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The Rise of Free-to-Play

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First impressions count for a lot, and free-to-play is still synonymous with shabby gameplay, slipshod graphics, and wonky translations for many Western gamers. Judged on the whole, that opinion is still well deserved, as seldom a day goes by that yet another poorly localized import tries to make up for in spammed press releases what it lacks in true appeal.

That said, a number of free-to-play MMOGs have started to close the quality gap between subscription- and microtransaction-driven games in the past few years, however, among which are solid efforts like Atlantica Online and Runes of Magic. The free-to-play market has experienced something of a sea-change over the past six months since Dungeons and Dragons: Eberron Unlimited was released.

Something was lost in translation with the first wave of free-to-play MMOGs

With the help of two industry insiders that have given a lot of thought to the free-to-play market in North America - Fernando Paiz, Executive Producer of DDO Unlimited, and Bjorn Book-Larsson, CTO & COO of publisher GamersFirst (Sword of the New World, War Rock) - Ten Ton Hammer investigates what's stifled the evolution of free-to-play MMO gaming in North America long after the concept had taken hold around the world. We'll also examine why many hail DDO Unlimited as a turning point, and trace the increasing quality of free-to-play MMOGs even as subscription MMOGs turn in disappointing numbers. Could free-to-play may ultimately make the subscription-driven MMORPG obsolete, or is this just another increasingly popular way to game? Find out in next week's feature article: The Rise of Free-to-Play.

Coming to America

Speaking as an American (and perhaps channeling George C. Scott's Patton), if there's one thing Americans hate, it's falling behind. But, speaking with regards to the free-to-play market segment, that's exactly what Bjorn was telling me. “I think North America’s kind of far behind," he lamented.  "If you look at the world map and where people play our games, we’ve got more players in Europe than we do in America. “  

Bjorn noted that the unfinished nature of most MMORPGs at launch, typically viewed in the West as a irreconcilable weakness, is viewed elsewhere as fundamental part of the experience. In other words, for gamers and developers of a certain mindset, polish may limit potential.  “Putting the gamers first, and letting them dictate their experience – that feedback loop is really important to us… You can’t shove your ideas down the throat of the user.”  GamersFirst, Bjorn explains, spends an enormous amount of money monitoring and adapting to player behavior, sometimes in a radical manner. “One of the biggest assets of the company is probably our data warehouse, which analyzes the behavior of players throughout our games."

To be fair, North America didn't get off to the best start with free-to-play. Asia had Kartrider, Habbo Hotel, and MapleStory, Europe had Runescape, and North America had... Guild Wars? Perhaps, but Guild Wars, while subscription-free, required players to buy the box and expansions and had no comparable microtransaction model.  And some of Guild Wars' pioneering thunder was undoubtedly stolen by a certain other subscription MMORPG that had taken the market by storm five months before.

Sword of the New World proved free-to-play didn't have to mean lackluster graphics

As a result, the first wave of free-to-play games in North America had a huge trust barrier to overcome and were typically published by companies with little to lose.  Bjorn continued: “There are a lot of crappy games that never really made money in Korea or elsewhere, and those guys decided to bring the games to the rest of the world." These games met with predictable results, and unfortunately, free-to-play came to mean bad localization, wacky translations, poor graphics, and backward gameplay.

Publishers like GamersFirst, Frogster (Runes of Magic), Nexon (Maple Story and Mabinogi), nDoors (Atlantica Online), and Perfect World (PWI,  Jade Dynasty, Kung Foo!) eventually rode to the rescue, hoping to salvage free-to-play's reputation with higher quality localization efforts, but it took Dungeons and Dragons Online: Eberron Unlimited to turn the corner and open up North America the idea of gaming a la carte.

Out of the Dungeons

After three and a half years of soul searching, Dungeons and Dragons Online seems to have come into its own.  What brought revival to Eberron? It wasn't any of the usual suspects; no major updates or a well-hyped retail expansion.  Instead, last August brought perhaps the most comprehensive, most successful revision of an MMORPG to-date when DDO became DDO Unlimited, the first top-tier title to make the switch to free-to-play.

Fernando Paiz, a five-year veteran of Turbine and Executive Producer of Dungeons & Dragons Online: Eberron Unlimited, intimated that DDO Unlimited was the result of a careful study by Turbine as to how they wanted to enter the free-to-play market. "It wasn't necessarily going to be taking one of our existing games to free-to-play. We considered importing games, or making a new 'lite' MMO and doing it from scratch. But we were very attracted to the opportunity of taking a game like DDO, that was a subscription game developed with a triple-A budget, and converting it to free-to-play and bringing that premium quality to the free-to-play space."

Turbine's foray into microtransaction-friendly Eastern markets with Lord of the Rings Online influenced the DDO Unlimited decision not a little. "As we've worked with partners in Korea, China, and Japan, we've gotten to know a lot about their games - what they've done, what's worked well.  At the same time, when I joined the company five years ago, there was a lot of trepidation about how a Western audience would receive a game with a microtransaction model. And at the same time, the prevailing wisdom was, they wouldn't. Everyone would assume that you could buy the endgame and the game was unfair and everyone would leave... So we very much wanted to do our take on free-to-play, always with an eye toward the Western audience and what they would like or dislike."

To ensure that the game worked at all levels and for all player, Turbine's not-so-secret ingredient was an intensive "polish pass" conducted prior to and into the game's beta. "You can't separate the business model from the gameplay design. For us, it was about taking great care to make sure that those things work well, didn't ruin what was fun about DDO already, and in fact enhanced the game and are useful to players of all types - both the hardcore and more casual players."

Even so, many of the most important changes aren't visible to the DDO players. In addition to the technical challenges imposed by adding an e-commerce system - the ease-of-use and fluidity of which has garnered a lot of positive attention by reviewers usually eager to poo-poo any such "vampiric" revenue-producing initiatives - Turbine has created a digital merchandising department responsible for the DDO store catalogue, weekend promotions, and marketing these goods to the playerbase. For a team used to a roughly 3- to 6-month development cycle, Paiz noted that it's been a morale booster for the development team and many players to have something exciting and new on a weekly basis.

The Dividing Line

"When you initially come into the game," Fernando explains, "it needs to feel completely free. Your first one, two, three playsessions - it needs to be clear that you really can play the game for free and get a taste of what's good about it. Otherwise, the players that will naturally take a little while to decide - you're going to turn them off right away."

With any free-to-play game, developers must maintain a delicate balance between keeping the game fun enough to attract new players, yet restricting enough of the game to make it financially viable. The old free-to-play paradigm was to balance the game in such a way that the average player must lean on item store potions to succeed against challenging foes. Alternatively, they could grind easier content and play for free, adding to the community in their own way for some time before eventually falling in to the microtransaction vortex.

There's clearly a line between casual and hardcore, and DDO does caters to both groups.

The bulk of microtransaction sales might still run to consumables like resurrection kegs and healing potions (Paiz is careful to note that purchasing these items are still entirely optional). But Turbine wanted to do more with microtransactions in DDO Unlimited, and the game's hub-and-instance design afforded the designers interesting opportunities to extend the traditional free-to-play model in ways that enhance, rather than toxify, the gameplay.  

Going back to the beginning, the hallmark of DDO are the hand-crafted instances where all the action takes place, all designed with the same sort of care that traditionally goes into endgame instances and dungeons in other MMOGs. "Those are fun to play, but they're expensive to make," Paiz noted, smiling. One of Turbine's major goals, he explained, was to monetize the ongoing creation of content, not just the potions and other consumable items that make up the bread and butter of the common free-to-play MMORPGs.

Another important delineation among gamers is between casual and hardcore players. But, as Paiz explained, Turbine views this less as a divide between players boasting the best gear and stats versus those play sparingly. Instead, the hardcore / casual divide for Turbine is between players who would spend time and those who would prefer to spend money. Both groups are important, Paiz explained. Even hardcore players who never spend a cent on the game help deliver the game experience in many ways.

The Price of Success

Turbine has faced criticism from some corners over its decision to take microtransactions beyond cosmetics and consumables in DDO, offering advanced races, builds, content, and even equipment for sale. Fernando explained that it was a decision that the Turbine team did not take lightly. "We had different people in the building championing different points of view, but we started off very cautious on this. We didn't initially sell, for example, 32-point builds (which is essentially the stat boost you get for the Drow race with any race), because it was a high-end favor reward. 

"We expected more players coming out and saying, 'You shouldn't be selling this or that.' To our surprise, what we actually saw was a whole lot of players saying, 'Why aren't you selling 32-point builds?' There are always voices on all sides of the debate, but the prevailing opinion was, 'You're selling the other total favor rewards, why aren't you selling this one?' So we ended up adding 32-point builds to the store."

Paiz noted that the 32-point build went up for sale at the same time the true reincarnation system entered the game, which allows level-cap players to be reborn as a 34-point build (or twice-reborn characters as a 36-point build). So even as new players got a potential boost, veteran players get an even nicer premium service rooted solidly in player achievement. With Update 3, Turbine will introduce greater and lesser resurrection, which are essentially the long-awaited character respec systems that players have been requesting for years.  (Both systems allow the same respec, but the greater resurrection allows 28-point build players to upgrade to 32-point builds.)

DDO's hub and instance format lent itself perfectly to free-to-play.

"But this isn't something we take lightly, and I would very much say we don't sell the endgame. That's something we continue to be aware of - we don't want to take away that accomplishment. We never sell any named items in the store. We sell very simple weapons and armor that are meant to be a recourse - it's not meant to be what you're wearing at high levels of the game."

Subscriptions Make a Comeback...

Perhaps the most surprising aspect of DDO's resurgence is the growth of the game's VIP program, which is a subscription program that includes access to all content and races plus 500 Turbine Points a month for premium services. It seems odd that going free-to-play would actually garner Turbine more subscriptions, but Paiz noted that some of that is just a function of how the free-to-play move opened the floodgates. "We had a ton of players coming through the early parts of the game; some decided the game was worth paying for and that they were playing it at a fast enough rate that they wanted to subscribe and get content, rather than buy things a piece at a time."

But Fernando also noted that a number of returning players, many of which had high-level characters, also re-upped their subscriptions to take advantage of the renewed vitality of - and Turbine's new investments in - the game.  "The subscription offering still has a really good value for a certain kind of player, and that was our intent... some of our players put in more than 20 hours a week - some of them put in a lot more, actually - and if you put in that kind of time, you're going to be touching all the content. And unless you know you're going to be with this game for a long time, you don't want to be necessarily buying it all a la carte, because that can get expensive. So you pay your $15 / month fee, and you get unlimited access."

But Not For Long?

We know that microtransactions are on the rise. You'd be hard pressed to name a subscription-driven MMORPG that doesn't offer some cash-and-carry premium service, even something as simple as a server transfer. But is the converse also true? Are subscription-only MMOGs in decline? According to Bjorn: not yet, but soon. Much of the growth in the MMORPG market segment is occurring  in markets like Eastern Europe, South America, and the Middle East. These are regions of the world where "unlimited" subscription plans are virtually unknown - whether you're talking about mobile phone service or games -and paying per item or for a one-off service makes much more sense, culturally speaking.

In the meantime, Bjorn believes we'll see more "freemium" plans cropping up in traditional MMORPGs, offering preferred login, content, a leveling boost, and sundries - much like the DDO's VIP access program. "But over the long term," Bjorn explains, "when the next generation of gamers shows up, then [the subscription model] will go into decline." Not incidentally, GamersFirst has offices in Brazil, Turkey, and India, as well as Korea and the US.

The big question is whether more subscription-driven MMOGs will do the DDO shuffle, morphing into free-to-play games while attempting to maintain the quality that earned them primo advances and development budgets in the first place. Bjorn’s answer?  “Yes, as publishers realize that free-to-play doesn’t mean you won’t make money, that it builds a much bigger community and brand awareness. And if you build a great game, you’ll have a larger captive audience than you might otherwise."

Fernando agrees. "I'd be very surprised if we didn't see other games making this choice. I'm sure it's not right for every game. We were fortunate in that we felt there was a very good fit with DDO, with the way it was built, and also to an extent with the IP." Paiz noted that microtransactions are an easier sell for the Dungeons & Dragons crowd (accustomed to buying books, dice, miniatures, etc. a la carte) than a monthly subscription.

The Future of Free-to-Play

Assuming free-to-play games continue to enjoy the success and greater respect they've seen over the past year, that success may have its own costs. As Reuben Waters so artfully noted in last week's feature article, WoW's ascendancy spawned more stagnation than innovation among subscription MMORPGs. In like manner, Bjorn noted that higher quality doesn't necessarily mean more innovative games free-to-play games. “Because the really high quality games will require up-front funding, you can’t really experiment as much.“

But, the focus has shifted from quantity to quality, at least among tomorrow's successful free-to-play developers and publisher. "Quality is critically important, especially now, when you're seeing a flood of free-to-play games entering the marketplace," Fernando commented. "Ultimately the free-to-play space is going to become more and more competitive. We certainly believe in this business model, and from the success we've seen with DDO, we think more and more companies are going to go this way. The way you have to stand out is through the quality of the product."

In the meantime, publishers like GamersFirst will continue to bide their time as the world flattens out, picking and choosing from MMOGs the world over. "We see a lot of weird stuff," Bjorn laughed. “We do, at the moment, have the luxury of mitigated risk, partly because there’s so much product in other parts of the world that’s already finished, so we have the ability to pick and choose.”

That doesn't mean that GamersFirst is anxious to return to the bad old days of throwing free-to-plays against the Western wall to see what sticks. "There are costs associated with trying a game out, so we have to be reasonably sure there will be an audience for it. We actually do pretty extensive testing; we have a team based in China that does nothing but test new games. On the other hand, we donÂ’t need these games to make an enormous amount of money to make them commercially viable."

Screencaps from Victory: The Age of Racing

Will the genre mix among free-to-play roughly mirror what we've seen with subscription MMOGs: fantasy RPGs first and foremost, with other genres working the edge of the crowd? Our respondents were much clearer on how you'll pay rather than what you'll play, but Bjorn noted that GamersFirst has two racing titles in the works -the casual carter GoGo Racer and Victory: The Age of Racing, which is sort of Speed Racer meets Mad Max. Victory, he explains, is being developed in an Italian studio. “It’s very different in terms of graphics and design than what comes out of Asia. We like that.”

But not all genres work in all markets. “We’re not really clear on what market these racing games will work in. We know they work extremely well in Asia. We suspect they’ll work well in Europe.  Some say the racing genre has a lot of potential in 2010 / 2011, however, just by volume and sales, I think the two traditional genres – the fantasy RPGs and FPS games – clearly should outsell anything else. RTS games are also starting to show up as well.”

Don't look for the unapologetically repetitive nature of MMORPGs - the grind - to disappear entirely, no matter how successful free-to-play games are in subduing the subscription, where time is often (quite literally) money. "free-to-plays must be designed to encourage you to pay us." Bjorn commented, with refreshing honesty. "It’s pay or spend time; one of the currencies is time.” He went on to note that in skill-based games like War Rock, GamerFirst's MMO first-person shooter, the grind actually plays an important role. If you pay, he explained, you better be good; the grind is an important part of the training.

Left to its own devices, Zynga could destroy us all.

Given their relative accessibility, free-to-play MMOGs may make serious in-roads into non-traditional mediums too. A billing system everyone can agree with (especially the players) has long been a major holdup in planting subscription MMORPGs on consoles, but free-to-play MMOs have no such qualms. Look no further than Facebook, where FarmVille and Mafia Wars mysteriously holds millions spellbound. But are these games social and interactive enough to attract a dyed-in-wool MMO developer? Bjorn thinks so.  “It doesn’t have to be that you go do something in a group, it can also be a performing a certain activity for status recognition... The sharing of results can be a social activity too.”

Taking Free-to-Play to the Next Level

All these positive indications notwithstanding, we might know that free-to-play has really arrived in North America when a high-powered license is developed from the ground up as a free-to-play MMORPG. It's one thing to convince a licensor that a maturing MMOG, like Dungeons & Dragons Online, might see a rebound with a microtransaction makeover, but it's quite another to develop a major license as free-to-play from the start.

“The problem," Bjorn explained, " is that in the traditional licensing model, the brand-holder has so much power to change the design.  It’s very hard to work with in free-to-play because it’s difficult to explain to the holder of the IP of a large franchise why a certain type of activity makes sense."

 That being the case, don't look for the Transformers or Harry Potter free-to-play MMO for at least a few more years. Do, however, look for free-to-play MMOGs like Mytheon and Allods Online, whose graphical quality and tilt can stand toe to toe with their subscription counterparts.


Ten Ton Hammer would like to thank Fernando Paiz, Executive Producer of DDO Unlimited, and Bjorn Book-Larsson, CTO & COO of publisher GamersFirst, for their time. Pick out something nice from the store, on us!

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