Posts Tagged ‘Business Models’

Is play-4-free advergaming?

I’ve been thinking about the nature of advergaming lately, how we can define the genre and which types of games to include.

Many games are quite obviously advergames, as they are developed as games with the sole purpose of supporting and promoting products/services/brands and so on. You know these games, right? Pepsi Invaders for the Atari 2600 released by Coca-Cola was an early example back in 1983, but most newer advergames fit the same pattern: often small in scall, often rather uninteresting as games and often thought as but one component in a larger campaign.

We are seeing more interesting stuff, but the basic premise remains the same; the game is an advertisement attempting to influence our consumption-related behaviour.

Somewhere along my process of investigation, I arrived at play-4-free (free-2-play, free-to-play or whatever you choose to call it); social games in particular, but also the increasingly complex titles released within this burgeoning business model. The iconic social game would be FarmVille, whereas RuneScape possibly is one of the first larger titles released as play-4-free, while Battlefield Heroes has created quite a buzz, another Battlefield games is about to be released, Lord of the Rings Online was made free, Company of Heroes Online is out and more is happening as we speak.

The core concept of free-2-play is, as you know or might have figured out, that the game is essentially free to play.

This is only half the truth, of course, because few developers would care to make a game, release it for free and have no intentions of making it into a sustainable source of revenue.

So where’s the income from a game, which in itself is free?

The answer is (primarily) the selling of virtual goods and/or virtual services (I wrote about virtual goods earlier).

You have probably heard of the (in)famous red tractor in FarmVille by now. Or weapons and upgrades in Battlefield Heroes.

Battlefield Heroes – fight as Santa Claus?

My experimental hypothesis would suggest that the core product is not the game itself, but the “shops” in which all the virtual goods are on sale. Or more precisely, as Ben Cousins from EA stated, play-4-free “is a service, not a product”. A service, where the game itself is but one component, and even a component effectively reduced to an advertisement, luring the player into buying all kinds of more or less interesting virtual stuff, be it a tractor, a flying horse, the coolest gun or a hilarious Christmas costume.

I’m not trying to make normative distinctions about whether this tendency is “good” or “bad”; it might be both depending on the concrete games and services. I am simply trying to understand how to perceive this rapidly growing phenomenon in video games business models.

Does it make sense to label play-4-free games “advergames”?

I love cheap games!

I love bargains!

All right, I also love expensive games, but every now and then I stumble upon a bargain on a great game – or a bundle of great games.

Being a video game fan and all, it is hard not to smile when a wonderful time is thrown at me for almost no cost. And with all the pirating going on, buying games just feel a whole lot better.

Just recently, I bought the action RPG Torchlight at Steam for silly four euro. This is almost free, damn it! I am humbled and amazed, that such a polished and rather big game can sell for such a ridiculously low amount (yes, it was on sale, I know, but the regular listing price is 20$, which is also extremely cheap!). The game had me right away, being one of the best Diablo2-inspired hack ‘n’ slashers I have played. I quickly played through the storyline, yet I am certainly going back (quickly as in ≈15 hours of playtime).

A true indiehit – World of Goo

Earlier I have bought several bundles on Steam, often including a number of charming and creative indiegames (e.g. World of Goo, Braid, Blueberry Garden, The Path etc.) at almost incomprehensible prices. Sometimes developers even allow buyers to decide upon the price – e.g.  World of Goo and Crayon Physics Deluxe.

Oh, and just as I write this piece, I bought the great Gobliiins-games at Good Old Games for just $5.99. Is that cool nostalgia or what?

Digital distribution lowers costs

How is all this possible? Well, part of the explanation is clearly digital distribution.

The Long Tail by Chris Anderson @Wired

As is made clear by Chris Andersons description of “The Long Tail“, digital distribution allows for a much wider selection of available goods, as the costs are radically reduced.

Following this logic, we have certainly seen an explosion of available games, creating a much-appreciated diversity. Thus, we are beyond the “tyranny of the hit”, as Anderson dubbed it. We don’t all have to play the new blockbuster, be it Modern Warfare 2 or The Sims 3.

With the costs of distribution reduced, it becomes feasible to sell games much, much cheaper than what we know from the traditional PC and console market.

Of course it is still expensive to develop Uncharted 2, and it seems that a lucrative market for these games continues to exist – which is definitely good! Even AAA-titles can be sold digitally at lower prices, though, and we do see this as well.

Services like Steam, Direct2Drive and Good Old Games are selling quite a lot of games – digitally – and very often you can find a bargain at these outlets. All it requires is keeping an eye open (or let others do it for you, e.g. look at Rock Paper Shotguns weekly “Bargain Bucket” or SavyGamer).

Games to the masses!

I believe that most people would actually like playing games, if only they were introduced to appropriate games. Making games more economically available is probably an important component in the ongoing process, where more and more people are playing games.

Whereas buying a game at 60 euro might require some serious thought, dishing out a fifteenth of that is hardly even worth the thought.

What is there not to like?