How subscription services and micro-transactions are shaping the future of gaming
The digital revolution has changed a lot for the entertainment industry. The financial model used to be the same for games, movies, and music alike: selling physical copies of content as disks or cassettes that had to be delivered to retailers around the world just like every other good or resource.
But the online world has opened up new possibilities for content creators to reach a wider audience. Not only has the internet allowed them to make their creations accessible around the globe in an instant, but it has also made all this content cheaper, giving more people the opportunity to enjoy it.
In fact, games, movies, and music are so accessible online that one of the greatest challenges in the entertainment industry has been finding a way to effectively monetize what it produces. Steam, iTunes and Beatport have proven that hardly anybody wants to buy physical copies of something that’s so readily available at the click of a mouse, but it’s equally difficult to motivate people to spend money online where so much information is free and files can be shared in a multitude of different ways.
The necessity to monetize online content has given rise to streaming platforms like Netflix and Spotify, which appeal to users by giving them access to a countless number of artists and movies for one cheap monthly payment. The road to this same sort of subscription-based service for gaming has been a bit longer, but it’s on the rise as well.
Jump, Gamefly and Utomik represent a fundamental change for the gaming industry by letting players try all kinds of games for one subscription payment rather than making them purchase a game to give it a try. This model of gaming comes with an additional benefit that’s lacking with services like Netflix: By tying achievements, game progress and saves to their platforms, these gaming subscription services discourage players from sharing accounts or even buying the game and starting from the very beginning.
However, while Netflix and Spotify dominate the digital film and music industries, subscription-based services have stiff competition in the gaming world from the concept of micro-transactions. This model doesn’t rely on selling the game itself or even access to it. In fact, micro-transaction games are often entirely free to play — well, almost entirely.
These games can initially be accessed for free and from a monetary point of view the game itself becomes a sort of teaser or form of advertisement for a deeper gaming experience that can only be gained by making small in-game purchases to unlock exclusive content, whether that be a new area on the map or different skins for your avatar.
The jury is still out on this model. Many in the industry believe it to be the future of gaming, but others feel uncomfortable with micro-transactions. These gamers often prefer to purchase a game outright to have an uninterrupted and complete experience with a game.
But micro-transactions are a massive industry, the size of which is evidence enough that the model is an effective way to monetize gaming content in the digital age. So, what about you? Are you a micro-transaction gamer? Do you believe in a future for subscription-based gaming? Or do you prefer to spend a little more and own a game outright?
