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Do you agree? How In-app Purchases Has Destroyed The Industry


MichaelD
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Found an interesting article about in-app purchases, and since many of the dwellers of these forums have released games I would be interested to know some opinions.

 

http://www.baekdal.com/opinion/how-inapp-purchases-has-destroyed-the-industry/

 

I tend to agree with the article mostly because I am part of that "old" generation of games and retail purchases from local stores...

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I do agree, but it's a complex issue. The simple fact is that if you want to run a games development business, you have to make money. In-app purchases seem to be the only real way of doing that right now on mobile - or at least, the most profitable. If it's a paid app with no in app purchases, people will just pirate the game. Even if they don't, you can only get away with charging 50p-£2 (and £2 only if your game is amazing), which means you have to sell a lot of units, something that's hard to do unless you're very lucky or have a marketing budget. There's always the route of ad-supported games with a paid upgrade, I'd like to see data on how much money this makes, but I suspect it's not a lot compared to in-app purchases.

 

The problem with the mobile games market is that you're largely targeting the lowest common denominator if you want to make any money - that is, people who don't usually play games, who want the simplest experiences possible, and can be easily influenced into spending 60p here and there to get bonuses in-game.

 

This has obviously caused the mobile games market to become stagnant, with rip-off after rip-off of the most simple game mechanics, compounded with the fact that touch controls still haven't been fully explored or mastered yet, gameplay for anything more complicated than this can be very tricky and fiddly.

 

This obviously calls for some kind of disruption in the market. We need to put our heads together and think of a different way to do this. It's a good time for it, with articles like this becoming more frequent, people are obviously tired of this shit. Using html5, the browser environment, the web - we have a whole set of tools available to us to do something different and try out new ideas for monetization. We have the power to a/b test without app updates. It's something that hasn't really been explored in html5 gaming but I think it's something that desperately needs some research.

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Last year I had a conversation with a person who cuts my hair, the conversation went like this.

Them: Oh I play lots of games on my phone.
Me: Cool, what games do you buy?
Them: Oh I don't buy any, why would I? if I see a game that I have to pay for I know there's a free version out there, so I just find the free version and download that! No I'll never buy any games.
Me: Ok, so you don't spend any money then?
Them: Ha! I spend money all the time, there's this game...hmm what i is it? you have to dig, anyway I'm always buying extra lives!
Me: Right.....

And therein lies the rub. People will continually pay for enjoyment. But there's so many games available these days that they won't pay to try out something, they expect to do that for free. In the current market situation for games (especially mobile) this is an inevitable reaction. There's so much un-curated content that you can't download everything that is available and "looks" like it might be of interest, so you pick a few and see how they are as you play them. 

Games which have advertising dollars behind them, or can tap into big networks can be pay to download and make some revenue, but for everyone else (the majority) F2P is the only way to go.

So you can't blame the majority of devs who release their games F2P for doing so, because unfortunately it's a result of the current market situation.

I'm a developer who is working on a F2P game ( www.clankingdom.com ) , but I want to implement F2P in an innovative way, which hopefully is fair to the players, and if they enjoy the game and if they keep playing it, will hopefully give me a financial return which makes the whole enterprise of making the game in the first place worth it.

There are good and bad ways of doing F2P. But I think bad F2P is actually another way of saying "bad game", the new Dungeon Keeper is not the same game as the old version because it has F2P integrated into it which makes it a different game,and by the looks of it not implemented well, making it a "bad game" at least for us who can remember the first version.

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@Lewis

 

I only started learning HTML5/JS/Phaser a week ago and I've already almost completely first game with it and I must say I'm a fan, and in theory it would be great if it became more of a standard by which people can play games (especially on mobile) but there are powerful forces ranged against it which might mean it may never fulfill it's potential, but I'll definitely be trying to push it.

 

The real issue regardless of development platform/technology is actually discovery, but there are going to be more and more and more games released all vying for attention, and increasingly will be cross-platform (even if not JS based). I've also got some great ideas in the area of discovery and I'm just waiting for the means to get them off the ground.

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@Lewis: can you tell me what wrapper it is?

 

...as for the general topic, I think it's a natural evolution. Like the others said, people obviously prefer to download free apps rather than pay for them. Then, if they are really hooked, some of them pay for in-game stuff. At least, they get to experience the game well enough before paying. It's not like buying something and then being disappointed, like in the classic "model". It also has the benefit of "various spending degree". It'll be free for those without money, but still useful to spread the word, get downloads, ratings, etc. And the spender can spend various amount of bucks, and you can get more from it.

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This would have been death of the industry, if we had not had:

- Steam

- Kickstarter

- Consoles (including hand-held consoles)

 

Mobile has its specifics: short sessions, huge dependcy on being in TOP100, big return of investement and big budgets. 

 

Author just refuse to understand that Dungeon Keeper released on mobile device is NOT real time strategy game, but Clash of Clans clone. Complaining that digging one block takes 24 hours is bit like complaining that hard-core flight simulator needs you to read manual before you can even taxy to the runway. This is specifics of the genre, part of the fun, live with it, or choose something else to play. :)

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@Lewis: can you tell me what wrapper it is?

 

You use the chrome apps sdk/api, and then package them using cordova. It's only a developer preview at the moment though.

 

https://github.com/MobileChromeApps/mobile-chrome-apps/blob/master/README.md

 

This would have been death of the industry, if we had not had:

- Steam

- Kickstarter

- Consoles (including hand-held consoles)

 

Mobile has its specifics: short sessions, huge dependcy on being in TOP100, big return of investement and big budgets. 

 

Author just refuse to understand that Dungeon Keeper released on mobile device is NOT real time strategy game, but Clash of Clans clone. Complaining that digging one block takes 24 hours is bit like complaining that hard-core flight simulator needs you to read manual before you can even taxy to the runway. This is specifics of the genre, part of the fun, live with it, or choose something else to play. :)

 

This is true - but I think it's worth looking at the specific context of html5 games here (as we're on a html5 games forum!) in that one of the main benefits of writing games in javascript is that we can get them running cross-platform, so people can play on desktop and on mobile. The article doesn't seem to be lamenting the death of the games industry at large, just the mobile games industry. And it seems that sponsors in the html5 games industry want mobile games because of the lack of Flash on most mobile devices. So I think comparing html5 games and mobile games and classing them within the same industry is fair.

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This would have been death of the industry, if we had not had:

- Steam

- Kickstarter

- Consoles (including hand-held consoles)

 

Mobile has its specifics: short sessions, huge dependcy on being in TOP100, big return of investement and big budgets. 

 

Author just refuse to understand that Dungeon Keeper released on mobile device is NOT real time strategy game, but Clash of Clans clone. Complaining that digging one block takes 24 hours is bit like complaining that hard-core flight simulator needs you to read manual before you can even taxy to the runway. This is specifics of the genre, part of the fun, live with it, or choose something else to play. :)

Exactly, it's a different game, the F2P makes it a different game.

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Found an interesting article about in-app purchases, and since many of the dwellers of these forums have released games I would be interested to know some opinions.

 

http://www.baekdal.com/opinion/how-inapp-purchases-has-destroyed-the-industry/

 

I tend to agree with the article mostly because I am part of that "old" generation of games and retail purchases from local stores...

 

I have so much to say about this topic. So much in fact, I won't even try to write them, but instead one basic summary.

 

If you desire is to make high-quality games, don't even try selling mobile games. Look toward financing a start-up and try getting your game on Steam. End of subject.

 

Steve

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The real issue regardless of development platform/technology is actually discovery, ...

 

Discovery is the core of the problem and it is a difficult one to solve.

 

There is so much money involved that any ranking system will get exploited.  The people making decisions about this stuff currently have no incentive to improve since lots of money is being made on these scams masquerading as games. 

 

What is the solution?  I don't know.  I feel like a crash is coming when people finally clue-in and get fed up with allowing themselves to be cheated.  It can't happen soon enough.

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Discovery is the core of the problem and it is a difficult one to solve.

 

There is so much money involved that any ranking system will get exploited.  The people making decisions about this stuff currently have no incentive to improve since lots of money is being made on these scams masquerading as games. 

 

What is the solution?  I don't know.  I feel like a crash is coming when people finally clue-in and get fed up with allowing themselves to be cheated.  It can't happen soon enough.

Maybe but then what would the alternative be?

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Charging for something that really matters like expansion packs/ extra maps/ more levels.

 

But not for every little bit of the game.

What this system really does is to allow people with more money to have a more complete experience.

Ok this is not bad for the developer or studio but imagine if something like this happened in a game that you play... imagine people with more money to have better equipment in an RPG, or faster cars in racing games. Then is is certain that game would fail in a very short-amount of time for 2 main reasons:
1) People with money with eat away all your extras in very little time and no-effort (means no commitment) and move on to the next "awesome game"
2) People with no or little money to spent will simply get frustrated and simply leave the game.

 

So it is not a matter of I want to make more games or better games or more money, but to invest in a good-game and figure out ways to keep players happy enough to spend some money and ensure commitment to the game.

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I think IAPs would annoy me less if this current model of using timers and lives would die out. I might want to opt to buy a faster car in a single player game, or buy a powerup in candy crush or whatever. What I hate in the current market is the 'press this, now wait x hours or pay $$$' model. I don't know how anyone finds that fun, it's just frustrating. Pretty much all city building games are the same, there isn't any gameplay, it's just press this button and wait this amount of time! Yet somehow it generates a buttload of money...

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Interesting discussion guys, thanks for sharing. The article was a fun read :)

 

One thing that excites me is the simply devices becoming more powerful. For example, I recently bought XCOM for my PC, finished the game, it was awesome. Then I noticed it was on iOS, too. So I tried the app on my iPad and played for 15 minutes then put it away. I was pretty blown away by that as the experience was so extremely similar to my PC experience. Graphics were not quite on par, but everything else was, it was just fit the form factor in a great way.

 

And recently I bought KOTOR again, one of my all time favorites and am currently doing a playthrough together with my girlfriend also on the iPad. Again, fits the form factor in an awesome way and it's just a lot of fun, absolutely identical to the PC experience but now playable on a mobile device. 

 

It's these games that I'm absolutely willing to pay for. $10-15 for 5 to 30 hours of gameplay is nothing compared to paying the same for a predictable, non-interactive hollywood movie of 1.5 hours. So I'm looking forward to move of such games being ported. Final Fantasy on iOS was a great step for example, but we barely see any quality games being ported. There are so many good RPGs that don't have real-time combat that could easily work on Android or iOS. All these games wouldn't need any IAPs at all.

 

Another model I'm very excited about is the walking dead. It's episodic, you pay per episode which are released every two months. It's been a big success and I think it might work for mobile too. Release episode 1 for free, really capture players, then allow them to buy extra content for a price of say $2 per hour of gameplay. So a 3-hour episode nets you $6 and if you make 4 episodes of a game you essentially sell the game for $24, to a mobile customer. That's a great deal for the developer, and I think it's a great deal for anyone interested in games with substance and depth. And it also works in terms of the psychology that was described earlier (people not willing to buy games upfront, but willing to pay for things in free games). The Walking Dead could have a similar freemium model where you just buy to unlock new content. You don't pay to unlock things that get you ahead (an especially big no-no for me in multiplayer games), but just to get more of the game. If this is communicated well, I think it's fine. (There was a Japanese game that, after finishing the final mission, basically said pay up or we won't show you the ending, give the praise, tell you what happened etc, which is pretty horrible.) 

 

But for the casual type of games, the puzzle genre, bejeweled etc... As developers I think we have to accept a lot of humans are not looking for games as art, not looking for games for a story, for immersion or emotion *all the time*. Some of them some of the time and almost all gamers some of the time will want to just play something like Candy Crush or now, Flappy Bird (ugh!). I think those games are entirely acceptable even though I hate playing them and never do. Then there's the 'wait 10 hours' or 'wait 2 days' for upgrade/progress or whatever type games, or use this gold, you have 200 gold at the beginning, and the game is neatly engineered to essentially make you run out of gold right after getting used to/addicted to the game, then throw up a paywall or wait a day or spam your friends and do their marketing. Candy Crush does this, but it's not nearly as bad as some games like Battle Island.

 

At last I want to mention payment systems. That's something I think is very important and something that will be opened up soon. And interestingly enough, HTML5 both stands to gain the most from better payment systems and it's the most accepting of them. Apple won't quickly allow other payment systems because it competes with their 30% cut, their mission to get the next billion creditcards on file etc.

 

So why is this important? Well, if you only had to pay 5 cents to play the game and did not have to go through any complex hoops to pay. You could just give your email and password, then press okay to send just that amount, and that's all. If that is possible, *so many* games could be viable paid for upfront. IAPs wouldn't be necessary to fund or monetize a game. You could essentially get money through volume, basically what ads are for the industry, without the annoyance of ads or the lack of effectiveness of some ad campaigns. Microtransactions are surprisingly hard however, they barely exist anywhere because transaction fees often start at 25 or 50 cents. Paying 5 sends or paying a fraction of a cent isn't really something that fits in our financial system, our financial technology or consumer mindframes. But that's something I think will change. Bitcoin was mentioned earlier on these forums, it's a great tool to do such microtransactions. If you get a thousand plays and they all pay 5 cents or 20 cents, that's a really great eCPM compared to ads and you're not annoying anyone, not obstructing or slowing down gameplay, not putting up paywalls or giving people with money unfair ingame advantages.

 

So I hope payment systems will be improving and we're seeing a looot of news in that area. This wouldn't just change games by the way, it could really revolutionize all media. Newspapers for example could really benefit from microtransactions. Things like youtube or email. Imagine only accepting email if it was coupled with a payment of a fraction of a cent, I'd send just as many emails to my friends, colleagues etc, but it'd pretty much erradicate the majority of spam overnight. If watching a youtube video costs a fraction of a cent, I'd still do it, I wouldn't have to look at ads and someone with a million views could still make thousands of dollars from his views on a single video. Vlogging, podcasts, radio, newspapers and even simply accessing things like blogs, voluntarily paying fractions of a cent for wikipedia articles etc. It'd allow anyone to monetize anything in a fair, by-consumption manner, without immediately requiring subscriptions, large payments and it could replace advertising all together (which is a function taken over by people, reviews, news and word of mouth in a more social and connected world. Spamming banners is not the future of marketing your product). All these things require very elegant, secure, quick and extremely low-cost payment systems and they'e coming!

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I agree that in-app purchases have gotten out of hand.. If a developer gives away the first 10 levels of his game, and the users can buy the other 100 levels for $2 or something like that, that's perfectly fine in my opinion. But it has been perverted by games like Dungeaon Keeper. 

 

Smurfs' Village is another notorious example. You can still buy a "wagon of berries" for $100 resulting in some ridiculous bills. Or take a look at the in-app purchases available in Super Monster Bros, $109.99 for a "Role No1" (?) or $109.99 for infinite lives etc., it's insane! These are apps that target children who will buy this crap by unsuspectingly tapping away on their parents' iPad. :blink: Seriously it's criminal. Also, I'm shocked that a respectable developer like Capcom was involed with Smurfs btw.

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I guess all want a share of the bubble that are mobile games right now. The thing is, who will be there when the bubble bursts. Even revenues are crazy high for mobile games that years back would be a shame even to show your friends for fun... horrible graphics, no gameplay, just random tapping here and there, and yet companies are buying them (or at least were buying) at rediculous prises.

 

I just hope this isn't where mobile gaming is going... 

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I don't see anything inherently wrong with in-app purchases.  It allows customers to try games risk free and even "enjoy" them at a relatively low cost.  On the other hand, why someone would play a game like Dungeon Keeper, which is such an obvious black-hole of entertainment is beyond me.  Then again, aren't slot machines some of the most popular games worldwide?

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Destroying the industry? I think that's a bit hyperbolic. The industry will be fine with or without in-app purchases.

 

A better question would be "Are in-app purchase models designed around milking whales ethical?". For those that don't know, the term "Whale" comes from casino culture and it means someone who comes in to the casino and spends tons of money for at least one of many reasons (including gambling addiction). The term translates to IAP design fairly well, in my opinion.

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In-app purchase has been there since arcade machines. You want to continue from where you died? insert 3 coins.

 

How about real trading card game? If you have a lot of money, buying a lot of packs to finally get the super rare/strong card you wanted in no time.

 

Same goes to those gachas (toy vending machines).

 

For me, the way of selling games like what console/PC did actually is the second generation, using the business pipeline like selling cassette/cd music or dvd/bluray movies.

 

Soo.. IAP destroys the industry? nah I don't think so.

 

Some people will just find whatever method to make it feel unfair so you spent more money. IAP just still sounds so new and viral that so many people keep talking about the goods and the bads of it.

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It's just where the market is at right now, for reasons other people already explained in this thread much better than I can.

 

It sucks because the f2p model really effects the gameplay of the game and if you wanna have the best chance of making your money back you need to go with f2p most of the time. The problem, for me, is that you can't just make a good game exactly how you want it and have decent income just because you have a fun game. If you want money you have to design it around a f2p model and it's very hard to do that without corrupting the original game idea.

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