Subscription business model...why don't people (and companies) like it?

alzoo

I keep reading criticisms of the subscription model for MMORPGs.  In addition, it seems as though very few of the upcoming games are planning to use it.  Why is that?  It seems as though it's an ideal compromise between scaring off users by charging them a larger amount to buy the game up front, messing up game balance with pay to win in-game purchases, and not generating enough revenue by selling only cosmetic in-game purchases.  It seems as though the WoW model of letting users play for free until they're hooked, and then charging them a relatively modest monthly fee is the best mix of generating a lot of revenue, not scaring off users and not negatively impacting game play and game balance.  What am I missing that's convinced everyone that it's not a good business model for most games?

anemo

Because they're not WoW.   Because WoW has been around for a decade.

So when it comes down to it MMO's thrive more on their playerbase.   Essentially you need a playerbase to grow/maintain your playerbase.  

Which means you're number one concern is getting/keeping players.   So not having a sub at the start means that players find it easier to get into your game. when players start to get bored(which they will, especially with current designs) it means players will cancel their sub, once a sub is cancelled it's harder to get that player back than to get a new player(So better to have no sub).

Like wise WoW has been around so long that they have man centuries(not man hours/decades centuries) invested into content.   Which means it sets the bar of what $15 a month and a $20 box gets you for content.   Likewise $15 a month is such a low sum that you can't really charge less than that every month, well at least without saying "we know we're an un-superior product"(The only game that really gets away with this is Runescape, and that's a weird case)..

Vermillion_Raventhal

alzoo said:

I keep reading criticisms of the subscription model for MMORPGs.  In addition, it seems as though very few of the upcoming games are planning to use it.  Why is that?  It seems as though it's an ideal compromise between scaring off users by charging them a larger amount to buy the game up front, messing up game balance with pay to win in-game purchases, and not generating enough revenue by selling only cosmetic in-game purchases.  It seems as though the WoW model of letting users play for free until they're hooked, and then charging them a relatively modest monthly fee is the best mix of generating a lot of revenue, not scaring off users and not negatively impacting game play and game balance.  What am I missing that's convinced everyone that it's not a good business model for most games?

The type of games being made don't support reasons to pay long term.  Smaller transactions with people who have more money than they need can pay for a whole crop.  

1 guys who spend 10k a month pays for around 666 people. The devil is in the math.

nomotag

Because it requires too large a commitment from players. Every month players have to stop and ask is this game still worth paying another $15 and if it's not, then they are likely gone forever. Gamer tend not to go back to a mmo. Letting a player play the game without paying means they can stay longer and the longer they stay, the more chances they have to spend money.

laxie

Subscriptions limit the spending of the top spenders. That is one of the main reasons companies don't use it.

About 5% of the players are willing to spend enormous amounts of money. A flat subscription (or even a tiered one) forces those big spenders into spending a lot less than they would. It is often more manageable to have 10 people spending $1000 a month, than 1000 people spending $10 a month.

Subscriptions also put great pressure on developers to maintain the quality of a product. Subscriptions worry about longevity of the players. In free-to-play models, you generally do not have to worry about maintaining low spenders at all. The goal isn't to keep as many people, it is to convert low spenders into high spenders. If someone isn't likely to turn into a big spender, it is counter productive to focus on them.

From a player's perspective, subscription models are really nice as they promote community and equality. Free to play models usually don't.

As you hint in the OP, I also personally believe free to play models are not particularly ethical. The companies prey on the poor spending habits of the select few.

AAAMEOW

The big spenders spent so much money it makes up for many F2P players that don't pay.

I was looking at the financial reports of some games, and their average pay per user is not much different than normal subscription game.

olepi

"About 5% of the players are willing to spend enormous amounts of money. A flat subscription (or even a tiered one) forces those big spenders into spending a lot less than they would. It is often more manageable to have 10 people spending $1000 a month, than 1000 people spending $10 a month."

This.

In my software business, a $2 billion a year company, 80% of the revenue comes from a small minority of customers, perhaps 10-12 big spenders. Another 10% comes from mid-range customers, maybe 50 or so. And the other 10% comes from the thousands of remaining small customers.

Supporting a small number of whales is a lot more profitable than getting a penny from a million minnows.

Albatroes

Some people dont like it because they feel they might not be playing the whole time that they will be subbed for. Also, you have other games that let you play for free without you HAVING to pay to access the game (even though some games cut your benefits severely if you are not paying). As for companies, some believe (may be true, may not be, I do not have the figures for every f2p game) that more money can be generated through f2p models vs sub since some people like to spend a lot of money at certain times if they have the option to do.

Mendel

The subscription model is an heirloom business model left over from the days of print.  The big difference between the print media (newspapers, periodicals) and the games industry is the cost to create is much higher for games.  The print has always created content on a daily, weekly or monthly basis, then sells that content for a near-immediate return on investment.  Games have massive costs to develop the content, and the subscription model will recoup that initial cost, but over a long period of time.

The subscription model as used by the print industry also includes a supplemental revenue stream that isn't present in games -- advertising.  Roughly 1/2 of any modern newspaper is advertising, and periodicals are probably closer to 70% advertising.  I haven't noticed any MMORPGs that I've ever played having cola ads, or sales announcements for a department store, and there's an absolute lack of pharmaceutical inserts filled with legal disclaimers about negative side effects.

Even if you ignore the 'whale' issue as @laxie said above, the subscription model just cannot recapture the investor's money fast enough.

Wizardry

I used to be pro sub model,like 100% for it,however my feelings have changed.
My stance is this,if a develoepr wants to charge us 15 a month i am ok but what that money is used for is where i draw the line.If all the developer is doing is leeching an added 15 a month off me,i am not happy.

Here is the scenario,FFXI years ago cost Square a lot of monmey to make it.It took them 5+ years to recoup their cost and turn a profit,so i am ok with that 15,it was worth it to help the developer recoup it's cost o na great game.However now a days developers are trying to turn instant profits,so there is absolutely no reason or need for an ongoing  $15 cost.

Option B Travis,there is no option B,there is always an option B.
If the developer wants to bunlde in their overhead and cost of developing updates and future content i am ok with the 15 bucks.However when comes time to release the next xpack,i am not paying for it,that already went into the 15 bucks you got from me for the last 6-12 months.12 months at 15 bucks is a lot of money,far more than the price of the game and far exceeds any cost on overhead.

Math is simple,you make a solid game,you can retain 500k subs,at 15  month that is 7.5 million dollars a month,that pays for EVERYTHING ,overhead and cost to develop content and keep the game alive and well for years to come.Point being,your not charging me 15 bucks a month just to rip me off,there has to be give and take.

Kopogero

Producers have to figure out if losing big chunk of their player base that are willing to pay $15+ is worth more than losing those individuals that are willing to pay thousands of $.

There is a price for everything and rest assured, any game that hastens, speeds up progressions or anything in the cash shop interferes with the features it offers is unhealthy in the long run.

pantheron

F2P is more flexible, has higher spending caps and lower barriers for entry. Its attractive to people with irregular spending habits, because you won't lose access to your game if you didn't want to spend 15 this month, and the choose to spend 30 or 50 the next month. 

Rusque

A recurring monthly sub makes people think about the money they're spending (or will spend) and it feels like a cost (which it is). But cash shops enables impulse buying, which allows people to think about what they're getting immediately and it feels like a one-time thing. A person will buy a mount for $30 two days after launch and stop playing a month later, but would scoff at paying $30 for two months of unrestricted game access.

There's a reason so many of the costs are frontloaded, founders packs, early access, deluxe editions, beta 1,2,3,n, people clearly will spend much more up front rather than $50-$60 + $15 sub (which starts on the second month, first 30 days are included in box price). But you give people an option to pay $150 with additional shop items to purchase and they'll spend $250 right off the bat without even blinking and then two months later they're back on the forums complaining about WoW.


Business' don't care for sub models because it requires so much more effort for (usually) worse results. They know players will likely get bored with their game or want to game hop which is common nowdays. So why sell yourself short when you know that you just need to give gamers enough rope and they'll happily hang themselves while defending how awesome it is that they get to do so.

All of this is balanced by the fact that some part of the playerbase is playing for free.

eye_m

olepi said:

"About 5% of the players are willing to spend enormous amounts of money. A flat subscription (or even a tiered one) forces those big spenders into spending a lot less than they would. It is often more manageable to have 10 people spending $1000 a month, than 1000 people spending $10 a month."

This.

In my software business, a $2 billion a year company, 80% of the revenue comes from a small minority of customers, perhaps 10-12 big spenders. Another 10% comes from mid-range customers, maybe 50 or so. And the other 10% comes from the thousands of remaining small customers.

Supporting a small number of whales is a lot more profitable than getting a penny from a million minnows.

so in a $2,000,000,000 / year company 80% or $1,600,000,000 is spent by a dozen people or $133,333,333 per "whale" ?

I know that if I had an extra 133 million of throwing around money that I would be spending it in a video game instead of actually having fun with flying around in my own personal jet, or taking out the yacht for a cruise with the family.  I'm sure that I would be sitting around in my basement playing some videogame trying desperately to find that rare dungeon helm of Dumphuqueri.  Because that is what the uber-rich do. 

 

kjempff

Sub require a creditcard so a "free" game will attract the younger crowd who has none; and they days of buying game cards at the local game pusher shop are also over.
Then there are those instant gratification types, whose mentality also effects how they spend money, and therefore a one time purchase in a game shop comes more natural than a mortage type.

These two types take up a large percentage of most games player bases. The genre has changed, the player base has changed, so sub based as a model has become less efficient for most games.

Kilrain

1. It's easier to get players to try your game when it's free
2. It's easier to get players to come back next month if it doesn't cost anything.

This is why I like free + sub based games when done correctly. APB's model is pretty clear. You sub and you progress and earn money faster. You get access to 100% of the game without paying a dime, it's just slower. That's perfectly fine imo. Archeage has a similar model that I liked, it added that you couldn't own property without a sub, which makes perfect sense. Getting into either of these games is easy and free. It's when you get hooked that the company makes money. 

It's a win win really.

Kyleran

If you enjoy playing only one or two games a month subscription model is fine.

However if you are a person that likes to dabble in many games in the same time period free to play is definitely the superior model for that style of gameplay.

Leon1e

Because the quality of the said sub games has tanked. 

What do you really get for those 15$ exactly? Access? Please give me a break. 

Back when WoW launched those 15$ meant content. Polished and great content. Most sub-games were fighting who'd release better content to justify the sub. Lineage 2 offered 6 month free expansions for it. EVE Online basically rewrote the game couple times by now. It started as a silly python game. Look at it now. 

Nowadays they are not even trying. They charge you 60$ for box and then 15$ for access ... what? And if that's not bad ... they charge you extra 50$ for expansion (which is a whole game worth of a price tag but expansions are rarely full games on their own)

Thus i prefer games that are the lesser of two evils. Box price + expansion price. Pump content and I'll pay for it. Seems fair. Sub doesn't feel fair. Unless it's SWTOR sub. That sub feels fair. You only sub when there is new content that you need unlocked. That's fair. You pretty much buy that content this way. 

I dont like freeloading. Thus the best medium for me is demo/trial + full game price + expansion price later on. 

As a helpful tool for newcomers, if a said game has 2-3 expansions, a newcomer should just pay 60$ and receive all teh content currently available. ala guild wars 2. 

SpottyGekko

It's mostly psychological.

The average player will refuse to pay a compulsory $15 per month "just to have access to the game". They're much happier when they can play for "free", while spending $30 per month in the cash shop (via multiple small transactions) over the course of a month.

Most people don't really keep track of their impulse spending, so 6 purchases of $5 go down very easily. The individual transactions also give a clear and direct benefit for the spending. You can see exactly what you're paying for. It's much more difficult to relate a monthly sub amount to the things you earn while playing normally.

Of course, F2P monetization also gives the developer huge scope to design game play elements that can be "enhanced" via cash shop spending.

gervaise1

The default model for most goods and services is buy to pay. Rental exists but it is usually for "big ticket" items.

When mmos launched "network access" was a significant cost - people "accepted" subs. The sub covered network access only; content was extra. As network costs fell unrest grew. Enter content with the sub. CoH every quarter; WoW a content patch very 2 months for 2 years and then they released BC. Yes companies can make expansions and content at the same time if they employ enough staff to do so. What content do people get for there sub today?

For companies today - when network access costs "are real but not huge" having a sub model simply allows people to play through all xpacs etc. for the cost of a months sub. Is this the best model? If people carry on paying a sub maybe but many leave after a month or three. A better model - potentially - is to charge for content.

Its a balancing act but delivering some content, if only for a few dollars, can at least claim some value. Unlike charging a sub and delivering "nothing". Words like "ripping people off" and "price gouging"  are words that spring to mind - they can charge what they like of course.

So the "no content no pay; no pay no content" model has reasserted itself.

And from what they have said publishers would like to get rid of "free-to-download" as well and replace it by "download for a dollar". Whether they ever take the plunge however remains to be seen. Having a million minows, even if they never spend anything in a cash shop, can go a long way to recouping costs.

VengeSunsoar

Because it limits both parties: the players and the devs. The are many games I have only wanted to  play partly but if I want to play  I have to pay the full amount. The cs  let's me choose how much and how often i want to pay.  The devs are limited to a max set amount  of money per person as  well.  The cs let's the player break through the pay floor and  the dev break through the pay ceiling. 

Quirhid

With a subscription model, it is in the developer's best interest to make the game last as long as possible which means the first priority is NOT to make the game fun. Players are catching on finally.

Encephalitis

subscription for people that work just means paying month after month to never be able to catch up to neets/no lifers. broad generalization, sure, but when was the last time a worker drone was capable of keeping up with the pack without breaking out the wallet to do so?

BlurBleh

To me the subscription model is bad because it is disproportionate with the levels of enjoyment derived from the game over time, which leads to a conflicted feeling in the players.

Initially when the game is released, players would enjoy the game at the maximum level as everything is new and they can't wait to spend as many hours as they can on the game. Together with the hype generated before the release, the level of enjoyment would peak during the first month give or take.

However after players familiarize themselves with the game, they quickly know whether the game is for them or not. Those who dislike the game would stop playing. For those continue playing, their game experience would fall into a routine where they try to maximize the efficiency of their game times. This is evident in the form of grind that is so popular in most MMOs. The problem with this is that repetition lowers enjoyment, so their levels of enjoyment at this point in time would be lower than that during the initial month/s.

In a subscription based game, the players make the decision of purchasing the game often before its release, hence their judgement is based on the perceived level of enjoyment during the initial release, where it is at the highest. Hence if they decide to purchase the game, it will be based on the belief that their enjoyment would be worth the subscription fee, and more importantly, this proportionate ratio will continue as time goes on. Unfortunately this is often not the case, as players enjoy the game less over time, the subscription fee increasingly becomes less "worth it".

Why do people keep playing and keep paying then? The answer lies with commitment. As players become more invested in a game, it becomes more difficult for them to quit it. The reasoning would be along the line of "I've spent so much resources into this game, my character/s are high level with good gears, it would be a shame to stop playing and start anew in another game." And hence they keep paying, but for a different reason. This reason however, is less able to justify the fees, as a result players are in a conflicted situation where on the one hand they feel they are no longer enjoying the game enough to warrant paying for it, but on the other hand they are pushed by their commitment/reluctance to quit and thus keep on paying. It is precisely this conflicted feeling that cause players (including yours truly) to dislike the subscription model.

In a way there are two layers of cognitive dissonance for the players.
1. They are paying the fees, but they don't enjoy the game as much to justify the cost.
2. They want to stop paying, but they are too invested to quit.

Volgore

It's not that "people don't like it", but rather that most games aren't worth paying a sub for anymore.
Alot of players would gladly pay 25+ monthly to sub to a game if it is a complete package. People would already pay that for a single server on which i.e. roleplaying rules would get enforced.

Since mmorpgs have become fast food in every way, nobody wants to pay restaurant prices.
Alot of titles in recent years have obviously been throw-away products, with the studios behind them cashing in on preorders and bringing the game into maintenance mode right away release.

Publishers also cant seem to get the concept of alternative submodels. To them it is still 12,99 or nothing.
My bet is that i.e. Wildstar would have had a better chance if the game would have come with various flexible payment models. Like a basic B2P version, a 6,99 all around package and a 9,99 premium sub, all differing in say character slots, bag space and other convenience stuff.

Vermillion_Raventhal

Quirhid said:

With a subscription model, it is in the developer's best interest to make the game last as long as possible which means the first priority is NOT to make the game fun. Players are catching on finally.

Or it could be that gameplay is so shallow and stale, community so far removed you can barely get player to play for free let alone for a fee.  

MMORPG have mediocre gameplay, always have. The online play was it's strength which lost its luster and been marginalized.  I mean really who wants to play a mediocre single player game with a monthly fee attached?