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LONG BLOG

Microtransactions and the Future of Gaming

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I was originally going to write about F2P games, but it seems the monetization models of F2P games are now being placed in full priced AAA games making the distinction increasingly irrelevant. There is an increasing trend of treating games as services rather than products and a mentality of consumers 'renting' the service instead of owning a product. Steam has always walked the fine line between the two concepts since customers technically do not own anything purchased on the steam platform, but it is allowed because customers are generally treated as if they do own their games. Valve did this as a form of DRM, to give them a greater degree of control over their store for better or worse.

On consoles and mobile devices, where the user has extremely limited control over their device, certain market practices have flourished. Many practices, like cosmetic DLC and repetitive microtransactions are not very successful on PC where users can modify the game to suit their preferences. On PC it has mostly been MMO's and online only games that have managed to succeed with microtransactions until recent years. With the success of the mobile market, making maximum profit off of minimum effort, many publishers are looking for ways to bring those practices to the PC. Let's take a look at some of these practices.

Cash Shop Currency:

A while back I spoke about Bethesdas Creation Club and its use of cash shop currency. This is a practice where the user doesn't buy things from the store with cash but instead has to purchase a special currency to use on the store. This is often accompanied by varying the currency to cash ratio based on the amount spent, i.e. getting 400 units for $5 but 900 units for $10 and so on. This makes it difficult to place an exact cash price on store items, but keeps it in a positive light by giving it the appearance of a bargain. This can be muddled even further by awarding cash shop currency in game, which makes it easier to put ridiculous price tags on items while minimizing complaints. The next part of the cash shop strategy is that currency conversion goes only one way, so anything unspent is lost. Occasionally this is accompanied by the currency expiring after a set amount of time, encouraging the user to spend more money to keep it from going to waste. Lastly, store products often don't match an even cash purchase requiring the customer to spend more than they need to for their purchases. When it's all combined, it's an insidious scheme that appears quite innocuous.

Repeatable Purchases:
Most F2P games tend to favor repeatable purchases, whether it be through RNG based gachas and loot boxes, consumable items, or buffs that expire after a period of time. Some games have time mechanics and charge to speed things up. Repeatable purchases means infinite profit potential. The game no longer has a static price tag and consumers could potentially spend thousands or even tens of thousands on a game over time.

RNG Purchases:
The first thing to come to mind with RNG based microtransactions are gachas and loot boxes where the consumer has no way of knowing what they are purchasing. There are also items to counter in game RNG. For example, some MMO's introduced item upgrade systems that require repeated enhancements to max out equipment with each enhancement having a lower chance of success. Failing an attempt will often result in the item being destroyed but the cash shop will sell an item that protects the player from that, making maxed out end game gear only realistically possible through the cash shop, and making it ridiculously expensive. It is not uncommon for F2P MMO's using this to have end game gear that costs hundreds on average to max out. Gachas and loot boxes are far more popular since they are more obscure in the method and generate the same sort of excitement as gambling. Because of the abuse of gachas and loot boxes, China has started issuing laws governing these practices, and the citizens of the US, UK, and Canada are calling for gambling regulations to be placed on these transactions. At the very least, many consumers want games with these systems to be labeled for the sake of consumer protection.

Paying for Time:
Many F2P games have time based mechanics combined with cash shop currency designed to bypass the mechanic. Sometimes it's a matter of in game actions taking a set amount of time to complete, other times it's in the form of being able to only play so much in a set amount of time until money is spent. Regardless of how it is implemented, it amounts to making the game boring and holding the fun hostage until the player pays up. The worst part of this mechanic is that paying up is temporary, just like dealing with terrorists, minutes later the fun is held hostage again. This is no longer solely the domain of F2P as AAA publishers are experimenting with adding it to full priced games. MMO's have been experimenting with minigames using time mechanics for over a decade. Some people even argue for ridiculous pricing for the sake of game balance, since paying up might make the game too 'easy'.

Cosmetic Only:
Many F2P models that succeed on PC do so in competitive games like MOBAS where P2W practices can quickly kill the player base. Because of the dangers of P2W unbalancing competition, most successful competitive games sell cosmetic items only. When microtransactions are cosmetic, companies can practically get away with murder. The reasoning is that it doesn't affect the game and can be ignored. The reality is that they are not ignored and are very popular, if they weren't, many businesses would fail. If people are willing to pay large sums for it, it cannot be called it irrelevant.

When I was playing Everquest back in the days of dial up internet, there was a highly sought after helmet for clerics. The helmet didn't have particularly good stats, it wasn't ideal for clerics to use, but it was the only helmet clerics could use that had a 'plate armor' look. Even in the early days of 3D graphics, where hard edged polygons were normal, cosmetics were very important to players. Many players spend hours in character creation trying to get a look right. Considering the amount of money and effort that goes into creating art assets and the amount of praise and criticism indie and AAA games alike receive for aesthetics, we can't continue to claim cosmetic items don't matter. The reality is that cosmetics can make or break a players experience in a game.

Whaling:
Whales are people who repeatedly spend insane amounts on specific products or services. It could be someone who spends $200 a week on McDonalds fast food, or someone who spends $50,000 on Star Citizen ships. Often it is believed to be people with more money than sense, and that is certainly a factor, but as every coke dealer knows, you don't have to be rich to be a big spender. The reality is that publishers go to great lengths to create addiction for their microtransactions, exploiting any weakness they can find, using every psychological tactic to get people hooked and spending. Mobile games are known for taking data mining to extremes and will even stalk whales through social media to exploit them further. In F2P circles people often excuse the behavior on the premise of supporting the game, but these are businesses not charities.

The reality is that getting $100 from 10 people is far greater than getting $1 from 100 people. When some users will pay thousands on a game and there is no limit on how much can be spent, there is no reason to price content reasonably. This is why GTA 5 is selling virtual yachts for $100. Even if the community condemns it, they only need the big spenders. Star Citizen proved that publishers could sell $10,000 packages for a game that isn't even in a playable state. With Star Citizen we saw poor college students using their student loans on the game, so wealth isn't even an obstacle. There are insane amounts of money to be made from the few who will pay it, this means marketing to sensible people is only relevant for the purpose of attracting whales. As long as whales continue to enable the behavior, the abuse will continue.

It's Optional:
The most common argument against accusations of greed is that the microtransactions are optional. This is a Red Herring meant to distract from greedy overreach. Purchasing the games that use these practices is also optional, at least until they become standard practice. This argument only serves to deflect criticism and avoid discussing the topic altogether. Players will argue that the game can be completed without using any store purchases, which is also a Red Herring. This is essentially arguing that theft is acceptable because the perpetrator didn't commit murder, or that shooting the sheriff is ok because they didn't also shoot the deputy. It's an irrelevant defense made even less relevant when perseverance and skill are factored in. Being able to beat Final Fantasy 7 without using materia doesn't make materia irrelevant to the game. Being able to beat Diablo 1 using only white items doesn't make rare equipment irrelevant either. Whether or not it can be ignored or avoided is irrelevant, the issue is that it is there and how it is implemented.

Trust:
The biggest issue is a matter of trust. We know developers alter games to push microtransactions, even when they are cosmetic. Activision patented a matchmaking system designed to push microtransactions by pitting players against stronger opponents using in game purchases. Matching a beginner against a pro so the beginner repeatedly gets a close-up of the player that killed them and seeing how cool the pro looks doing it to tempt them into buying the same items. Mobile games have altered their mechanics on a player by player basis to exploit individual psychological profiles. Diablo 3 nerfed drop rates into the ground because of the real money auction house. Games are having their integrity compromised for greed and it's spreading. Trust is frequently broken and many players don't enjoy the constant suspicion that the game might be altered to push microtransactions. Even if a game is completely open about their methods, even if they keep everything honest, the issue of trust will still remain as long as money is on the line.

The Future:
The largest danger to all this is setting a precedent. When a publisher gets away with egregious practices, it becomes normalized. People complain about $20 microtransactions, other people laugh because they have seen $100 microtransactions. If it can be done successfully, it will become an industry standard. What people consider outrageous will become normal for the next generation, and what the next generation thinks is going too far will become the standard after that. This is a slippery slope argument, but the slippery slope is only a fallacy when there is no precedent to base it on. The fact is that we have already witnessed its occurrence making it less speculation of the future and more of a documented pattern that is in mid-process.  The practices we tolerate today, will become the normal of tomorrow.

- “Give a man a fire and he's warm for a day, but set fire to him and he's warm for the rest of his life.” ― Terry Pratchett


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About Mordeth Kaione of us since 11:13 PM on 09.13.2017