Free to Play - Understanding the Alternative Business Models of Modern Mmorpgs

As most people are familiar with the rising popularity of MMORPGS, or a Massively Multiplayer Online Role-Playing Game, some might not be familiar with the more modern business model many companies employ nowadays to entice new gamers to play their product. There is a rising trend for companies to release Free-To-Play MMORPGS. Essentially this means that the product is usually not found on store shelves for sale and there is the removal of a monthly subscription fee common with many titles in this genre. Often you might wonder how a business company can survive with a business model of giving away their games entirely but I will attempt to explain how many companies thrive on this type of business model.

First I will explain what the RPG game genre is. It is a game centered around the player taking control of a fictional character often in a mythical setting and controlling almost all aspects of that character or what is known as an avatar. The overall focus in these types of games is to increase or maximize your characters level, abilities, skills and equipment. An MMORPG is unique in that it is a setting in which players could interact with others online in a virtual world via the Internet. The term MMORPG was first coined by Richard Garriott famous for creating one of the older and first widely successful online RPG known as Ultima Online Ultima Online is widely acknowledged with popularizing the genre in the early 90's. Some examples of popular Pay-To-Play MMORPGs after Ultima were Everquest in the late 90's and today by far the most popular one is World of Warcraft

Traditionally these games were available for purchase in a retail store which contained the game software and when you installed the program you also created an account with a valid credit card. Then on a monthly basis you paid the subscription fee which ranged anywhere from 10-20 dollars. This is commonly referred to as a Pay-To-Play model. Game mechanics employed insured that character progression was something that was not fully achieved in a short amount of time. Many of the game elements were heavily time centric and it could take many months or upwards of a year to achieve the maximum level or desired status. Group interactions were also encouraged to achieve common goals thus further immersion in the game community resulting in players just spending time "hanging out".

This traditional method has proved incredibly lucrative for many companies with world wide revenues exceeding over a half billion dollars in the year 2005. This figure has doubled in the last couple of years making this one of the leading categories of game revenue for major game publishers. The Free-To-Play model turns this perceived well established model and reworked it into something almost as lucrative.

This model was made widely popular in first in South Asia but now is a global trend. The Free-To-Play model is usually a downloaded game client instead of a traditional box cd. This helps cut down physical production costs and also encourages players to try the product for no charge. This model also addresses one of the limits of the traditional method and lets the game be available to players who may not have access to credit cards.

The Free-To-Play model focuses solely on micro transactions, often ranging in cost from a few cents to a few dollars, focused on virtual avatar appearance and sometimes performance upgrades. No longer was changing your character dependent on earning certain in-game items, but by rather making them available for purchase. Various items like property, pets, and items are usually all made available via micro transactions. Micro transactions can usually involve exchanging real money for in-game currency. Many of these companies offer numerous payment options as well, including credit cards, cell phone charges, and cell phone charges.

According to a consumer study of over 2,000 online gamers in the United States, a larger segment of gamers (social, leisure and the dormant demographic) showed interest in this Free-To-Play model as opposed to the traditional subscription methods. The study indicated of the players not currently playing an MMORPG, 14% would play the Free model as opposed to the subscription model.

Also there exists a hybrid model of both traditional and modern revenue elements, with games like Runescape or Mechquest. A limited version of the game is available for free, but an offer to upgrade the existing free account to a full options subscription account is available. Often the most powerful and rarest items are made available to the full members leaving a powerful incentive to upgrade accounts.

The rise of popularity of Free-To-Play models certainly will not eliminate the subscription models entirely but they will definitely continue to be present in any upcoming MMO titles. The amount of revenue generated by MMORPGS nowadays is so significant that the extra viable options of monetization will continue to be expanded upon.