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A (long) question about how Micro-transactions will change our hobby

Arnold Hendrick writes thoughtful information packed articles about the mmorpg business and one of his posts about "Selling Mmos" prompted me to write down a question that has been brewing  in my head. The short version of the question is "What impact will the rise of micro-transactions have on gaming from a customer perspective?" 

I wrote a much longer version of the question in a comment to Arnold so being lazy I will copy the comment here:

Great article Arnold full of interesting information and insights. My knowledge of game development and marketing is very limited but I am a long time game playing customer. I am still trying to work out what impact the apparently unstoppable rise of micro-transactions is going to have on my hobby from a customer’s perspective.

I can see several good things about micro-transactions: They offer a business model that allows smaller companies to compete with the industry giants which increases the choice and variety of games on offer. In theory free to play with micro-transaction offers the customer all the choice. Customers can sample a wide variety of games at little or no cost and once they choose to play a game they can pay as much or as little as they like.

Unfortunately the reality in many cases does not seem to be as customer friendly. My two biggest concerns are i) The impact on game design (games will be designed as grind fests order to maximise item shop revenues rather than customer entertainment) and ii) Micro-transaction systems which are designed to squeeze excessive amounts of money from a small number of addicted customers. I call this “customer abuse”.

You mention four types of item commonly sold in an item shop:
1) Faster advancement, 2) tedium shortcuts, 3) appearance selection and 4) Item access.

To me 1) and 2) are almost always problematical. If a game is fun to play why would people want to pay to skip parts of it? There is a moral hazard here encouraging designers to design grind fests in order to encourage people to spend money to bypass the grind. As these items are usually consumables they are also a prime vehicle for customer abuse. We read about addicted customers spending hundreds of dollars a month in item shops and I imagine a good deal of this goes on pots and other consumables.

I don’t have a problem with 3) even though I think Blizzards $10 for a non combat pet is just bad value.

I have mixed views about 4). I don’t really have a problem with people paying for items but I can see dangers. If getting powerful items is one of the main objectives of the game then allowing people to buy powerful items for cash may be game breaking. One common form of customer abuse is to introduce a gambling system where you buy a box with an unknown item in it. It may be high quality or it may not. I have read of addicted players spending large sums opening such boxes in the hope of gettign a good item.

I am perhaps most surprised that you don’t mention a 5th item shop category: 5) pay for access to content. This is very unproblematic and in my mind provides the best deal for the customer – you buy the parts for the game you want to play. The incentive on developers is to make an interesting compelling game so that customers want to buy more of it.

I have recently broken my own micro-transaction taboo and have started playing Dungeons and Dragons online. I have even bought stuff in the item shop. I am happy enough with Turbines implementation because a lot of the item shop stuff is “pay for content” and I also think that the existence of a monthly subscription option limits the potential for customer abuse.

My question for the future is this: given the apparent inevitability of micro-transactions for everything will this mean a descent into grind-fest games surviving on the revenues from a small number of their most addicted customers or will market forces ensure that only interesting, fun to play games with non abusive item shops survive?


Stabs said…
I think a lot of people are concerned about this change.

It doesn't need to be bad for us necessarily.

Some thoughts at random:

- some games will be flat out too expensive to play for most people. One of the most successful games of the last few decades was Magic: The Gathering. I spent £5000 on cards when I was playing this at the top level, and this was normal for someone competing at that level. 4 of each card from each legal set.

I really enjoyed those years (I won 2 national tournaments in front of large crowds) but I'd never want to repeat that kind of investment in a game again.

Eventually someone will come up with a computer game that can support the same kind of power-gaming addiction. A combination of buying stuff to win and a great game design that made you accept the cost in exchange for the pleasure of winning.

When that game comes along I won't be playing it. I can afford it but I'm simply not comfortable with the extravagance of blowing that kind of cash. I'd rather spend £1000 and give £4K to charity.

- many great games will be cheaper under microtransactions if you strategise your gameplay.

You've seen my post on cheapskating in DDO. I've also in 6 months of playing got Eve to a position where I can pay for 2 accounts with the ISK I generate in game.

I could easily play Eve and DDO for as long as I want without ever spending another penny on them.

It doesn't hurt the games companies either: other players are paying for my playtime and they're perfectly happy to do so, perceiving some benefit to themselves for a gameplay style that costs more than a standard sub.

- leading on from that many of the things people pay for are actually playstyle choices. Personally I love levelling and am perfectly happy to play the levelling game. I see an exp potion as something of a disadvantage.

However I'm delighted that exp potions subsidise my gameplay. So their existence simply means I can play games like DDO without needing to pay $15/month because some of the player base has the max level or bust mentality.

Likewise with appearance stuff. Not something I want but an opportunity for other people to subsidise my game.

Storage limits impose their own discipline. In most games you really don't need to keep stuff (I'm a terrible packrat - in D2 I had 8 accounts worth of mules). But all that packrating doesn't really do any good, I've realised that I am much better off owning money than owning items, since I can use the money to re-acquire the item I would have stashed away.

What I'm saying is you don't need to spend real money on bank space.

- game design. The spectre that's haunting a lot of players just now is of a horrible grindy game that you would want to pay to skip.

Those will exist. But players will pay to skip even fun games like DDO and WoW simply because they value max level gameplay very highly.

It's a false value for most of them, they just get bored, circling around Dalaran for hours showing off their mounts to other bored people.

It's much more fun to be levelling than doing that.

Many games will continue to offer fun gameplay regardless of the item store simply because they know many people will splurge in the item store simply because they love the game.

I got a friend into DDO 2 days ago. He spent about 5k Turbine Points today simply because he loves the game. He hasn't even bought an adventure pack yet.

So games don't need to have horrible parts to get people to use the item shop.

The shrewdest operators will do a DDO like sliding scale where everyone picks their own money v time ratio and feels like they've come out ahead.
mbp said…
Hello Stabs thank you for your long and detailed reply.

I suppose I too am quietly optimistic that common sense will prevail. If game designers start pumping out unpleasant grindy games in the hope of suckering people into item shop addiction then they will lose players to better games with less abusive item shops.

Although my experience with F2P is limited I have found DDO to be a very customer friendly implementation. The existence of high quality games like that will hopefully act as a bulwark against abusive item shop practices.

The only dampener on my optimism is a worry that people immersed in a hobby often do not act rationally in their own best interests. Look at the ludicrous amounts of time mmo players already spend doing stuff they don't really enjoy just to grind rep or some minor reward. Once customers abandon rational decision making it is almost inevitable that suppliers will succumb to greed and try to exploit the customer.

I am pretty confident of my ability to control my own expenditure and to get value for my gaming euro but if greed turns the whole industry turns into a grind factory then there may be no games left that I want to play.
Stabs said…
Well there won't be no games you want to play.

But there will be games you like the sound of but that you find unreasonably expensive.

I'm expecting SWTOR to be a £35 box with a £20 a month sub and a pretty intrusive item shop. I'll still play it because I'm a massive SW nerd and think SWG was the best game I ever played but I'm expecting it to shock a few people with its business model.
Tesh said…
As I've somewhat alluded to over at my place, let's just call bad business what it is; bad business. If it's a jerk move by a microtransaction game, like the lottery boxes, it's a jerk move. If it's a sub game pulling a jerk move, like Champions Online's "tripple dipping", let's call them to task for *that* move, and stop extrapolating to hyperbole with slippery slope arguments and idiotic extremist positions.

There are jerks inherent in *any* business model. I think a more democraticized market will have better options for everyone, and we'll be forced to look at each jerk move on its own, rather than say "subs=Holy, MT=teh ebil" or vice versa. To that end, I'm calling for the revolution sooner rather than later.

As for grind and the moral obligations to give a hoot about player mental health, it's pretty well established by now that businesscritters *don't* care. Subscription games are just as guilty of installing grind to string players along; the whole subscription model depends on getting players hooked and setting up the $15/month IV drip. If a player doesn't have to grind through insane time sinks, they will get through the content faster and pay less.

It's high time for the hobby to grow up. Players need to grow up too.
mbp said…
@Tesh said
It's high time for the hobby to grow up. Players need to grow up too.

but but but ... I don't wanna grow up. Ever. That's why I escape into the fantasy world of games. :D

I like your down to earth approach Tesh. Bad business is bad business and usually trips up over its own greed.
Anonymous said…
It's not addiction, it's obsession. No one can be addicted to any game.

Humans are wired to obsess, it's nature's gift to counter laziness and gain useful group skills. Even your typically unrealistic mmog computer games have benefits, both socially and in coordination and problem solving.

There seems to be some fascination with the word addiction. I guess it's marketed to us as yet another guilt trip ...

mbp said…
Excellent point @solbright and a useful clarification. I guess mmos are designed to capitalise on this obsessiveness gene.

With regard to the benefits though I believe you need to weight the cost (particularly the time investment) against the benefits. Many other activities can deliver similar benefits (socialisation, co-ordination, problem solving) for a much lower investment of time.
Anonymous said…
Hehe, I wasn't saying that games were the only thing we obsess over. For example, obsessing over learning all the nitty gritty details of how some equipment works is very much up there on the benefits list.

PS: It's entirely possible that only 50% of the population have the obsessive tendencies. It's a details thing and details is not everyones cup-of-tea.

Anonymous said…
Oh, it's a group benefit really. One individual becomes an expert and performs functions for others that no one could have performed before.

Or is able to demonstrate a better way of doing something as a result of the hard work.

Or just finishes a job that no-one else saw any value in until it was done.

Anonymous said…
I do believe both my posts have been deleted.

mbp said…
Hi Solbright. I didn't knowingly delete any of your posts. I get so few comments that I can't afford heavy handed moderation!! The only stuff I delete is out and out spam (gold sellers, stuff like that).
Anonymous said…
Soooo ... Blogger losing it's marbles then?
mbp said…
It is a mystery to me Sol. I thought it might be something to do with the fact that you post anonymously but I checked earlier posts and they still have anonymous comments on them.

I can see clearly where one comment has disappeared from my reply to your comment but do you think that there was more than one?
Anonymous said…
Yep, there was exactly two of them.

There is one other comment also gone missing at the same time from

It was always 32 comments when I checked it.

I don't think it was one of my comments though as I can't see anything missing from what I said there.

Anonymous said…
Cool, the postings have all returned intact. Dunno when though, I was just randomly looking through some old links I'd saved and realised what this one was about.

Seems I was wrong about there being two of them. There was actually three! :O
mbp said…
Hi Solbright, nice to hear from you. Do you have a blog of your own by the way? I click on you name and it doen't go anywhere.
Anonymous said…
No, not much interest in social stuff. Don't even have a cellphone. That said, a cell connected computer does interest me. Pity about roaming costs though.

The name Solbright is only used for Eve. And because I linked to one of my Eve posts right at the start of my posts here I decided to use the same name here.

For all other forums I frequent I use my real name.

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