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How in-app purchases have destroyed the game industry (baekdal.com)
829 points by seivan 1183 days ago | hide | past | web | 525 comments | favorite

I suspect many game developers find themselves in an awkward spot:

1) People seem to balk at paying >$5 for a mobile or tablet game. (With some notable exceptions.)

2) The $0.99 or $1.99 price point is not financially viable for most games.

3) People do seem willing to purchase coins or lives or more daily playtime via in-app purchases. Some spend tens or hundreds of dollars on a single game.

If you're building a game for a large company like EA, you're probably forced to take the most lucrative path. EA's not an atelier for starving artists. And if you're a small, struggling game studio, you probably can't afford to leave money on the table.

So what's the solution? If people are unwilling to pay reasonable prices up-front for games, how besides in-app purchases does a game company profit from their work?

This is an honest question, because I also generally hate how IAP is integrated into most games. I'd much rather pay up-front.

It seems like a simple solution to me would be to make the game free, but with most features blocked behind a SINGLE in-app purchase. That way you can download it, play what amounts to basically a demo, and decide if you like the game. If you don't, you've lost nothing, and the game developer gets the opportunity to add an additional step to their funnel and see how many people genuinely don't like their game or are frustrated / confused by it. If you do, you buy it with the IAP and now have the rest of the game forever.

What am I missing here? Is this hard to do? Or prohibited somehow?

Disclosure: I'm not a mobile game developer, so maybe I'm missing something here about the rules of the app stores.

It's not necessarily difficult, and it's not prohibited, it's just not very profitable. The problem is you're cutting out the whales. You might have a $5 gate, and get 2% of people converting, whereas unlimited IAPs might only get 1% of people converting. But now some of that 1% can (and will, believe me) spend $30k a year on your game. And almost all of them will spend more than $10.

Games used to do this somewhat frequently, they just don't anymore because it leaves so much on the table.

Also the much lower RPUs will make paid acquisition unprofitable, and paid acquisition is the only reliable method. App stores are great if you get featured or by some fluke work your way to the top of the charts, but for 99.9% of developers, you're either doing paid acquisition or getting no substantial amount of customers.

Do you feel it's ethical to take $30k a year from 'the whales'?

As I understand it, "whales" tend to be less "poor gullible fools maxing out their credit cards" and more "extraordinarily wealthy people that enjoy wasting amounts that seem ridiculous to us but are truly nothing but a drop in the bucket to them." The term "oil prince" is trotted out sometimes, and people like that really do exist: I don't remember his name, but there is a very real "oil prince" who likes to go on twitch.tv and shower random (mostly female) streamers with thousands of dollars. It is an utterly bizarre experience seeing screenshots of these events, where, say, a teenaged girl is playing a game in her parent's kitchen with a webcam trained on her, the caption is something like, "wow, $person just donated $20,000 to me! thanks!", and the entire family is in the background with their mouths agape in shock.

I hate these glorified slot machines, I hate the companies that make them, and I do think it's unethical to prey upon children and regular people with bad judgment, but my guess is that the average "whale" is far too wealthy to deserve your sympathy. As a different example of the same idea, do you feel bad for the celebrities that spend hundreds of dollars for a drink at an exclusive club?

I spent over $400 on a certain free-to-play stronghold-building game, over a few weeks, after intending to spend only about $5 or so testing it.

It was very interesting to introspect on the self-rationalization, etc, all the while understanding that I was BS'ing myself and also understanding the tricks they were using. It was addiction, pure and simple.

Now, part of the reason I didn't stop sooner was that I can afford that, although it's not a good use of my funds. That was actually built into the rationalizations: Oh, if I'd taken the car to work today I'd have spent $20 on parking, and $15 on lunch, so I'll just take the subway and bring my lunch tomorrow ...

Would you do that again? (If $400 is a non negligible amount of money for you). Or would you rather avoid temptation by not installing such games in the first place?

I wouldn't do it again, and I now avoid such games. Since that game, I've spent about $50 on another iOS game, before tiring of it.

In both cases, I initially considered the games vapid, but my friends got into it, and I wanted to have stuff that was as good / better.

So spending 20$ on parking instead of taking the subway is better use of your funds?

I don't understand your question. This seems to be the opposite of what I said.

Talk to people in the social games industry privately.

I run one. When I've done cursory searches on our whales, I find people who appear (at least from LinkedIn/Facebook) to have great jobs. I don't get the impression the large guys can't afford it, generally speaking. I am sure it happens.

I trust that what you are saying is accurate for your company. (And, thanks for saying it. That's one data point I hadn't heard before.) It is at variance with things I have heard about other companies. I am, unfortunately, not able to elaborate.


Good article that got passed around in my office on Friday. People who are 'gamers' and by extension people who make games tend to look at "whales" as gullible stupid people but a lot of us tend to exhibit the same behaviour about other things all while congratulating ourselves for not pay 5 bucks to support a game we've played for 50 hours.

That said I think there is a really really fine line you have to walk to keep your IAPs "ethical" and it's very temping (and profitable) to fall on the Candy Crush side of things.

Oh, Candy Crush does this too? (I have honestly never played it so i don't know). Well apparently there was a little exploit to bypass the wait (without paying). My GF told me about it (yes, she's addicted). You can just change you local clock and the game thinks a day has passed and tada! free lives.

Why aren't HN readers outraged by this blatant privacy violation?

Do you mean him searching for open-source information about his customers that his customers voluntarily put on the web, or him saying it to us?

If someone spent $30,000 on my digital cards, I'd look him up so that I could sleep at night and not worry that his kids are going hungry because of this.

(I'm not someone who sells these kinds of things, so I'm fully aware this is largely armchair quarterbacking.)

Him using customer provided data to then go and look those people up on the Internet.

Creepy. I can't understand why anyone on HN thinks it's acceptable.

So googling for information about someone that I do business with is creepy? Pretty sure that I don't agree with that.

It depends on the business, but in general I give a supplier my information so that they can supply me with the goods I request; inform me about that process; and invoice me.

Using that information for other reasons without informing me is a clear, unambiguous, invasion of my privacy. It's probably not legal in the UK.

Tl:dr yes, it's creepy. Especially in the context of a game dev.

There are CRM plugins that do it for you automatically when you view records. At the low-end, when I go into Mailchimp, there's a pay plugin (that I don't use) that puts up social information. If anyone emails me, Rapportive brings up their social profile to the right of the email.

Depending on the business I guess it's okay. But for a game dev?

My question is: why is it unsavory when a game developer tries to get a customer to pay more, but not for any other startup? If Amazon improves its recommendation service, or another etailer a/b tests checkout flows, they're a genius. When a game developer does it, they're evil.

My theory is that a lot of it is back-rationalization. People just have a gut reaction against it and search for any reason they can find to argue that it's bad.

The main reason it's different for game developers is that in most instances, in-app purchases will undermine the integrity of the game more significantly than for other kinds of apps. Indeed that is the main point of the OP ("There is no game here.")

If you add a rule to chess where you can pay cash to put a taken piece back on the board, you don't have chess anymore. Additionally, consider that videogames are often escapist entertainment that people play specifically to get away from real-life financial pressures or wealth-based status sorting.

There are all kinds of ethical ways to get your most dedicated customers to "pay more" (what's the MBA-speak term for "trying to get everyone to pay exactly as much as they're comfortable with"? I can't remember). There are pre-order bonuses, special editions, purely cosmetic items that don't change the gameplay, mission packs, "mission pack sequels," actual sequels, "pay what you want," donations...

It gets "unsavory" when you're focusing more on designing the perfect skinner box than actually creating a game. I think games are all about the feelings and mental states you get into when you play them. An action game gets your adrenaline pumping, competitive ones especially so. Strategy games require incredibly deep thought to stay one step ahead of the enemy. Puzzle games really stretch your brain to the limits of logic (or maybe they're just bullshit). From my experience, the games that people malign when they talk about mobile games and "social games," on the other hand, promote nothing but anxiety, and use it as a tool to wedge themselves into your subconscious so that you will fork over more cash into their creator's pockets. See the common practice of games based around waiting for something to happen, and bugging you with an alert whenever it does. I don't think very well of people that create things (I won't dignify them by calling them games) that do nothing but prey on anxiety, compulsion, and our attractions to flashing lights.

It's the difference between creating something that people will pay $50 to experience, and creating something that is engineered to repeatedly exploit our basest negative emotions. These games are in some senses worse than heroin, because at least heroin is fun while it lasts.

Jonathan Blow does the topic far more justice than I can at the moment (what am I doing, it's way too late to be drink posting on HN...) in his talk "Video Games and the Human Condition"[1], if you're interested. It's nearly two hours long, but I believe it's very much worth your time.

As for "why do other startups not get shit for this," I think there's a big difference between A/B testing different versions of your game's site to see which version results in more "conversions" or whatever it's called, and designing your entire "game" around frisking people at every turn and being the best darn frisker you can. Not to mention the ones obviously marketed to children, which reasonable people agree is one step removed from turning up at your local elementary school with a trenchcoat full of free samples.

(I have no idea who you are or what games you make, so don't take these comments personally, this is just my general opinion of the mobile games I've tried. If it (or especially Jonathan Blow's talk, because he's much more eloquent than tired, drunken me) rings close to home, however, it might not be a bad idea to download a pack of the 1000+ NES games and try a few at random for a reminder of what playing a real game is like)

[1] https://www.youtube.com/watch?v=SqFu5O-oPmU

> what's the MBA-speak term for "trying to get everyone to pay exactly as much as they're comfortable with"? I can't remember

I don't know if MBAs have different jargon, but the term in economics is "price discrimination"/

You can use price discrimination to extract maximum consumer surplus, but there are other ways too. ( MBA here :-))

I think these games are more targeting "addiction-forming" (which is MBA speak for what any sane person calls "drugs").

The same sort of thing happened so mid-90s pay-per-second or pay-for-items games on what we now call dumbphones (ie. java games). They were regulated, essentially demanding up-front information about what they charge and an option to disable it on the telco contract (effectively giving parents a way to disable it for kids, and everyone a way to disable it for themselves), and their market completely dried up. This happened after several high-profile court cases where the telco was preventing from charging large amounts to kids (think $30k-40k). You can't find them anymore at all.

And that's just fine by me.

As far as I'm aware those things are still going, the one I remember was Jamster (though they use different names in different countries, so it was originally Jamba):


And the last link on the page goes to:


Which is a site for people who have been fraudulently charged, with comments from within the last few months.

Profiting from ludopathy is ethical if the other person is rich?

> Do you feel it's ethical to take $30k a year from 'the whales'?

I don't have any essential ethical problems with the question. I have two concerns.

(1) They're called "games" when they're not really "games."

(2) The socio-economic implications of a system where it's easier and more profitable to sell to 50 people willing to pay $30,000+ than to 1.5 million people willing to pay $2.

It's the exact same question whether it's ethical to take that amount of money from the whales in casinos. Because that's where the term whale comes from, synonymous with high rollers. It's the exact same scenario, except that in casinos, whales have a chance to make it back. But even in casinos, the rich people who can afford to be whales know that they're just throwing away their money. They're not like the poor stupid ones who go bankrupt with gambling debt.


I worked on a system where we could see these people's behavior. I recommended that we take the top X and refund their money. They had problems, and it was unethical for us to continue to bill them. Senior management said, "No." Which was appalling to me. It would cost us nothing, all virtual bits anyway. To see the greed of taking a sick persons money is kinda depressing.

> I recommended that we take the top X and refund their money.

> It would cost us nothing, all virtual bits anyway.

I see a contradiction here.

The system I worked on did 40M in revenue. We are talking about 10 people spending 5k a year (ish). So 0.5% of revenue for product that never even got activated? Refunding is the only correct response.

Thanks for the details. I wonder, what do you mean by "never even got activated"?

Yes we would have "lost money", if that is the contraction you are seeing. But it is money we shouldn't have rightly had in the first place.

Sure. The games (generally) aren't doing anything illegal or unethical. If someone has the spare money and the inclination, why would it be unethical to allow them to spend it?

Remember that there is a lot of money out there. If you're a millionaire, a billionare has 1000x more money than you. His $30,000 is your $30.

Would you think it is unethical for iTunes to take $30k from someone who purchased a large amount of music, tv and movies?

What about someone who spends $30k to get their Aston Martin repainted in chrome paint?

People have to be careful here - this is clearly consensual behaviour as long as they know how much they are spending as they purchase. Everyone wants to compare to gambling - I detest gambling and never do it - I would cautiously support moves to rein in an ever-expanding gambling industry - but at the same time if people want to spend money on entertainment, even all of their money, I find it hard to come up with a suitable argument. People can spend all their money on all sorts of weird obsessions, but these shouldn't be reasons for outlawing the behaviour for the majority of people who get along just fine.

>People have to be careful here - this is clearly consensual behaviour [...] //

Right. Many apps are designed to be effective Skinner boxes bypassing the brains logic to push at the base responses in order to initiate a "player" to want to continue without engaging their executive functions. Games like Candy Crush and Bejeweled play ever trick possible to part users from their cash.

It's more like having a bar and when the mark is drunk you waft a cheeseburger under their nose, flash subliminal messages on the video screens, pay beautiful people to sit eating cheeseburgers, tell them all their friends ordered one and finally selling it for 3 tokens [$1000] because you know they won't then notice the cost. Oh plus wash that burger down with a beer that's suddenly $500 because arbitraryTimeLimit just ran out.

Most obsessions that people spend silly money on aren't carefully designed to be obsessions. Those that are - smoking, gambling, drinking - are often tightly controlled.

Nightclubs, so far as I know, don't have systems of their own currency specially designed to hide the dollar amounts of their drinks, for example. They also, where I am at least, have to post prices and are by law required to stop serving people who're drunk [though I hesitate to guess how often that law is flouted].

Your position on gambling seems contrary to your position on other for money gaming.

All consensual and non-coercive transactions are ethical.

It is simply not your place to decide for others how they should get their dopamine, or how much they should be paying for it.

A gambler comes into a casino, which I own. I know this gambler personally, and I know his style. However much he comes in with, he bets it all on black at the roulette tables. If he wins, he places the bet again, and again, until he loses. This time, he has come in with what I know to be his 17-year-old child's college fund. The fund is in his name, and is legally his, but is intended for paying for college. If he loses it, he will not have enough time to build it up again before the child graduates high school. I allow him to bet and lose the money.

How the hell would this be ethical, no matter how consensual and non-coercive it is?

What would be unethical is if you tried to coerce him into somehow not spending it.

The money is not a college fund. Your customer's previously-held inaccurate predictions of the future turned out to be false. He changed his mind. Your assertion that it "is intended for paying for college" is false. It is intended for paying for roulette.

It is not your right to choose for others how they spend their money.

Stop trying to control other people because of your certainty in the belief that you know what's best for them.

That view is insanely simplistic. Sometimes people do things that are against their own interests because they are in the clutches of an addiction. In these situations, it is sometimes OK for someone to step in and overrule them. Sometimes it's not just OK, but morally necessary.

It can be better to temporarily infringe someone's rights if it stops them from doing something that they will regret for the rest of their life.

> It can be better to temporarily infringe someone's rights if it stops them from doing something that they will regret for the rest of their life.

No, this is false. You're incapable of guessing what other people may or may not regret with enough accuracy to use it as a justification for infringing upon the rights of others.

Furthermore, most are heavily influenced by societal norms and customs, making this even more dangerous a justification when used against the rights of those with eccentricities or nonstandard tastes or lifestyles.

It's never ok to infringe upon someone's rights.

A question: how do people find themselves "in the clutches of an addiction"? How do they escape? Could it possibly be their own free will to decide to smoke the first cigarette, or their individual decision to walk past the bar without going in, on their way home from AA?

> It's never ok to infringe upon someone's rights.

Do you agree that it's right to have age restrictions for buying and selling alcohol?

Not at all. However, any responsible guardian of someone drinking underage should be subject to the appropriate penalties for neglect. It's not a child's fault when they make an error.

> It's not a child's fault when they make an error

You realise that many alcoholics start drinking when they're children?

Let's take another example, even more extreme. Suppose I run a pawn shop. Somebody comes in looking to sell goods that I know are stolen. I buy them from him. This contract is entered by both of us consensually and without coercion. It is also entirely immoral.

People are social creatures. Trying to ignore that and treat everybody as isolated individuals ignores those.

That transaction is illegal. There is a difference.

Laws follow morals, not the other way around. If the parent poster's absolute statement is to hold, it should be independent of the legal system.

That's a baseless assertion -- legality and morality are independent and only coincidentally aligned. Unless you want to start telling us about the ethical necessity upheld by the farm subsidy bill.

Clearly it would be immoral for you to intentionally provide a source of liquidity for stolen goods. How does that show anything about your gambler?

They are both separate examples of contracts that are consensual and without coercion, but are immoral, both for different reasons. My goal was to find a counter-example to the statement that "All consensual and non-coercive transactions are ethical.". Once that example was found, expanding from there.

They were discussing morality, not legality. There is a difference. You can base your decision to do/not do something because (you feel) it is immoral, whether it is illegal or not.

Often legality and morality do align (but really not as often as you'd think), and this is fortunate, because it allows good people an easy mental short-cut for weighing one's actions based on legality (and punishment), as well as protecting the weaker-willed parts of society that often end up on the wrong end of moral decisions by people like sneak, who'd let people drink themselves to death because if everybody was completely free they'd surely decide out of their own free will to do what's best for them and nobody would ever prey on the weak-willed like that, ever.

  All consensual and non-coercive transactions are ethical.
Another contractor and I are bidding to build a website. The customer is a guy in his 90s who wants a website for his antique furniture shop. The customer requirements aren't water-tight as he's not really into computers. For example they don't say the website should be accessible from the public internet or that I should hand over the source code and hosting credentials. My competitor has bid $1000. Is it ethical for me to bid $900 then later to demand an extra $200 to connect it to the internet, work that only I can do?

In most jurisdictions, that would be in violation of laws. The laws are created to prevent shady operators, like people who go around 'fixing' the roof for old people. They agree to the work, then get charged a fortune for overages, which usually just amount to painting the gutters.

Another example is the phone scammers offering 'virus fixes'. These are generally in violation of different laws.

When I was a consultant in the construction industry world, our contracts all had an clause requiring a "reasonable standard of care". Basically, if something would be reasonably expected to be included (say accessing a website from the public internet which is the reason it's being built in the first place), you need to provide it.

Whether software contracts include that same kind of verbiage, I don't know.

That's simple extortion, and is obviously nonconsensual.

It sounds to me like you've redefined 'consensual' to make your philosophy produce the results you want.

Both transactions were consentual and noncoercive. There were no threats of violence. An adult business owner signed a contract for services which were provided exactly as specified. The customer didn't have to agree to the first, poorly negotiated contract. And they don't have to pay extra for the extra services later on - it's entirely their choice.

It's no more extortion than if you need a new ink cartridge for your printer and you find they're expensive.

I put it to you that the situation I've outlined is unethical, even though it's consensual and non-coercive.

It is as long as you say it upfront

Of course I wouldn't say it upfront without being asked - Caveat emptor. If I wanted to be upfront I would have just quoted $1100 to begin with!

Exploiting contracts is OK. Providing public with detailed info about contract exploiters is OK either.

"For every complex problem there is an answer that is clear, simple, and wrong." -- H. L. Mencken

A half-way competent attempt to examine this issue would need to dig deeper into the meaning of "consensual", "non-coercive", and the fact that we are engineering these products, knowing that these cognitive biases (defects) exists.

Your dogmatic quote meets none of these criteria, and is frankly a pathetic attempt to address this complex and well-studied problem.

What do you think "consensual and non-coercive" means in the context of addictive behavior?

It is everyone's individual right to have and maintain whatever addictions they choose.

"addictions they choose"

What makes you think that addiction is a choice?

Because almost no-one is born with them, and many choose to end them.

It is clear that they are undertaken with free will, and ended similarly thereby. All of AA and everyone who's ever quit smoking stand as evidence.

Addiction by itself is absolutely not a choice. Whatever it is that someone tried or was coerced to try that eventually resulted in that addiction may or may not have been a choice. A person may indeed, with appropriate support and resources be able to break their addiction, but they remain afflicted with it throughout the rest of their lives. Why do you think most people who were once addicted to alcohol must remain eternally vigilant to never touch the stuff again?

Playing the "no one's pointing a gun to your head" card and claiming it is therefore "non-coersive" in defense of targeting and manipulating addictive behavior may very well be profitable but it's delusional and downright dishonest to everyone, including yourself, to think it isn't exploitive and conducive to serious personal and social issues. You need look no further in the historical record to see how this plays out than the tobacco and alcohol industry.

> but they remain afflicted with it throughout the rest of their lives.

That is not accurate.

There are quite literally thousands of documents that disagree with you on that, especially when it comes to physical addiction. Your response demonstrates a misunderstanding as to what addiction is, even if you happen to have experienced it first hand.

If you're really interested in continuing to debate whether your perspective of addiction should be adopted by others feel free to search Google for "addiction" or "is addiction a lifelong problem" or if that's something you don't have time for start with the first Google result I pulled up: http://aspe.hhs.gov/hsp/subabuse99/chap2.htm

There are plenty of other, better, sources that will provide more thorough descriptions of both the physical and psychological characteristics of addition. Practically all of them acknowledge that addiction, once attained, does not grant an individual the luxury of choice as you entertain it. One can certainly choose to seek the tools to control the impulses of addiction through willpower (be it internally or externally inspired), but that will never mean they can choose to make the underlying addiction go away and never bother them again at any point for the rest of their lives.

> All of AA and everyone who's ever quit smoking stand as evidence

Have you ever met a "former" addict? Plenty will tell you it's not as simple as that, unless you're using your own novel definition of "choice," "free will," and given studies generally show genetic predisposition is a factor, "born with."

The issue for me is that if you went to every smoker and said "Do you want to just quit now, cold turkey, no repercussions, no cravings?" I think the majority would say Yes. But the majority don't quit on the spot like that because addiction is a tough thing that can wrap tentacles around your brain.

They're lying to you. Most smokers pay lip service to wanting to quit. They're in denial.

The ones who actually want to quit, do.

Because they can't quit. They can't even bring themselves to want to quit. The actions are muscle memory, the thought of smoking brings pleasure to them. Even people who've successfully quit miss it.

It's unfathomable to someone who hasn't smoked.

The average person sees a video game as care-free entertainment, not a dangerous compulsion.

If you want to make your business about manipulation of the customer, don't pretend to be morally pure. You are scum.

Are you saying people's decisions are never influenced by society, advertising or habits?

Should we factor this in, or is public health department a nanny state intervention?

"Free will" is not black and white.

The lines of free will and accountability are blurred by things like mental illness, addictions, childhood naivety, etc.

By definition an addiction is not a choice. That's a fallacy

By that logic, it would be impossible to escape them without being physically restrained against your will.

That's not the case. People choose to stop being addicted to things all the time.

Nope. Think British selling opium in India, ethical? And notably, selling a variety of addictive dopamine stimulants [including cocaine and methamphetamine] other than games is considered to be unethical.

Leading people to ruin is not ethical. Ripping vulnerable people off is not ethical.

Where did you get this view on ethics? It certainly isn't most peoples view, for sure.

Ah the free market guys.

I think every time I hear "you should eb ashamed" the free market guy SHOULD stand up and say NO, morality is actually whining that someone should be coerced into doing something they wouldnt want to selfishly do. If there is a market for your thing then caveat emptor.

Screwing your clients? The market will decide whether you can keep operating.

Providing a dopamine fix may be being coercive. It's a reward that may be manipulated by those with few ethics. Certain types of marketing, similarly, may be considered coercive. Coercion isn't limited to physical violence.

> Providing a dopamine fix is being coercive.

Convince my girlfriend of that.

Seriously, though, it doesn't even pass the laugh test. People control their own circumstances. Making those circumstances available to be chosen does not alter the source or responsibility of those decisions.

Smokers choose to smoke. Gamblers choose to gamble.

Proof lies in those who subsequently choose to stop.

You always have free will, even if you aren't using it at the moment.

Your view of addiction is incredibly simplistic.

You are assuming that what one person can do, the rest of the population can do with a similar amount of effort. This should be self-evidently false.

Some people can stop addictive behavior with relatively little effort, other people need external help and tons of effort, and other people will literally prefer to die before stopping.

The only way to say that the latter two groups "don't actually want to quit" is to redefine "wanting to" in terms of "being able to", which makes your argument circular.

I don't think you have any idea what the word "ethical" means.

The issue is that you'll run into the Gasketball problem of having 100,000 players but limiting the amount of things they can buy (should every player be worth $1.99 IAP?). It's just a math problem, and the reality is that you want to do it like League of Legends where you can never run out of things to buy for a long time, but of course whilst not being annoying like most mobile games are currently.

I think it's better for players to enjoy a game fully for free (if you're doing IAP), and then provide ways to monetize that enhance their experience. Ramin Shokrizade has lots of amazing blogs about this: http://www.gamasutra.com/blogs/RaminShokrizade/914048/

Definitely: I think the only real solution for the industry at this point is finding better ways to monetize with IAP that don't mix so heavily with the gameplay. And League of Legends is a great example of keeping the gameplay separate from the monetization.

No pay to win, no timers, no paywalls that ruin the experience: we need to go back to building games as entertainment experiences, and find ways to monetize with things like skins (purely aesthetic so they don't disrupt gameplay, but can make you look cool when you play with your friends).

Unfortunately the sad truth is that for the majority of mobile games if you charge up front you will not have enough sales volume. And a single $1.99 IAP has the same problem because while you might get 10x downloads from being free initially, you'll still only get your $2 from <10% of them, and $2 LTV is not nearly enough to support a game (+ some gamers like those here might be willing to support a great game with more than $2 but won't have the option to do so in this setup).

At the end of the day, when people invest in an entertainment experience they want to be entertained. And thinking about money and waiting for timers during the experience only reduces the amount of entertainment we get out of it. So we need to find ways to design IAP that is separate enough from the core experience, and yet still works well enough to fund the games we want to play.

It's nice to hold up League of Legends as a shining example of IAP done right, but the fact is that there are plenty of excellent games with vibrant communities that couldn't even dream of having 5 million concurrent players. Riot does fine with very little marginal revenue per player, but not many other games can do the same, especially on mobile.

let s mine bitcoins as playing, a primitive Ender's game if you will.

> It seems like a simple solution to me would be to make the game free, but with most features blocked behind a SINGLE in-app purchase.

This is pretty much what id Software did in the 90s with Wolfenstein, Doom, and Quake and most people in the industry thought they were nuts and it would never work. Obviously it worked extremely well (the difference being it was levels that were gated instead of features, but same concept).

Yes, it works well. But mobile gaming companies have discovered that selling drugs is far more lucrative.

The problem with that approach is that you are likely to get lots of highly negative (one-star) reviews.

I can already hear "greedy devs charging me money for levels"

Great point.

There are several highly rated games that do this. If i remember correctly, "Where's my water?" is one of them.

One other great example i recently experienced was BADLAND. Its a really cool game in which they give you a level pack called "Day I" for free which has 40 levels. If you want the second set of 40 levels (which are way cooler btw), you have to purchase those. Also, they let you purchase multiplayer levels (6 of those are free btw). So just as you said, they let you demo their game and if you love it, you buy the rest of the game.

But one thing i REALLY loved about the devs was that that they you EARN the extra levels. If you unlock a certain achievement, you get the Day II pack for free! So that's like the devs rewarding their biggest fans. (I unlocked those levels for free btw).

Disclosure: BADLAND is also powered by video ads. You can pay a little to turn them off. There's also the option of a small fee that's not enough to buy the levels, but it lets you turn off the ads.

Sorry, I haven't read your reply and replied with almost the same thought. It is not hard to do and many developers already do this, Triple Town by Spry Fox is doing exactly that for example.

>It seems like a simple solution to me would be to make the game free, but with most features blocked behind a SINGLE in-app purchase.

This is the strategy of the Ouya - games on the market have to have a free, playable demo of some type in order to be included. I think it's great, and I'd like it even more on a mobile device since my phone isn't brand new and this would let me quickly find out whether the game will even be playable.

This is completely possible and as a consumer my preference. Most hidden object games follow this practice.

I would not object to this. Play for free, see if you like it, buy the full version.

Some developers do do this, but it's much rarer than P2W.

Hmmm... isn't that what id used to do with Doom? I think they're called shareware if I'm not mistaken.

Not only this, developers shouldn't shy away from charging what they think the game is worth, $5, $29, $59, $99, whatever. If the game is good, people will pay it.

I would bet the higher that price the less likely the sale and also the more likely the piracy. Charging even $5 for a game will likely drive your actual installs and sales through the floor. If you make a good product but most people can't justify paying for it, they'll just find an alternative means of playing it. Also the pump and dump industry in the app stores especially in gaming is another thing you have to worry about. You make a good game at a $10 price tag within a couple weeks you'll find your exact game with slightly altered graphics and a similar name that will be under cutting your price point. This used to be much worse, but unless you're a big studio like EA, Rovio, or King it's still a problem for you as a little guy.

I can't think of anyone without an already established reputation managing to do OK at a $5+ price point in the last year or two.

Like literally the only example of paid games I can think of to do one on phones in recent year are Minecraft, Final Fantasy and GTA.

People pay $99 for 99 lives in Bjorks Butter Batterer. People will pay $99 for a real game.

"already established reputation" is overrated in the age of the internet. Lets hope the internet is still around these days.

I remember paying ~ £5 in the 80s for 8bit games on cassette tape and considering it a bargain. I remember when Street Fighter II came out on the SNES ~ 20 years ago. It was priced at ~ £65-70 and people snapped it up (I DO remember considering it expensive, in relation to the normal price for SNES games which must've been about £30-40).

If prices had kept up with inflation, 'budget' games would be about £12; blockbusters, over £100. Games are well undervalued on app stores, and exploitative rubbish is the result. I've personally paid reasonable small amounts for some of the classic games (e.g. Monkey Island) and am on the lookout for good modern games at about the same price point.

This is simply not true. Price has an enormous impact on units sold.

Price elasticity is strong, but the original comment is presumably assuming you can make a decent revenue with a non-minimum price tag.

For instance, imagine a game listed as free:

- a freemium model let you play 15 levels and asks for 4.99 to unleash 500 more levels, maybe let a 1.99 option for 100 levels; this should convert 3-5% with a million testing players; v.s.

- free-to-play with locking levels every 10 levels that are so hard you have to use bonus, that would convert 1% to pay for either a Golden Orb for 1.99, or a Golden Blast for 5.99, etc. each who may or may not make a difference, and appease your frustration, and work only once. You get a couple of whales (desperate, clueless players) who pay 50$ a month, but even with a larger distribution (two to three millions players) you don't break even.

The idea in the original comment is not that a price twice higher will double sales, but more that having a price tag (which free-to-play games deny having) makes sense for good games.

Sure, if units sold is your only metric, then optimize for that.


The problem new devs face isn't even really that people won't pay for the game. It's that no one knows about the game.

It's all good and well that 100 of your friends and acquaintances will pay $20 for your game, but you really need 10000 people to buy it.

Kingdom Of Loathing (www.kingdomofloathing) is a game (well webgame) that I think has a good business model. The game and all of its (vast) content is free. But to get certain items or items of the month (that are optimal but by no means necessary), you donate $10 to the site.

It is not a pay-to-win type of scenario because it is a single player game (with one minor PVP minigame element). It also never feels scummy because you can do basically everything in the game without ever paying a single cent. Even 'premium' content that is unlocked by purchasable items is generally tradable and purchasable with the in-game currency (meat) that drops from the monsters.

Thus you don't have to pay up front... But you do end up donating some money for interesting items at some point due to the game being great, current, funny, having a great community, etc.

The business model probably wouldn't work for most, but in the case of Kingdom of Loathing it works really well.

One of the reasons this model worked for KoL is that it grew organically, as a side project that started as a joke and slowly built a community. Initially, donations were mostly to cover bandwidth costs, then became enough for the creator to quit his day job, and eventually enough to hire some extra people.

For more complex games that require more work (and possibly investment), it's questionable that this model could be relied upon. Still, as an old-timer who seldom plays anymore (#53596), I have huge admiration for the Asymmetric team for carving out an awesome niche gaming community with non-exploitive business model.

Do they have public numbers on how much they make with this model?

You advertise the game as free with voluntary donations (Mr. A and Mr. Eh accessories). Without pressing for financial info, can we ask: Does this translate into a full-time paying job, cover the expenses of running the project, or simply add a bit of pocket change here and there? Why did you choose this business model?

KoL's donation revenue is currently sufficient to support a full-time staff and a second team working on a new game. I feel like we were extremely fortunate to have launched when we did and to have gotten the critical mass in the beginning that makes it possible for this to be a career instead of just a hobby.

As far as choosing the business model, I'm not sure there was ever a moment when I made a choice about it. A couple of months in, the hosting bills were starting to cost more than I was comfortable paying out of pocket, so I put up a link to ask for donations to offset the cost. A player suggested, "Hey, why don't you give donators an in-game reward?" and I figured "Hey, why not, it couldn't hurt." To my surprise and delight, it was pretty much instantly profitable. I was still processing the donations by hand for quite a while -- the revenue model was really kind of an afterthought.

After it got to the point where I was able to comfortably and safely quit my day job (and finally start paying Josh, who had been diligently working for free for several months), I started offering the monthly specials, which caused another surge in income and allowed me to hire an office manager, another writer/designer, and another programmer. Since then we've added a full-time customer service/abuse-tracking position and part-time forum and chat-moderation supervisors.

I do not believe so... Though I could be wrong and they are out there somewhere?

What I do know is that it was enough for the two initial guys to now do it full-time and they now also employ something like 4 additional people full-time (I think its 4 additional).

Thanks, that is a good ballpark figure.

KoL is something totally different, it started out as an attempt to create something that didn't exist and was more of a joke, now 10 years later it still lives on and to me it is one of the most enjoyable videogames I've played (and replayed) again.

Nothing even close to a major studio adapting an old hit to mobile platforms to squeeze out as much profit as possible.

When I found out that there was a mandatory quest at the altar of literacy to gain access to the chat channels of kingdom of loathing, I knew I was hooked. I even learned haiku to be able to chat on the haiku chan. http://kol.coldfront.net/thekolwiki/index.php/The_Altar_of_L...

I don't necessarily think that there is a solution. In almost all cases, the game itself is the problem. Most people won't pay full price, because most mobile games lack depth. When you develop for mobile, you can either make a game with simple mechanics, or you can make a game with terrible controls. Those are the options. While it is possible to make a great game with simple mechanics, it takes an extraordinary level of talent that most game development shops simply don't possess.

On the PC/console side, you of course have ports of popular mobile games. In addition, however, you have AAA games like Diablo 3 that are reasonably complex, yet seem to have been intentionally ruined by IAP and the real money sale of items that affect performance.

> Most people won't pay full price, because most mobile games lack depth.

I think you might have this backwards: Mobile games lack depth because their developers know most people won't pay full price.

Mobile games can have great depth. Just like PC/console games can be extremely simple and trivial.

(Depth doesn't come from complex mechanics or controls, btw. In fact, those things are often used to mask how shallow a game really is.)

I agree that the ability to use complex control system isn't necessarily an indicator of depth, but it certainly opens up a lot of possibilities. There are entire genres that have always been and will always be terrible on touchscreen devices.

Perhaps you are also right that most developers won't even try to make a real game, due to the difficulty in getting customers to pay for them. Now that its more profitable to milk small amounts of money out of non-gamers, I think the rest of us are going to eventually get stuck playing the kick starter lottery in order to see real games hit the market.

> > Most people won't pay full price, because most mobile games lack depth.

> I think you might have this backwards: Mobile games lack depth because their developers know most people won't pay full price.

Chicken, meet egg. :(

This is why I hate the mobile space for gaming.

to be fair, you have to make the game for the market. If the market will only bear $2 then you need to make a simpler game... not "play the horses" that you can beat them into spending more money. That's why the App Store and Mac market in general was full of much smaller game companies for so long. People were putting "more love than money" into games. But along come the big companies that want to sink half a million dollars and then complain that they won't get it back. that's not reasonable expectations... but they're too rich to be told that.

Depth doesn't come from complex controls, but complex controls are almost always needed to be able to play a game with any depth.

It's hard for me to gauge whether this is true or not. There are some amazing deep games like chess and bridge that have extremely simple controls. Do these counterexamples disprove the rule, or are they rare outliers?

Games in general don't have to have control complexity in order to have depth, but some genres have to be significantly dumbed-down in order to work with touch controls.

The concept of an on-screen virtual analog stick is great in theory. I practice, its always going to be terrible in comparison to its physical counterpart. Games like Modern Combat 4 are pretty impressive when you first see them, but 5 minutes in you realize two things: The controls are bad, and the entire game has been dumbed-down because the developers know that the controls are bad. Its not even their fault. They did as good of a job as anyone has, but a capacitive touchscreen just isn't going to offer the user a pleasant experience in a 3d fps.

Certain genres are well-suited to touch controls. Many genres are not. Board games and card games work very well.

I would say any strategy game would be just fine with touch controls. Any quest or exploration game too. Many puzzle-type or construction-type games as well. So I don't think touch is a huge problem here except for some genres like hardcore "click-click-click" action or racing games.

>I would say any strategy game would be just fine with touch controls.

I'd agree that board-game style strategy/war games would work, and also quite a few turn-based strategy games.

Its also possible to make certain types of real-time strategy games. Unfortunately, complex RTS games like Starcraft probably can't be done well without extreme oversimplification.

What would be the problem with Starcraft? I can't think of a lot of things that you can't do using touch/twofinger touch/long touch.

I think you'd need to slow down starcraft for it to be playable as the same game. People hit 60-100 actions per minute, like jumping around the map and directing units, setting build queues. Without hotkeys, you'd drop to around 20apm, and you'd be unable to do any micromanagment of units in battle. So it's not that any one action is impossible, just that lots of tactics that require many actions would be impossible.

Maybe for hardcore sport-like starcraft players this is true. But when I played starcraft I never did nearly anything like 100 apm neither my game ever required me to. Yes, that'd probably mean I'd lose miserably if I ever play 1-on-1 against a hardcore sport players, but that's not why I would be playing it and I'd probably never play with them anyway, I'm not in the same league. So I think for a casual player it would be OK. And hardcore players would have their hardcore setups.

There's also the accelerometers, compass, perhaps more. X-Plane is basing the primary controls on those and I find it works amazingly well (I've been playing the Android version).

Mario. Sonic. Doom. Complex controls?

The missing element for all three of those (which are action games) is latency.

With mobile touch-screen controls the game has to somehow register a button-press as soon as a button-press is made.

But it must also never (to a first approximation) register a button-press when a button-press was not requested (e.g. an accidental brush of a finger against the screen).

It's hard enough to do this anyways, but the "input device" does no favors for the game developer either. There's a reason that input devices on consoles and computers have evolved over the years into the shapes they have, they are meant to be easy to hold in a certain position (so that you always know where the buttons are) and perhaps more important, they have tactile features that allow your finger to quickly find and stay near the buttons. It's the reason that buttons and the D-pad are not fully-flush with the shell, even though that might have been more stylish.

Imagine trying to play Super Mario World with a NES-shaped rectangular controller where there are no tactile buttons. This might have worked if you only needed Left, Right, Jump, but even that game required all of the following for the best gameplay: Left/Right, Up/Down (for pipes and to literally scroll the screen up), Jump, Run/Hold/Fireball, Spin Jump, Pause, Drop Stored Item and Shoulder Left/Right (to scroll the screen). And if the input wasn't right you'd either jump into a spike you had meant to run under or accidentally run off a cliff you'd meant to jump past.

The controls on Mario seem complex only because they were so completely intuitive when you were actually playing them but I assure you they were far more difficult to implement than you think. It's not until you start playing platformer games with horrible controls that you can realize the great job done by the development teams at Sega (for Sonic) and Nintendo.

In this context, yes. Precision jumping and strafing-while-turning-while-firing are basically impossible with touchscreen controls; at least I've yet to see them done well.

On a phone, yes, they can be harder to control.

Chess is deep but it's not complex. Starcraft is both deep and complex. Candy Crush is shallow and simple. I can't think of a game off the top of my head that's really complex and really shallow but whatever it is it's definitely not on a mobile device.

I'm not so sure. I suspect writing a near-optimal Candy Crush AI would be quite difficult.

Diablo 3 was something of a different story. Blizzard knew players would create their own functionally-IAP black market anyway, because it happened in Diablo 2 and World of Warcraft. So Blizzard figured they may as well bring auctions in house to make the market honest and usable for players without worrying about scammers. There's nothing inherently wrong with that.

What wrecked Diablo 3 was the enormous power discrepancy between what a player could reasonably find on their own and what was readily available on the auction market. The game had to be balanced around the latter to avoid auction buyers god-moding over everything, which left solo players completely screwed. With a tighter power balance between common and rare items, Diablo 3 would have continued to be playable just fine.

>There's nothing inherently wrong with that.

Yes there is. Diablo 3 would have been much better if buying gear was the exception to the rule. By legitimizing it and as you mentioned, failing to provide balance, Blizzard unintentionally made the purchase of gear the only viable method of progression for most players.

With World of Warcraft, Blizzard made tons of money off of cosmetic items. If they wanted to increase revenue, they should have gone this route instead of ruining the best action-rpg franchise in the world.

I think D3's AH failing was using real money, not just balancing or buying gear by default.

Buying gear in WoW is easy and a given up to a point, but limited to in-game currency. To buy some of the best gear, you just have to be the owner of enough gold to buy something from one of the two auction houses if it shows up. That meant you were active in your server's economy (helpful) or you were buying gold from scammers (which a lot of people are scared to do) - or you were raiding at a point where that gear was equivalent to what you can get, so you just ignored it (a small minority of raiders, not just WoW players overall). If real money was involved, it'd probably turn into something worse than D3's AH fiasco where people would quit playing since everyone playing for non-RP/solo reasons would eventually be forced to spend a bunch of money on top of in-game time to be on an even footing.

Not that I think D3 should have followed the same exact footsteps as WoW in terms of how to make money, but I'm looking forward to next month to maybe get around to start playing D3 again now that the AH will be gone there.

Most gear in WoW cannot be traded. If you want to buy the best gear, you wait for a guild to farm the content, then buy the gear from the guild by doing the instance with them. People do trade real money for this service, but it is understandably quite expensive.

Current-tier raid and PVP gear can show up on the Black Market Auction House, sold by NPCs. The BMAH sells a very small number of pieces during the few months it takes people to clear content. When I played in a top 20 US 25 man guild in T14-15, our BMAH was usually camped by the other faction, so we couldn't buy stuff anyway. It didn't make any noticeable difference.

Yeah to those who see it as some catch-22 that was forged at the dawn of man, sure might as well "legitimize" IAP...

For others, like myself & Phaus, apparently, we'll just play a different damn game. I think the disconnect here is that people are like "well look its still working, isnt it?" but the idea of "ruining" a game isnt that the thing is broken now, its that casual players dont wanna get involved cuz its an all-or-nothing shitshow where youre not sure exactly when the menu is gonna pop up saying "give us more money or your time invested is now a complete waste".

i only play single-player story titles now for the most part because i know that pretty much anything else is gonna try to mess with my mind & prey on the consumer. COD & Battlefield are the best examples i can think of. They keep game prices high, get players addicted to repetitive mindless multiplayer, then charge $15 for a change of scenery (should 3 or 4 maps cost 1/4 the price of the game itself?)

If you buy, you know beyond a shadow of a doubt that you're being ripped off & it makes you resent the gamemakers. If you don't buy, you're left with a limited set of maps that is getting duller by the second, lol

I'm avoiding by just buying downloadable PC games for between $1 - $10 each & then when its over its over. its the skinner box games that overprice DLC and this alone should be a trigger that makes people see them for what they are & have the willpower to opt out

Its especially sad i think because old-school PC gamers probly remember when COD2 & the like were very DIY, moddable titles for nerdy WW2 enthuiasts.

Now they are a massive corporation with nothing moddable & the balls to sell simple gun skins in like $15 packs :D

This is pretty much spot-on. I can't stand CoD anymore for quite a few reasons, but one of the biggest is that they charge money for map packs that are often based on old content. If I'm loyal enough to give you 60 bucks every time you come out with a new game, don't try screwing me out of extra money for maps that I already bought a year ago. Port them for free like good developers always have, or just don't do it at all.

I think valve has done the best job out of anyone when it comes to monetization in Counterstrike:GO. You can purchase custom maps and skins to use on official matchmaking servers, or you get all of the same content for free plus a wide variety of mods and use them on custom servers. They get paid, and the customers still have freedom of choice.

thats cool, i didnt know GO does that (bought it during xmas sale, haven't even played yet).

its nice to be back in the PC world. my friend gave me an xbox360 & i was playing that for a bit but now instead of a console i have geforce 770... hadn't even realized the notion of "custom servers" still existed, hah :D

The cosmetic business model has seemed to work well for Valve. Team Fortress 2, CS:GO and Dota 2 use this model, from which Dota gathered worth of $600'000 only from donations towards the game's yearly championship. The players received some in-game items from the donation, which gave them cosmetic items for playable characters and new UI skins. I personally like the idea, as the highly competetive games stay balanced as the cosmetic items do not give any edge to their owner.

Valve also gives the cosmetic items as random drops after matches or from spectating competetive games. The players are then able to sell these items to other players trough Valve's market. From the trades Valve takes a procentual fee (or margin, that is), which can raise quite high as some knives in CS cost over $300 and some couriers in Dota have been sold as high as $9000 a pop.

Even though the cosmetic business model sounds like a golden road, I've yet to across any mobile game which would have used it.

Valve also had a virtual monopoly on digital game sales, billions of dollars of alternate revenue and huge teams of engineers and artists to build that Steam market and make the initial bunch of items.

Valve is incredibly unique yet people keep telling tiny companies making mobile games that they should be like Valve.

Look at games like XCom, or Jagged Alliance. These games had better depth and AI than even current console games. They work well with a touchscreen interface.

The problem is that good game design is hard, and not particularly repeatable. Having a single simple mechanic, surrounded by a reusable monetization platform is much more formulaic and repeatable. Formulaic is bad for players, but good for businesses.

As another example, any traditional turn-based RPG can probably be controlled better on a touchscreen than a controller (navigating menus on a controller sucks) and have at least the potential to be deep. Or roguelikes... really, most turn based games can be done okay on a touchscreen.

There could possibly be a solution that has to do with legislation forcing game developers to be upfront and transparent about the kinds of purchases in their games. Lots of games, for instance, might have a very reasonable limit on in-app purchases analogous to paying for "the full game". Other games have no limit on what they'll let you buy. It could be done by an independent ratings board (much like how movies are rated for age limits).

Nintendo has resisted this trend of nickel-and-diming users with bags of coins and gems. However, they're struggling mightily to convince modern consumers to fork over $60 up front for their (very fun) Mario games.

I'm an indie developer and my paid games have done very poorly. It's just so much easier to convince someone to download my apps for free, and then try to upsell them later on. I've also resisted bags of coins, but probably to my own detriment.

I don't mind at all when a game is free for the first few level but then asks you to pay to unlock the full version. It's basically the same as the old shareware model, giving you an option to try out the game before purchasing. It's only when paying money actually becomes part of the game that I start to feel ripped off.

I agree with you. However, most consumers just play the free part and then move on to the next game. Everyone's busy, and there are so many games to try!

Sadly I find myself feeling the same way (as a consumer). I don't really want to pay > $5 for a game. Yet, I don't like microtransactions... so I generally just play the free part of a game until I get bored and move on.

Yes, but then again, you're probably not the type that spends ANY money for IAP (not judging you, am like that too). Now consider people that DO spend money on IAP, wouldn't it be much better if that money is utilized properly? Wouldn't it be much better if those people aren't being scamemd and milked dry, but intead are being given a rich gaming experience for that money?

PS: i recently ran in to a game for people like you and me. They give you the premium stuff for unlocking a few (surprisingly achievable) achievements. Yay devs! (Its BADLAND)

I think $60 is pretty high price for a game. I'm a very casual gamer and I'd probably would never ever paid this much. OTOH, thinking about it I realize that I would pay like $15 for a movie ticket, to be entertained for like 2-3 hours, so if the game entertains me for 20 hours, I should consider $60 a bargain. But I guess linear extrapolation does not work here.

I'm curious why the very successful Apogee model of indie sales and development (first episode is free and later episodes (sequels) cost) hasn't really stuck around.

That's basically a demo, and demos are proven to reduce sales:


The claim that demos are proven to reduce sales lacks context.

The Apogee shareware model was extremely successful in its day but was predicated on certain assumptions about marketing and distribution that are no longer true. A standard scenario is that you'd read about the game in a magazine, play the demo episode on the accompanying disk, order the full version by fax or telephone and then have it within a few days.

Games based on the Apogee model were designed from the ground up to demo well and hence monetize well.

I hear what you're saying, but I feel like their approach was a bit different. A demo is clearly an incomplete piece of a larger product, hopefully setting up the customer to see the steak, but never taste it. The Apogee model really was to give away a complete contained game, and if the customer wanted "more like that" they basically bought additional "episodes" which were more or less just a couple more complete games built with the same engine and style.

i.e. You can play through all of the Doom shareware episode and enjoy the entire experience of playing a complete game.

It's hard to say it didn't work, when it did work very well for many years. Today, games just aren't produced like that I guess. But I guess the equivalent would be say, a Grand Theft Auto Game set in NYC, with what's just the part of the game where you're locked onto one borough/island, and where you complete enough of the game the episode has a logical "conclusion" or "finish". If you want to play more missions and see more story arcs that include other boroughs you can buy episodes 2 and 3. (this is also different than the DLC approach in some important ways).

I am doing that, and the sales suck.

After buying mobile games for 3 years, at Christmas I bought a 3DS. The quality in games is comparable. While I would like to be wrong, at the moment I plan on never buying another ios or Android game.

It's a problem of economics. The costs of making table stakes-quality mobile games has been holding steady, if not increasing. Meanwhile, the price people are willing to pay up front has been converging on $0. Something's gotta give.

One could argue, and perhaps somewhat convincingly, that the mobile gaming space is in its chaotic adolescence. It started off as an undifferentiated mass market, but making games for the mass market is extremely challenging unless you're a big publisher with economies of scale. Enter IAP, the best way to bootstrap a game and maintain cash flow over the lifetime of a given gamer.

So now IAP has been exploited to the hilt. It's everywhere. It's the new mass-market model.

Don't want to do IAP? In that case, you should find a lucrative niche. Differentiate. Certain developers are doing fairly well charging large (by iOS & Android standards) up-front prices for deep games in hardcore categories. Square-Enix, for instance, routinely charges upwards of $15 for its Final Fantasy releases, and by all accounts, it's doing just fine with them. (S-E is a fairly big publisher, but I see no reason why a small RPG shop couldn't attempt the same, provided it got itself in front of the right initial audience.)

Devs and publishers who don't have $10M+ in venture funding in the bank are going to have to make their peace with freemium, with niche pricing, or with IAP. Any of these things can be done well. IAP can be done well, for that matter. It's not, in and of itself, an unalloyed evil. De facto-forced IAP, of the sort you need to opt into in order to pass a roadblock, is the dickish (if lucrative) way to go. But IAP that is a fun add-on to an already awesome gaming experience is a bird of a different feather.

My rule is that there is no such thing as free-as-in-beer software. (There are exceptions, but they are exceptions.) The developer's bills will get paid one way or the other. The simplest and most efficient way is to just pay them up front. If you try to get things for "free" both you as the consumer and the developer will end up worse off.

Dwarf Fortress, the creator writes you a short story or illustrates a drawing in crayon in exchange for your optional donation. Quite the exception.

...and the developer lives on about $35K/year, which is far less than what he could be generating with that franchise.

Maybe that's because the creators don't see their work as a "franchise" and are happy to have a vibrant community around their game without needing to milk it dry for money.

Most open source/free software(free as in liberty) is free as in beer. It gets payed for by donations and/or big sponsors. It has no hidden costs. Not everything is available as open source/free software, but it is enough have a usable computer and even some games.

The difference is that such software goes through multi-year evolution and usage (be it bash or OpenOffice or kernel) so it makes sense for a company to invest on feature X that's missing for them, and get everything else for free.

On the other hand, in the game market, most games are a one-off experience with a very short lifetime (excluding MMO games). So there is no way they could be constructed through subsequent donations and evolutions.

Add to this the fact that open source communities are only made of programmers (because they are the ones benefiting most from the network effect and from incremental integration of software components), while games require other kind of professionals. Eg: volunteer designers in OSS world are mostly non existent; most of them are on the payroll of some sponsor.

I agree with this. I've been playing Final Fantasy XIV which has a monthly subscription fee. It's refreshing after Guild Wars 2 which was constantly trying to sell you something in the gem store. Unfortunately, I doubt many companies without the name recognition of SquareEnix/Final Fantasy could pull it off though.

The obvious solution is to put a cap on IAPs. Once you've paid however much it should have cost to buy the game outright in the first place, everything gets unlocked.

Unfortunately, that won't happen because it's much more lucrative to raise a generation of "gamers" who don't know any better than to provide a continuous revenue stream in exchange for the occasional dopamine hit.

Most people who play it would still never pay for it though. Mobile games are somewhat dependent on whales to justify the costs of upfront investment. It's more like one person paying for 10 other guys who can enjoy it for free.

More like 100 than 10.

Playstore is horrible for matching buyers and sellers. You can filter games by category and that is it. Plus, mobile games reviews are practically useless. I can not even is no way to guess difficulty nor whether I will like the game.

The problem is, there are hundreds games coming out for Android every month. I might like maybe five of them, many are of them are crap and many many more are good games - for someone entirely else then me.

Tell me, how do I find those five I might like? Useful reviews are practically non existent. I'm not willing to pay 5$ for something I will probably play for 10 minutes.

In order to find 1 game you will like, you have to buy maybe 10. So, basically, those games I do not like count into my games budget. They are partly reason why I'm not willing to pay much for one game.

If there were a way (maybe curated storefront) for me to know in advance I will be playing this game for hours next two months, I would gladly pay those 5$. I would see it as cheap. As it is now, it is 5$ for something I will likely not play at all.

so.... You're ok with the "few levels for free, then pay more the rest" model?

The most lucrative path is NEVER to rip your customers off or sell a basket of virtual blueberries to children for 50 dollars each.

That's the solution of someone thinking one quarter ahead.

If a game company cannot find a way to be profitable without IAPs it might want to find something else to do besides make games.

> The most lucrative path is NEVER to rip your customers off

Las Vegas begs to disagree with you.

That's because Las Vegas is actually fair to the extreme. The odds are in place, they are what they are, and if you hit the lucky number, you win all the golds. There's no deception at all, except for that people enforce on themselves when they go there expecting to be that lucky winner.

Not quite.

As a simple example, slot machines are actually implemented as raffle tickets, not mechanical random generators. But not losing plays are deceptively displayed as being "almost" winners. You get a "star star (half star, half bar)" far more often than if the machine behaved the way it appeared.

Then of course you have free alcohol during bad decisions, no clocks, upsells for crap like "insurance" at blackjack....

And if you play blackjack as well as possible, they kick you out.

Why would they? Isn't it impossible to beat blackjack in a long run with 6 decks and such?

Not impossible, but you do have to do some brazen, easily-detected stuff like watch the table for awhile and refuse to sit down unless the count goes positive.

What's that old line..."The markets can remain irrational longer than you can remain solvent."

Similarly, even though a player may lose asymptotically to the house, they can be quite annoying in the short run.

Vegas is not ripping you off. Vegas is selling entertainment of the game, not winning. Except small percentage of professional gamblers, most people won't go to Vegas if not for the experience that surrounds the gambling process. Otherwise you could just as well play state lottery or gamble on forex markets online. Would also save on the plane ticket.

I was using "Vegas" as shorthand for "the gambling industry". Which is selling an addictive product that makes people worse off in direct proportion to the amount they consume. Which, yes, sells the hope of winning. Talk to anybody on a flight to Vegas and ask them if they hope to win. If they're playing, they're not playing to lose.

There's a difference between hoping to win and hoping to win being only reason of going there. If you ask me whether I hope to be a billionaire one day, I'd say, sure, why not, I'll take it. But that's different from actually working on becoming one.

But if they are happy to spend their money on the playing of the game...it's not like they are being tricked any more than the purchaser of an overpriced handbag.

Go to Vegas. Look at the expressions on the faces of people playing. Almost nobody looks happy there.

As far as I know, handbag addiction is not a serious problem. Gambling addiction is.

No kidding. Some say the odds are known, so you're not being ripped off, but that's not always the case. Beyond that, there is a science behind separating you from your money: free drinks, no clocks, no windows, ugly carpet and ceilings to keep you focused on the games, slot machine sounds, and likely a bunch of other stuff that we don't even know.

I'd say undertaking such a massive clandestine effort to liberate you from your cash is pretty customer-hostile.

I don't think the successful casinos today are as profitable as they could be. I believe they can be MUCH more profitable than they are now.

Then you fail to understand the sheer amount of analytics and data casinos use to tweak everything to "perfection"...

But but but San Francisco hipsters invented data science! No-one was optimizing their businesses based on numerical data before!

And you fail to understand the sheer amount of incompetence present in the gaming industry. You also overestimate the amount of anayltics (or even anything you could call math) happening in the gaming industry.


casinos fail all the time.

i'm not talking about keeping what casinos have right now and "tweaking" that. I'm talking about a reimagining.

Casinos fail all the time because they as everyone else have fixed cost, and in the Las Vegas style casinos especially because they are not just casinos but massive hotels or resorts where the fixed costs are absolutely huge. There's certainly lots of room for innovation in that area, and in attracting gamblers.

Casinos don't generally fail because they don't know how to tweak the odds.

I think you and girvo are talking about different things.

Why is that not the most lucrative path?

That seems to be the most lucrative path by far. There are always more whales that make serving the 99% of players worthwhile.

Most people just copy whatever everyone else is doing without thinking about it very hard. Hopefully people will eventually get tired of being nickle and dimed by their video games, and come to appreciate the advantage of paying upfront for a game and being done with it.

It is sort of funny to see people arguing about the most appropriate way to finance the activity of wasting time. There of plenty of games, movies, books, etc for people who want value for money, lots even of free value, and plenty of free crap to waste time.

There are now enough good games in the universe that I have trouble imagining the person who can legitimately think, "I have too much time, I should play some garbage to fill it."

> 1) People seem to balk at paying >$5 for a mobile or tablet game. (With some notable exceptions.)

The dotcom bubble of the 90's taught people to expect everything they do on a computer to be free. We're still digging ourselves out of the very deep psychological hole that VCs of that time dug.

Not the VCs. The natural scaling costs mean that marginal cost is cheaper than the hassle of billing. The trick is how to cover the overhead.

Spotify for games

Why not offer the customers an option? Download the game free with limitations that you can buy in game stuff to get around, or pay $5 and have the limitations removed (or an unlimited amount of the in game currency whatever. Sounds like the next logical evolution of shareware, to me.

You would probably get a lot of people who would download the game free, try it out, maybe make some in game purchases, then decide to upgrade to the $5 version, so you would make $5 + whatever they spend on in game items before upgrading. (Or whatever price you decide to charge). You won't be making hundreds off anyone, but you'll probably get more bites overall.

If you're honestly asking, the reason this isn't done is because the main source of revenue for these free to play games are the people who become addicted. ("whales") They spend enormous amounts of money and if they had the option to just upgrade then this would cut the legs out from the main chunk of the revenue the game generates.

I would personally buy jelly splash from wooga for 20 bucks but I would not spend anything in-game as it seems like cheating to me.

If you make that an option, then children might not spend $500 on their sword upgrades.

What child has $500? "Whales" are adults. (Usually, specifically, they are people in high-stress/high-reward jobs, like finance, who want to release their stress by throwing out their rewards. Same as casinos.)

Children use their parent's phone, there were a spate of cases recently where children's apps had a ton of expensive in-app purchases and hooked children ran up $2000-$3000 Bills

This happened to a friend of mine. Her grandson only 4 was able to make many in app purchases to the turn of hundreds of dollars.

They're mostly addicts who still have room left on one of their credit cards.

Apple could solve a lot by introducing video previews or game demos and overhauling the shittiest rating system on Earth.

Apple could put an spend curve next to each game too presumably (if they don't have stats they could make it a requirement of entry to the store to furnish them going forward).

Then you'd be able to see easily that more than 50% spend more than $10 on that 99¢ app and factor that in to your purchase decision.

Some apps, of course, do this. Paper on iOS, for instance, is a free app that relies upon you buying each of the tools. Alternately you can buy the whole set of tools for a given price. There are official emulators (e.g. Atari) that let you buy individual games, or you can buy the set for a price.

for me though the evidence of intent is in having $39 and $99 level tiers. There's no way to expect that to ever be "reasonable" for a mobile game. I could go with up to about $20 in IAP. For instance the Settlers of Catan iPad game is rather expensive at $9 up front with expansions at $2 - $3 each that match the paper version of expansions and you can easily sink $20 in to get all the pieces, but you don't NEED all the pieces to play the same game that's in the paper version box. Many other games do a very fine job of using it to unlock new "expansions" as they add extra additional effort to the game every few months. Those ultra expensive tiers are nothing but "click bait" to see if children and/or stupid people will "just pay it".

I did half to laugh that the reviewer clearly never played games like farmville. That worked out really well with it's timers and everybody checking in a few times a day to manage their items. so he's a little overreacting. That said, this new game looked really nice but I won't be buying...and I was already skeptical because it's EA. EA has plugged $50 games with this kind of stuff. I wasn't really holding my breath here. I don't want to play "dungeon-ville" I want to play an RTS.

The problem is that somebody could probably put this together for say $20 without using servers at all. But the App store buyers are so stingy with expensive games, only really established games like Final Fantasy can get away with more than $10. So they have to have some other way to get the $20 or even $10 or they can't make ANY GAME to sell you because they have bosses.

In some cases IAP actually facilitates better games. Developers can put in enough effort to get the base game up and running, and then use IAP to spur additional content development throughout the life of the game.

I'm thinking specifically of Hero Academy here. A really neat little turn-based strategy game which cost a few bucks when it came out, and had (I think) 3 teams to choose from the beginning. More teams or different skins for your team cost extra. This was the best use of IAP I've seen, and facilitated the devs getting what was essentially a proof of concept out, then building on it.

For gamers it gave you the freedom to just buy the base game, or only pay for the additional features/teams etc that you felt were interesting. I would never have paid $20 for that game off the bat, but because I had the freedom to choose what I DID buy, I probably ended up spending a lot more, and happily so.

So IAP is not inherently bad, it's just frequently (and intentionally) misused to turn games into cash generating slot machines via intentionally bad game design. It doesn't have to, and isn't, always that way.

>1) People seem to balk at paying >$5 for a mobile or tablet game. (With some notable exceptions.) 2) The $0.99 or $1.99 price point is not financially viable for most games.

This sounds like: I want to sell for $5 but customers won't buy my product at that price.

Well, in that case your product, however much your toiled and however much you spend to make it, is not viable?

> Well, in that case your product, however much your toiled and however much you spend to make it, is not viable?

Exactly, it's not viable. Only IAP driven games are. That is the problem being discussed here.

Sounds more like a fact than a problem.

The problem is that everyone with opinions hates IAP even though they're ridiculously good at making money.

.. except is can be made viable by changing the charge structure; that's the whole point of IAP.

It defies simplistic supply-and-demand analysis because there is no longer just one price, but many; the customer has to make a constant series of decisions about the value of instant gratification. Some people hate this.

The problem with that logic, as much as I'd like to believe it, is that customers seem to be very happy to pay >5$ after "buying" the "free" game in IAP. And because "free"+IAP is the norm these days, customers scoff at expensive games. Why pay 5$ if you can get another one for "free"?

I'd much prefer the free demo + paid full version to be honest as I'd like to see if a game is worth it. If it is, I'm happy to pay a decent price. Then again, I might be a minority.

The marketplace isn't viable. Refunds aside, people aren't willing to spend that level of money on a mobile game when they don't know if it's going to be good or not (and many are not).

SquareEnix sells some ported versions of older Final Fantasy for around $15, but I doubt many other companies could get away with that.

If software refunds existed as a matter of course then up front prices should make a comeback. Otherwise the customer must trust marketing and we know how trustworthy that is.

If I pay anything for an app, I hate the fact that after I'm bored with it, I'll usually leave it on my device since I paid for it.

If you think in app purchases are bad, you haven't seen skylanders (activision) or infinity (Disney). These games require action figures to experience the game...wouldn't be so bad if each action figure wasn't over $10!

$10? I'm guessing you don't collect anime figures.

LOL, from the perspective of someone who routinely buys anime figures >$50 I find it funny. Although, I guess there is a big difference when you see the value (more of an artistic value to figure itself) rather than as a secondary instrument to play the game.

Solution: make a game free with a small number of free levels and sell unlimited levels for a fee as a one-time in-app purchase.

I (naively) hope that eventually people who prefer microtransacions will realize what a waste of money it is, and start paying upfront. But seriously, maybe a good solution would be to design the in-app purchases in a game so that instead of endlessly paying for consumable items, one would pay for actual game features. That way, you can play the basic game for free, and then start "constructing" the full game piece-by-piece by purchasing individual features. For example, an RPG where you can play the warrior for free but then pay $X each for additional characters. Or a "dungeon-keeper"-style game where you can pay to unlock more types of monsters and tools.

Radiant Defense on Android works exactly how you described. It's a tower defense game,where in the free version you are given some towers, but there are a few which are locked behind a paywall - so you have to purchase like 6 separate packs to unlock them all(totalling like £8), but once you do, that's it, you own the entire thing and there is nothing else to buy.

>I (naively) hope that eventually people who prefer microtransacions will realize what a waste of money it is, and start paying upfront.

You mean like getting a NYT subscription for $200 dollars, instead of paying for the 10-20 articles I want to read all year for like $1 or $.5 a piece?

Well, not developing for mobile is one option.

There is a solution, but it won't work:

1. Release games for "pay what you want, whenever, as many times as you want".

2. Educate people that if they don't pay voluntarily for things they want to support/see more of, they will end up living in a world where they're forced to pay for crappy non-games (e.g., the micro-transactions above).

It won't happen cuz most people aren't smart enough to see the benefits of paying for things they want to see more of/support voluntarily. I wish they'd be, but it doesn't seem so.

You get what you pay for is pretty applicable here.

An important thing to keep in mind is that #1 here is the state of the affairs after the fact, i.e., when people can see many games that are apparently free built using the IAP concept.

Dan Ariely noted that the mobile app industry has done this to itself by ... well better read in his own words: http://danariely.com/2011/12/25/the-oatmeal-this-is-how-i-fe...

This article hit on something very true... I used to LOVE games. Many of the top programmers I knew got their start making awesome games. Now the people I know getting into games are experts in gamification. And the games are absolutely awful. They just try to play into our personal addiction.

To limit addiction, I refuse all in-app purchases for games. As such, games suck for me, and I now hate them.

I think we have to give additional purchases some degree of legitimacy; look at EVE Online and the upcoming Star Citizens of examples of in-game purchases that, at the very least, are not dark user patterns or scams.

I generally find in-app purchases on iOS games to be scummy as hell, though, so the big problem is probably that it's a Wild West for dark user patterns in games on the App Store.

Online games are more amenable to legitimate purchase models.

When the game is entirely offline, though, it's just nuts to require the player to put in more money.

Contrarily, if you introduce pay for performance in to a competitive online game, it completely fucks the competitiveness.

We can accept sports where players and teams spends millions of dollars of on training, equipment, etc. What if instead the team just paid the money to buy additional points from the referee?

Yeah, that is not a game.

The appropriate way to do this is to make premium/paid items cosmetic only with zero influence on game play. If your game blows, this model doesn't work.

Sure it is. It's called "United States national elections".

I know this might be crazy, but what about Apple/Google setting a floor on app prices? What if no app could sell for less than $2.99 or even $4.99? Although, I'm sure that would probably result in less money overall for Google and Apple, so it would never happen, but if customer expectations were at a higher price point, maybe the developer options would increase.

I disagree with this because I think that there's a lot of cases where a free or very cheap app makes sense, but maybe they could do something to better surface the IAP pricing. I think metrics like the average amount of money spent by users or the highest IAP amount displayed prominently next to the app in the store would make it so that apps that try to pull stuff like this are much easier to recognize before the user downloads the app and invests time into it.

They could still allow free apps, for FLOSS software and glorified web browsers.

I think Google/Apple are happy with the game developers figuring out the solution to maximize the profit. They take a 30% cut.

It makes sense for Google, but I don't understand Apple's motives at all. The IAP model ruins gameplay for everyone but the whales. But Apple is making most of its profit through hardware, and now I (as a non-whale) have lost one of my main reasons for buying an iPad. It used to be a great casual gaming device.

I guess I'm just gonna play Carcassonne on iOS 6 forever :)

> I'm sure that would probably result in less money overall for Google and Apple, so it would never happen, but if customer expectations were at a higher price point, maybe the developer options would increase.

Given Apple & Google take a flat 30% of money coming in, if they get less money, that means developers are also getting less money. So I don't know how that would increase developer options.

I think part of the problem is not having a decent try before you buy option in the major app stores. Since the app stores manage purchase and licensing, it would be easy to remove apps after the demo period. The 5+ years of free and .99 cent apps created a psychological barrier that still stands today; thus the rise of IAP.

>I think part of the problem is not having a decent try before you buy option in the major app stores.

Part of the reason for this is that the games suck. When a game is good, word of mouth tends to spread it.

IAP isn't just a mobile concept, the non-mobile IAP sector is as large as the mobile one.

The desktop game CrossFire did $1bn revenue last year through micro-transactions:


Emulate a demo as much as possible without breaking the guidelines of the Play or App Store. I feel that once I put money into a game once, I should be done. With that being said, it can be hard to make a $10 investment based off of 4 screenshots and a description.

I don't care if a game has IAP or not. I do care Bout how playable the game is without IAP. Blocky Roads could probably start offering cars or road packs as IAPs and people would buy them. That's not destroying the game.

By making in-app purchases valuable and small, people are more likely to spend more on engaging games. This can increase TLV for good, replayable games.

The solution is for more people to build games simply for the love of building games. For example see Dwarf Fortress.

Nope. They've already been doing that for decades. The games industry is like the music industry in that regard. There's no shortage of people who are making games for the love of it. The vast majority of them will just never be able to support themselves doing it.

Free trials.

Most soldiers after returning home find themselves in an awkward spot, killing is the only thing they do right, and having a PTSD doesn't help to pick other skills, so their only pahts are:

1) They become hitman, even if its socially unacceptable

2) They become mercenaries even if it is for enemies of USA

3) They commit suicide

So what's the solution? If people is unwilling to let them kill everyone in sight how does a soldier profit from their work?

This is a honest question, I generally hate mass shooting and soldier suicides.


When thinking about gaming business models it's important to think about the context in the history of gaming.

Since in the 1980s in addition to retail and digital sales the business models we've seen have included:

  * Pay-to-play arcade games
  * Premium hint lines
  * Add-on content sales
  * In-game sponsorship (Zool, sports games)
  * Shareware
  * Advertorial games (McDonalds Land)
  * Subscription fees
  * Peripheral sales
  * Real money betting
  * UGC Rev shares
  * Membership clubs
  * Game rental
  * In game ads
  * IAP 
  * Virtual items
IAP is likely here to stay, but just like the many many business models that have existed before, it'll likely become one of many in use.

Many apps use several of these business models at the same time - buy in game currency with money or watch in game sponsorships to earn it, then use that currency to buy virtual items.

Gamers have voted with their wallets for this outcome. (Dungeon Keeper retailed for $60, not $6, at launch. I couldn't afford it so I checked back weekly, and then found the best deal of my life six months later: $9.99 with a $20 manufacturers rebate.)

Minus the rebate thing this is the traditional curve for IP price discrimination: you pay more to get faster access.

Gamers thought both $60 or waiting one day, to say nothing of 6 months, were monstrously unfair, so they pirated the games. So the industry did a rethink, and figured out a way to give them what they want. Enter Free To Play.

> Gamers have voted with their wallets for this outcome.

This is a popular shared delusion. It is such a great intuitive and false truth, that when George Akerlof informed us about this about 50 years ago he got an Nobel price for his effort.

"The Market for Lemons: Quality Uncertainty and the Market Mechanism" inform us how the bad drives out the good when there is an information asymmetry between the buyer and the seller. It uses the market for used cars as an example of the problem of quality uncertainty, but software (games) is several order worse in this aspect. Even a game software developer can not assess the value of a product through examination before purchase, so the only hint available to customers are reviews (such as those provided in this HN linked article). Sadly, reviews are not enough to reverse the information asymmetry, as proven by the article point, so the lemon games are driving out the good games from the market.

However, contrary to the article I do think we can escape. Strong reputation systems can combat it if used correctly, but for-profit gatekeepers like Nintendo, Steam, and Apple has shown to be affected by short-term thinking and corruption. Thus, we need better reputation systems that the customer can trust long-term for the lemon market to reverse. That or better customer protection laws to increase the risk of selling a lemon game vs the scam of "free to bleed money to play".

I strongly disagree with the assertion that gaming is a lemon market. The information asymmetry doesn't exist and I think the analogy is flawed in this case.

The key part of Akerlof's used-car market is the information asymmetry that exists for every instance of a car. Two caryards may have the exact same year/model/colour of Toyota camry. One has no serious flaws and is priced at $1000. The other is priced at $500 but has lots of hidden problems and is a real lemon. To the consumer they look the same, and the logical choice is the $500 car. The $1000 car never gets sold. This is the lemon market in action.

Software is different because when you sell 100k units of software, its a reasonable assumption to believe that all of these 100k units are the same piece of software[1]. A game being reviewed, or upvoted on reddit, or aggregated on metacritic - this is the same software I will recieve if I choose to purchase it. Thus there is no information asymmetry.

If anything, the market has become better in this regard. It is easier now to choose a high quality game. When I was a kid, and lucky enough to have enough dollars in my hand to purchase a video game - I had to make my decision based on the cover art of the SEGA cartridge. Perhaps if I was lucky I would have some entirely objective (cough) information from the Official SEGA Magazine.

[1] Yes, some people will experience the game differently because of device compatibility issues, but that information is also shared (ie Google Play filters reviews by people with the same device as you).

The argument you put forth has already been done against the case of used car salesmen/saleswomen. The argument is that those people rely on reputation to sell successfully, and thus reviews from previous buyers will fill in the gap of information asymmetry to new buyers.

If the customer collects the critical information about the product from other buyers before purchase, information asymmetry can always (even with used cars) be removed. However, the buyer must also in practice be able to assess the value of a product through examination before purchase. If consumers in the general case do not inform themselves by reviews and shared customer experience, information asymmetry will happen.

So when a game is released with horrible user reviews or below working condition, they still tend to sell perfectly well. Even in cases where the developers themselves has admitted the poor state and given refunds, the games sell perfectly well. In a world with information asymmetry in games, Simcity and Rome 2 can be commercial successes, and even Ride to hell sells copies.

If you believe that there is no information asymmetry in games, how do you explain the discrepancy between reality and theory?

The media-as-a-product model is breaking down for games the way it has or will for everything else (journalism, music, movies) because in a competitive market, marginal price trends toward marginal cost, and the marginal cost of digital is nothing. More than that though, is that in a connected world, basically anyone is able to become a competitor selling low-quality junk for basically nothing, or a pirate giving away your stuff. Being able to publish is no longer a gate that can hold prices high. We are in the twilight of this short-lived infinite marginal price to marginal cost ratio of digital publishing, and the games publishers are scrambling for the last rays of light by selling non-scarce product inside the games instead of the games themselves. This too will end as they eventually alienate enough of the customer base that they have to adjust their strategies to something economically sound.

If it turns out for games (as it did for journalism) that people just aren't willing to pay as much as they used to for good content then we'll see a smaller market. Whatever audience there is of folks that are willing to pay up-front for a good game (sans manipulative bullshit) and the developers able and willing to make those games seem likely to find that crowd-funding is their best option - publishers not required. Game-as-a-service (MMOs) have shown that they work well, and will need publishers if they're to have high budgets and quality that players expect but players demand there to be some amount of service (you can't pull a SimCity without pissing them off). There will always be some amount of this IAP model, but it'll have to become tasteful enough to be sustainable in a world where the available audience of fresh unalienated suckers is exhausted (Valve's use of IAP is a good example of what this is likely to look like). I think (or at least hope) there's not enough gamers willing to be repeatedly abused to sustain a whole market of abusive IAP games forever.

I think that "We give you the client for free. We control the thing of value on our servers. We will rent you access to it." is both a) sustainable and b) almost completely robust against any attempt to "compete" with the company by pirating the product.

With regards to the sustainability of IAP: As I've told people for a few years now, take a look at China/Korea to see where the American companies will be in ten years. They were doing IAP and free-clients-with-content-controlled-by-server back in the late 90s. They're still doing it.

So many people forget this. I've spent a lot of time in South Korea a few years ago (nearly 12 months altogether). This is normal there, and most people are okay with it. Yeah, some publishers and developers take it a bit far, but a lot of others don't. Combat Arms/Warrock sort of had a pay-to-win setup -- you bought weapons with in game cash, or could buy them outright. But, play a few games, get some cash and suddenly you have the same weapons those who have no patience did, and more importantly it was a twich based skill FPS -- even if you had the best weapon, I'd still headshot you with the base M4 before you knew what was happening. And then I'd gloat, cause I'd be playing with 16 other guys in the games cafe at 2am... Sorry, reminiscing is fun :)

Anyway, truly, it may seem like the end of the world, but I don't think it will be. It'll just be the new normal, and you'll always have those devs that don't take advantage of pay-to-win, and everyone has fun, and developers make money. Seems like a good trade off to me.

Bullshit. Free to Play was not prompted by piracy. It took over the industry via the Apple App Store which supposedly has the best piracy protection for game developers yet! Free to Play got a foothold due to the race-to-the-bottom pricing for moving up the charts of the App Store.

Free to Play is also the business model for the largest PC games (by playerbase), like League of Legends. It is being adopted in fits-and-spurts by the largest and most prestigious game developer, Blizzard. It hasn't totally monopolized the console games business yet, because they still care about their relationships with retailers, but I'd put money on it doing so within 5 years.

The dynamics of App Store discovery exacerbates FTP, but it clearly didn't uniquely create the viability.

Should be noted that it's not impossible to create a game with an FTP+Subscription+IAP pricing model where IAP has a strictly limited effect on actual gameplay and most of the core game is accessible either at the free tier or a modest subscription.

Usually, such games are still lower quality than the equivalent game with a shrink-wrap or subscription model, but the IAP infection is more like a festering sore than the terminal cancer described in the OP.

I prefer the narrative in which sales on Steam are the popular response to high pricing (and DRM), and where Free To Play is something that bad guys do to exploit people's psychology (tapping into the same mecanics as casino do).

You are framing it in a way that makes Free To Play the only valid response to piracy.

Gamers have voted with their wallets for this outcome. (Dungeon Keeper retailed for $60, not $6, at launch. I couldn't afford it so I checked back weekly, and then found the best deal of my life six months later: $9.99 with a $20 manufacturers rebate.)

This seems backwards or insufficient to me. It seems to me that what's happened with the wallet-votes is that IAP is a way to maximize exposure among people unwilling to pay and maximize revenue from people willing to pay a lot, while mostly ignoring everyone in the middle who want a quality game at a reasonable price (the traditional core videogame audience).

It's not really price discrimination because PD is usually about getting people to pay more for the same product. In this case, "free-to-play" is not getting the same product as the users spending yachtloads of money.

It's not a lemon market, it's a cleverly-disguised luxury market.

iunno, i fancy myself a "gamer" and i don't play any game on mobile. i keep trying them from time to time. i paid a few - never paid one based on microtransactions.

Heck even paid some that THEN required microtransactions, that sucked... in these cases i mailed the authors to tell them to go to hell.

I play a few recent games on pc/consoles, and quite a few old games which seems to still be fun. DungeonKeeper actually is one of those good games ;-)

The last game i enjoyed on mobile was carmageedon, which happens to be the exact same game as on PC (which i also bought a long, long time ago). It was fun and i completed it in a couple of days, having fun. Probably my best mobile game ever, and i fear, the only one too.

Because of the nature of IAP-based game design, I don't believe this is really about the revealed preferences of gamers. There's widespread hate for IAP among gamers. Zynga or whoever was first discovered a way to exploit players. There's a level of deliberate manipulation in the design of these games that just can't be paralleled with charging up front. Companies even update the game in response to the telemetry they're collecting, trying to find ways get players to spend more. The dynamics can't really be compared to the honest exchange of a product for money. I think that's why it engenders such hate. I realize people weren't too happy with $60 games, but as far as I could see, great games always did very well.

What people hate is paying money. Full stop. Oh sure, there's always the "I'd pay for that if..." or the "I don't mind supporting stuff I like" (as though this were charity), but this is talk and talk - like bullshit - is cheap.

In reality, the vast majority of people won't pay unless they absolutely have to, with "absolutely have to" meaning "you'll go to jail on criminal charges if you don't." So assuming you're in a situation where people really must pay, the question becomes "How seamlessly can you integrate payment extraction into your providence of value?" In the case of airline tickets, groceries, and auto repairs, the answer is "Pretty easily, actually". As a result, payment extraction is a solved problem.

With the non-negotiable inevitability of payment accepted, and the means to pay made as frictionless as possible, people don't think twice about handing over their credit cards the moment a demand is made. When people expect to pay, producers can expect to get paid. It's just that simple. Businesses compete for the custom of those who accept the system and it call the cops on the tiny minority who don't.

The problem with IP is that the legal system that protects every other viable business has imploded. And it's not about "just inventing another business model" since the unsolved problem of human nature means having to produce a new law enforcement structure to back that model up. Devolving to private enforcement (e.g. the Mafia) is an obviously unacceptable outcome, so instead of telling IP producers that it's up to them to "just invent new models" it's really time for people to recognize that law and law enforcement are the responsibility of citizens, not corporations.

If you want a smooth and efficient market then come up with the laws and enforcement mechanisms that (a) this kind of market requires and (b) you can live with as a society. In the meantime, expect suboptimal solutions from producers who have been left to squeeze whatever cash they can from the teeming hordes of assholes who think payment is debatable.

paying 3-4000 USD for playing a game.. yeah.. yeah people hate paying that. I doubt ANYONE finished dungeonkeeper on mobile, for example..

This looks like a bunch of baseless assertions. Good games sell. I'll just pull one example out of the air - Portal 2. Relatively recent. PC version sold over 2 million copies. And iOS games are harder to pirate than that. As far as that goes, mobile Minecraft has sold more than 15 million copies, and it's priced at $7, a price point I bet a lot of people would think is high for a mobile game. I think what a lot of people see as gamers not forking over money is really game developers with delusional expectations of pushing a lot of uninspiring shit games.

Times change. Converting demos into premium purchases used to be a viable business model, but it's not anymore. Selling premium games on the app store used to be viable. It's not anymore. You've got access to balance sheets - would you disagree?

Re: "widespread hate for IAP among gamers", that only applies to gamers, who compose a negligible part of the overall population. Any company that's trying to target the wider market ("people" instead of "gamers") is right to ignore what gamers think, because gamers are not the ones playing Candy Crush, Bejeweled, Farmville, etc.

IAP can be done well, IMO, but it requires game designers to accept and embrace the model. If they view their target market as exploitable simpletons, they'll neither make a good game nor make much money, and this happens too often (as I'm sure you're aware). This doesn't need to be the case, though it does require some care to do it well and make sure that the free experience is valuable to players while still providing compelling opportunities for people willing to pay to do so.

Re: updating games in response to telemetry, why is that any worse than when a website A/B tests different calls to action? Or do you think games should not optimize to be the most profitable businesses that they can be?

I'm almost out of energy for repeating myself on this point. Every good game that I can think of offhand made plenty of money. Right up to the present day. Selling a game for money is still a plenty viable business model. Now, ok, yes these freemium Skinner box things are not games in the same sense I and other gamers are used to. Just like slot machines have nothing to do with Grand Theft Auto, this new breed of F2P 'games' have nothing to do with Portal. What's unfortunate is that companies that used to make good games are selling out, in the very essence of the phrase. In my opinion, it's not because what they were doing before isn't viable, it's because their management is that admirable combination of greedy and risk-averse.

Sadly, the gaming public has brought this fate upon itself, because so many people don't respect game developers and routinely pirate the results of their hard work.

I remember having this discussion on forums like Slashdot a few years ago. I argued that although pirating games was easy in the Internet age, if people kept doing it then the only surviving game developers would be those who adapted to models that prevented it. The usual response was mumbled with the eloquence of a five year old, and said something about copyright infringement not being the same as theft and whatever the developers did someone would just crack it so why should anyone pay for games?

Fast forward a few years, and almost all the AAA games are heavily linked with some on-line element and the most successful games tend to be either multiplayer subscription models or rely heavily on in-app purchases and DLC. If you actually wanted to make a good standalone, single-player, one-time-purchase game today, I wonder how hard it would be to make real money on it. It seems like the only winning options along that path are to make a relatively low-budget game like a puzzler and sell it for an order of magnitude less so it's attractive to a long tail of customers and/or to be hit-it-out-of-the-park successful. Of course, for every Minecraft or Angry Birds there are probably thousands more titles that never quite made it.

I have some hope that crowd-funding models will help to end this kind of stand-off, because they tap into a genuine desire many gamers have for good and original titles to play but they also bridge that reality gap and illustrate in concrete terms why money is needed to make them. I've seen several very promising games get funded far beyond their original goals on Kickstarter, including RPG, RTS and even space combat titles. Whether any of them will actually be able to pull off what they promised with slimmed down teams remains to be seen, as I don't think any of the really big ones have actually launched yet, but this is a field where I'm optimistic about an alternative model to the old copyright vs. piracy conflict.

I am suspicious of your explanation.

Who pirates iPad and iPhone games? Approximately nobody. But the problem describe in the article is acute for game publishers regardless of platform.

The public has brought this upon themselves, sure, but more by being cheapskates. And I think Apple has contributed to this as well; their app store design isn't helping.

On the iOS family you can install Cydia which lets you install 3rd party non-apple-sanctioned apps. This in turn let's you download things like Installous which lets you download every single popular App for free, pirated.

There is a HUGE amount of people who pirate iOS apps.

I just don't believe it, not without data.

The approach you describe requires a jailbroken phone, plus going through a lot of shenanigans. Even most of the nerds I know haven't bothered to jailbreak their iPhones. I'm very skeptical that a significant number of civilians do it. Certainly not a significant number of civilians who would otherwise pay for games.

I've talked a lot with friends who started an iPhone games company two years back. They have mentioned a ton of issues in the marketplace, but worrying about piracy has never come up. Ever.

You're assuming all people who pirate jailbreak their phones themselves. Nope.

Lots of people pay some kid to do it and install N amount of apps.

I'm not assuming that.

I've seen no data on "lots of people". Even if it happens, I've seen no evidence that it's a significant concern of people writing iPhone games. And if it were a significant concern, I'd still be skeptical that there's a real financial impact, as opposed to the erhmagerd school of "they are stealing my precious things" freak-out. And if there were a measurable financial impact, which I don't think there is, then I'd expect it to be an order of magnitude smaller than the concerns raised in the article.

This is silly. You're suggesting that at one point, there were high quality games that people pirated in the first place. I was in the mobile games industry for a while. There weren't and saying that a "HUGE" amount of people pirated those games is total bs.

[citation needed] I have hard time believing HUGE amount of people jailbreak and pirate, given that most people wouldn't know their way around jailbreak and with all those iOS upgrades you'd need to re-jailbreak it at regular intervals.

In Asia, you can walk into most malls, go to the Electronics section, and almost every other vendor will have a dirt cheap (in US standards) offer to jailbreak your phone for you. From there, a basic upsell (or free with jailbreak) is to install any iOS app they have in their library for free.

Just because it doesn't happen here in the US, doesn't mean it's the same everywhere.

I've heard Martians do that too.

The fact that people in Asia (who did not buy games 20 years ago and do not buy games now) pirate them is completely irrelevant for the actions of the US market. Unless the argument is "Americans don't buy games anymore because Asians pirate them".

I was just responding to "I have hard time believing HUGE amount of people jailbreak and pirate". Someone else is contending that if a significant number of people pirate a game, it can affect their server costs/performance.

In any case at least 80% aren't pirating (since iOS 7 had 80% user share before the jailbreak came out). 80% of the iOS market should be enough to survive on.

I sincerely doubt that's true. Like, really, it's a ludicrous claim.

I know no one with a jailbroken iOS 7 device, and it's enough of a pain in the ass to get Cydia onto iOS 7 that very few people have bothered.

Piracy is actually fairly common. One of the dangers with an iOS game is that you have to make sure that your per-copy expenses are low. For example, if the game requires server capacity, you must make sure that the lifetime cost of the server per user is much lower than the purchase price, because pirates will cost you money without giving you any. There's at least one well-known failure due to this problem, and I'm sure it influences lots of other games without being obvious.

However, it's still really different from piracy on the PC, because the piracy is still limited. With the exception of per-user costs like above, it doesn't matter how many people pirate your game. What matters is only how many people pirate it instead of buying it, and the high barrier to piracy on iOS means that most of your potential buyers won't pirate.

Would you mind naming the well-known failure? I'd be especially curious to see links that describe the situation.

Sorry, that was just my laziness leaking through, as I thought it would be hard to actually dig up. But it turned out to be easy! Search for "Battle Dungeon".

Who pirates iPad and iPhone games? Approximately nobody.

How many AAA titles with nine-figure budgets and $50-100 up-front price tags are there on the iPad and iPhone? Approximately none. In the world of $1 iFart applications, no-one is even trying to make the kind of large scale, high production value, big budget games we (used to) see on consoles and PC.

Who pirates iPad and iPhone games? Approximately nobody.

Piracy claims are often inflated through the intended operations of the Android and iOS app stores -- with my single iOS purchase I can have it on my iPad, iPod Touch, and iPhone. A single Google Play purchase might be on my two Nexus 7s, and then n variants of phone that I've bought over the years. I've heard complainants in such cases compare installs to purchases, using that as the foundation for their piracy claims, when I alone might have installed the app I legitimately purchased 20 times over new and varied devices, and not one of those installs was piracy.

Remember when Dead Trigger did the whole bullshit "piracy is so bad on Android we're going free to play". They then quietly did the same thing on iOS, hilariously justifying their change as some sort of reward for iOS users, instead of the reality that IAP is far more lucrative than upfront purchases.

However supposedly iOS piracy is overwhelming in China.

That sounds like the old chestnut of blaming pirates for the fade of the album in the music industry. We don't need to invent reasons, the death of physical retail is enough to drastically change the landscape.

I'd say the new pricing models are a consequence of digital distribution, no more and no less. In app purchases were simply impossible with physical media games, why would we assume piracy has anything to do with it? (It doesn't)

>whatever the developers did someone would just crack it so why should anyone pay for games?

Isn't this largely mitigated on iOS with code signing? Unless you jailbreak, which most won't bother with, it doesn't matter if it is cracked, you won't be able to load it.

In the game I'm developing, although it'd be considerably simpler to write it client-side, I'm writing it server side. No point in building something that will be easy to rip off by a "fast follower".

I find that even in games which are generous and you could play them just fine without paying, if I can buy consumables that effect the game it severely reduces the enjoyment. Ben Kuchera said it like this:


>I’m finding it increasingly difficult to enjoy free-to-play games, even those that are designed well.

>Hitting a difficulty spike can make you unsure of whether the game has simply gotten more difficult and you must try harder to succeed, or if this is where you’re supposed to be putting coins into the slot in order to move forward. It’s hard to focus on the story of the puppet show when you’re straining to see the strings, and that’s how many of us feel when we play these titles.

>Playing free-to-play games is often a matter of waiting for the other shoe to drop. Until it does, it's hard to relax. I don't want to have to figure out where the stress of the purchasing decision will be, and having to be faced with that stress on an ongoing basis is a major turn off.

Thank god for PC gaming. So far it has remained immune from so much of this.

The top 2 selling games on Steam for the last 2 months, even over the Steam Sale, are Rust and DayZ, which couldn't be farther from this model.

The closest you get are F2P games like LoL which are not nearly as bad as this, and Dota 2 a competitor doesn't let you purchase a single thing that has an effect on gameplay.

>The closest you get are F2P games like LoL which are not nearly as bad as this

Just to put this in perspective, LoL has more (by 400,000 users) concurrent players than the entire Steam platform.[1][2] I would also put forth the argument that you do gain an advantage by paying for stuff like new heroes which are almost always OP. I think the only element of PC gaming that is keeping more major studios out of the F2P models are dedicated server and p2p gaming where it doesn't make sense and is probably hard to accomplish in any meaningful way.

[1] http://en.wikipedia.org/wiki/League_of_Legends (para. 1)

[2] http://en.wikipedia.org/wiki/Steam_(software) (para. 3)

This reminds me of an insider's-view feature written by Tim Rogers back in 2011 titled Who killed videogames? (a ghost story) [1]. Some find his writing style objectionable but it's worth a read even if you do. Page 4 of the article in particular, which somewhat confusing leads you to "chapter three: engagement wheels and compulsion traps", can serve as a pretty good introduction to F2P mechanics and their dark patterns.

The following quote more or less summarizes the piece:

>[...] “The players will come for the cute characters, and stay for the cruel mathematics.”

There is also an accompanying review of The Sims Social [2].

[1] http://insertcredit.com/2011/09/22/who-killed-videogames-a-g...

[2] http://www.actionbutton.net/?p=1076.

Thank you for linking that insertcredit article - you saved me the trouble. Sure, it's long, it's quite repetitive, and it's cynical as anything.

But it's also spot on for this discussion.

(I'm also very happy the domain is no longer on google's shitlist for serving malware. Not long after that article was published, the site startede to trigger a big fat warning if your browser used safesurfing.)

When I read a user review stating a game has In App Purchases, I don't buy it. Period. No matter how good it looks otherwise.

I'm probably just old, I guess.

I'm not that old—27, so, maybe—but I do the same thing. In-App Purchases signal to me that the game is likely to begin ransoming my pleasure as soon as I invest time into it. It's a very frustrating feeling.

There are too many things out there that don't do that to waste time on a computer game that plays mindgames.

EDIT: I should add the caveat that if it's clear about what the IAPs do—i.e. they're clear addons or a shareware model of an otherwise good game, rather than "this game will progress untolerably slowly unless you pay"—I'm not a stickler on principle. Without more information, though, the presence of IAP is a strong negative signal.

You're old enough to know better. The problem is that for younger kids, this kind of stuff is normal. There are even IAP for fully paid games on consoles/PC (are DLC considered IAP?). IAP are everywhere now.

I've started talking to my kids about IAP in the exact same way I talk to them about drugs - without even realizing it till just now.

A small minority of games have optional IAP which does not detract from the game. They basically do "expansion packs" via IAP, or skinning and nothing more. And that's OK by me, it's essentially freeware for platform which does not really provide a good path for demos/trials. So just "IAP = bad", I don't think that works. If an F2P game looks good but turns out to be unplayable without IAP, or to have IAP up the ass, that's a removal and a negative review, but having IAP is a broken criteria.

IAP can be "pay for more content", or "pay for useless shit to support the developers" and that's fine. It's not fine when it's "pay to actually play" with the intent that having downloaded the software, having a foot through the door, is sufficient an investment to get people to pay.

What's the difference between in-app purchases, and what Quake did (the first episode free, pay for the other three)?

There is a big difference between in-app purchases for extra content (paid DLC, basically) and the model that Candy Crush is such a despicable example of, i.e. pay for access.

Although you could even argue that pay for access IAP is no different than the coin-operated arcade games from last century.

Quake was one time fee. Which is fine for me. Arcade coins - they were roguelikes all of them and the fee was per game and there was no savegames.

If CCS you pay 1 cent per play it is ok. but they should charge it directly and transparently.

Not to mention in an arcade you're playing on someone else's machine, using their electricity, their space, their air conditioning, and occupying a spot that could be used by another customer. It's very much not the same thing as playing a game on my own phone.

Comparing that to IAPs is like justifying a coffee maker that makes me put in $4 for every cup because that's what it costs at Starbucks.

From what I have read, and from what I know of my limited experience, most of the money on IAP games are made from "whales". Most people will download and just play the free levels. Others will spend a little. Some people spend a lot, and from what I know, many of them can afford it. If you offer a $100 super sword they will buy it. This is something to bear in mind as to how these companies structure pricing.

That’s awfully shortsighted. IAPs are not the enemy. IAPs can be pretty awesome, if used correctly.

For example, the Carcassonne app on iOS is the base game (a board game), but you can buy expansions through IAPs. That mirrors how the physical game is sold (you buy the base game and add expansions as you want).

Expansions are basically new tiles and figures that add new game mechanics.

It’s fair for both buyer (they only buy the expansions they actually want but still don’t have to buy the game multiple times in different permutations) and the developer (they make money for the additional time they put in adding expansions).

Actually, I think IAPs are the only way to correctly solve this problem (short of the ridiculous expectation that developers should not make money from expansions), especially since it’s also possible to combine expansions (something not possible if you were to sell different Carcassonne+River, Carcassonne+Princess, etc., apps).

It’s really a shame that stupid smurfberries are ruining the fun for everyone.

I'm working on a game data project and one of the things I'm trying to figure out how to track is exactly this difference.

How can you tell whether a game with IAPs has "good" IAPs -- and the critical path of the game remains free -- or "bad" IAPs, paywalls/gating/pay-to-win? Also, how do you decide whether a content gate is a "bad" IAP or a "good" one?

I'm coming at it from a value-for-money angle at the moment, but I've learnt that people's definitions of "value" vary wildly. Some folks are more than happy to boast about completing Candy Crush without giving a cent to the developer.

It's simple.

IAP of extendable resources is a sham.

IAP of shortcuts and powerups is a sham.

IAP of extra game levels, something that extends existing game universe without changing the rules (and that also maps onto a non-trivial work on developer's end) is NOT a sham.


This jibes pretty well with me, in regards to most games. However, where do games like EVE Online fit in, where (IIRC) a month's subscription is an item in the game world that you can pay real money for and trade with others (who are using their in-game wealth to pay for their game subscription)? Technically it does confer advantages to people with cash to spare (who can bypass normal progression through trade), but the way it links the in-game economy to the real world and the fact that it's an organic, player-driven process and not some "pay2win shop" makes it seem more legitimate to me.

I've never actually played the game, so I don't know how well it works for them, but it's always seemed like an interesting idea to me, and EVE has a lot of hardcore fans that don't seem bothered by it.

So, if I can IAP to get an extra 5 moves in a puzzle game, or infinitely replay the same level and get stuck, never playing the game again, that's a sham?

What about currencies/powerups that I can either get via IAP vs social obligation? I'd rather pay than bug my friends.

(Of course, one argument is that none of these mechanics should exist in the first place. But they do.)

Agree 100%.

I would add that IAP that are have no effect on gameplay (skins, announcer packs, etc) are not a sham.

My guideline would be that any IAP you can repeat is a bad IAP. If you're buying a consumable that's obviously bad; if you're buying a completely different additional game that's obviously ok. In between there's a spectrum; an expansion that requires its own development is mostly ok, pay to level up is mostly bad even if there's a cap on how many times you can do it. And so on.

So if a game is free to download, but you have to buy the last 10 levels after playing 5 already. Would you consider that an in-app purchase? Is this a deal breaker for you?

That is at least a negative indicator for me, and a deal breaker in many cases.

I've played demos in the past and sometimes that has led to a purchase of a full game, and sometimes not. A difference/problem with this newer model is that paying could lead me to being asked for more payments: I don't necessarily know.

If the game was advertised at free, but then charged me after a point (i.e. if I didn't know in advance that it was a demo), that would be an immediate deal-breaker.

Unless it was clear exactly what I was paying for, I would be unwilling. Will I have to pay for level 16? If it was possible I would be asked repeatedly for more money later, I would be unwilling.

Just so you know this is exactly how many games were distributed in the 90's, under the shareware model. Like DOOM and Quake. The first entire level was free, and was a substantial amount of content. Then you paid for the rest.

Yep. I think there's a difference.

When you had to physically get your software out there and into people's hands, that was perhaps a good model.

Now, it's more awkward. Asking me for payment for partial content is a dangerous indicator that you might ask me for more, later.

There's also reasonable evidence that demos reduce sales figures (i.e. that demos act as negative indicators):


The payment is for the full content of the game, not partial content, and there is no chance of asking for more later since there is no additional content. That's the way demos and shareware worked in the past.

That's not bad - that's more like a free trial. My issue with in app payments is that they create game breaking incentives and it's hard to know if that's what they're going to be when you see 'in app purchases' on the main screen.

Most that I've seen seem to require purchases to unbreak the game or make it so that progress isn't artificially restricted by time. I think this effects some people more than others (WoW, farmville, clash of clans players who pour thousands of hours/dollars into the game).

> WoW

Hold on for a minute. WoW is almost the exact opposite of this model, and for that reason I still respect it as an MMO compared to others I've seen.

In WoW, at least when I played it heavily during the Lich King expansion, you pay for the game and for a monthly subscription fee and that's it -- there was no other use for real money other than maybe buying a faster computer or a vent server, but that's outside of the game environment. Buying gold, while possible, was heavily discouraged and bannable.

This policy made WoW feel very fair to teenage me and I ended up putting a considerable amount of time into the game as a result. I realized that it was plausible for me to be the best simply by putting enough time into it.

Additionally, WoW's social environment is typically what keeps the long-term players going (as opposed to ingame objectives, although objectives are important for keeping players engaged), and that's another story entirely.

Actually, I don't know if you've caught the news, but they're in the process of implementing a "automatic level 90" token as an IAP, which will probably hit their store before their next expansion comes out.

I don't personally have an issue with it, but their IAP is encroaching subtly on the gameplay, and it might not stop there.

Right now though, there's an in game Shop button for purchasing stuff in WoW. It's just vanity items, mounts and pets. They do balance a very very fine line - if they let you buy stuff that has a genuine in game advantage, they cross the line, though they're probably quite aware of that.

If they called it a demo, which is what it really is, then no, I would not call it a deal breaker.

If however, they called it the full game, then yes, it is a deal breaker.

This happened to me with FF4: After Years in the Wii. It was advertised as a full game and then I learned that most chapters had to be paid separately (and they weren't cheap). That made me really angry, but now I know better: research absolutely any game I purchase (digital or physical) so that it never happens again.

That's a "feemium" model which also has problems, but different problems.

IAP is open-ended. It targets certain types of personalities. It is exploitative in that you can respond to calls to "help" other players. Addicted "whales" dominate revenue.

You should be able to play the game, and beat the game, without any in-app purchases. It can beg you for add-ons all it wants, but gameplay shouldn't be affected.

I think IAP's to upgrade trails are ok. IE play two levels for free, buy the rest.

That's just one model. Personally, I'd much rather pay for levels than pay for resources that make the game less tedious.

This is definitely the best model. But it doesn't matter.

Up-front, I have no way to know which exploitative model is going to be used. Just seeing IAPs are involved is enough to turn me off. It's not worth the effort to investigate.

Same here, I hate the idea of IAPs and never ever consider even downloading a game that has IAPs. I would rather pay more to have a full game than to be constantly nickeled and dimed. I know a lot of my friends feel the same way.

I'm 21 and I do the same thing. I just don't feel like either having to pay $30 for a simple app to get all the features I want, paying to win, or paying just to play the game.

I'm really into emulation and retrogaming. One thing that concerns me is how these works of art will become unplayable and "die" once their life expectancy is over. The body of work of video games is pretty large now, but I'm worried the body of games we can continue to enjoy 20-30-40-50 years from now will grow at a very slow rate from now on out. This is very different from the movie industry, where films from 60-70 years ago are still very enjoyable.

We still listen to and perform the music of 300 years ago (Bach), read and perform literature of 400 years ago (Shakespeare), and the look at the paintings of 500 years ago (Leonardo, Botticelli, etc.).

Sure, a bunch of the games produced today are semi-glorified slot machines, but most movies of 60 years ago were crap. Most Baroque music was crap. Most Elizabethan drama was crap. Most Renaissance Art was crap.

Quality lasts, and if quality managed to survive a time when conveying information across the world took decades and when literacy rates were basically nil, then given modern literacy, and storage and communication technology, it's crazy to say the quality media of the present day isn't going to last.

It's going to require some work, but if the media matters to people, people will do what it takes to make it last.

I think the parent's point was not that modern games are not worth preserving, but that the way they are implemented requires an enormous effort to preserve them far beyond the cost of just copying media, that may not be warranted for anything but the most important and well-loved of games.

Most of these mobile games are continuously upgraded, and more importantly, reliant on an external service to implement purchases and access restrictions and such. You cannot just load such a game up in an emulator if the server containing half the code (yes that's hyperbole, it's a smaller but no less important amount) no longer exists.

People have reimplemented the servers for very important online games in the past. Off the top of my head, Phantasy Star Online (one of the first MMOs) and Vanilla World of Warcraft both have fanmade reverse-engineered recreations of their server software that allow people to play the original game as it was when they were released, even though Sega and Blizzard respectively have long since shut down their official servers. To reiterate, they did this with only information from the game client, neither the source nor binaries of these games' server software were ever made available. I can only imagine how tremendous of an effort this must have been for the fans, but they did it out of love for these games and the time they spent playing them.

Now imagine that one of the various free to play IAP games gets shut down tomorrow. Game binaries that worked fine yesterday are now useless. Chances are, no one cares nearly as much as the aforementioned MMO fans (it's a hell of a lot of work, and I'm going out on a limb and saying that skilled reverse engineers are more likely to be interested in MMOs than cow clickers), and the reverse engineered replacement never gets started. The game disappears from history, except as a Youtube video and a memory.

Good point. 90% of everything is crap. But that last 10%...that 10% contains everything from "Big Trouble in Little China" to Bach's "Magnificat" (BWV 243).

Same for games, in that 10% we get everything from Super Mario World to Skyrim.

Yes, but it took something like 100 years after Bach's death before people generally believed it to be awesome IIRC. There were doubtless composers who were more popular at the time that we've never heard of.

I'm not saying you're wrong, I'm just thinking that it'd be better to keep everything and let the future decide.

>This is very different from the movie industry, where films from 60-70 years ago are still very enjoyable.

They are to us, but the average movie goer would need restraints to sit and watch them.

With the BS emphasis we had for over 2 decades on special effects, fast editing, CGI, and teenage-fantasy kind of material, the adult oriented movies of yesteryear are only left for cinephilles.

For the average 15-25 year old today, they'd be unbearable to watch, whereas back in the day they watched them just fine.

So? Who cares if the average 15-25 year old does something? The average 15-25 y/o may not visit a museum, attend an orchestra, or have a tenured professorship, but all those things still exist. Plus, 20 years from now, those kids will be adults who might want to play the games of their youth.

>So? Who cares if the average 15-25 year old does something?

Well, since we were talking about old movies, people who value them, and who would have liked to see them being watched by newer generations and surviving into the future, do.

>The average 15-25 y/o may not visit a museum, attend an orchestra, or have a tenured professorship, but all those things still exist.

Just barely.

I dunno. I fail to see how the Marx Bros are any less entertaining today. Or the 60+ year old Nineteen Eighty Four, is that unbearable to read (well, yes, but that's beside the point). Old doesn't mean unwatchable, it means different. Hopefully future games and content won't entirely be rentals, as some things are worth keeping and replaying for free...

I can see both sides of it and I'll posit this argument. 15-25 year olds of any age may never really get old media, but as they grow older, they may find an appreciation of them. I know that many movies and books and things that I loathed as a youngster I grew up to appreciate and even enjoy as I grew older.

For example, I've grown to really enjoy old classic radio shows, decades after they've stopped being commonplace.

I don't think the really bad IAPs/scams like Clash of Clans or Farmville or this Dungeon Keeper incarnation can really be considered works of art...

I don't totally disagree with you, but suppose IAP was not an avenue these could have gone. They may have been better designed games as a result.

Jonathan Blow -creator of Braid and working on The Witness- also has a very nice critique on the problems with games that are designed around micro-payments. The whole talk is interesting, but he starts discussing the issues around the 20 minute mark:


Jonathan sometimes comments on Hacker News as well: https://news.ycombinator.com/threads?id=jblow

His comments on game industry, I find, are usually very on point. One of his last ones: https://news.ycombinator.com/item?id=6803844

I love that talk.

I've had some friends complain that he takes too long to get to the point, but I would argue the comparison to TV is pretty important. I wouldn't skip it.

This is sort of like when MMORPG's were all the rage and they said that they were destroying traditional RPG's, but fast forward a decade or so and guess what, we still have great traditional RPG's. We have great MMORPG's. There's a lot of enjoyable gaming to be had.

So there's in app purchase, okay. That's another way some games are going, but it's not the only way and it probably won't be. You can't make a AAA title like Halo or Call of Duty as a F2P with IAP. that's not going to happen anytime soon. However, some devs might try and nickel and dime players more because they can, but maybe just maybe this means that game developers will have a more sustainable business and won't be going bankrupt every few years as many seem to.

Maybe I spend too much time look at MMOs, but what recent RPGs are there?

As for AAA with IAP, look at Planetside 2. Free to play, IAP, AAA by any measure.

In many ways, we're training a new generation of gamers to have the following beliefs:

- Games are not meant to challenge you, but to steadily progress you, no matter how good you are. - Anything difficult can be "spent" out of.

While both are working theses, I feel that there are far too many games that will fall away if this becomes permanent.

>In many ways, we're training a new generation of gamers to have the following beliefs: - Games are not meant to challenge you, but to steadily progress you, no matter how good you are.

Working in f2p games, I've thought about this quite a bit. From my observation, you have causality reversed. There's a new audience that is demanding progress-based games and that new market is pushing a lot of game designs away from skill-based challenges.

Going back to the pac-man era, games had to be extremely challenging because they couldn't have enough content to stay interesting otherwise. That selected for gamers who enjoyed overcoming great challenges and pretty much defined "what games are" for 30+ years. Meanwhile, there has always been an unserved audience that does not like overcoming great challenges and preferes steady progression based on effort rather than mastery.

That huge, newly discovered audience pushes back /hard/ when the games they play swing towards rewarding mastery. They just want to show up, know exactly what routine needs to be performed and know that if they do it, they will progress. For them, it's not about winning the gold at the Olympics. It's about tending a garden/getting fit/going on a hike. Imagine going on a hike and some weird old man stops you to say "No. That guy hiked better than you. You must go back down the mountain and start over from the beginning until you hike better than someone else." You'd never come back.

Meanwhile, the classic, challenge-oriented audience is still there and games are still being made for them. But, a lot of them are discovering that sometimes they just want a nice hike as well. Thus more and more products are responding to that new demand.

Gaming is a bigger world now. After 30+ years, the focus has shifted from being laser-locked on catering to hardcore gamers like you and me. Now there are not just different genres of fun challenges, there are different genres of fun.

Sure! Gaming is definitely a bigger world. I suppose games that are being made for "steady progressionists" also are those with "and here's a cash money way of ensuring the steady progression, so you don't have to work too hard".

That seems to short circuit the reward for playing.

Example: Angry Birds is has their Eagle that beats a map for you. Beating a map unlocks another map. Assuming a steady progression, being able to buy your way past a map removes any requirement that the game designer creates a steadily ramping progression, and instead encourages them to put up as many "little roadblocks" as possible.

> Meanwhile, there has always been an unserved audience that does not like overcoming great challenges and preferes steady progression based on effort rather than mastery.

> They just want to show up, know exactly what routine needs to be performed and know that if they do it, they will progress.

That rather handily explains degree inflation, too.

Disclaimer: I'm really having a hard time being empathetic here.

Why do companies chase this market? They're very fickle, and rarely appreciate any sort of gameplay mechanics. These sorts of games devalue the medium to themed Skinner boxes, essentially. I play games to be competitive, and employ creative problem-solving strategies. Meanwhile, loads of companies seem hellbent on removing all nuances from their games to pursue ever-more-mainstream sensibilities.

It's disgusting and patronizing.

>Why do companies chase this market? They're very fickle, and rarely appreciate any sort of gameplay mechanics.

Because they spend money.

Have a few links of the past year:

http://playism-games.com/games/onewayheroics/ http://en.wikipedia.org/wiki/King's_Bounty http://stoicstudio.com/game-overview/ http://bluebottlegames.com/main/node/21 http://roguelegacy.com/ http://www.spiderwebsoftware.com/avadon2/ http://www.metacritic.com/game/playstation-vita/soul-sacrifi... http://www.metacritic.com/game/playstation-vita/toukiden-the...

While the mobile market is flooded with manipulative crap, both the PC and console markets have plenty of good RPGs available, even and especially when you look outside of big studio stuff like Mass Effect.

Jeff Vogel probably isn't rich, but he seems to make a good and honest living running Spiderweb, charging $10 for the tablet versions of his games with no F2P nonsense. You can make a living doing something less evil than Zynga.

I'm glad there are small publishers making RPGs. It just seems that MMOs have sucked all the air out of the room for PC AAA RPG titles. I can only name a few in the past 5 years (listed further down in the thread by someone else).

Skyrim was releases something like 2 years ago, and you have Fallout series based on the same/similar engine from Oblivion (AFAIR Fallout 3 and Fallout: New Vegas).

Mass Effect is a huge new RPG game series, also Dragon Age did pretty well. Both launched well after WoW went huge and everybody was chasing that market.

There's a small irony here: The enormous success of the Dragon Quest series (currently approaching its 30th anniversary) in Japan was, in no small part, due to the fact that it was designed so that anyone could complete it if they put in enough effort. There is little real strategy or challenge to the main paths of the games (the secret dungeons are another story), you just keep "grinding" for money and EXP until you eventually get strong enough to venture into the next area and move the story along. Even if you die, you don't lose your progress, you just restart at the last town with half the gold you were carrying.

It might sound a bit dull when I put it that way, but the series is enormously popular in Japan amongst all kinds of people that you wouldn't ever consider to be interested in video games. Each game is far lengthier an experience than you would expect out of a "casual" game, but the fact that you can make a little progress every time you play, no matter how frequently you do so or how bad you are at video games, really appeals to people.

I obviously see the difference between that style of play, and paying for progress, but I just wanted to throw out there that games that are more about progress than skill or strategy have existed almost since the beginning, and they're not necessarily a bad idea.

DQ III to this day is my favorite console RPG. I'm also somewhat surprised the battery hasn't died on it yet. I will lose probably 60 hours of progress for my current save when that happens.

Is it really training the gamers? I would say it is taking advantage of the similarity between a difficulty progression and time/spend ladders. Other than some amount of real world benefit from improved hand eye coordination they are just different ways of providing a reward stimulus that is relatively empty of extended value.

(I don't mean that as an invective against fun, I just mean that the rewards from fun are mostly fleeting)

Top of my head: Dark Souls franchise, Dragon Age, Mass Effect, The Witcher. Just in AAA, american style RPGs. J-RPG and indies are coming as strong as ever.

EDIT: as pointed out below, Dark Souls is a JRPG.

To be clear, I hope we aren't talking about Dragon Age II, which was awful, awful gameplay on what was an intruiging premise. I enjoyed the original, but it clearly had some IAP (I don't mind, but I can see how someone else might).

Dark Souls is actually a JRPG.

Not in the meaningful sense (static multi member battles with combat menus and a focus on story telling over gameplay).

The character progression and the general pacing are closer to those of JRPGs. It reminds me a bit of Vagrant's Story in terms of gameplay, for instance.

I'd lump the entire Assassin's Creed franchise into the RPG category.

RPGs are basically coming out of Kickstarter today, aside from the fairly boring AAA games like Elder Scrolls and Witcher.

Great MMORPGs?

A friend sent me a video of MMORPG 'gameplay' a while ago. I don't play these things, she does and is aware of my opinion of them and chose this as the best sample she could possibly find as a way to try to change my mind about them. It was a major boss battle, something that should've been the highlight of what the game had to offer.

There was no gameplay. The boss monster was rendered as a hundred foot tall demon, but it didn't fight in any meaningful sense of the word. It stepped back and forth over and over again, executing some canned move the same way every time. The two dozen players did the same thing, wasting half an hour of their lives mindlessly pressing the same buttons over and over again until the boss monster 'died' (scare quotes because obviously it popped up again later for the next batch of victims).

MMORPGs aren't games. They're Skinner boxes, exploits for security flaws in the human motivation system. The real challenge is at the meta-game level: the developers win if they successfully exploit you, and you win if you successfully prevent yourself being exploited. And the way to achieve the latter is to stop playing.

You simply just didn't understand the gameplay. Raids are great fun and challenging. The repetitive bit is a totally different part of the game that you actually don't have to partake in. I hate platformers, but don't randomly declare them not to be games because I don't understand them.

With mmorpgs they have to have these time sinks simply to have content for the hours people actually want to put in.

Maybe I've been out of it, but I can't remember a really A-class MMO that came out in the last 4-5 years. Which is the period of time that F2P & pay to win started making heavy inroads on the MMO market.

I was rummaging around looking for a modern (post 2010? 2012?) AAA MMO the other night and couldn't find it.

Neverwinter is the first I've seen since WoW where you log on and there are tons of things going on and lots of people running around. It's free to play.

Star Wars, Guild Wars 2, and the upcoming Elder Scrolls MMO are the ones that come to mind.

Star Wars TOR went F2P and apparently, it was extremely successful for them and made the game profitable.

Guild Wars 2 has an initial purchase fee (usually on sale for $30), but no monthly fee. New content is subsidized through both functional and cosmetic IAP, although neither is game-breaking.

Elder Scrolls Online, however, is $60 + $15/mo, with no IAP. Everyone is expecting it to die a horrible death.

True. Though I think all 3 would fit the AAA MMO description (especially considering that all of them have a relatively high upfront cost), even if they have IAP.

> Elder Scrolls Online, however, is $60 + $15/mo, with no IAP. Everyone is expecting it to die a horrible death.

Because it's $15/mo with no IAP...?

It's hard to justify both $60 and $15/mo for a game that isn't super good. (apparently, reports from beta users indicate that the game is average)

FFXIV and Planetside 2. ESO is coming. WAR died a horrible death (sadly).

These are good. Guild Wars 2 is also worth a look. However, I am enjoying not having any in-game purchases and instead paying $14/month with FFXIV. It's much more relaxing to just pay your $14 (it's not that much, you can't even see a movie for that much anymore), you get the entire game, developers get paid, new content every 2-3 months, etc.


It is true though, that an MMORPG is very likely to destroy an RPG franchise. Anybody still waiting for Warcraft 4. How about a new Elder Scrolls game?

> Anybody still waiting for Warcraft 4

That's because Blizzard is a very slow developer, which is not unheard in the industry. People were(are) also waiting for HL3, Prey 1 and 2 or Duke Nukem: Forever.

> How about a new Elder Scrolls game?

Skyrim came out in 2011, it's unlikely there'll be another one before 2015-2016, Morrowind came out in 2002 and Oblivion in 2006.

Fair enough. My sense of time is gone since having kids.

Though I'm fairly confident with my prediction about Warcraft 4. There are probably a lot of people at Blizzard, right now, thinking about how to make "the next WOW" work. A Warcraft strategy title just feels like small fry compared to that.

Also, there might actually be brand dilution, since it is quite likely that many WOW players don't know about the old RTS games.

It's not just that it's "small fry". It's that the Warcraft lore is irreparably broken at this point. A Warcraft 4 would need to be a reboot, after WoW faded.

Working on two RTS games at the same time would be a very odd decision, and Blizzard's been working on Starcraft 2 since 2007 and the third part is still at least a year out. Even if WoW never existed and Starcraft 2 was started earlier, Warcraft 4 would probably not be out yet.

Not sure if you're joking there -- Elder Scrolls Online comes out in June. There is some controversy because you can pay ~$10 extra for the "imperial edition" that is the only way to play the imperial race ...

Ah, you misunderstood. I was talking about a Skyrim-like Elder scrolls game _after_ Elder Scrolls Online. That is what I consider unlikely.

I also saw the Dungeon Keeper on the iOS App Store, and my first thought was: "DKs gameplay would be fantastic for mobile!".

Then I saw their IAP strategy and dropped the game.

I would happily have payed $19.99 (the price of XCOM for iOS) for a decent DK on my iPhone.

On the other hand I see myself paying for cosmetic items in DotA 2. They don't change gameplay, but my characters look cool. It sounds stupid, and it probably is, but Valve have really designed it well.

You are unique in this. They would get almost no sales and destroyed in reviews if they charged the real price of the game ($20).

Instead, they use IAP. Some users buy nothing, some buy the $69.99 game, and on average everyone pays $20.

Actually, the effect is much more exaggerated than you are suggesting. According to Tim Rogers, the mythical average player pays $1.70, but it's really made of 95% of people who spend $0, and a power-law-esque distribution of people who spend >$0 to hundreds or thousands of dollars.[1] Most of the money is made off of "whales." Technically he's talking about social games and not mobile games, but it would be surprising if the economics were significantly different given that the mechanic (pay to make things go faster) is identical.

1: http://insertcredit.com/2011/09/22/who-killed-videogames-a-g...

He's not alone. I played both DK games when they were originally released, and eagerly downloaded this new one. It looked great, and the narrator's "So...you've finally returned" was a perfect beginning.

Then I played through the tutorial, and saw it would take four hours to dig through a single block of dirt. I went to the store screen and would happily have paid $20 for a full unlock.

Instead I was faced with multiple gem purchase options, including a "BEST VALUE - $100!".

You have got to be kidding. And while I could make smaller purchases, I have no way of knowing how fast they would be depleted. As the article notes, the game is clearly focused on scamming the money out of you as fast as possible.

So I've uninstalled it without spending anything and am left with further disgust for EA. There's got to be a happier medium ($10 game with cosmetic unlocks?) than this pay-for-every-move methodology. Valve certainly seems to be making it work.

There are a few dynamics going on. In one sense, in-app "gem" systems have enabled companies to create highly social online games without a per-month fee. I've been playing Clash of Clans and it's really fun. Everything is run on their servers and you attack other people's villages. This sort of game would normally require something like $5/month.

But with the in-app gems, I can play at a slower pace for free. If I wanted to play faster, I could spend $5 on gems and do pretty good for about a month. So in some ways it's a pay-per-usage system.

The problem is that it can be easily abused and the dungeon game he describes sounds much more socially engineered. The handicap applied in the dungeon game sounds a lot worse than it is in Clash of Clans.

This could also all be a result of the downfall of LAN-centered games. Clash of Clans could have taken the decentralized host-your-own-server route and it would still be just as good, if not more interesting. That actually would be ideal setup because I do find myself wishing I could just play the game underneath the gem-fishing strategy.

I think Minecraft should remind us that it's the host-your-own-server strategy is a really good one, and I hope that doesn't die. It probably doesn't make as much money, so we need to figure out a way to balance the economic force which will eventually extinguish it.

I’ve been really disappointed with Apple’s laissez-faire approach to policing this trend in their App Store, especially since their philosophy is founded on making big, sweeping decisions in favour of their users.

Honestly, I don't know why they haven't, because this is one of the biggest dark user patterns that exist outside of outright illegalities.

We - and I - are used to giving companies like Facebook and LinkedIn shit for similar things, so why are Apple tacitly supporting this abomination. They don't even make that much from games anyway.

What would the coverage be like, if the FCC fined either of those two $35.5M, as they recently did Apple[1][2]?

If we believe that the App Store is a Big Deal, we should care that this is the new normal in handheld videogames.

[1]: http://www.ftc.gov/news-events/press-releases/2014/01/apple-...

[2]: http://www.nytimes.com/2014/01/16/technology/government-and-...

I think Apple has a big part of the blame to take. Somehow - I don't know how - they engineered a situation where the original apps were priced dirt cheap for the iPhone. 99c was the initial expectation, and companies were so keen to get in on the early app store action that they didn't care. Starting from there the industry has struggled to ever raise prices for apps to a reasonable level. No matter how much content there is in a game, no matter what the quality, the perception in the consumer mind is that a good app costs $1 - $2 and an exceptional app might charge $5, but nobody ever in their right mind would pay $20 for an app. We're now at the point where mobile games contain graphics at the same level of consoles from a year or two ago, and yet prices aren't moving. Entire office suites that might have been $50 - $100 struggle to fetch $10. It's not sustainable, has never been sustainable. The only question is how we're going to get out of the mess, and it looks like we're having to go through an IAP hell before consumers will start to be prepared to pay a premimium price to get an IAP-free experience.

There are still plenty of games that don't use in app purchase at all or at least in a conservative way (like expansion packs) on consoles and PC, so I wouldn't draw such conclusions.

I think the reason for this push of freemium games (in particular mobile games) is that people (who aren't usually gamers) tend to play them for very short periods as a way of passing the time. (while waiting, or while they are sitting on the toilet)

And since most game companies were unable to sell full priced games to this demographic they adopted this business model to make money.

Would you pay $30 for a game on a mobile phone with all its limitations? (touchscreen controls, small screen, crappy audio, battery drain)

If I'm paying that kind of money (or more) for a game I expect at least solid 15 hours of immersive gameplay. (which is impossible for me on a phone - I have my consoles&PC for that)

There needs to be a distinction drawn between mobile games and console/pc. These are two completely separate industries that are only married by name. They have different target audiences, mechanics, and business models. Mobile games are played to piss some time away, and are almost never played for hours like console/pc games are. One of the big reasons the Ouya failed was because its creators didn't realize that the console and mobile markets were separated so much - they don't compete with each other on any level.

This is why I think it's silly to compare older games to mobile games. With the mobile market, you can do all sorts of disgusting slimy things and the consumer won't give a damn because they spend at max - 20 minutes on your game at a time. As long as people view mobile games as a way to blow some time rather than an interactive experience, I doubt nearly enough people will become involved with them enough to even care about in-app purchases.

Another interesting video review of the another incarnation of this problem: http://www.youtube.com/watch?v=w_AgjWkNGew Angry Joe on the iOS app Star Trek: Trexels.

It does not amaze me that this level of depravity was tried; I always considered it a forgone conclusion that the companies would do anything that worked. It does sort of amaze me that this is working. Though I suspect rather than being the long-term future of gaming that this is the equivalent of slash&burn development. Yes, there's a huge bunch of people right now who haven't quite cottened to how nasty this can be, but they're learning fast, and while another one is born every minute, it's never quite the same as the first time the new scam goes raging through an unprepared population.

It would be an interesting experiment to offer a version of Dungeon Keeper (the focus of this article) in the App store for $39.95 and without the IAP accelerators. Then compare sales with that one and the cheap one. Clearly EA just works out their life time value per customer either way.

I did hear a game developer mention that IAP is really a form of copy protection, in the sense that if you made a copy of a game that can only effectively be played by buying additional tokens, then it is more difficult to pirate.

I agree with the author that it has made for a very different sort of industry. But given the income these companies are making I don't think the industry is being "destroyed" any more than the extortionate seat prices the NFL charges to see a game in person are "destroying" football.

Plague Inc. allows you to unlock the game for a few bucks as an IAP, but it's a one-off purchase. That seems to work for copy protection.

Needling the shit out of your customers like Dungeon Keeper is doing is killing the system. Unless a game ends up on the Humble Bundle, I almost refuse to get it because I'm worried about IAPs.

some games that end up on the humble bundle have in app purchases. I don't know if they've changed their policy about it. I remember one game in particular that was pretty aggressive with it's DLC nag.

Some other commentators on this article noted 95% of people pay nothing in IAP games, and some pay a huge amount, which pays for everyone. I think this would mean that your proposal of two versions would cannibalize each other in a very bad way. The large majority would play the free game and pay nothing, while the "whales" would only pay $40 instead of the huge amounts they would otherwise. So you'd lose both the "tail" and the the "head".

Shouldn't the comparison of prices be for the original cost of the game, rather than how much it costs nowadays? Surely in 14 years time the iPad version would be indeed be cheaper if still existent?

Dungeon Keeper costs $6 because it's 15 years old... When it was new it cost $50.

Which is still less than that £69.99 In App Purchase that lets you dig out 56 blocks.

Sure, but when he says things like:

"So this is the old days: Full game price + expansion packs included: $5.99 [...] Just remember that."

That's a complete and utter lie.

A used or budget version of DK was easy to find for a few bucks back in maybe 98 or 99 thats still the old days.

Still cheaper than spending 70 pounds on gems.

It is, but doesn't make what he's saying about "the old days" any more true.

I don't really understand in-app game purchases, but that's maybe because I've never made any. I don't know anybody that has either, so I'm a bit baffled that it's disrupting the industry this much. Might be cultural difference too, being in Europe.

I also don't understand the sense of in-app purchases in some games. For instance, in Candy Crush I believe you can make in-app purchases to skip ahead, not have to play quests to clear levels etc. Reason I don't get it is because the whole point of playing the game is surely to play the levels and not skip them!

It leads me to believe that the only reason in-app purchases happen is because they pray on the weak: people who genuinely get addicted. I may be wrong about it since I don't have data to back up my claims, but I'm assuming that instead of a lot of people making up the industry, that the whole concept is powered by a few people making massive payments in the form of tonnes of purchases; people who I can only imagine get addicted in the sense that anyone can get addicted to drinking, smoking, gambling etc.

Perhaps someone can shed light on the nature of the in-app payment industry for gaming and perhaps explain to me what I'm missing.

Disclaimer: I'm not a big gamer, so that might explain all of the above.

PS: I find it somewhat amusing that the author's blog site offers a premium content purchase link: in-blog purchase?

I do think IAP has made games less fun, but as a non-game app developer I think IAP is amazing.

The old model (for devs who don't like ads) normally went like this:

* Free Version: Limited Feature Set

* Paid Version: $0.99 or $1.99, full features

There were a lot of problems with this model, such as:

1) People didn't know the paid version exist, leave bad ratings on the free version for lack of features.

2) It was hard to gain traction since your downloads were split over multiple apps, meaning each would rank lower individually.

3) When people made the free-to-paid conversion, you had to worry about data migration including all preferences, etc.

4) Some apps just don't have a meaningful feature set for a free version.

5) Maintaining separate code.

IAP fixes this and allows be to be a more "lean" operation. Now I publish a free app with a minimum viable feature set. I watch what features people ask for in reviews, and if one seems like a non-bug feature that people really want I'll introduce it as a $0.99 IAP. In the meantime, my free app can keep gaining users which means putting the opportunity to buy my product in front of more people and not splitting my popularity across two app store listings. I also make sure to add features for free to keep moving up the charts and make most users happy. Also, people are much more likely to want to pay for a feature after they've used the rest of the app than pay up front.

This is a silly argument.

1. Game developers aren't shooting themselves in the foot. They're catering to customers. IAP works because customers want to get a game for free, and the people who really love a game are willing to spend thousands (sometimes even tens or hundreds thereof) on it.

2. The old-school game model was struggling anyway. Console game sales haven't been doing well for a long time.

3. You can't rent an app, and you mostly don't play it on someone else's device. Both of these were ways of testing out a new franchise on consoles that no longer exist. It makes sense that something filled the void.

4. The platforms now (mobile devices) have a vested interest in you playing as many games as possible, moreso than you paying for them. Apple/Samsung etc. make their money by your buying a new $650+ phone every two years, and if you get a bunch of apps you love on one, you're more likely to get another from the same OEM later. Why try to sell you a few $10 games off of which they make $3 (minus carrier fees) when they can give you a ton of free games and hope you love a few enough of them to plunk down another $650 a year from now? Until content is no longer gated by app stores that have incentives very different from those of game devs, this business model is a natural fit.

Don't get me wrong, I don't love it either, and I make the damn things for a living. I don't think all IAP-monetized games suck. But I do think that plenty of them do, and the misaligned incentives make it hard to make a game that is both profitable and genuinely fun that way.

I just don't think the fault lies with game developers.

The inception of in-app purchases on mobile games is not to be blamed on game developers - it's the markets. Specifically, AppStore discovery and refund policies.

There you were circa 2009, a mobile game player, presented with games you need to pay for, upfront, with no demo or trial, needing a credit card. You don't like what you bought? That's a shame.

On the other hand, there was Free category, install it, play it, see few ads, or options for in-app purchases, and for the the most part, it matched the quality of premium up-front-charged games. But even if it didn't, who cares. It's free.

My point here is that in-apps were reasonable evolution of money-hungry marketplaces, not developers. Developers just sort of got shoved on that path.

Your point of argument might be - "Well, aren't developers money-hungry too?" Let me explain to you why game developers are paid way below the average compared to their IT fellows in spite of doing arguably much more complex work (you say web site - i say 3d world, you say RoR backend - i say real-time MMO-powering beast, you say web design - i say asset-friggin'-pipeline) and why game market is so cutthroat...

It's because we love what we do and will take shit in order to do it. We're very oppinionated about it, and for the most of us, it's not a job - it's life, a quest, a mission.

And even if this doesn't resonate with you, how about - there's nothing wrong with in-apps? Go to any international/interstate retailer. Check the shelving, check the products, the design, the smell. The sheer amount of science to get you to purchase that particular box of razor blades, removing any rationality you might have for your purchase, is towering over anything you might encounter in mobile game in-apps infrastructure.

No one is saying that the very essence of in-app purchases is wrong. In fact we all agree that games are the most under-valued pieces of software. We honestly support monetization of games (hence everyone saying i would happily pay $X for full unlock). Of course most people would NOT pay that upfront and need to be... "convinced" to pay that amount.

What we ARE decrying is the negative affect on the GAME itself for this monetization. The gameplay element should remain unaffected from this. So IAP that gives you extra levels, extra maps, extra skins, are the perfect way to monetize on it. In contrast charging per turn (or for speeding up turns), or for lives, or even things that make your game "pay-to-win" are not only unethical but ruin the GAME. SO doesn't that ruin your " it's life, a quest, a mission" philosophy.

PS: My most hated line on play store or appstore is "greedy devs charging me money for content"

I read a lot of complaints like this "OMG , all games are becoming F2P IAP" but I don't really see it outside of a niche of mobile games which seem to be modern day one armed bandit machine.

If you at the current crop of Steam games or console games there are a ton of popular games that have no IAP or IAP which are for only for cosmetic items or expanding game content.

A reddit user has started a tumblr to catalog ad-less, up-front-purchase, single in-app-purchase Android games:


Well I can only speak about myself and say that I have spent at least twice as much for in game purchases than I have for buying games. In my case the culprit is Heroes of Newerth , a game I am completely addicted to. Its a MOBA game , also known as DOTA clone. And I did try Dota 2 and LoL and non made me switch. I am waiting for Heroes of the Storm. In the case of Heroes of Newerth all you can buy is Alternative Avatars of your Heroes , or reset your stats, or some other accessories. None of the things you buy actually affects the gaming experience. The game is 100% free and if you dont want to spend a euro on it so be it it will be as playable to you as it is for the guy that spends thousands of euros. I really like this and this is why I decided to spent my money. They dont force me to spend , I spend because I want to support them and keep this game improving. I see DOTA 2 also follows a similar path.

From the second video (warning for language):


1. Few things in life are more enjoyable than an angry British guy having a good rant.

2. Coincidentally I just yesterday (re)read the part of Hackers talking about the founding of EA. Times have changed.

The author made a disingenuous comparison. Dungeon Keeper didn't cost $5 when it was released many years ago. It costed $39.95. And there was not trial play ahead of time. Is he willing to pay for $49.95 (adjusted for inflation) for the iPad version before even playing it?

The in-app purchase got to this way because of gamer purchase behaviors. If the majority of the gamers are willing to pay upfront, you won't see in-app purchase. This is just like most people (at least in US) unwilling to pay the full price to buy the phone upfront but rather to pay for it with smaller monthly charges via the long term contract.

Gamers change their purchase behaviors and in-app purchases will go away.

The price of AAA games has gone down in real dollars, so adjusting for inflation isn't accurate. Also, when you paid $40 for a game in 1998, you ended up with a game you could resell when you were done with it. The video game market was built around that expectation. And the price of used games was much lower than retail -- $5-10 was common for games that sold at $40 a year or two earlier.

In this case, I think it's notable that the mobile Dungeon Keeper is both less playable and more expensive than its predecessor.

The writer is ignorant and the article is nothing but a silly rant. No reasonable arguing. Makes me sad that this kind of articles can make it to #1 on HN.

Calling these games "the game industry" does a disservice to all the other games that aren't like this.

Maybe I'm an old fogey but those 1990's graphics look awesome to me.

That's because, while being low-res, they spent a lot of effort on the animations and the details. Most "modern" mobile games have about as much animation as final fantasy on the gameboy.

I'll point to Blizzard's Hearthstone (still in open beta) as a counterexample. It's a collectible card game, and it's perfectly fun to play from day one with little more than the starter cards. You can earn more cards slowly by playing a lot, or you can just buy them. But while buying better cards can make you more competitive, it doesn't necessarily make the game more fun, since in any case it generally matches you up against an equally-matched opponent.

Anybody notice the bottom of the article:

Subscribe for $9/month Baekdal PLUS: Premium content that helps you make the right decisions, take the right actions, and focus on what really matters.


Is this really different from arcade games, where when you lose all your lives you can stick some more money in before the timer runs out and continue where you were killed?

Having said that, I do think this concept ruins games. Personally I never play 'free to play'. I prefer ad supported ones, where if you like the game you can then pay a one off price to get rid of the adverts, or ones where you can pay to get more levels (and remove adverts).

Funny you should mention those old arcade cabinets.

Their "pay to try again" model created the perverse incentive to kill the player off quickly in unpredictable ways to give the impression that it wasn't really their fault. Coin eating machines.

They're great examples of how business models color the nature of a game deeply.

Obviously, this is a byproduct of our "everything should be free" online culture.

What's really funny is that the author's blog itself follows the same freemium model as the games he's decrying. Free to read, but $9/month to subscribe per the end of the article:

"Baekdal PLUS: Premium content that helps you make the right decisions, take the right actions, and focus on what really matters."

How is it possible that he's overlooking this irony?

It's the culture.

As a mobile developer venturing into building my own games, I disagree and agree.

First off, I hate, hate, the practice of slowing down the game or crippling it, and then allowing the user to use an IAP to get the game back to a normal pace.

I vow never to do that.

However, a some users (and anecdotally, quite a few of my friends) won't download my app if it costs $1. The barrier to entry is too high, and they don't know if they are going to get a good experience. They can't pick up my app and hold it, feel it, rub their hands over it's quality. They have 5 screenshots (and any reviews online) to go by. Okay, so I'll make it free to lower that barrier.

But now how do I make money? I think the best thing to do is to simply have users pay for content that they have already proved they love. Let them play through 50 levels, or the first "area" of the game. Let them buy more levels or unlock more content. This way they can play the game and decide if they like it, and if so, buy more.

I think the two rules of thumb about this sort of IAP is: 1: Don't be a asshole. Give the user a lot of completely unaltered content up front, and really let them dive into the game. Ensure they know that buying the rest of the game later will cost some money, but don't take away features because they haven't bought the game yet. Let them fall in love with it. 2: Price it fairly. Let users buy "All Levels Forever" for $5, or each level pack for $2. Allow them to unlock all the content at once. If they bought 2 levels packs, and want to buy all the rest later, give them a discount.

Make a game you'd want to play.

Isn't the reason actually that people have been "trained" to favour the quick hit instead of actually savouring experiences? If that is a given, then the game industry is just trying to sate this new/modern taste of esp. the younger generation. The "guilty" here isn't really the game industry then. Who is? No idea... and most assuredly not one single industry or person.

I recently wrote a book about Freemium, in part, because I think it is vilified unfairly within the context of gaming.

Before moving to gaming, I worked at Skype. No one ever accused Skype of exploiting people, or of facilitating addiction, or of polluting the purity of telephony. Skype made money by, essentially, up-selling people to paid phone calls. Those phone calls might have been to people's sick parents in foreign countries, or their kids. Imagine that! By charging for phone calls, Skype might have been prevented someone from speaking to their sick mother!

Freemium is a business model; it's not a moral framework or an ethos. Some people make terrible games with the freemium model; they likely would have made terrible games had they gone with an upfront payment model. The difference between the terrible freemium game and the terrible paid game is that people got to choose whether or not they contributed money to the terrible freemium version after playing it. They got more information before making a purchase, kind of like a test drive. Isn't that a good thing -- more information?

Gaming is actually the most evil possible context for freemium. It encourages bad design at literally every level, in ways that generally do not transfer to other types of software.

If freemium were generally just a demo for a better game, you would be right that there's nothing wrong with it, but optimizing a game for freemium means a worse game. Watch the second video in the article; the "best value" gem cart is in the ballpark of just straight up buying a game. Except you don't get the entire game.

> If freemium were generally just a demo for a better game

It's not, and no one ever said it was. The demo analogy isn't valid; a free-to-play game is a fully functional game. IAPs may unlock additional functionality, or help bypass time gates, or whatever, but the "core loop" of a game shouldn't (under the guise of freemium, anyway) be restricted by payments.

This isn't to say that it doesn't happen -- not every developer really understands freemium, and some bastardize it. But can you really argue with consumer preference for freemium? If consumers hated freemium, it wouldn't dominate the app store.

> a free-to-play game is a fully functional game

I suspect my definition for "fully functional" is different from yours, but I have high standards.

> If consumers hated freemium, it wouldn't dominate the app store.

Actually it's entirely possible for something hated to also be the most profitable course of action given things like information asymmetry. For instance, if people would be happier with good $20 apps, but it's so hard to tell which $20 apps are good that no one is willing to risk buying them, then you end up with the current situation.

I'm not necessarily saying that this is the case (much as I hope it is), but I would love nothing more than for reviews like this to bring people around to how exploitative this model is, and how much it encourages bad game design.

This is verifiably not the case; for example, see the positive reviews of Candy Crush Saga and any number of other F2P titles. It's pretty clear that consumers prefer the freemium model, it's just a vocal minority that continues to single out specific games (like the one in the OP) and use them to denigrate the business model.

Also, isn't your argument re: information asymmetry an argument in favor of F2P? In the case where a developer has made a great game, it behooves them to release it for free, not only because that's obviously what consumers prefer (see the App Store), but because it allows the app to be more widely distributed and critiqued (and thus the worst apps would be quickly identified as bad and not downloaded -- perfect information).

> Also, isn't your argument re: information asymmetry an argument in favor of F2P?

It's an argument that developers and consumers can both be correct to gravitate toward F2P. It's not an argument that this is the happiest equilibrium for either. It's the same rationale behind lemon laws; the absence of such laws pushes the market toward a position where buyers have to assume all cars are secretly busted, sellers have to price their cars accordingly, and the market ultimately gravitates toward people selling busted cars because nothing else is profitable.

You want everything included for $5.99. Studios want more lifetime value out of the customers. Consumers want to sample the game for free and incrementally pay if they are hooked on. Studios have come up with a model that makes them a lot of money and keeps consumed happy. This is evident by the fact that studios have moved to this model. In a nutshell the market has decided the best model.

Markets can't "decide" anything. They're not intelligent.

Investors have selected what they believe to be the optimal strategy for looting the games market. Time will tell whether the approach remains profitable or whether they're going to run their companies into the ground in the long term.

Crappy mobile games are not "the game industry"; it's a perverted travesty, just like the rest of the disgusting app culture.

Sadly, I didn't have time to play the iOS Dungeon Keeper myself, so I started to watch the video review in the article — and in one minute, the reviewer showed that he doesn't know anything not only about free2play, but about modern games in general.

DK is clearly a Clash of Clans clone. Apart from being a clone, this means that it's supposed to be primarily multiplayer. Persistent-state, massive multiplayer. And a day of real time in this games IS NOT a lot of time. Similarly to Eve Online (which I draw as an example as the "nerdiest" game to have this kind of mechanics), this kind of games have a LOT of stuff that take hours, days and sometime even months of real time to unlock or produce. This mechanics first started as a variation from traditional PBEM on BBSes; their primary purpose was not to draw money from players, but so that regular playing would yearn a greater, or at least similar reward, to hours of grinding, that only a tiny fraction of players can afford.

Freemium is not a bad thing. Dungeon Keeper for iPad is just a bad game. But why it sholdn't be? Who remebers the disaster Master of Orion 3 was? It wasn't freemium. It supposed to be good because it was master of orion, but it wasn't.

There are a lot of horrible games that are basically pay to play at any fun pace. They have one of two or three very stupid mechanics that proved to be most efficient extortion schemes dressed in some graphics and story.

Good thing is you can just install them, play ten minutes, recognize what kind of beast you are dealing with, uninstall and forget.

Bad thing is, thers no one place where you can go to check if the game is pay or wait scheme. Gamers basically get nohelp from noone when they try to decide what to play next.

Good freemium is when you pay for game to be easier. Pay or wait is insane but pay or play some more on the current level before advancing is reasonable enough if it's balanced so that you can advance faster if you are more skilled.

The problem I see with your proposed model is that game developers will then make games harder to encourage you to pay. Or the game will be grindier, so you have to farm for XP or items or whatever to advance. But for only 99 cents...

IAP hurt game design and result is less-fun games. The only use I can swallow is in cosmetic-only IAP, and even then I'm iffy.

Forcing player to farm things already happens even without IAP. It happens because average player wants this. I have no idea why. I suspect it's US cultural thing. Getting better just by putting more hours into crappy job. Cosmetic only IAP are holy grail but I can accept well balanced IAP that makes the game easier. I don't mind that my game is hard. What I don't want is waiting or doing easy thing over and over again. If a game makes me do one of those two things or pay I abandon it.

I don't even mind that such games exist. But I do mind that I can't know if a game is like that before I try it out myself.

My hunch is the "freemium is bad" argument is primarily an oversimplification of the underlying concern -- the erosion of trust and how that manifests during gameplay.

When I play a traditional "pay" game, I trust that the developer want me to finish the entire game. After all, the team slaved away creating all that content and the player should damn well appreciate their effort.

As a result, when I get stuck at some point in a game (Dead Space 2 being a recent example), I trust that there's a way forward and with a little more effort or practice, or perhaps if I retrace my steps, I'll become unstuck and move along the path toward completion.

Because the developer and I are working with a common goal in mind -- get Eric to the end of the game -- I am confident that at any point in the game I will be capable of completing the challenges set forth (no matter how stingy the Dead Space guys are with ammo).

With freemium games, that trust is obliterated. When I can't progress, I am forced to ask a fun-sucking question -- is the developer trying to extort money from me in order to continue? Am I unable to continue because I just haven't mastered some in-game skill or is this simply the point at which I'm supposed to hand over my tithe?

Candy Crush is an obvious (if extreme) example. When you can't complete a level after the 20th try, the player begins to feel that the developer is expressly barring their passage. And at that point, the game ceases to be fun, at least for the generations of gamers who saved the princess.

Then again, my kids (eight and six) just assume that buying gems is how one progresses in a game. It's not unlike when I was eight and pumping quarters into Gauntlet in order to reach the next level -- Blue Warrior's health dropped whether or not you were taking damage.

Everything old is new again.

  > With freemium games, that trust is obliterated. When I can't progress, I am forced to ask a fun-sucking question -- is the developer trying to extort money from me in order to continue? Am I unable to continue because I just haven't mastered some in-game skill or is this simply the point at which I'm supposed to hand over my tithe?
Absolutely. I hate the feeling of not knowing whether I'm not good enough yet or if this level is just designed to have no feasible way of completing without buying a power up. There is also no way to benchmark and compare with your friends since someone might have completed a level using a power up. Games for me is like sports, everyone should play on equal terms, even for single player games. Imagine playing/watching football where one team can buy an extra player to have on the field.

I'd much rather have the paywall be honest like buying levels like the oldschool shareware method or subscriptions like mmorpgs.

I'm actually surprised there are so few subscription based games, this should be ideal for both parties. The user don't have to pay the up front $60 for an unknown game and the vendor gets a constant revenue stream.

> It's not unlike when I was eight and pumping quarters into Gauntlet in order to reach the next level -- Blue Warrior's health dropped whether or not you were taking damage

You certainly could play arcade games that way, but the good ones could generally be beaten on one credit if you were skilled enough at the game. Plenty of modern enthusiasts still consider this the only "legitimate" way to play such games.

The difference between this and most freemium games is that it's your skill being tested and not your tolerance for pain, and many of us find the former a far more palatable thing to test.

Simply brilliant video.

I think that people who pay for these guys are miserable. It's up to them to choose what's "fun" for them. If playing this kind of game is "fun" for them, then it's fine for me. I'll play a different game. As long as there will be people like me, there will be indie games and a lot of fun for us.

I want to know how much overlap there is between mobile gaming consumers and console/pc gaming consumers. Has mobile gaming stolen away any of the spending of the console/pc gaming demographic? Or has it instead created an entirely new market that doesn't do console/pc gaming at all?

I can only go by personal experience as I cannot find any consumer surveys, but I've spent about a grand total of 5 dollars on mobile games, all for expanded content, not consumables, but I've spent hundreds on my 3DS alone. I strongly suspect the audiences for in game purchases and the audience for deeper games hardly overlap at all.

Are kids just not going to know that real gaming exists? I'm simply not convinced that the existence of mobile non-games means that the discoverability of real games is hampered. Console gaming isn't exactly a niche market that few people know exists and never end up experiencing.

I find it ironic that this blog post is filled with ads from top to bottom. Talk about destroying industries.

I don't see how ads sitting on the separate column and bothering nobody destroy anything. I personally didn't notice them at all before you said there are lots of ads. So I guess we can say about destroying ads industry since most of the target audience does not see them, but I'd say that's their problem to find a way to be more useful.

Virtually all games I've bought recently have had this inane obnoxiousness. One of my favorite games was 'Choice of Romance: Affairs of the Court.'

You play it. You want to go on to level 2? Pay. Level 3? Pay. Not have to wait 20 minutes to start a new game? Pay. No ads? Pay. Start from level 2 or 3 with accomplishments you achieved? Well, it claimed to be free, but restore-from-save doesn't work, so you pay. Play it on your iPhone, Kindle, Android, and Chrome? Pay four times.

It was a great game, and I would have gladly bought the rest of the games, but it's both not fun to know I can either waste hours or get blackmailed into paying, and terrifying to see where they'll try to skin me next time...

I moved on, but I haven't found any really good games that don't do this.

I mostly agree with the premise here, but I want to play devil's advocate:

* The game isn't actually reviewed. Maybe you can play the game perfectly well without paying for gems. Maybe the game is actually more interesting to play for the fact that you have to manage your resources according to the time cost/gem count. Maybe there's a genuine reason why thousands of people have given five stars.

* There's no reason to believe that we are supposed to pay for the £70 bundle. Maybe the £70 bundle is just for the IAP 'whales' who are paying for everyone else to play. When I go to a coffee shop, I don't have to buy a triple-cream, triple-chocolate mocha latte for £8, but I also don't need to get annoyed that this is on the menu.

Regarding the high number of five-star ratings, there's a common pattern in this style of mobile game to optimize for ratings. After the tutorial introduces the mechanics, and after a bit of time spent in the main game, it prompts the user to go to the app store and give a rating. Shortly after this prompt is when the game starts hitting the player hard for IAPs. I haven't played this new Dungeon Keeper, but EA's Plants vs Zombies 2 followed this model to a T at release, popping the rating prompt near the end of the first world, but before letting the player know that they would need to replay the entire world repeatedly in order to pass the paywall for free.

The reason people play these games is habituation. By placing delays on things, they encourage you to take the content in small doses, and thus build a habit of playing, rather then burning through the (relatively small) amount of content quickly. Once people have a habit, they will rationalize it... "I am playing this, so it must be fun". Even once the content and new game play runs out and it is reduced to a rote grind, people will continue to play because of the sunk costs creating an unwillingness to abandon all the weeks or months of grinding they put into the game.

It is a model pioneered by the MMO industry, but taken to an even greater extreme, where some of the worst psychological traps that people get stuck in are used against their customers to extend their profits.

There is something to be said for the fact that it's a different game. They took some of the mechanics and IP of the original game, and made a new game, so he shouldn't have expected it to match the original experience.

That said, from what he did review, it seems pretty clear that this new game is up there with the worst of the freemium/IAP model. I think your advocacy veers a little towards being willfully obtuse. I would say there has never been a single game that has been made more fun or interesting by the "wait a few hours or pay money to continue" mechanic. Resource and time management is certainly a valid mechanic but that assumes that the player can continue doing other things (as in actual "gameplay") while the time-intensive operation is happening. Even failing that, if we assume there is some game that is fun to not-play while you sit there waiting, the fact that you can pay money to advance invalidates it as a gameplay mechanic. At that point it can be nothing but a business decision.

On the coffee shop example, you are paying for the intrinsic value of the coffee, so no, other offerings should not affect you. But with the "bag-o-coins" type of IAP, you are not paying for the image of your character holding the coins (i.e. a cosmetic item, which is considered somewhat less evil), you are paying for a means to an end, to continue playing the game.

It would be more like this: the coffee shop advertises free wi-fi, which is one of the main reasons you went there. But by default your bandwidth is crippled to the point of near uselessness, and you have to buy the ridiculous mocha to unlock a decent speed. Now are you annoyed about it?

Don't pay so much attention to app store reviews. There are plenty of agencies out there offering fake reviews for pretty much anything.

I don't see how bad games full of microtransactions and fake reviews would be able to destroy the industry. They will not prevent the next Minecraft.

Don't people see that this is just a rant? The post is nothing but someone letting off some steam.

I purchased an iOS table tennis game, Virtual Table Tennis by SenseDevil Games after playing the free version. I "upgraded" with a $1.99 in app purchase.

Shocked to discover I still had to buy bats if I wanted to advance in the game, the bats for sale offered more spin to compete in harder levels. I'm not even sure what my $1.99 bought me.

If I spend money on a game, I don't want to find things "locked" such as table tennis bats in a bloody table tennis game. I left a 1 star review for that. Will avoid SenseDevil Games in future.

All their "buy coins" crap "visit the store" crap in the game. Who do they think they are? A bloody table tennis virtual economy? Obnoxious game developers, that's what it is.

Good that we can spoof in app purchases with in-appstore.com. I'm willing to pay good money for good games (full), but I'm not willing to pay 20 bucks to play and still have limitations to opponents who pay 50 bucks in multiplayer games.

The gaming market has ALWAYS been choked with shit. I don't understand how people can forget Sturgeon's Law so quickly and proclaim the death of the gaming industry. If anything, there are more great games now than there ever have been, if only because the barrier to entry is low.

You know all those old games that are so great that you wish they'd make now? They're still there! You can still play them! Go grab Dungeon Keeper and relive those days. So many amazing games to play, so many new technologies to make new ones with. Quit complaining and be a part of the solution rather than a part of the problem.

Here is the main problem. I don't know if I will like a game when I buy it.

I would gladly spend $5.00 on a mobile game if I really like it.

But, too many times I have spent money on a game and then not really liked it.

The reason in-app or in-game purchases work is because you don't mind spending money on something you really like.

If Apple or Google Play allowed for a testing period of a few hours, then this might solve the problem.

If I have a money back time limit of say 2 hours, then I can get my money back anytime before I spend a total of 2 hours playing the game.

This would allow me to only spend money on games I really like without the fear of spending money on games I don't like.

Long trial periods don't work. Lot's of potential customers will whip through a few plays of many types of games in a couple hours and "return" the game. Even strategy games with 30 turns per game can be played multiple times on different maps in 2 hours. What to do? Make better videos? If you have a good answer I'm sure Apple and Google want to know.

I recently mentioned the Doom model[1] of offering a few levels for free and the rest are paid. A few people said they had tried that and people really hated it.

I've been playing Scurvy Scallywags recently. I really like it. They deserve more money than the small amount I paid for the game. There is a tiny IAP, which I've bought, but I wish there was a way to give them more money.

It doesn't have to give me any advantage in the game either.

Maybe provide a free download and allow users to play through tutorials or the first 2 levels then opt for a single in-app purchase to unlock the full game. One single in-app purchase that would have been the cost of the game anyway. No different than all those free demos we got to play on PC.

> play through tutorials or the first 2 levels

That usually irks me. The free bundle should have enough to get me hooked. Few (possibly) really good games only gave me the most basic of levels for free without any of the complexity the rest of the game had. So obviously, it wasn't enough to get me to buy the rest.

Dont get me wrong, i LOVE this model. Give me free levels, make me love it. Promise me far cooler stuff awaits me beyond the pay wall (offer a video trailer) and i'd love to pay for the rest.

One great example i ran into (and yes i am probably mentioning this like the third time here) is BADLAND. I am honestly not a dev of it :P but am in love with their model!

At least Google play store has a 15 minutes of refund period after you buy.

In app purchases have ruined so many games for me.

I don't even mind their existing so much if they are a simple 'cheat' (and the game isn't impossibly slow to progress without them), but what bothers me is when they are the only way to get or do something (especially if the 'thing' is to progress any further in the game). I have quit games at this point when they no longer became fun for me, and I don't just mean fb/mobile games, but even proper (read: PC) games that used to be fun before that element came into them (e.g. Star Trek Online).

I remember arcade games that were designed to eat quarters. They did very well. People loved them.

Seems that people love these games. I don't know why either but I still burn through quarters playing Area 51 whenever I find it.

Go figure.

I played Smash TV on someone's free MAME system recently. I finished it in about 20minutes without starting over, just pumping credits. (In STV, you lose 0 progress when you continue with a new credit after falling. In fact, you get a brief invincibility bonus.)

It was surrreal. For one, a lot of the drama and challenged vanished. For two, it made me wonder how I sent god knows how many quarters as a kid.

Now I am playing Crystal Castles, where falling causes a partial start over (there are some warp/checkpoints later) and it is addicting me again, still fun.

I don't mean to defend in-app purchases, but this isn't the first time the game industry has tried to nickel and dime you. How is it that different from the 90s when the game industry put out incredibly difficult games and charged players tokens every couple minutes to keep playing? I know I've personally spent a hell of a lot more money in the arcade than on in-app purchases. This isn't a mobile example, but I think Riot (maker of League of Legends) is a company that really gets it right with in-app purchases in a tasteful way.

As far as I can tell, the objection to IAPs vs the old arcade model is the difference between "pay to win" and "pay to play".

With enough quarters a monkey could beat Area 51 so I think that is arguably "pay to win" as well.

The only way to break the in-app purchase model is to have try before you buy. I'm not going to pay full price to try a game before knowing if it's good or not. So yes, I'm potentially ignoring lots of great games that charge full price up front, but how do I know if they are good or not? I don't understand why Apple hasn't pushed for this from day 1. If I got to play even two levels of Super Mario 3, I would buy the game in a heartbeat.

Also, we rented the full game for a weekend from Blockbuster before buying.

I wonder if the problem isn't the AppStore itself. It is so difficult to find good content, and the 'Top 10 Lists' are the primary place people go to find games. This has led to rampant spamming and other dirty tactics to get on these lists, and now there is no market for higher quality content.

I think another problem is scarcity - there isn't any anymore, making it hard for me as a customer to focus on a few higher quality products. Now there are just too many apps.

In-app purchases are not the problem, people paying for them are.

I don't like IAPs but this blog post's argument misses a really big key point. To do a fair comparison between a real game such as Dungeon Keeper and its IAP version, you can't quote the GOG price for the real game. That's the price that arrived years after the game was fresh with healthy sales and years after the game already recouped all of its costs.

The price they should have quoted for the original Dungeon Keeper game is $49.99.

I think that "destroyed" is not the right word.

Yes, free to play games with in app purchases dominate the mobile market. For now. The mobile gaming is just 6 years old. We're in the 'Space Invaders' era. The quality of the top-grossing games is, how I shall put it, not great.

I think eventually the quality will grow to a level where paying up front for a mobile game will not be the stupidest thing on the face of the Earth.

>> The mobile gaming is just 6 years old. We're in the 'Space Invaders' era.

Game developers have access to over thirty years of video gaming knowledge when designing a game. People have access to multi-platform SDKs, etc. Today, anyone with a computer can produce and publish a game.

When Space Invaders was around, this was not even remotely the case.

The expectations for quality on a 6 year old platform today should be much higher than it was in the 80s.

It's quite funny how the author calls the game industry destroyed by in-app-purchases, when most of the games industry isn't mobile gaming and doesn't have that. PC or console, there isn't a lot of IAP (no real mechanism for it). The irony is that people who identify themselves as gamers generally see the mobile gaming space as a cesspool of discardable lightweight games.

Well, I am also very disappointed by nearly every mobile game I have ever seen, but on the computer and PS3/4 I still see good things done right. So don't really see the point here. The platform is obviously for little children with too much pocket money and people make lots of money serving them such kind of games. Looks to me like nearly everybody could be happy.

Posted on HN a long while ago, here's an article that describes in-depth just how some F2P games manipulate the consumer to spend the maximum amount of money they can:


The only games that are worth playing is stuff released years ago. i have never payed a single $ to play these app store scams and never will. I however dumped close to $200 on a KS game I wanted made.. scum is scum and I will never assoicitate with them(shared office in with one of these before.. felt dirty at the end of the day)

>The only games that are worth playing is stuff released years ago.

Wow. I absolutely detest the kind of games talked about in this article but I believe more great games are being made now than anytime in history. The whole gaming space has grown so much that every single niche is better served now. Not in the AAA space but indy game quality is so high now, they can easily best games from 15 year ago.

Look at the Steam top 10, it's not bad at all. DayZ and Rust are both extremely interesting game designs that like of which had only been seen in MUDs before.

I'll admit, sometimes I don't want to spend more than $10 on a game especially without knowing what it's like. But that's why there's in-app purchases or rather, a single purchase. Like the golden era of PC games where you got a free demo with your PC Magazine. Play it, love it, wait a few months, buy it.

> So what's the solution? If people are unwilling to pay > reasonable prices up-front for games, how besides in-app > purchases does a game company profit from their work?

If morality is valued higher than profitability, game studios wouldn't enter into the market. That's the choice they have.

It seems many think the same way - check out this Reddit thread:


In the last 18 months I've entirely stopped buying mobile games because of this trend. I know that any game I buy is probably going to become less fun if I'm not willing to buy virtual cranberries.

This is not sustainable as an industry practice. People will eventually get wise.

I'm surprised it hasn't been nicknamed something like the 'entertainment singularity'. It's like a philosophy of maximum productivity has encroached entertainment and now you're either working or paying. Not playing.

To me, this model is closer to gambling than gaming. In fact, some gamedev studio actually build some slot machine games, where you put in real money through in app purchase and you get game money in return. It's disturbingly successful.

I don't remember exact term for the idea that too efficient virus (a parasite) eventually eliminates the whole population of potential hosts and therefore destroys itself.

Too many cheaters destroys a market. Too many thiefs destroys a country.

The strategy of releasing part of a game for free and charging for the full product is tried and true. This frees the game from in app purchases and allows the developer to make money. Sounds like a good, workable solution to me.

That's not really the problem, though. Free demos have been around for ages. The issue is integrating cash payments into the core gameplay. This necessarily undermines the integrity of any game that uses it, unless it's really a game designed around real money like poker or blackjack.

Studies show that free demos aren't the optimal way to squeeze money out of the market. IAPs are. So the vipers in suits demand IAPs.

Killing the goose that lays the golden eggs probably also seemed like the optimal strategy at the time, too.

(originally posted in the similar post "Optimizing Your Industry to the Point of Suicide", I thought _this_ post title had been edited [same subject, same domain] - apologies if that's against HN etiquette)

As much as I also dislike how some IAP game developers base all their gameplay mechanisms purely on maximizing the user likeliness to keep spending without even noticing, I recognize that they get the very basics of video game design very right.

Because they have to.

The goal for any game developer who treats its creation not only as an artistic piece but also has a product, is to design software that offers a positive feedback loop to the user in order to keep her engaged.

Consider how Nintendo, for instance, considers the Mario platformer franchise as an instrument (see Ask Iwata interviews). During development, designers are focused on getting the timing (rhythm) right between challenge (say ennemies or holes) and corresponding rewards (powerups or secret exits). This ultimately plays/tricks how our brains are wired (effort needs reward) in order to engage users and ultimately enjoy the game... and pay again (and again) for the sequels/updates when they need their fix.

Imho IAP is an interesting return to the origins of video gaming (and coin-based arcades) and refocuses the industry on getting the core ingredient right, the feedback loop, rather than betting it all on graphics, story, feature-creep... and marketing.

Marketing is disproportionally important when you need to convince your game is worth paying upfront, even in a seemingly minimal amount, as mobile gaming is a very "dispensable" expense in the general public.

There is no ROI in marketing an IAP game that does not engage enough of its users (enough). On the other hand, marketing heavily an upfront-cost game can draw sales, sometimes thanks to the franchise name as well, despite providing no to little entertainent to most of its users as the feedback loop is just not good enough to engage them.

For good or bad, I think IAP is accelerating adoption of data-driven practices for video game design. As an engineer/scientist, this is very interesting.

Last but not least, IAP probably helps expand the (mobile) gaming audience to people who would have otherwise either not played game(s) at all or would have downloaded illegally.

In the long term, I believe this can only be good for the industry. The bad apples of IAP will be regulated by better consumer protections for the worst "abuses" and more naturally over time by the users themselves as they get more familiar with the model and more "meaningful" IAP titles become available.

The world's sure changes since I was shoving quarters into a coin-op.

On the technical side, wasn't there something in giving a game away and in-app charging that made it harder to pirate on iOS / Mac App Store?

The consumer would only invest $40 in a game purchase if it represented durable value, but that is incompatible with the platform which is itself a consumable product -- get a new phone every two years!

Games are making more money than ever, destroyed is not the right word. There will always be a demand for games, and if users do get sick of IAPs then the strategy from every game company will change.

I must have missed part I and II, namely "The game industry has been destroyed", and "It was in-app purchases that destroyed the game industry." Any links to those?

Is hex editing your savegame files to get more coins, stars etc then piracy? After all I am licensed to use software and the savegame is my creation and its IP belongs to me.

Or that guy who had one of his servers pretend to be the Candy Crush server, so that he could "beat" all of the levels instantly?

What is incredible is that they don't even throw in the fully unlocked game to a user who would pay £70 which is > the price of a next gen AAA game.

There still is a sane solution: make a game free with a small number of free levels and sell unlimited levels for a fee as a one-time in-app purchase.

This can be fixed with better content discovery tools. There's currently no decent way to discover, if a game will be any fun for me.

pfft. IAP? Dude's talkin about the 90's like it was the genesis of gaming. Arcade games did IAP back when we were feeding those big machines quarters in the 80's. "Oops. You got this far and died. Want to continue? That'll be one more quarter please. 20.. 19.. 18.." The gaming world didn't end.

You could beat the good arcade games on one credit, and if you were skilled enough to do so it was the best possible experience. Some people still consider it the only "legitimate" way to play those games.

* the mobile games industry.

It's not just games using these strategies now, it's everything..

This just in: The game industry is destroyed.

Just sell the damn Hats instead!

yes you are right.

Destroyed? Sounds whiny and old.


I work at a well-known and [formerly?] successful casual game company. Recently, the company ventured into the 'freemium' with in-app purchases model. It hasn't gone so well - garnered a lot of hate, and not nearly as much money as hoped. The execs have responded by doubling down and going all in on freemium.

So now there's this uncomfortable tension in the air, where lots of employees think it's a potentially company-destroying mistake, while the execs are pushing it as the type of propaganda that you either shut up and get behind, or 'perhaps this is no longer the right company for you.' And if it fails, it'll be because those employees didn't believe in the vision, not because freemium fucking sucks and core customers hate it.

Why are they doing this? Basically because of the success of Candy Crush and Puzzles and Dragons. The execs want so badly to be them. They want that money. It's revenue envy. Never mind that the company has always been wildly successful doing its own thing, these other companies are printing money doing this other thing. We gotta get that money. We gotta do whatever they're doing over there.

I just think money inside games distorts the game and is distasteful, like money in politics, or money in your esophagus.

...the execs are pushing it as the type of propaganda that you either shut up and get behind, or 'perhaps this is no longer the right company for you.'

Perhaps they are right. As an entirely serious suggestion, if you've got a solid development team who know how to make good games and it's the leadership that is letting you down, maybe some of you should move to another company.

Maybe there is an existing competitor that would benefit from hiring a ready-made team with a good track record, and you could collectively negotiate a mutually beneficial deal.

Alternatively, in true HN style, maybe you could start your own company. Either learn the management skills you need personally, if that's achievable with your group, or hire in management staff whose views are more compatible with how you want that company to behave.

You'll have to get a lawyer to look over your existing contracts for anything that might interfere with these ideas, and of course it can be a scary move to break away from an established job. On the other hand, if you're seeing the writing on the wall already, it might be a good idea to start thinking about your options.

Will the next Traitorous Eight or PayPal Mafia come from the games industry?

The guys that started Activision did this already 30 years ago. Do we have a catchy name for them, too?

That sounds awfully like Popcap games, with Plants vs Zombies...

PvZ 2 was a total waste on me. I hesitated a long time before downloading it, and only did so because the reviews said you could play through the whole thing without buying anything. I played it until I got bored, and spent nothing. Throughout, I retained a vague sense of annoyance at the purchasable upgrades.

I would happily have shelled out £10, maybe £15 to play it (and my wife and my mom would both have done so too), and would have played it through without any sense of annoyance. Result? Popcap game annoyed me despite all the effort they put into building a great game, and left £45 on the table.

If their conclusion from that is to double down on IAPs, then quite simply they are saying they don't want users like me and my family, but want, as the second "Dungeon Keeper" iPad review from TFA, "fuckwits". Sorry, I don't buy games for fuckwits.

I look forward, with little hope, to a PvZ 3 with no IAPs but a good upfront price.

I really hope it's not Popcap. They are a favourite in my household too, again because they make entertaining, well polished, and not excessively priced casual games that several of us enjoy. If even companies like that are succumbing to the allure of ongoing charging, they'll lose us as well.

Popcap is owned by EA, who is well known for being heavy handed with their studios. EA happens to really like the IAP model.

I'm afraid for Mirror's Edge 2. Even Dragon Age saw the beginnings of this, with "Bioware points" used for DLC.

ruined quizup

I think that having to purchase item is a huge problem because without it you are at some disadvantage even when you enjoy the game. It completely turns me off from even trying out the game if I find out it has in game items.

On a side note that Dungeons Keeper game is simply, mind blowingly ahead of it's time. It looks insanely fun. Thought it was just another RTS but wow, you can play as any of the minions in FPS mode. It was on DOS too. Why can't games be like this more? Focus on fun instead of graphics and wallet grabbing?

More like destroyed the iOS/Android market. The game industry is doing just fine.

Only the lowest common denominator has suffered

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