View from the Road: No Such Thing as a Free Lunch

[Bretty]

It takes a loss on direct revenue from TF2, but makes up for it in the cash it rakes in by keeping you checking out its ads.

But this means that Valve/Steam has microtransactions.

To say that cigarettes have microtransactions because as I walk through 711, I may buy a soda, doesn't ring true to me.

Automatic advertising logging in and out of TF2. Is exactly that, just advertising. But Micro transactions are not people falling for adverts and buying something unreated to the game at hand?

Good article but I don't agree with your hypothesis 8)

 

[Corpse XxX]

I dont mind this way of conducting buisness by Valve, imo its way better than what Activision and the rest of the lot are doing.. Buying a DLC for a quater of what you paid for the game is in my eyes bollocks.. I have yet to buy a DLC at all..

I know that when i buy a Valve game, i will get all extra stuff for it for free..
Buying from other developers, you know you will have to put up extra money later..

Conclusion: Good value games makes me wanna buy other games from them

 

[Redlin5_v1legacy]

Reading this article made me hungry. Good thing I'm about to eat!

 

[Jacob.pederson]

That article essentially just said, "Valve use a cut of the money they generate when people buy games to make new content for TF2" Isn't that just a ovbvious point? I mean yeah obviously people need to be payed to make new TF2 content, but I could never buy another game from Steam, and still ejoy every piece of conent in TF2 that exists and will exists, this isn't the same as a microtransaction in the traditional sense, because I would have to pay to access the extra content, but I don't, it's all there for me once I have the game in my hands. TNSTAFL in my eyes only applys to the person you're speaking to, ok yeah someone is paying for that lunch, but it isn't me, so therefor from my perspective it's free.

But have you never bought another game from steam ?

 

[RvLeshrac]

Very nice.

As I saw the number, I was suddenly curious whether just subscriptions maintained the $136,986 per day. After the number crunching... Blizzard gets $5,500,000 a day, so they have $5363131 per day. Of course, with 11 million players...

Sorry, but I doubt your numbers are accurate here. You need to keep in mind that out of the 11.5 million players, roughly 5 million come from Asia and they don't use a subscription model like elsewhere. Instead, they pay per hour of play, so Asian players are not a reliable source of income. Plus, as Funk mentioned in his article, the figure 136,986 is only for actualy keeping the servers running. There is a whole slew of other expenses that need to be considered.

I am not saying Blizzard isn't making a fair bit of money with WoW. But I think people tend to oversimplify and exaggerate how much money they make and also ignore how much it costs to maintain an MMO of such a magnitude as WoW.

I think I remember reading that even though it's a 50/50 West/Asia balance in the playerbase, Asia is only 5-10% of Blizzard's revenue when you factor in currency exchanges, the cut that the operators take, and different payment methods.

But don't quote me on that.

Even taking into account the *worst* estimates, Blizzard makes substantially more than $50mm/mo in fees. They also still make money from retail expansion sales.

As of 2008, Blizzard had only spent $200 million on game maintenance.

I saw that $200m figure back in 2007 right before the launch of TBC, so...

Again, that is just tech stuff. Physically keeping the game running. The vast majority of the 3,000+ strong WoW team is customer support. That is a lot of paychecks to write out every two weeks.

Actually, that $200mm is from a late-2008 issue of PC Magazine.

What most people fail to take into account is that the cost is *excessively high* for WoW precisely because of the number of subscribers. A game with 200,000 subscribers spends substantially less on general maintenance.

Even the worst-case scenario, that Blizzard spends $10mm/mo on staff *AND* maintenance, leaves them with a a minimum of $40mm in profit.

 

[oranger]

Where does all this anger regarding costs (among other topics) stem from? perhaps subconsciously, many gamers are afraid of where the industry is going? I know I am.

 

[thepj]

Where does all this anger regarding costs (among other topics) stem from? perhaps subconsciously, many gamers are afraid of where the industry is going? I know I am.

how so? what makes you afraid of where the industry is going? the way I see it even though we have al sorts of bad things out there like heavy handed drm, bad customer support, Michael Atkinson, people who want to see all games and gamers burnt at the stake, and expensive games. There are still quite a few positives, gaming as an industry and hobby is growing, indie game developers are keeping up the flow of new ideas when big companies fail to inovate, the graphics are awesome and games are more recognised as being a genuine interest rather than something exclusivly for nerds

 

[oranger]

Where does all this anger regarding costs (among other topics) stem from? perhaps subconsciously, many gamers are afraid of where the industry is going? I know I am.

how so? what makes you afraid of where the industry is going? the way I see it even though we have al sorts of bad things out there like heavy handed drm, bad customer support, Michael Atkinson, people who want to see all games and gamers burnt at the stake, and expensive games. There are still quite a few positives, gaming as an industry and hobby is growing, indie game developers are keeping up the flow of new ideas when big companies fail to inovate, the graphics are awesome and games are more recognised as being a genuine interest rather than something exclusivly for nerds

Honestly? aside from all the bad stuff you mentioned, the awesome graphics and large companies failing to innovate are linked: what does EA games do when they are starting to lose market share? in the past, they ate up a pile of indie companies and made them disappear, and then produced a bunch of high graphic quality, low everything else quality drek. Same for activision, majesco, and a slew of others. What happens when there's too few independant developers to innovate on the scale necessary to keep the industry afloat? (yes, I do believe the gaming industry is kept afloat with more than money; innovative ideas make new games and standards)
I think either making large games has to get a LOT easier, or a handful of companies have to draw a line and decide what standards they will not dip below.

edit: I'm aware that I am implying that large companies cannot innovate, but so few of them have set any kind of standard that I feel safe in describing them as video game mills; places that produce the same product year in and year out.

 

[acutekat]

To respond to the people arguing on whether or not blizzard is "right" in charging what they do on WoW you need to keep in mind one thing. If they can get away with charging a certain amount they will (also WoW is not neccessary for survival). Blizzard will charge as much money as they can to maximize profits. This will not change, but their subscription price may go down. If another firm were to enter the market with a true "WOW killer" then blizzard would have something to worry about, especially if that firm charged it at a lower cost (all other things equal, meaning a customer is not swayed by how many accounts or how much time he has invested in one game) a logical normal customer would obviously choose the cheaper of the two options if the two games are judged to be of equal quality. When Blizzard starts to lose customers it will have to consider either lowering subscription costs to draw customers back or try to one up the hypothetical "WOW killer"(by an increase in content or some other measure). My personal hope is The Old Republic will fill those shoes (I'm not diluted, there is a great possibility that it will fall flat on its face, but I can still dream)

 

[12th_milkshake]

Umm... you can turn Steams Adverts off in the settings menu... and you can also play offline for most of the games you use on steam. You can also launch by right clicking your tray icon and selecting from your installed games - you never ever have to even open steam.

Updates are minimal and only ever show a small L4D2 ad and thats only if you have the update infront of you.

And see all these new hats & weapon ideas. They put in mostly from fan base creations over at www.polycount.com Sorry to burst your bubble there is nothing new here.


Somethings worth is balanced on what a customer in willing to pull out his pocket to get it. It has little to do with it's true material value.

 

[Awexsome]

Sigh... if only every game developer had a massively popular digital distribution platform to let them take things as easy as Valve does. A lot of developers like Bioware or Bungie I fully believe would allow bunches of free DLC if they could.

But ya gotta pay the bills. And by paying for their great stuff you show support in really the best way you can.

 

[Korolev]

I don't pay them to advertise to me (unless you count the initial price of the game, but I argue that I paid them for the game, not the advertisements). So how is that a micro-transaction? Are they making money off me? Yes. But that's not the same thing as if I gave them money. My local council technically "makes money off me" because the more people they have, more more money the state government will allocate for them. But that's different from paying my council rates.

Valve's stuff for TF2, is, as far as I can tell, free FOR ME. I haven't paid another cent for anything TF2 related.

 

[Delusibeta]

Memo to self: send all SPUF complainers to this article. Bwahahahahahaha!

 

[Imperioratorex Caprae]

Yep. This article is a win. I'd love to find a coverall like this that would explain how "free healtcare" isn't free.