What is a game worth? This question can be answered in many ways with no wrong answers. In a sense, a game is worth what the player is willing to pay. When we talk about “worth,” we usually conjure ideas of price tags and MSRP’s. However, even when just talking about monetary value, there are many ways to pay for a game. This comes as no surprise to many of you, as you have all bought a variety of games. There is the simple flat cost for a new game, the subscription model, the collectible model, and the ever so famous free-to-play model.
Free-to-play sounds simple enough, it’s free, right? Sure you can pay for in-game content but the budget minded player doesn’t have to, sounds great, right? … Right? No, at least, not in the way that benefits the player. No company does anything for free, it flies in the face of capitalism. A company needs to make profits, but not just any profits, more profits than last it checked. Companies care more about profits than the Catholic Church! (Get it? Instead of prophet?) It’s not enough to make money, a company is only considered successful if it’s making more money than it already is. So when someone makes a free-to-play game, you can be sure it’s anything but “free”. The easiest way pay for free-to-play game is by seeing advertisements. Those annoying pop-ups, videos, and banners are all a cost you pay. Nevertheless, if the ads are too annoying you can just stop playing. Actually, that’s not true, not if the game was built correctly. Have you heard of an operant conditioning chamber? To quote Wikipedia:
“An operant conditioning chamber […] is a laboratory apparatus used to study animal behavior. The operant conditioning chamber was created by B. F. Skinner while he was a graduate student at Harvard University (studying for a master’s degree in 1930 and a doctorate in 1931). It may have been inspired by Jerzy Konorski’s studies. It is used to study both operant conditioning and classical conditioning.”
These chambers are also called “Skinner Boxes”, named after its creator. Its basic function was to provide a reward for a specific action, like pushing a button, in response to a specific stimuli, like a light or sound. This process conditions the lab animal. The Skinner Box model has been applied to a variety of functions, like teaching our pets tricks and even in marketing. Another use is slot machines; put a coin in and pull the lever. Each time you feel the excitement from the lights flashing, sounds whirling, and coins clinking, you are being conditioned. If it works for slot machines, why not games?
That’s how free-to-play games are structured. Consider a game like Farmville 2: Country Escape. It provides simple actions, like planting and harvesting at the touch of your finger, and provides rewards in the form of in-game currency. After performing enough tasks, it gives a colorful scene filled with fireworks and music to congratulate you. This should sound familiar. However, that’s not enough. To keep you coming back, there must be a time function. Come back in 3 days, or your crops that you watered will wither and die! You don’t want your crops to die because if you harvest enough, you will level up! Remember that? It was so fun! Another way to level up is by building structures, which take in-game currency and real time to be completed. To build a windmill, it will cost 25 coins and 4 seconds. You want a windmill because it will let you make flour. To make flour, it will cost one wheat and 20 seconds. How do you get wheat? All it takes is 1 water and 30 seconds. But make sure you turn it into flour because it sells for +2 coins and +1 XP versus wheat. The more XP and coins you have, the sooner you will level up! Remember that? It was so fun! Oh, but 50 seconds can be a long time if you are waiting for all that wheat… Don’t worry, we can speed it up, all for just a little special currency, each and every wait period! That special currency is real easy to get, we’ll give you some just for starting the game! The first one is always free, right? You can earn more for free too, all you need to do is watch ads! Or you could pay, for a small fee, you can get more Farmville 2 special currency!
Do you see what the game is doing there? You think you can quit the game, but not only is it trying to condition you, it’s literally trying to get you addicted. It gives you a rush when you level up and threatens you with not leveling up if you don’t come back in a timely manner, but also makes you wait to level up, then offers a way to avoid waiting as long as you pay. While Farmville 2 is just one example, you will find this to be the way almost all free-to-play games work. Even though this model seems lucrative, it hasn’t been doing as well as it has in the past. Over the recent few years, Zynga (the company that owns Farmville) has been posting losses, which could mean reevaluating business models.
There are some free-to-play games that don’t use the Skinner Box model, and instead use a pay-to-win model. While pay-to-win can be used to describe Zynga games, it is typically used in competitive games with a lot of player vs player (PVP) conflict, pay-to-win is exactly what it sounds like. You pay real currency for in-game content that makes your character significantly better than someone who doesn’t. These games have one significant difference than Zynga’s games, and that difference is the amount of upkeep required. A massively multiplayer online (MMO) game requires servers, designers, developers, artists, testers, actors, etc. for every update, patch, and expansion. Pay-to-win evolved because players slowly rejected the subscription-based model, and these games need to make money to keep going. Pay-to-win has become stigmatized among certain competitive games, so it has also slowly evolved into other money making methods such as free to play the basic game but pay for every expansion, pay for locked in-game content, or pay for extra content not influential to gameplay. League of Legends and Overwatch are notable games that use this model.
When it comes to a subscription, it’s a hard sell to a lot of people. In most minds, the subscription should be a lot less than what the service actually costs to provide. If you are willing to pay a subscription for anything, a game included, you believe you will be using it enough to justify the cost. If we look at the most iconic MMO game, World of Warcraft (WoW), we see price tags all over the place. It’s $19.99 USD to play World of Warcraft and at least $12.99 per month if you want to play for six months. This doesn’t include $49.99 for the latest expansion. In the first year, you would pay $225.86 + tax for this game. That’s almost two and a half Netflix streaming subscriptions. Would I use World of Warcraft 2.5 times more than a Netflix subscription? I wouldn’t, but some people would. Unfortunately for Blizzard (Activision Blizzard, WoW’s developer) a lot more people agree with me than the latter. This likely occurred because many MMO games were created after WoW and wanted the same audience, but saw the price tag as the biggest barrier to entry. So alternate ways to make money were created, such as free-to-play with a pay-to-win model.
It’s not like Blizzard is having hard times, there many other active games that Blizzard owns and are very popular. Some of these games include the Diablo series, the StarCraft series, Overwatch, and Hearthstone. When it comes to price, Hearthstone in particular is worth mention. Hearthstone is an online only collectible card game. Hearthstone can be downloaded and played for free, and some very basic cards are free, but other cards need to be acquired by purchasing “booster packs” that contain cards. In addition to purchasing boosters with real money, you can purchase them with in-game gold. Every day, Hearthstone provides its users with a random “quest” that rewards about 40 – 100 gold on completion. These quests range from winning a number of times with a certain class, to playing a certain kind of card a number of times. You can also stack up to three quests, so you don’t need to play every day if you are trying to get the most gold out of your games. In addition to quests, the player will earn 10 gold for every three games won in normal play, with a max of 100 gold per day or 30 wins. This makes gold objectively easy to acquire.
It is notable that you can’t actually buy gold with real money, rather, products either have a gold value, USD value, or both. What can you spend Hearthstone gold on? A single booster pack, which contains five cards with at least one “rare or better” card, is purchased for 100 gold. The “Arena” which is an alternate way to play, where you make a 30 card deck one card at a time by choosing from random cards, costs 150 gold to enter. The Arena provides rewards that scale with how many victories you achieved with the deck against other Arena players (you do not get to keep the 30 card deck afterwards). These rewards are always at least one booster pack. “Solo Adventures” are player vs computer games that are released every year in sets of four “wings”. Each wing rewards a player with about twelve specific cards and cost 700 gold each. Compare these prices with the USD prices:
|Product||Gold||USD||Value in Cards|
|The Arena||150||$1.99||5 or more|
|1 Adventure Wing||700||$6.99||About 12|
|All 4 Adventure Wings||N/A||$19.99||About 50|
Besides buying some personalized cosmetic changes, these are the only ways players pay money for Hearthstone. In 2015, it was reported that Hearthstone was bringing in around $20 million in monthly income. Of course, that’s not all profit, but that’s still a lot of money each month. Combine that with the lower upkeep cost compared to WoW, Hearthstone is doing pretty well for itself.
Now here is the real question, is it pay-to-win? When it comes to real money, each card is worth about 30 cents because that’s how much you’re spending per card on boosters. Hearthstone is a collectible card game, so can you buy the cards individually? No, you get individual cards by spending a special currency called “Arcane Dust”. The only way to get dust is by destroying cards you already own. Since you can only have two copies of a card per deck, dust is a good way of getting rid of more duplicates. Can you trade cards with other players? Nope, that’s not a function in the game. Dust is really the only way to get individual cards. Fortunately, all cards have a flat dust rate based on its rarity:
|Rarity||Cost to Make||Trade-in Value|
Does this remove pay-to-win? No, but dust allows Blizzard to control the pay-to-win feel by making all cards worth the same as each other and the randomness of the boosters levels the playing field. Furthermore, removal of trading has completely eliminated the bane of all collectible card games from Hearthstone, the secondary market. As a game, especially a collectible card game, Hearthstone is quite generous to its players.
When it comes to the price to play, collectible card games are the notorious undefeated champ of “way too expensive.” The villainous cause? The secondary market. The Trading Card Game (TCG), or Collectible Card Game (CCG), was invented by Dr. Richard Garfield. The idea was to make collectible cards, like baseball cards, into a cheap-to-make and easily portable game. The name of his game was Magic: the Gathering and it took the gaming world by storm when it was released in 1993. When Dr. Garfield made the game, he figured that players, on average, would only spend the same amount of money on Magic as they did on any other game, about $20 – $50. In hindsight, that number is laughable with players paying that much just to enter one tournament. Nevertheless, you can’t blame Richard, who could have imagined the success of Magic?
Magic is an extremely fun game with a great deal of depth, and it is still very successful almost 25 years later. Wizards of the Coast (Magic’s developer) has boasted record sales for Magic in the past few years. I always wonder, however, just how much money Wizards sees of the card sales. Wizards only sells sealed product and only to retailers. A Magic booster costs the consumer about $4, and comes with 15 cards in it. Usually, that’s 1 rare or mythic rare card, 3 uncommon cards, 10 common cards, and 1 basic land card. If I pay $4 for 15 cards, each card should only be worth about 27 cents. Seems like a good amount of cards for the price; no matter what you open, it’s probably worth it. Now introduce the secondary market. Some cards are better than others, usually a rare or mythic rare, and those will show up more often in tournaments because they will help the player win. More players realize this and want copies for themselves, even willing to pay more. Maybe just $4 for the one card at first, then maybe a whopping $200 for the one card. See that? One card could be worth just the entire cost of 15 random cards, or fifty times the cost of those random cards. What is a retailer to do? A $4 random pack of cards could actually be worth $200. Sounds like a better idea to just open all the cards and sell them individually. Recently, a single card rarely becomes worth $200, but it’s normal for the best cards to be worth about $70. These prices should seem ridiculous to any objective observer, $70 for a piece of cardboard? No sane person would pay that! Heck, it feels wrong, like it should be illegal. Probably because it functions just like a lottery, the state-backed method of gambling. Only $4 for a ticket, maybe you’ll win $10, maybe $200! To some people, Magic has become like the stock market. A new set comes out and people speculate on how well a card will do, pre-order the card in hopes of the price rising and then selling them for a profit.
When you are paying $600 for a competitive deck, $5 – $50 to play in a tournament is nothing. That’s not to say the prize support isn’t good, every year the top 24 players in the world championship split a prize purse of $250,000. In one of the quarterly pro tours, you can win $50,000 for 1st place or $1000 for coming in as low as 64th. As someone who finds high level competitive play to be a caustic environment, I’d love it if Wizards took the $1,000,000+ tournament budget (assumed, not confirmed), slashed it, and turned that into making expensive cards cheaper.
Even if Wizards had a way to beat down the secondary market, they don’t have the will. That’s right, Wizards actively protects the secondary market. Once, long long ago in 1995, Wizards did think the secondary market made cards too hard to get. So they took a bunch of cards people wanted, and over printed them so they were easier to get. Sounds like Nirvana, right? Well, not to some overly vocal, entitled, and greedy collectors. Wizards apologized and vowed never to do it again. Then, going above and overboard, they created a special list, called the Reserved List. This list is a promise to never reprint any card placed on the list. So they retroactively placed cards on the list and added at least 75% of all new rare cards on it until 2002, by then, 571 cards were placed on the reserved list. Those cards’ prices are constantly increasing and will never go down. The most famous card on the list is the Black Lotus, the cheapest you could by a single one of this card is about $3000, and its condition would be considered damaged.
Nevertheless, it is the correct thing to keep the reserved list promise. As a company, your image is very important, and if a company has a no-good-dirty-rotten-liar image, people won’t like you as much. Even though the reserved list isn’t adding new cards, the salty tears of collectors still stings Wizards. This is apparent when the policy of reprinting high-valued (non-reserved list) cards includes making reprint-only sets where the MSRP for the 15 card boosters are $6.99 or even $9.99. If it felt like the lottery for $4, $10 matches it exactly, you just win $200 instead of a million.
The best way to purchase a game is for a flat price. In the past, if you purchased a game disc or cartridge, you owned an entire game and could do whatever you wanted with it. The video game industry is one of the few industries that vigorously feels that is way too little money. Pay once for a product and then own it? Ridiculous! Could you imagine buying a computer or groceries and owning it forever? Toshiba made that computer! Dole grew those bananas! While farcical, game companies seem to have this mentality. Games have been notorious for cutting parts of a game for selling DLC later or making extra locked content for day one. These companies even invented a “Season Pass”, a product that pre-orders all or most the DLC for a game, even if they haven’t made any of it yet! Game companies also try to lock out users from trading in their games with something called DRM, which stands for Digital Rights Management. Computer data is infinitely copyable; if one person has a computer program, like a game, in theory that person could copy it for everyone. DRM is the extra annoying stuff that prevents that from happening. DRM typically attaches a game to an account, in a similar way a person buys a disc for themselves. The biggest difference is that it isn’t your physical property, you can’t trade it, sell it, or loan it. Ultimately, that’s just a downside of digital, and for digital only versions of games, this is arguably a justified practice. Microsoft attempted to create DRM for physical discs, but shut down the project from the overwhelming dissatisfaction shouted from their audience.
Recently, video games have slowly stopped over milking customers for more money, but go back five or so years and it was rampant. Now, games sell DLC that hope to expand content, which is usually worth the price considering the expanded content. If you are lucky, a game will be rereleased in a year or two with all the DLC, and maybe for a bit less than a brand new game. Consider the recent rerelease of The Elder Scrolls V: Skyrim. Updated graphics and all the DLC for the same price as a new game. Could you imagine if the people who bought it for the previous console generation and each DLC individually complained? Would Bethesda (Skyrim’s developer) care? No! They want to make money! They won’t create the Skyrim Reserved List so the precious collectors who bought it first will always have their money’s worth. For collectors, game companies make a separate, special, but ultimately equal product called a collector’s edition. While objectively ridiculous for new and untested intellectual properties, collector’s editions are an easy way for game developers to make an extra dollar off long time fans and crazy collectors.
If you make a game I want, I want to buy it once. If you release something big enough for it, such as DLC or an expansion, I’ll want to buy that only once too. Conversely, that model won’t make you a ton of profit. When making a game, consider all of the complaints I’ve shared and think how your game should be marketed and sold. The last thing to keep in mind, after all this talk about money, is that your game isn’t only worth cash. Make sure your game is worth playing by making it fun, because the most valuable commodity you’re charging is the player’s time. If you waste that, you can be sure they won’t be back.