Ethics of free to play games

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  • 1. Whales, True Fans and the Ethics of Free-to-Play Nicholas Lovell GAMESbrief Develop Liverpool November 24th 2011
  • 2. Nicholas Lovell, GAMESbrief Author, How to Publish a Game Director, GAMESbrief Clients include Atari, Channel 4, Channelflip, Firefly, IPC, nDream s, Rebellion and Square Enix @nicholaslovell / @gamesbrief
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  • 4. Show offer: Get 80% off Go to Enter code DEVELOP Get How to Publish a GAME for 80% off: Digital: 99 19.80 Physical: 149 29.90 Both: 149 29.90
  • 6. Q1: Are free-to-play games evil?
  • 7. Q1: Are free-to-play games evil? Interactive options: Yes 14% No 86%
  • 8. Q2: Is Zynga evil?
  • 9. Q2: Is Zynga evil? Interactive options: Yes 46% No 54%
  • 10. Q3: Is Tiny Tower evil?
  • 11. Q3: Is Tiny Tower evil? Interactive options: Yes 10% No 30% Whats Tiny Tower? 60%
  • 12. Q4: Is the National Lottery evil?
  • 13. Q4: Is the National Lottery evil? Interactive options: Yes 35% No 65%
  • 15. Free has been hugely successful Zynga: filed its S-1 $600m + in revenues Valuation expected >$10bn Tiny Tower: 2 men, four months Currently #12 in the top grossing chart Conservative estimate: $3m revenue in first 12 months (PS: # 1, 3, 4, 5, 6 are free too) Bigpoint 200 million in revenue 650 million valuation
  • 16. Free is a marketing technique Free means you have a lower barrier to entry Free means more people try your game Free gives you players; players are potential customers Its all about the conversion from free users to revenue generating users If you are not free, you are competing with free Advertising-funded Pirated Free from someone else
  • 18. The price/demand curve In an era of physicalPRICE distribution, you need to set a single price For games, around $40 Its great value, Id have paid much more Thats too expensive for me Demand
  • 19. Now we let users set the price Hypothesis: Allow users to choose howPRICE much they spend on your product, and your revenues will go up DDO revenues up 500% LOTRO and Everquest II showed a similar story $3 $5 $5 $1 $5 $3 $10 MMO $3 $3 $3 $1 $5 subscription Demand
  • 20. WRONG!
  • 21. Allowing users to choose how little to payis not the secret We all knew that 95% of users played forPRICE free We now know that 80-90% of revenues come from 0.5% of users Spending $50 - $10,000 or more Demand Paying: 5% Free: 95% 80-90% of revenue from 0.5% of users
  • 22. Making it pay The 10th Drone from DarkOrbit Sells for 1,000 2,000 sold Thats 2 million in revenue In 4 days!
  • 23. The Nine Inch Nails Example Ghosts I IV Ultra Deluxe Edition: $300PRICE Ghosts I IV Deluxe Edition: $75 Ghosts I IV physical: $10 Ghosts I IV digital: $5 Ghosts I: $0 Demand
  • 24. The rule of 0-1-100 Make it enjoyable for people to play for free for ever Make it easy for people to spend $1 Make it possible for people to spend $100 per month
  • 25. An iOS example: Pocket Frogs
  • 26. An iOS example: Pocket Frogs
  • 28. NO
  • 29. F2P = evil (or not) The business model is designed to take money from you So is the coin-op, or the MMO, or the DLC Games are a business we should always remember that Some people spend lots of money on it You get lots of content for free Instead of paying for access, you pay for the experience that you VALUE Theyre not real games Grow up. Oh, and the games will grow up too They dont have enough skill / fairness / challenge Well dont play them then Just because you dont like them, doesnt mean they are evil
  • 30. Some valid concerns How much money is it ethical to take from a single player, in a single month? Are microtransactions appropriate for children? Are there certain games that