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Democratizing DDO - Turbine Reveals New Facts and Figures at GDC 2010

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It’s no secret that DDO has successfully switched from a subscription-driven revenue model to a hybridized model featuring a microtransaction store. So how have these changes impacted Turbine’s bottom line on DDO? Short of sharing the actual dollars and cents, Turbine’s Fernando Paiz, Executive Producer of Dungeons and Dragons Online, was refreshingly free with the numbers. Paiz’s openness was all the more surprising because Turbine, unlike nearly all of its competitors, is a private concern and need not make its financials public.

Fernando Paiz at GDC 2010

Paiz’s thesis was that DDO, under the old subscription-only model, cut off both the hardcore players who were willing to pay more to get more from the game and the free-to-play players who wanted to play the game without ponying up a minimum fee each month. The hybridized model unveiled last October not only allowed players to pay for as much or as little of the game as they desired, it also precipitated new levels of involvement in the game for both players and developers and dramatically increased revenues from the game.

Noting that the hybridized model unveiled last October was the result of 18 months of tough design decisions, Paiz broke down the game’s microtransaction offerings into five distinct categories: content, convenience, consumables, cosmetics, and concierge services. While the nature of most of these categories is well understood by anyone with any knowledge of a microtransaction game, the workings of two of Paiz’s more unusual categories - convenience and concierge services - are a bit more obscure.

Convenience services include items like experience potions, which allow players to speed past run-of-the-mill leveling content, and veteran benefits, which allows players to skip the first four levels after playing through these levels once. Turbine was all too happy to let players skip the first four levels anyway, since these levels were already part of the game’s free-to-play offering.

Concierge services allow players to experience the game in a different way - for example, as slightly more powerful races and unique classes (i.e. drow, warforged, monks, favored souls). This also includes one of the DDO store’s bestsellers – 32 point builds – which essentially allow players to transform any class or race combo into the more powerful purchased races.

Some of these microtransaction categories were more controversial than others. Paiz noted that among Turbine’s stickier decisions was making content available as an a la carte. But Paiz contended that challenging, compelling “adventure packs” (unlike brainless, grind-driven content) can carry a price tag comfortably.

According to Paiz, making parts of the game that players considered especially valuable, such as excellent content, available in the DDO’s store offering essentially “democratized” the game. Instead of just building content to attract new players or retain end-game players, Turbine builds content and services based on what sells.

This was where Paiz’s talk differed from other free-to-play sessions we’ve attended at GDC 2010 and before – Paiz contended that a hybridized model breathed new life into their development efforts. Rather than the free-to-play encouraging DDO’s developers to take a vampiric stance towards their playerbase, it instead encouraged them to think very closely about what adds premium value to the game for their players. This “marketplace of ideas” approach is fairly new to MMO gaming, and in this writer’s opinion, very welcome.

So much for definitions. Let’s move on to the numbers, but keep in mind these figures come straight from Turbine. That said, numbers can match perception and good sense, and in this case, they certainly do.

First up, how has DDO’s hybridized model impacted overall player numbers? According to Paiz, the peak CCU (peak concurrent users, the maximum number of players online at any given time) have gone up by five times since the subscription days, monthly active players have gone up by ten times, and monthly revenues have risen by five times.

The hybridized model may signal a shift among player demographics as well. The under-25 crowd playing DDO increased from 15% of the playerbase to 25%, and those aged 35 or less now make up 57% of the playerbase, up from 50% in the subscription-only days.

DDO Store Top Sellers (through Feb. 2010)

(For item descriptions, click here.)
By Units Sold
By Revenue
1. Siberys Spirit Cake 1. 32 Point Build Characters
2. Major Experience Elixir 2. Major Experience Elixir
3. Moderate Heal Potion x50 3. +2 Tome of Supreme Ability
4. Copper Sigil of Leveling 4. Siberys Spirit Cake
5. Medium Jewel of Fortune x5 5. Favored Soul Class
6. Best SP Potion x10 6. Drow Race
7. Greater Siberys Spirit Cake 7. Character Slot
8. Greater Experience Elixir 8. +1 Tome of Supreme Ability
9. Bell of Opening 9. Monk Class
10. +1 Full Plate 10. Veteran Status Characters

Playing habits are also very different for the free-to-play and subscription player communities. Under the subscription-only model, 45% of the playerbase logged in for 20+ hours each week. That went down to 43% among subscription players after Turbine implemented the hybrid model last October, but only about 35% of subscription-free gamers top the 20-hour mark. That subscription gamers in the DDO community spend more time in-game than free-to-player gamers makes sense, since subscription gamers have more motivation to log in rather than pay for a subscription service they’re not using.

Digging into the sales numbers, Paiz reported that DDO has a cart-to-checkout rate of 70%. Paiz attributed this outstanding number to Playspan’s and Turbine’s seamless integration of an in-game DDO store, as well as the better buying decisions occasioned by Turbine’s reluctance to show items not useful or irrelevant to the player’s character.

Combining the subscription and microtransaction models, which as Paiz noted was originally thought to be an ill-considered move among some of Turbine’s Asian free-to-play counterparts, actually resulted in some surprising combined sales. Under the new model, a significant portion of subscription gamers actually engage in microtransaction purchases as well, pushing their lifetime expected revenue over 175% of the subscription-only baseline. (Exact numbers weren’t revealed, but Paiz did say that current subscriber counts are double what they were under the old model). Those who only engage in microtransaction purchases (and do not take advantage of the subscription offer) came in at about 70% of subscriber-only revenues.

Putting it all together, while DDO’s average proceeds per user (revenues / peak concurrent users) dropped slightly from $75 -$100 per user (under the subscription-only model) to $65 - $90 per user (under its hybrid model, using early data), this slight decrease is more than offset by the dramatic influx of new paying players. According to Paiz, DDO now has three times more active customers and subscribers than under the old subscription only system, making the hybrid move a rollicking success for Turbine as well as players who have undoubtedly benefitted from a more vibrant online community.

Turbine continues to fine tune DDO’s hybrid model, however. Continuously reevaluating how much of the game should be free; the most drastic of Turbine’s recent changes was the elimination of the leveling sigils – i.e. game elements which forced players to pay a small price to continue leveling every four levels. Paiz noted that it is far better to have too many “toll gates” at launch than not enough, since the removal of such requirements will make players much happier than adding them in later.

Such seemingly common sense efforts have helped Turbine make a hybrid microtransaction / subscription game that both old and new members of the game community seem to believe in. And if PowerPoints don’t lie, players are affirming Turbine’s changes with their pocketbooks. It’s an exciting thing to see happen in a game many thought was in its death throes this time last year.

Although DDO’s hub-and-instance format lends itself perfectly to a microtransaction basis, the numbers show that this is a model worth considering for other developers of maturing MMO titles as well. Our thanks to Turbine and Fernando Paiz for a very compelling peak behind the curtain at GDC 2010.

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