Square Enix Apparently Has No Economists On Staff, Can't Figure Out F2P
Damion Schubert, Lead Designer on Star Wars: The Old Republic has a blog.
I didn't know that until yesterday, when someone on my Twitter feed pointed me toward a recent entry where Schubert analyzes last week's news regarding the subscription model announcements for The Elder Scrolls Online and WildStar.
The first point to take is the usual “These views are mine (meaning Schubert's) and not representative of BioWare or Electronic Arts.” With that in mind, he acknowledges WildStar's noble attempt to at least “try something different,” while being somewhat less kindly to ESO and Final Fantasy XIV, whose director Naoki Yoshida offers the following defense of subscriptions:
With free-to-play, because you’re selling these items, you’ll have months where you sell a bunch of stuff and you make a lot of money in that one month. But it’s all about what happens during that month. Next month, the person who maybe bought $100 worth of items in the last month could purchase nothing at all. You don’t know what you’re going to be getting, and because you don’t know what you’re going to be getting, you can’t plan ahead. You don’t know how much money is coming in. If you can’t plan ahead, then you can’t keep staff, because you don’t know if you’ll have enough money to pay the staff next month.
Schubert responds by agreeing that F2P is difficult to predict. His company is actually very conservative with its guesses and is pleasantly surprised when they routinely exceed those expectations. Commenter Eric “Dalmarus” Campbell adds:
Obviously I can’t give actual numbers, but I can definitely say that while I was at ArenaNet, Guild Wars 2 was also doing just fine. Like… really, really fine. I think the pure subscription model is dead, even if some companies aren’t willing to concede yet.
What Yoshida seems to be saying is, basically, “If we didn't have a subscription, like those pure F2P games like SWTOR or B2P games like Guild Wars 2, we would have no idea how much money we might bring in in a given month.”
Psst, Yoshida-san... there are these people who work for big, serious companies who create these things called “projections.” Some of them even work for F2P game companies and know the market you're in. You should look into hiring one or two.
Yoshida's logic also collapses under the most basic scrutiny. If you have, say, one million players paying your sub, you'll make $15 million that month. That's great. So, how do you predict how much you'll make next month? What if you have more players? Or fewer? How about when an expansion comes out? How many copies will you sell? How many more people will come back?
Really, does this head-in-the-sand mindset work anywhere else than in subscription-based services? This isn't even a “F2P is better than subs” argument, it's about basic logic and how poorly the man in charge of a multi-million dollar property understands economics.
Imagine you owned a restaurant. How are you supposed to predict how much money you'll make in a month? Better charge every customer $15, no matter what they order!
Running a business is hard. I don't dispute that. Forecasting revenue is one very hard aspect of that. I would like to think Square Enix has people who are capable of doing that kind of hard work. If Yoshida's words can be taken at face value, though, I guess they don't.
About the Author
Jason Winter is a veteran gaming journalist, he brings a wide range of experience to MMOBomb, including two years with Beckett Media where he served as the editor of the leading gaming magazine Massive Online Gamer. He has also written professionally for several gaming websites.
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Actually, you realize that the only thing they sell is the contract to play their game? Nothing else! And charging for a fixed amount is wrong?
While I respect your view, do NOT drag Square down this hole too. If you want F2P, then there are plenty already. I'm not going to say that all of them is bad, but I think a lot are. And the few I like and are ACTUALLY unique? Pretty much broken because of your favor F2P model.
But yeah, from a business standpoint, some F2P games make more profit than the the P2P, but the latter is unarguably the more stable. To each their own.
It's like yes, Imagine you owned a restaurant. A buffet restaurant and you set the entry fee of $15. No, no, I'm not going to let you in without paying first. If you want otherwise, there are plenty of other restaurant out there. You can either go to boiling crab and spent hundreds like the rich kid you are, you eat all you can here for 15 bucks. Your choice.
In the FP2 model you since there is no set ratings you are constantly, basically, working at a loss because you dont know how X thing will be received and Square Enix is a big enough company that they dont feel like working at a lost for something. I mean.... when did The Old Republic turn FP2? That' right.... when they reach the point of cancellation and they were working at a loss.
as far as the payment model statements go. both models have merits honestly. and like some have stated, a bad game is a bad game regardless of payment type.
I mentioned in the MMOBOMB forums that the P2P model would see a comeback of sorts. Mainly due to the F2P market being flooded with cash grabbing companies. And that if the games coming out using it were to do it right and make quality games then it would grow stronger. If not it would wither and die.
FFXIV:RR - I own it, I buy most mmos. I LIKE IT ALOT. it goes back to some old school foundations while introducing new school ideas and its beautiful to look at. if the rest of the P2P games coming out are close to equal then P2P gamers have something to be happy about.
Wildstar - From what I can tell from what ive read it will be designed for the more dedicated gamer. most of that group are willing to pay for their game and will do so if it turns out well. the ability to buy CREDD only strengthens its stance by allowing F2P gamers access if willing to put in the time and effort or are intelligent with their ingame resources.
TESO - I personally don't have high hopes for this game. I have said it from its inception that I cant see the ES world being MMO viable. But hopefully Im wrong and they deliver a great product for their fans. If they do it will be another victory for the P2P market.
as far as the F2P supporters go, expect more and demand more from your game developers. The door was almost shut on P2P games after the SWTOR debacle but this part of the genre has failed in so many way in so many games that the door is again opening. You really want your F2P style to survive? Then send emails to the devs of your fav games, have your friends and their friends do the same. Tell them what you want, what you DEMAND from their product otherwise this stigma attached to F2P games is here to stay.
I dislike having a popup window interfere with my game play!!!!
I have no problem paying SE monthly sub. to keep that out of my game.
That being said, I believe all p2p games should have some sort of trial so we know what we are getting ourselves into. I would probably have spent a lot more money over the years on p2p MMOs if I was able to try them beforehand, and I think that goes for a lot of people. Especially considering 'AAA title' MMOs are barely worth $10 a month, not even close to $15 a month nor buying it in the first place.
Hopefully publishers will realize this and give us the option to try their subscription games instead of us having to resort to ignoring it until it is dead.
It's all about getting you hooked and then torturing your experience just enough to make you want to pay to have as much fun as possible.
I prefer P2P. I'd rather spend $12-15 a month to receive the whole game, rather than need to spend hundreds to get the full F2P game.
$12-15 is a pittance. It's an hour and a half at minimum wage, per month, to pay.
BTW I think MMOBOMB is jealous about not getting to try and review this game because it is not free to play.
p.s. Why would you put words into somebodys mouth that they did not say or make assumptions : What Yoshida seems to be saying is, basically, “If we didn’t have a subscription, like those pure F2P games like SWTOR or B2P games like Guild Wars 2, we would have no idea how much money we might bring in in a given month.”
And then insult them about their own game and financial services :
Psst, Yoshida-san… there are these people who work for big, serious companies who create these things called “projections.” Some of them even work for F2P game companies and know the market you’re in. You should look into hiring one or two.
WTF is this : Imagine you owned a restaurant. How are you supposed to predict how much money you’ll make in a month? Better charge every customer $15, no matter what they order!
uuummmm heres a clue, Golden Corral makes you pay 11$ each visit, but you get the all you can eat buffet.
God you guys are stupid.
Also, why target just Final Fantasy?
Why not ESO and WildStar?
SWTOR went further down hill going from PTP to FTP
Before MMOs id pay 45$ + at a video store renting games....now i pay 15- and play all month.....If the game is worth PTP then people will pay...i have
Id rather pay 15$ and have quality content rather then having an a AD pop up telling me if i buy something with RL money id have an edge......that everyone else and there mom payed for as well
NO THANK YOU!!!
FFXIV Keep on, Keeping on!
It seems that whoever wrote this article just pasted examples here and there without even knowing their financial schematics and took a piss directly at Yoshida and Co. for not making FFXIV ARR F2P
"This isn’t even a “F2P is better than subs” argument"
oh ? but the way things are written in this article, it sure is exactly that.
seriously ? SWTOR is a pure F2P ? Did you even try to play it until the end ( lv max and trying to up your gear to the top ? ), SWTOR ends up with a big message in your mind : subscribe or give up. Stop jumping so quickly to conclusion....
And for your information sir, FF XI is still running with SUBSCRIPTION over many years.
Your review is so cliché, talking about F2P game on a dedicated F2P review website :)
Stop talking so badly it's your opinion, and i guess a lot a guys follow you, but there are gamers that are " smarter " and are ready to spend 12$ a month unlike hardcore F2P gamers who can throw more than 100$ each month for only one reason : Feel the pleasure to destroy everything and be above all.
They can justify it all they want but in reality they are digging a hole for the mmorpg genre. If you think otherwise then you're just delusional and part of the deconstruction of mmos.
Does F2P 100% mean that the game will be bad? No.
Does P2P 100% mean that the game will be good? No.
So yes, there do exist some F2P games which are good, and yes there are some P2P games which suck. The morons will argue until the cows come home about all the wrong factors, throwing in example game after example game to try to back up their fallacious crap. Simple fact is this, if a game *>IS BADIS A BAD<* game. The converse is also true, if it is a good game, what you pay (or don't pay) won't stop it being a good game.
With this in mind, I still do not favour the F2P model and would much prefer a subscription based game.
Why? A few simple reasons, which mainly centre around the community, after all MMOs are social gaming:
The community - Typically speaking (not across the board) the community on F2P is more negative. People don't fear being banned, as they don't lose anything in terms of costs, and it's free to start up. Added to this the anonymity of the internet and pretty much anyone can come in and troll people who are trying to enjoy it, and simply leave when bored.
Longevity - With no costs to play, you may be incentivised to pick it up and play, as it's free and you lose nothing by giving it a go. However, many people will simply try it and drop it quite soon. The lack of paying for it, means you are not incentivised to have some patience and stick with it (after all, you have paid for a month of play, why not use it etc.). This results in a much higher turnover of people, which doesn't add to the stability and longevity of the community.
Maturity: Young teenagers who don't need their parents credit cards, can pick up and put down F2Ps at will. Often this results in a very immature gamer base, where I personally prefer a more mature base. Again, this does not mean all teenage gamers are immature, or that all adults are mature. Still, there are more immature teens than there are immature adults, and F2P is often more densely populated by teens.
Net Costs: F2P is free to play, well duhhh... P2P is Pay to play, again obvious. However, the main difference is that P2P is capped at whatever the sub per month fees are - say you pay £10 pcm, that is a cap of £120 per annum. F2P games make their money by incentivising you to pay for premium products, armour/weapons/mounts/costume/potions/boosts etc etc etc. Yet their costs are not capped. It is quite easy, to spend £20/30/50 pcm and not realise it. What happens in many cases is P2P is net capped at £120 pa, but F2P can stealthily squeeze you for much more than this and you don't realise until long after the fact.
Overall, if you like a game you should support it, regardless of it's economic model. In this instance FFXIV is P2P, you should try it out, and if you enjoy it support it. The P2P model works, and it works well if the game is good enough so that people want to stick with it. FFXI still has a massive gaming base, and is bring in the money for SE. WOW still has a massive fan base, and so on. Will FFXIV survive as a P2P? I don't know, nobody does, but I hope it will (and my prediction is that it will).
The amateur writer of this article clearly has no idea of how statistics and economics work, he also doesn't realise that with such a massive fan base of the FF series, it is actually very easy to predict month to month incomes, given the subscription bonuses and multi-month sub fees - it is highly unlikely that 100% of your customer base will quit all in one month. I am very sure that a company as large as SE has many (far more intelligent people than the writer of this article) who work for them, and know how to forecast and predict things like this using statistical modelling and forecasting.
The simple fact is, that if you can't afford to subscribe, then you don't get to play it - a very tough love stance, but the realistic one. Furthermore, if you don't like P2P model, then again you don't have to play it. Quite simple really!
I'm really stunned. Is this what passes for research and journalism in the gaming world? You should feel awful about writing this, and whoever edits for this site should feel awful about letting you put it up. It is completely lacking in substance and serves as nothing but a soapbox for the way you feel about the issue. Thanks for wasting my time. Feel free to argue back, but I really have no interest in engaging you or anyone else that thinks this article isn't pure sh*t.
The games that went F2P are games that could not stand on their own with a subscription model because, frankly, they weren't good enough for a subscription. That's the cold, hard truth of things. I have no doubt that subscriptions will be making a comeback as companies begin to put more effort and heart behind their games. If anyone has a problem with shelling out a meager $0.50 a day for these games, I suggest you stop relying on your parents' income to fund your gaming habits.
Make an MMO that I want to play and I'll give you some money! These petty attempts to swindle your customers are insulting and ultimately damaging to your company and IP. 'Pay to Win' needs to die in a fire, along with anyone that thinks such a model is beneficial to their customers. The WildStar devs are on the right track and I feel like they'll be the recipients of my hard earned cash this year.
Damion Schubert, Lead Designer on Star Wars: The Old Republic.."
"..Star wars : The Old Republic".
Yeah I'm gonna have to stop you right there..because I could go on forever on how frucked up their idea of F2P is, especially with their tactics concerning the cartel market. As it is controlled now by EA, at one point we were told (and I'll paraphrase here) that if people didn't buy the Cathar species that they'd not do any other species releases. Essentially they like to hold any new content hostage in a bid to force people to buy. That's backwards, even for a capitalist business.
So as far as I'm concerned Damion and anyone else working on SWTOR are completely irrelevant in the discussion of F2P and how it should be done. So long as they're under EA's thumb you know it's all PR talk.
Now on the topic of F2P, personally I despise it. Why? Because it never fails that they reduce the quality of life in a game in a way that makes it irritating and difficult--and thus less fun. You can say you enjoy it but deep down there isn't a single one of you F2P players that doesn't wish you didn't have these restrictions imposed. Those that won't buy stuff on an F2P game choose to suffer. Those that do pay quickly find out that the game itself is problematic because it was designed to eat your wallet.
You guys will complain about a $15 per month (that's $0.50 a day) subscription fee but have you ever watched how much you'll spend going out to the cinema for an evening? Going to a restaurant? Mini-putt? Bowling? I guarantee you will spend more than $15 a month for what equates to a few hours tops of entertainment. But you'll refuse to pay $15 for what amounts to as many hours of entertainment as you can squeeze into a month?
You guys ought to step back and examine the amount of cash you spend every day. Hell I bet some of you people out there spend more than $10 a day just in coffee and breakfast on the way to work!
F2P offers exactly ONE aspect; no commitment. That's all well and good. But how committed are you to a game that reduces the quality of life purposely in a bid to get access to your wallet?
I don't know about you but I'd prefer to pay $15 and not have worries than pay $0 but then want so desperately to level faster or have a mount that will cost you $10 or more. Honestly I don't understand the F2P mindset.
Is it because you guys feel that your money isn't worth it if you have to resub monthly? How many hours are you going to get out of it? Is 80 hours a month not worth the $15? Most retail console games nowadays only last 20 hours, sometimes less and are worth four to five times the cost of a monthly mmo subscription! Why do people then buy those but balk at the cost of a subscription? If a game holds no value for you unless it has no upfront price tag that's a problem, people!
Hopefully square will stick with Pay-to-play! There is no reason to harm the quality of their product and the quality of life in their game in a bid to nickle-and-dime.
since FFXI (which still running with still lot of people on their server), SE aim toward loyal player base that will play not only for 3 month but for very long period.
Most player are original from FFXIV or FFXI which mean person that are used to the style of the game being new and oldish by the same way. They will play and keep playing the game till they stop releasing extension and that can be long !
Look at FFXI up to.. last year if im right? they released the latest extension of it !
Quite impressive for such an old game to still have lot and lot of people and not only japanese. The game got lot of EU and NA. And the content is quite serious and very long to finish, myself only managed to get 2 extension done before and it took me long time of work and training.
Yes F2P look like to be the future of mmo lately but when i see lot of company such as Sony, using this as pretext to turn an interesting game into p2w or highly restrictive, there'll be problem..
F2P was well made by few company such as Perfect World, who's i think, quite leading the f2p market, followed now by GameForge who did an excellent job with Tera, even if there's problem can't argue with the fact they give a full game with no limit.
I quite prefer pay for FFXIV or repay for FFXI, a game i know will develop for a long time with more and more stuff to do than playing a F2P that will either highly limit my experience of the game or promote pay 2 win.
this is the reason why i say think once if its a matter of a general market think twice when pointing at someone else s market.
well you have to give everyone a chance you cant just judge em like this.
Not in favor of this article at all ....
I think the author of this article should learn how does the MMO market look on the other side to know whether his subscription belief is biased or simply logical conclusion from where he comes? Who knows, maybe in Japan P2P subscription model works much better than it does here in the west. Is there any Japanese-localized MMO savvy player here who would care to elaborate on my thoughts?
anyone who thinks it is fun should shoot them self.
SWTOR is the absolute WORST EXAMPLE of a Free to Play model.
Get me the Developer of Rift now that its Free to Play. I see his input on the F2P market being a LOT more viable than the guy who helped think up "More than 2 action bars should cost them money"
F2P, buy to play like gw2 and in game stores are the future of MMO.
In any case, it's likely a decision from the Squeenix heads, and not Yoshida, to ultimately not allow FF14 to be F2P. FF11 still makes a hell of a lot of money, so I hear, so I doubt Squeenix is even considering F2P as a model.