Rants tag

Rants, ruminations, and rambling remarks from my mad, muddled, meandering mind.

Sunday, January 19, 2014

Don't Step on the Long Tail

The hardest part of writing a post every day is the actual sitting down to write. Currently, I have little access to the internet during the day, which forces my writing to after work, when I'd rather be eating and playing an MMO with Scooter; or to the wee hours of the morning, when I'd rather be sleeping. I guess I just need to get to bed earlier. On the other hand, I am making a bigger effort to read the blogs of others, which inspire some great ideas . . . that I have trouble following up on. >.>

Busy Busy-ness

The other day, I was mildly taken to task by C.T.Murphy for focusing too much on the business side of MMOs. We players are the modern patrons of the gaming arts. No major game sees the light of day without a solid business plan to recoup the cost of developing it, plus a tidy profit. I have played quality games with varying business models from full sub-only, to full F2P/cash shop. And the reasons I may have stopped rarely had to do with the payment model, in and of itself.

But it's a topic I find fascinating because of the economic decisions we make as gamers and game developers. In a perfect world, we could all create art of our own choosing without regard to how we're going to put food on the table. But the reality is far different. Do you want to know why Da Vinci painted the Mona Lisa? It wasn't love or her beauty, it was a commission. The ceiling of the Sistine Chapel by Michelangelo? A commission. Most art throughout the ages was created to feed the artist (including slave artisans, and attempts to appease the gods).

However, money is an influence. I am not just thinking about my own personal costs, but the costs for my family to play. As Kemwer pointed out somewhere that I have lost, if you have children capable of playing, but not capable of paying, then you face far more than just $15 per month on a subscription. On the other hand, I paid a sub and paid microtransactions (MTX), as well, for items from Star Trek Online's store. And for pets and such in Blizzard's store. Times and circumstances change.

Thus, discussion of business models fascinates me. And since this is my blog, I shall follow my own whims.

Capturing the Long Tail

Tobold brought to my attention this article by Pathfinder's Ryan Dancey, wherein he discusses the advantages of what we might call the hybrid business model of MMORPGs.

The Y-Axis is revenue paid per month. The higher up the line the more money a person is paying. The X-Axis is the number of people willing to pay at that level. The traditional subscription system creates the "box" in the middle – a certain number of people are willing to pay the fixed-price subscription. The problem with this model is that there are some number of people (in the green area) who would be willing to pay more per month but can't because the subscription price is capped, and some number of people (in the purple area) who would be willing to pay something but can't or won't pay the full price subscription amount who generate no revenue because the subscription is the minimum payment for entry to the game.
~Ryan Dancey
Regardless of how the demand curve is shaped, it will follow that pattern. Hybrid models take advantage of every price-point that people who want to play the game are willing to pay. Are some exploitative? Yes, but that threshold is in the eye of the beholder. And generally those people will cease to play the game—possibly sharing their opinion of its exploitative nature on the internet.
The sign a game has failed is when it is closed, not when it begins to accept MTX payments.
~Ryan Dancey
I have in mind a post on the games I feel have good MTX vs. those I feel are exploitative, but I wonder if I would bring anything new to that discussion.
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  1. Yep. The other way to think about it, as I've explained before, is that if to games charge $15/month, but one has 10k subscribers and the other 1 million, the second game is going to get 100x the income and resources to spend on the game. But, from the players' perspectives, they're paying about the same amount for both games. So, the second game will be perceived as "better".

    Having a flexible business model allows that first game with less players make more money and have a chance at competing more directly. People can pay what they feel is appropriate, too, so comparisons between the two games don't happen primarily on a set price point.

    1. That is an excellent point I had not considered directly, though I realize that a studio like Blizzard has more resources than, say Funcom.

    2. Right. And, that's why under a subscription business model every game has to shoot for WoW-sized numbers. They need that much income to compete even beyond player perceptions. Other models beyond subscriptions allow for smaller games to make more income rather forcing them to follow WoW's lead.

    3. Yes and no. That does seem to assume an "all things equal" sort of scenario where both games are offering content similar enough that one can replace the other. That works for FFXIV vs. WoW. Does it still work for EVE Online vs. WoW?

      And does that change at all if you change business models? Doesn't the F2P game with 1 million players continue to have the resources to be "better" than the game with 10k players?

      Isn't the message more like "If I am going to copy WoW, I need WoW level numbers, so maybe I had better not just copy WoW."

    4. I think that might be a big part of the message. As far as the two F2P games with differing numbers, the advantage for the smaller game is that its players may not be expecting the same scope that the larger game's players have; plus there is freedom to move from one to another without necessarily feeling like you're wasting your money.

    5. @Wilhelm As with most things in business, it's complicated. Keep in mind that for all it's success, EVE Online was a failure at launch. CCP enjoyed some luck that isn't available to most studios. This also delves into the topic of what is "fundable" given the amount of resources needed for even the most modest modern MMO. I've written about this before on my own blog over the years.

      The high level summary is that high fantasy PvE-focused games are proven to be the most popular, despite there being a variety of MMOs that have tried other genres. So if you're building an MMO that you want to have even a modest chance of success (being funded and being played), you're going to be treading into WoW's territory. Since WoW has a ton of resources to throw at the game, you can't compete directly on quality. So, you compete on price without cutting your legs off; you allow some people to pay less, but a few people to pay a lot more.

  2. Against the Leonardo/Mona Lisa example and the countless works of art brought into existence by way of commissions that support that argument you need to consider the equally overwhelming evidence of artists never appreciated in their lifetime, who made little or no money from their art and from whom no-one at all was commissioning anything. Van Gogh sold, what was it, three paintings in his life. Emily Dickinson published less than a dozen poems. Didn't stop either of them cranking out the masterpieces year after year.

    Of course it's relatively easy to produce single-artist works even when no-one's buying. MMOs cost a fortune to make, don't they? Well, they don't cost more than movies. The Blair Witch Project cost $35k. El Mariachi just $7k. There are many, many more like that.

    My point isn't that something made for little can make a lot. It's that artists make work for many reasons but getting rich or even putting food on the table is rarely one of them. If they aren't starving in garrets then it's because they have other jobs that pay the bills.

    Of course this does all depend on whether you think of video games as "art" to begin with. If we're going to think of game devs as Commercial Artists and Copywriters, like the people who write the captions for greetings cards or draw the illustrations for refrigerator manuals then our only expectations of them should be technical competence, which we can still admire even though we know they're only doing it for the paycheck.

    If we accord them the dignity of considering them artists, however, or if they claim the calling for themselves, then we should rightly expect more - a lot more- of them than mere professionalism and we should assess their efforts by more - a lot more - than how much money it puts in the pockets of their corporate paymasters.

    1. I would have to look it up, but iirc, Emily Dickinson didn't need to feed herself on the proceeds of her art, unlike AAA games developers. And Van Gogh, while a genius, was also certifiably insane, which may also apply to some devs. And you said it yourself, MMOs cost a fortune to make. They are not generally endeavors made by a single person during leisure time from some "real job," but a major undertaking involving many full-time employees.

      But you're right, do we want to consider MMOs as art? I think that many devs would like us to. And the example of the Sparkle Pony is perfect, because the item itself can easily be considered art, separated from questions of game design, business model, etc. The quality of the art can be debated, of course.