Sometimes, it is safe to say that the age of the “hermit inside and hogging your video cartridge for hours at a time” is gone. Regardless of playing single or multiplayer, nowadays, video games connect millions of players together forming a community and social identity of its own. Why would I mention this seemingly trivial and melodramatic information? Well, I felt it was a good starting point to look into the video game industry from an economic aspect – video game producers make money by selling video games, you know.
Major video game companies used to be able to generate enough profit by just selling video games, and that is no longer the case. Nowadays, there’s a myriad of ways for them to make extra cash, from Downloadable Content (DLC) to video game wear. After all, a sufficient diehard fan base is willing to dish out extra money for access to more content or to proudly display the fact that they play those video games. Companies also commit extensively to marketing efforts, exclusive market deals, and other methods in an effort to attract more customers. Personally, I am still fuming over how Nintendo has exclusive rights to Monster Hunter for the foreseeable future, denying possibly an enjoyable and powerful Sony PlayStation Vita title, and completely cutting Vita away from a console-redeeming game. I don’t blame them—they bring you entertainment for profit, after all.
Ever since video games moved on from cartridge and CDs to digital download, the cost to produce a game has been significantly reduced for smaller companies, and has allowed them to thrive on the Internet. However, when does a video game company cross the line? I think most readers will know what I am about to discuss—“Freemium” games of different kinds. The central idea is simple: you play a “trial” or reduced version of game for free, and pay money to access extra content or full version of the game. However, these “extra features” became hot topics of discussion. For many of the games, money is spent on some form of “energy” or to unlock each piece of content in order to play, racking up the bills ruthlessly.
Nowadays, most games online involve a degree of competition, from racers trying to beat each other in a friendly manner to the finish line to players “killing” each other in a fantasy environment with everything at stake. A lot of games of Freemium nature give what can be considered an unfair advantage to the paying members, unbalancing the game to those paying by granting overpowering power-ups or exclusive items. This turned online gaming, which is supposed to be a showdown of skill and mastery, into who can throw more money at the screen. Sadly, for a lot of games, this money making scheme worked – as players became gradually addicted, they had the painful option of paying a lot of money or not progressing in the game.
While I won’t call on any bad examples of these games, it is important to recognize some of the negative impacts they leave. However, I am glad to know that there are better economic models for paying for a game. Instead of “Freemium”, many of the top-tier games have been running “Pay-to-win-faster” style shops, with examples including League of Legends, Hearthstone, and World of Tanks. This kind of transaction style means spending money will not grant any unfair advantages in the game, but will only introduce pretty cosmetics, sometimes out-of-game boosts, and contents that can be earned fairly otherwise.
While “pay-to-win-faster” is still a hot topic of debate, one thing I am sure of is that this method of video game economy is effective, on top of minimizing its impact to gameplay fairness. I sometimes cannot resist putting a little cash in myself, and sometimes even up to a full version video game’s cost. I believe that it is up to us, the consumers, to discern good entertainment from a money sinkhole. However, in the end, it is up to us to spend responsibly on our hobbies.
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