The Elder Scrolls Online is in closed beta testing right now, and though ZeniMax Online has been generous in their revelations about the game's setting and background lore, they have yet to address one of the most crucial issues about its impending launch: how will we be paying for it?
The question can really be applied to any Triple-A, big-budget title entering the MMO market. Back in the day, it was easy - charge ten or fifteen bucks a month and everyone's happy. But times are different now. The economy is still horrible enough that you can use it as an excuse for pretty much anything. And perhaps because of this, free-to-play is the new go-to financial model for new games. But not all F2P models are created equal, and big-name games have some options.
Option A: Subscription-Only
Game developers need their MMOs to earn money. That's a simple fact. If the game stops earning profit, it gets shut down. It stands to reason that a big, ambitious game like the Elder Scrolls Online will have ongoing maintenance costs proportionate to the scope of the game, and the size of its player base - in other words, quite high. The easiest way to meet those costs and turn a profit is to charge players a monthly fee.
This was the industry standard for years - an initial fee for a copy of the game, either digital or on physical media and in a fancy box with books and such, and a monthly access fee. Eventually, after an expansion or two, the original game might be offered for free download, though a subscription is still required to play it. But this method has fallen out of favor recently, and proven to be less economically viable than it had been in previous years. Except for Blizzard and CCP.
World of Warcraft and EVE Online continue to make this model work and have been using it since before most other games ever saw the light of day. But the fact is, not every game can be an industry titan like WoW or a niche-market champion like EVE. In fact, most of them can't. Most games, with their sky-high aspirations, strive to be the giant skyscrapers in Dubai or Kuala Lumpur. WoW and EVE are the Pyramids and the Parthenon.
- Tried And True - This method has been around for a long time, and it has been known to work. For a while, anyway.
- Built-in Customer Loyalty - Gamers who pay for game time generally try to make that money count, and tend to take the game more seriously.
- Exclusivity - A monthly subscription discourages casual players who will check out a game for a short while and then move on to something newer and more shiny, without ever spending any money.
- Outdated Model - The times, they are a-changin'. What worked five years ago doesn't work so well anymore, unless you are Blizzard or CCP.
- Unsustainable - Even huge-budget Triple-A games have a tough time sustaining this model. Star Wars: The Old Republic is a good example - its subscription-only model lasted less than a year.
- Limited Market - Paying a subscription requires a monthly income and a means of paying the monthly fee electronically. Young people, who make up the majority of the game-playing public, often don't have jobs or credit cards.
The Elder Scrolls Online is not likely to launch as a subscription-only game. The failure of Star Wars: The Old Republic to make that model work for more than a few months serves as a warning: even massive IPs backed by enormous development budgets will need to look at other options for long-term sustainability. The fact that WoW and EVE (and an ever-diminishing cast of other characters) can continue to run as subscription-only titles is a testament to their longevity and large, dedicated player base, rather than to the viability of the financial model in a modern MMO market.
Option B: Free-to-play
Free-to-play is not the dirty word it may once have been. Back in the day, there were only a handful of sleazy, small-time F2P games with dodgy cash shops selling pay-to-win items and disproportionately huge populations of Asian gold-sellers. Then some forward-thinking Western developers took that model and made it legitimate and respectable, attaching it to big-name games. Converting flagging titles from a subscription model to F2P has proven time and again to be a game-saver. It worked well for Star Wars: the Old Republic, and even better for DC Universe Online.
Turbine's hybrid "freemium" model, used in Dungeons & Dragons Online and the Lord of the Rings Online, set a standard for the industry, and would probably work really well in the Elder Scrolls Online. There is an option for players to subscribe if they prefer, and subscribers gain certain advantages over free-players (a monthly allowance of cash shop currency, unlimited access to all game features, etc.), but players can enjoy essentially the entire game for free. Dedicated players can also earn cash shop currency through gameplay, usually through grinding for achievements or running specific content over and over.
Cash shop items in these games tend to be cosmetics (outfits, skins for mounts), convenience (XP buffs, consumables, stuff that can be earned through extended gameplay) or character unlocks and upgrades. Items that offer purchasers a particular advantage over other players are generally considered taboo, but some games do offer "statted" items for direct purchase through the cash shop. Some of the starships sold through the C-Store in Star Trek Online, for example, come pre-packaged with leveled weapons, but these ships are not really any more powerful than the same-level ships earned through regular gameplay.
- Current Standard - This model has proven popular with the gaming public and profitable for developers. Games that cannot sustain a subscription-based model thrive when they convert to free-to-play or "freemium."
- Broad Market - Allowing access without requiring a financial commitment allows players to play the game at their convenience, without feeling like they need to make the most of their subscription fee. And since so many players no longer spend all their game time with just one title, players feel free to come and go as they please, hopefully leaving some of their money behind.
- Microtransactions - Players who don't want to spend $10 or $15 a month for a subscription are often perfectly happy to spend $5 a month in the cash shop for cool stuff. Some players will spend even more than the cost of a subscription, a buck or two at a time, for the cash shop items they feel add value to their game experience. And some players (like me) will spend extra money in addition to their monthly subscription for those must-have cosmetics and cool toys.
- Nickel-and-Dime - Monetizing every tiny aspect of the game can make the game feel cheap. Super-restricted UIs and a hundred per-character unlockables can make the new-player F2P experience unpleasant.
- Zero Accountability - Free-to-play can weaken a game's community by making it easy for miscreants to create disposable accounts for the sole purpose of causing trouble - trolling, griefing, spamming and other such disruptive, selfish behaviors. These players don't feel compelled to spend money on the game, and since their only investment is the time taken to download the game client, they feel they can get away with anything. When it stops being "fun," the jerk players bail, having never spent a dime.
- The Razor's Edge of Pay-to-Win - It's a very fine line between cash shop items that offer convenience and items that become mandatory for certain kinds of content. If a careful balance is not struck and cash-shop items become a prerequisite for raiding, the game becomes "pay to win" and players feel ripped off.
This is a much more likely option for the Elder Scrolls Online, but Zenimax Online may take a different approach than Turbine, BioWare or PerfectWorld. Sticking too closely to the established model risks coming off as conventional and possibly cheap, and ESO likely needs to appear innovative in all aspects. The competition in the F2P market is kind of fierce, and all developers are constantly trying to find new ways to make their microtransactions more lucrative than the next guy's.
Option C: Subscriptionless with Cash Shop
Also known as "Buy-to-Play" (B2P) or "the Guild Wars 2 model." A copy of the game is initially purchased, and there is no further financial commitment required. The initial box price gives players full access to the game, and an in-game cash shop with cosmetic and convenience items funds the maintenance and development teams.
Again, a fine line must be walked here. On the one hand, the developers need to make players want to spend money in the cash shop by offering lucrative items. On the other hand, loot boxes requiring a store-bought key to open them are kind of annoying. There's no guarantee that they contain anything worthwhile, and they can't be pawned to vendors like other trash loot, but they accumulate quickly and take up precious inventory space.
Cash shop items tend to be fluff and convenience, plus nonessential upgrades. Cosmetic outfits and accessories seem to sell fairly well, but not all players care much about how their character looks. Convenience items serve to eliminate tedium - for example, using a consumable to access a town service out in the wilderness instead of having to run all the way back to a town, or boosts to accelerate experience gain (or other, similar level-up resources for PvP ranking or faction renown, etc.). Nonessential upgrades include increased storage or carrying capacity and additional character slots - you get more value from these upgrades if you play a lot, but most players can probably get by with the default.
- One and Done, Plus Bonus - Pay one upfront fee for the whole thing, and the rest is all voluntary. A large number of players will be happy to spend additional money to enhance their game experience in some way, but no one feels compelled to.
- Familiarity - A lot of players will be coming from the Elder Scrolls series and not from a MMO background. The one-price admission fee will be most familiar to them... as well as to ZeniMax, which is breaking new ground with their first MMO.
- Spikes and Dips - These games generate a spike of income from the initial purchases, but this drops dramatically a few months after launch. By then, pretty much anyone that will ever play the game has bought it, and new players come in at a crawl.
- That Fine Line - Again, there is a fine line between "convenience" and "requirement." For example, the ability to buy extra inventory space is great, but only if inventory space is not ridiculously restricted without paid unlocks. And any game offering statted gear in a cash shop will ultimately be accused of being Pay-to-Win, even if the gear sucks compared to drops or quest rewards.
Guild Wars 2 challenged the dominant F2P "freemium" model and seems to be doing very well, without so much as a single subscriber. This bodes well for future games, but only if these future games have as much to offer as GW2 does. The Elder Scrolls Online looks like a serious contender as direct competition for GW2, and adopting a similar financial model makes sense, in a way.
While B2P and F2P/Freemium seem the most likely models for the Elder Scrolls Online to follow, we won't know for sure what direction they will pick until closer to the launch date when ZeniMax Online announces it. And of course, there's always the possibility that the studio will come up with some kind of new financial model. However it pans out, we'll be there, happily parting ways with our money.