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| <em>LotR Online's</em> Free-To-Play Switch Tripled Revenue
| from the one-does-not-simply-log-into-mordor dept.
| posted by Soulskill on Friday January 07, @17:36 (Lord of the Rings)
| https://games.slashdot.org/story/11/01/07/2220228/LotR-Onlines-Free-To-Play-Switch-Tripled-Revenue?from=newsletter
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Last June, Turbine made the decision to switch Lord of the Rings Online
from a subscription-based business model [0]to a free-to-play model
supported by microtransactions. In a [1]podcast interview with Ten Ton
Hammer, Turbine executives revealed that the switch has gone well for the
company, with [2]game revenues roughly tripling. The active player base
has also [3]grown significantly in that time. Executive Producer Kate
Paiz said, "This really echoes a lot of what we've seen throughout the
entertainment industry in general. It's really about letting players make
their choices about how they play."

Discuss this story at:
https://games.slashdot.org/story/11/01/07/2220228/LotR-Onlines-Free-To-Play-Switch-Tripled-Revenue?from=newsletter#commentlisting

Links:
0. http://games.slashdot.org/story/10/06/04/2013217/Lord-of-the-Rings-Online-To-Go-Free-To-Play
1. http://www.tentonhammer.com/podcasts/live/30
2. http://www.gamasutra.com/view/news/32322/Turbine_Lord_of_the_Rings_Online_Revenues_Tripled_As_FreeToPlay_Game.php
3. http://www.vg247.com/2011/01/06/lotro-revenue-has-tripled-since-going-free-to-play-says-turbine/

Interesting, but it isn't exactly the same situation as VO. LotR Online has a built-in player-base because of the popularity of The Lord of the Rings in general. VO doesn't have that luxury and so has to struggle to get noticed. I'm not saying a free-to-play model definitely wouldn't work for VO, but it isn't guaranteed to just because it did for LotR Online.

Turbine also had the liberty of 'perfecting' the free-to-play model on D&D Online for a year before making the decision to introduced it on their flagship MMO. That, and they had the financial might of Warner Brothers behind them. Not really much of a risk.

Having played D&D Online on the cheap, it's quite hard to remove the level cap just by just playing the game, as opposed to buying it off. You might equate it to " You can advance beyond combat level 3 if you have taken down a levi in your Vulture Mk 3". I suspect that would have killed most people off in their VO trial.

However, in Turbine's favour, WoW has made their type of MMO the accepted norm, they make a very pretty game, and as Strat rightly says, they have decades of mythology and a captive audience of millions of bespectacled spotty dice rollers to draw upon. When EvE becomes f2p then you might have a case for re-examining this, Alloh.

I just want to point out that eve can be free to play because you CCP lets you buy game time from other players with in game money so if you have a big enough operation and make enough ISK you can play for "free" There are a number of players who haven't paid for the game in a year or more. Granted getting there is quiet hard and making that amount of money is much more difficult then it is in vo.

Not to mention that you need real money in order to get to such a point, effectively defeating the purpose of a f2p MMO game plan, namely to attract people with little or no money to spare for such things (for whatever reason).

Toshito, lots of free players means easy targets for paying servers, who become more happy to pay, and incentive subscription for unleashing its full potencial.

Just finished playing my trial on android (tegra transformer). Game looks rly interesting, fun to play and outperform any space-shooter on andoid... but lack player base a lot. Maybe it's because of my prime time (Russia) or because i didn't leave Sol II, actually. But associating only 3-4 ppl in main chat with MMO game a bit frustrating for me.
I'm ready to pay 10$ for MMO with huge online and "hard-balled" pvp. But from newcomer point of view - VO today looks like sandbox project with huge potential: game worth buying (because it's solid space-shooter), but not worth subscribing (it's not looks like MMO).
I don't know if it's game design flaw or subscription model drawback, but if u want me to pay for subscription - give me hordes of real spacemen, not just collector drones.
PS Back to topic. Dust 514 will be f2p and now i'm considering buying ps3 for it. World of tanks (one of the hugest russian game titles with 400k online peaks) is f2p. f2p works, just give it a chance.
PSS Sry for my english, it's not my native.

I'm not sure what their situation is like now, but I know in the past the devs avoided changing their business model due to financial stability issues. Personally, I've always carried a strong aversion to games that use Real Money Transactions to deliver content. I get the feeling it's like luring players in: sure, play for free, but if you want that super cool ship(tm) you're going to have to expend real life resources that have nothing to do with the game. I'm familiar with the example used in the OP, and I believe LOTRO limits what "areas" you have access to based on what you spend. (i.e. the password to Moria is not "mellon", it's $10). The current system is simple: either you have access to the game, or you don't. The only difference is instead of buying space or virtual items, you are buying time.

I also dislike the argument of "not enough people play this, so I'm not going to play". There is an obvious loophole there. I've often wondered how much difference a single subscription can make to a game like VO. I don't think the number of players has anything to do with VO being subscription based versus free to play with RMT. I can only speak for myself, but I probably would not have stuck with the game as long as I have if it had started to charge real money for virtual items/areas. Such a model would reward initial expenditure, but in the end yield a negative result for long term players.

As a logical thought experiment, assume everyone starts with similar skill, but can gain a small advantage through spending additional money. A new player would quickly advance after learning that spending a little extra gains a small advantage. However, in order to continue advancing, the player must continue to spend. The reward of spending extra cash becomes less, and eventually drops into the red. In order to feel like s/he is succeeding in the game, the player feels that s/he must outspend the competition.

This is fundamentally different from a game in which no advantage can be gained by spending real world money. In the second case, as I spend more time in game, my skill (hopefully) grows apart from expenditure. I can do more with 10 minutes in game than a newbie, due to practice and experience. One might say that instead of rewarding expenditure, this second model rewards play-time. It may feel like a bit of a grind to the new player, however, the veteran knows s/he will have steady access to the game world, in which s/he will feel like a star in whatever niche s/he may have carved out for him or herself. Whereas a F2P model may generate more initial interest, a subscription model is more likely to balance out in the long term.

This is all conjecture, of course. In my opinion MMOGs haven't been around long enough to prove the efficacy of one business model over another. It just seems like every so often a new idea comes along and it's The Next Big Thing, and it gets way over-hyped without considering some of the potential drawbacks. GS tends to do a lot of cool new things, but I would beg them to consider the economic ramifications of going free-to-play, if such a possibility ever comes to the foreground.

As a footnote, say I had a lot of free time to play VO; a $10 subscription would feel more costly, however I am actually deriving more utility from that money. $10 to a teenager is a lot more than $10 to a working class individual, but a teenager also has more leisure time. Say I have a 54 hour a week job; I probably don't have as much time to play VO, however I likely have more expendable income to use on things like ice cream and movie tickets. For me it's not such a big deal to give up going to the movies one night in order to pay for one month's access to the game, even if I don't get to play as much as the teenager with more free time.

Sorry to be so long-winded on this topic. I guess I had more to say about it than I realized. That's what I get for graduating from a school known for its contributions to the dismal science. It really has nothing to do with what I was studying, but I couldn't get away from there without a little armchair economist rubbing off on me.

Phaserlight, nice to read you here. Your guides was solid source of real game-play wisdom for me.

But back to topic. From my experience F2P is NOT always equal to "more money = more in-game advantage". Nowdays i have full access to two twitched base MMOs that uses F2P business model: guildwars & worldoftanks. And they both are not punishing long-term players.
Guildwars is about accessing the areas not items. I can pay 50$ for new area and additional skill set each 6-9 months. As a "PvEer" i can pay for new story, as a "PvPer" i can pay for access to new game mechanics. Also i can buy unique armors, but they do not give any in-game bonuses comparing to regular armors, just looks more fancy and uncommon.
World of tanks has more traditional f2p business model. You don't have to pay at all if you have a lot of spare time or want to play only low-level pvp. But you'd better pay 10$ subscription fee for more smooth & comfortable high level experience (cause repairing high-lvl tanks is costly and subscription gives your better "reward rate").

You can say that it's same 10$ per month. But main differences are: i don't need to "marry" to guildwars (nor worldoftanks) to play it; f2p gives them solid casual player base that is vital for any MMO.
F2P is nor good, nor bad by itself. "Bad/good" is a question of implementation.

Just pay the $10 a month or less if you buy bulk. Really, this game won't work this way, and the devs need to eat pay bills, etc.

Sigh. I have so much to say on this thread, but I believe it's all for nothing. Vo moves too slowly to fluidly change into a sustainable f2p mmo, but the business case is very strong and the subscription model is thoroughly antiquated in my view.

I have so much to say on this thread, but I believe it's all for nothing.

You'll never know if you don't try.

edit: as an aside, this is a sharply divisive topic over at mmorpg.com, where threads on it get pinned and locked all the time.

So, what do people see in free to play games? It's obvious that there is going to be some cost to playing the game. Wouldn't you rather have the cost be the wage you earn in an hour of the day-to-day work you have to do anyway than the gameplay experience?

PS: Phaserlight already made this point, but I think it hasn't quite sunk in in some brains: how can you have an antiquated business model in a market that is at best twenty years old?

PPS: If anything, as the mmo market matures, I'm betting the free to play models will die away. I have little doubt that given the option, paying players would rather play a game that has a business model based on paying for a pleasant experiance, rather than paying to avoid an unpleasant one.

Some people seem to forget that, sometimes, a game is it's devs' sole source of income(like this one). If it becomes f2p, where are they going to get the money the eat, pay their bills, etc.?

@genka

F2p encourages casual gaming over long periods rather than committed bursts which is what the subscription model inherently encourages players to do. Obviously there will be a cost corresponding with a gameplay benefit, but the f2p model allows the player to choose when and what that might be.

@Terran

Doesn't matter if they have 6 mortgages to pay, if they can't engage an audience it means no money, period. F2p is a way of appealing to a massive audience.

F2p encourages casual gaming over long periods rather than committed bursts which is what the subscription model inherently encourages players to do.

I'd have to disagree with you there. If anything the f2p model increases the distance between the haves and the have-nots. I think play patterns are more related to personality and available free-time.

Academic shmacademic.
Arguing about stupid shit on the internet is what I live for!

Anyway: I'll rephrase what I was trying to say. Free to play games make money by frustrating players until they pony up some cash to get rid of the purposefully frustrating bits of the game. Aside from the obvious twitch of horror I'm sure all of us experience at that idea, this way of describing the free-to-play business model also makes it pretty obvious that free to play games encourage "hardcore" players and discourage the "casual" ones.

I agree that making a game free to play makes for a nice initial hook for a casual player, since he is free to play a the game for as long as he likes without making any commitments. That, however, doesn't at all mean that casual players are "encouraged," any more so than moths are "encouraged" by candles.

Pretty much any definition of "casual player" will make him a player that is initially less invested in a game than a "hardcore player." As a result, the casual player will be quicker to see the frustrations imbedded in the game as a major impediment to having fun with the game. So, when we compare two similarly frustrated players, the more hardcore of the two will have a) started out with more invested in the game and b) been playing the game for a longer time, ending up with more invested in the game.

Which player, would you guess, is more likely to pay a few bucks to overcome the frustrating bits?
Which one is more likely to say "fuck this game" and wander off to drink a beer and watch ru paul's drag race?

(Awww yeah, socratic method in action.)

genka,
a game that has a business model based on paying for a pleasant experiance, rather than paying to avoid an unpleasant one.

f2p is all about balancing pleasant experience and price of it. Subscription is all about "pay or gtfo" motto.
An example/analogy from real life. You need something in a distance of 50km far from you: a) you can go there on your legs, b) buy a ticket on bus, c) rent a car for month, d) or just say "fuck this game" and go to local pub. In modern implementation of f2p you got ALL 4 choices, in subscription base you can either rent a car or "fuck this game".

Condragulations! You've started us down the "shitty analogy" slippery slope!

The problem with yours is that the rental car company has no control over the other choices available to the person trying to get somewhere. In essense, your analogy matches a case where three different companies are offering three different quality games at three different price points. The long, glorious and invisible hand of capitalism then steps in and the dark magic of free market economics applies.
Instead, the free to play game offers a market of products, yes, but it controls all the producs. That's pretty obviously not a free market, so how can the "invisible hand" possibly benefit the consumers? What possible reason could I have to enter such a market?

The actual situation with free to play games is more similar to a really awful frat party.
It's advertised as having "free beer" (with an ID, of course) and so you're quite happy to hike across town to get to it. When you do get there, however, you discover that the beer is split into two categories, and served at two different bars. Both have the same beer, and indeed poor it from the same keg.
The only difference is that at the free one, before handing your expertly-poored red cup worth of beer over, the bartender spits in it. At the bar where you pay three dollars for your fifty cents worth of PBR, you get a smile instead.
That's right, I'm calling free to play games unsanitary.

If you're really attached to your rental car analogy, I can make up a more appropriate version of that as well:
Imagine you come into an agency to rent a car, and find that they have two price points for renting what looks to be the same toyota camry. The difference is, as you discover, is that the cheaper one has been expertly modified to accelerate slower, have half the top speed and a "door-open" beeper that never turns off. Good news though! They can disable these annoyances remotely, at any point during your trip for a nice little sum of money! Hooray!

The point is that makers of free to play games make decent games, for all I know. But then, rather than find a fair price point and charge you for the fun times you would like to have, they put effort into making their decent game worse, and then sell you the opportunity to get rid of the hassles they themselves have added.
Doesn't that strike you as disgusting?
Don't you have the urge to tell these developers to go fuck themselves?
I sure do. And I've always assumed that this was a byproduct of reading too many russian books, so I'm a little surprised if you don't.

^^^ My thoughts exactly.