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The Free Zone: Big or Small

By Richard Aihoshi on April 05, 2010 | Columns | Comments

Big or Small

A decade or so ago, it was pretty widely accepted within the development industry that there were two ways for an MMOG to achieve profitability. One was by going big and attracting at least 100,000 subscribers. The other was the so-called boutique approach, which involved budgeting for far lower costs, and thus only required capturing a much smaller audience.

This piece of conventional wisdom was a reasonable fit with the titles that were live at the time. But the sample was still quite small, and as it expanded, the relationship turned out to be more correlational rather than causative. It was and is possible to make money without being either huge or tiny. It just takes planning and implementing a business plan on a different scale, granted this can be much easier said than done.

Recently, an interesting and at least partially comparable situation seems to be arising within the F2P space. On the one hand, some projects are getting pretty substantial. As you might expect, actual budget figures aren't readily available. Indeed, only one comes to mind that's public knowledge. It has been stated quite a few times that Allods Online is the Russian development industry's largest project to date, weighing in at $12 million. And it's hard to question the source since it's the studio that made the game; originally named Nival Online, it became Astrum Nival and is now Mail.Ru.

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Unofficially, if you choose to believe the rumors that float around from time to time, a number of other upcoming games will cost even more to bring to market. If we run some hypothetical numbers, it looks at least possible. We can start by assuming a four-year development period. Allods is in that ballpark. In addition, last August saw Frogster announce a co-production deal with Runewaker, the developer of Runes of Magic, for a new title with a 2013 launch date.

Next, let's set the size of the team at 50 people, which seems reasonable enough since we're talking about a high-end F2P. Add the cost of salaries, offices, furniture, PCs, development software, benefits, marketing, servers, trade shows, etc., etc., and it's not very hard at all to arrive at an average burn rate of $3 million per year - if not more.

Returning to the other hand, the amount of activity involving far smaller and less costly endeavors is definitely on the rise, and very rapidly at that. Such projects typically get little if any play in the game media. Their size - or more precisely, the lack thereof - obviously works against them in this regard. In addition, many are looked down upon because they're not client-based. Instead, they use browser-based technologies such as Flash. This constitutes something of a double whammy since it means they don't have bleeding edge visuals.

A major offsetting benefit is that an artist can produce assets at a much faster rate. Design and coding are also less complex. This combination allows for far smaller teams - even just a handful of people - as well as significantly shorter development periods that are measured in months, not years. If we make our assumptions accordingly, our hypothetical project budget can shrink by an order of magnitude - if not more.

So, what looks to be happening is a change where the in overall size range of F2P projects. The expensive ones are costing more than ever before, although not nearly on the same scale as major subscription titles. This does beg the question of how far they'll rise. I really don't have much of an idea, but my best guess is that it will be to a lot more than current the $12 million range.

And at the other end of the spectrum, budgets can also be smaller now than they were in the past. In general, I think this will turn out to be a good thing. Provided they're prepared to think outside the conventional technology box, developers who want to try something different don't have to come up with as much money to fund their attempts. This should increase the rate of innovation and originality in the category. That plus the broader accessibility factor can't help but expand the MMOG category and its audience.

And what of games in the middle portions of the overall range? I think they're here to stay. The model put forward around the late '90s was incorrect. The mid-range was economically viable; it just wasn't occupied. Well, it is now, with plenty of competition to drive further improvement and market growth.

The Free Zone The Free Zone Editorials
Richard Aihoshi has been writing about MMOGs since the mid-1990s, always with a global perspective. As a result, he has observed the emergence and growth of the free to play business model from its early days in both hemispheres.

He is the former Editor of RPG Vault and his column, focusing on free to play MMOs, appears on MMORPG.com every Monday.
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