality titles with a tiny fraction of the budget that each Call of Duty game commands. The iterative junk that the big companies produce will continue to rake in the cash from the young and the dumb, but I firmly believe they are creating a vacuum that only high-quality titles that don't nickle and dime the customer can fill. Let them continue to push the micro-transaction envelope as far as they can. Don't worry, the free-market will sort it all out in the end.
 
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Phr3d

Posts: 404   +87
Free market sorting itself gets less appealing as you age - talk to anyone that hit retirement age in 2008-2009, lol.
IMHO, the theory depends upon the intellect that it takes to discuss it, whilst the practice does Not.
 
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