The emergence of free-to-play games has revealed new truths about media consumption. Not all users are created equal. Some have little interest in a game and will only play it for free; others are so committed they will spend tens, hundreds, even thousands of dollars on a single title.
Drawing on examples from the music and games industries, GAMESbrief’s Nicholas Lovell charts the end of the “one price fits all” business model, the emergence of high-rollers as the primary driver of revenue and the dire consequences for games and media companies that fail to adapt.
2. Nicholas Lovell, GAMESbrief Author, How to Publish a Game Director, GAMESbrief Clients include Atari, Channel 4, Channelflip, Firefly, nDreams and Rebellion @nicholaslovell / @gamesbrief
3. Mythbuster 1: Publishing is about content 10% 90% Books 15% 85% Newspapers $200m $50m Games Publishers add value through DISTRIBUTION
8. Great news for content creators Content distributors, not so much Ballpark, I estimate 50% of people in content distribution will be out of work over the next decade BUT many more content creators will be able to make a living from producing and distributing their own content
9. Mythbuster 2: All users are not created equal Circulation Units sold Audience Platinum disc
10. Users come in all shapes and sizes Grazers Buyers Sneezers Spenders Browsers Socialisers Gawkers Influencers Recommenders Passers-by
11. The price/demand curve In an era of physical distribution, you need to set a single price For games, around $40 PRICE “It’s great value, I’d have paid much more” “That’s too expensive for me” Demand
16. Doh, we knew this all along “90% of gamers don’t finish a game” A forum community is typically <10% of purchasers We knew it for time; we didn’t make the obvious leap to money
17. Darkwind – an indie example Mean: 107 events Median: 60 events Mode: 1 event
29. People pay for status, for emotions, for feelings, for progress People will pay to: Fit in: “everyone else has got a Santa Hat, I want one too” Stand out: “Look at me with my twin flaming swords of Poinsettia” Fit in AND stand out: “Hey, we’re the guild where everyone wears purple” Build friendships: “Here, let me give you some flowers as a sign of our friendship” Flirt: “Here, let me give you some flowers as a sign of things to come...”
33. Bands and managers are waking up Nine Inch Nails $300 First 2,500 only OK Go $25 Live recording of gig you’ve just been to! U2 by U2 $30 Coffee table autobiography Mos Def $40 T-shirt with code to download The Ecstatic
35. Mythbuster 4: Free players are freeloaders Free users are insanely important They are: Potential converts Eyeballs for advertising Leads for lead gen deals Influencers through virality and word of mouth Gawkers Every single player has value
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37. Incorporate ads for a limited edition, 1,000-only print of the original Morph, framed for your wall for $999
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39. My advice If you don’t have a way for whales to spend unlimited amounts of cash, you’re in trouble Look after the whales Treat your freeloaders with love and respect; they never stop being valuable All users are not equal. Tailor your products accordingly Sales, marketing, revenue generation. These are all part of the creative process now. Have fun.
41. Sources Going Free Boosts Turbine's DDO Revenues 500 Percenthttp://www.gamasutra.com/view/news/27416/Going_Free_Boosts_Turbines_DDO_Revenues_500_Percent.php What’s the lifetime value of a social game player? http://www.gamesbrief.com/2010/06/whats-the-lifetime-value-of-a-social-game-player/