No one sells mobile games any more

edited in General
"@giordanobc: Around 95% of iOS games revenue in July was from in-app transactions. Paid games don't even qualify as a market anymore" - https://twitter.com/giordanobc/status/373447983812984832 - via Daniel Cook @danctheduck

Normally I like to point to some research to back this up, but I've been says for the last few years in game jams and local competitions that as game designers you have to be thinking about monetizing your games and this just backs me up.

You guys and gals talk about the bad micro transactions in current games but are you practicing in your prototypes better solutions?

Comments

  • Yeah, gambling revenue has always been higher than game revenue. Just under $100B in the US in 2007, compared to +-$70B for game revenue in 2012 five years later.

    Does that mean we should all be trying to make casinos too?
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  • Such a sore point of contention. We all want to make what we want to make. We all also want to make money (well, some more than others, and some more necessary than others).

    In the end it's all down to balance, it's not really fair to say that either extreme is "the best" because they obviously have different pros and cons.
  • Leaving the sarcasm aside, I think that IAP and micro transactions are a viable business mechanism on the mobile platform but it's a practiced skill if you don't want it to feel tacked on in your game; and designers should be implementing it (if only as a thought exercise) in their prototypes.
  • @Fengol do you have any prototypes to share where you have practised this? I would be rather interested in seeing a pseudo-IAP system in a game that would be an effective means of learning.
  • It's a pity you weren't at GGJ2013 where, as an exercise, we went through the batch of ideas and how to monetize them.

    You should also check out DLC Quest which makes primarily makes fun of IAP but uses it to also tell a story and give the player more options to explore the world.
  • It's an interesting thought experiment, I remember runescape did monetization really well IMO.

    It is an mmorpg but is super fun for free players and just supe more fun for members and has separate areas for both :)
  • @Fengol: I wasn't being sarcastic - merely pointing out that most IAP games are essentially gambling. I don't see how any game that you can only pay for once is going to compete with a game with no spending cap on the "how much you could be theoretically earning" scale. Those earnings are just that: Theoretical.

    I've had game concepts that would benefit from an IAP-like structure. I just can't guarantee the volume of downloads required to make the earnings from the tiny percentage of players that pay get anywhere close to the earnings from the much smaller number of interested players that pay once up front and download.

    I feel like everyone going on about IAPs keeps not understanding that you need to have a fucking firehose of players aimed at your game. I don't see how you're supposed to get that firehose without a long, long period of reputation build-up and contacts with the right kinds of publishers. You can't pull that off with your first game! And even if you somehow make your first IAP game super excellent, your tiny reputation and reach as a starting dev will mean you'll get cloned instantly by the studios unscrupulous enough to do the sorts of IAP strategy behind Puzzle & Dragons.
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    @dislekcia Yeah, and I don't like the incentives that come along with needing a firehose of consumers. I don't want to make a game that has a broad enough appeal to get a million downloads. I love working on niche games that I can care passionately about. I even talk about trying to be actively offensive as a business strategy.

    But that's because I'm highly individualistic as a person, not because making paid games is better. It's just more fun for me right now.

    Though I'd like to try my hand at free to play, it's an interesting design challenge (and I suspect a difficult one), I just don't really want to make a living doing it in the current market.

    Obviously also that that figure doesn't tell us how many games were released as free to play and what the earnings mean-figure is. I'd be very curious to know those figures (as I suspect the freemium market is incredibly top heavy, dominated by the big publishers, and dangerous without the kind of resources @dislekcia is talking about).
    Daniel Cook, talking about what he expects the future of this staggering 95% in app purchase earnings is said:
    @osulop @giordanobc What I would expect is consolidation. Maybe 100 or so big, long term games/hobbies owning 95% of revenue.
    That sounds not super promising for indies.
  • I dunno why people are worrying about this magical 95% of revenue thing. Football (soccer, if you're silly) owns 95% of sporting revenue. Do other sports still manage to work out, or are we only stuck with one?

    Daniel Cook called DD a hobby-game when we first met him, before he started talking about that concept in articles. Yes, he meant it as a compliment ;)
  • dislekcia said:
    Daniel Cook called DD a hobby-game when we first met him, before he started talking about that concept in articles. Yes, he meant it as a compliment
    That's pretty awesome.
  • Am I allowed to geek out over how awesome meeting Danc is? Like, I read Lost Garden for years and Tyrian occupies a special place in my gaming heart, so that first magical trip to GDC I was super nervous to go say hi. But I got up after his talk anyway and went and asked him a question, then we got to talking and as we get to the door he asked what I was working on. When I said Desktop Dungeons he went berserk, loves the game.

    That was one of the best game design discussions of my life. So now we go find Danc every year and see what he's working on and poke some early builds. It's awesome :) Had some really in-depth IAP discussions with him as well, trying to figure out how to design around them. I mean, that's what Triple Town is kinda all about. (To bring this back to the OP)

    As a result, I'm not against IAP, I'm against exploitative crap design. I'm also against trying to emulate business models that aren't sustainable without huge spending on visibility and keeping those players churning through content.
  • So my question is, how do you figure out what's exploitive and not without practice? I'm not suggesting everyone switch to a freemium model, I'm suggesting that a good/fair freemium game comes with practice which developers should at least spend some of their time thinking about when playing with their prototypes.
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    @Fengol my belief (read untested opinion) is that a non-exploitative model of IAP/F2P/Sustainable hobby game design/Insert the next name is tied into regular game design. So just making games and having an extremely firm grasp of the interactions of your game.

    The basis of selling any game is that it is good. Once you have a tested your skills in game design, and have a concept that can work with such a model try making that.

    ---

    I suppose my question to you is how do you think designing for such a system is different from regular game design?
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    Karuji said:
    I suppose my question to you is how do you think designing for such a system is different from regular game design?
    The compulsion loops have to be much much much much much much much better for an indie in-app-purchase fueled game than for it's premium model counterpart. Practicing making score attack games or single screen puzzle games or adventure games won't teach you this skill.

    The player experience to be suitable for a broader audience than for it's premium counterpart.

    The game has to be long, preferably endless. Having a story that comes to a satisfying end is a bad idea.

    There have to be many points of contact with in-app-purchase in the game (unless we're either talking about DLC, which isn't really the topic of this conversation).

    The purchases have to reflect the player's desires. Manipulating player desires is non-trivial and unnecessary in premium games (except generally in their marketing).

    (I think those are some pretty hefty constraints. I'm sure more can be added. Obviously there is room for experimentation, but in most situations I'd think those constraints would prove true)
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    @Fengol: There's this dude, Ramin Shokrizade who writes about F2P monetisation strategies and studies on Gama a lot. There's also a ton of other F2P/IAP debate on Gama as well, which I feel tends to cover "both sides" of this thing in a pretty balanced way. The blogs themselves are less balanced, but the comments are actually useful most of the time.

    So that covers keeping up to speed about F2P systems... I'm not really sure why we should be practicing F2P monetisation "skills" when the actual skills involved in designing a fun game are much more important, given the general lack of resources and player bases we tend to have as developers. Sure, thought experiments can be fun, but you have to be careful that you don't get stuck in a loop that doesn't give you back much for your time.

    I'm basically not convinced that monetisation is something you should be actively thinking about until people are trying to actually give you money for a prototype, then you can expand on how you best feel that this thing you've got that people like should be earning. But, just like the story/mechanics debate in the other thread, you're not going to get to that point without, y'know, designing and building something pretty damn game-like in the first place. I feel like that's a common starting point, no matter how a game is eventually monetised.

    It might be worth pointing out differences between F2P and P2O (pay to own, herp derp let's make up acronyms) games from a development/design/resources perspective. I dunno.
  • @BlackShipsFilltheSky you really have been looking into this haven't you ;) in general I think those are a good set of constraints.

    I think @dislekcia said what I have always been trying say about these type of topics:
    dislekcia said:
    I'm not really sure why we should be practicing F2P monetisation "skills" when the actual skills involved in designing a fun game are much more important
    Sure if you are trying to monetize your game than it is something to practise, but otherwise
    I'm basically not convinced that monetisation is something you should be actively thinking about until people are trying to actually give you money for a prototype
    Also I kind of feel that:
    BlackShipsFilltheSky said:
    The compulsion loops have to be much much much much much much much better for an indie in-app-purchase fueled game than for it's premium model counterpart. Practicing making score attack games or single screen puzzle games or adventure games won't teach you this skill.

    The player experience to be suitable for a broader audience than for it's premium counterpart.
    Has some form of survivorship bias in it. Since that is what the games have succeeded. (I'm not saying it's bad advice, but I find game design is often more about what is not done as opposed to what is)

    So what would one need to do to avoid something like Gasketball? You can probably name more games that have failed at this than I have and if you are pushing for this kind of business model I would be rather curious on what your suggestions for not fucking it up would be?
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    Karuji said:
    Has some form of survivorship bias in it. Since that is what the games have succeeded. (I'm not saying it's bad advice, but I find game design is often more about what is not done as opposed to what is)
    I don't think we can armchair design a freemium innovation, that'll come out of actually experimenting (which is what @Fengol is advocating I believe).

    (I suggested that limited list of constraints because they're also opportunities, figuring out how the psychology of in-app-purchases work, and then searching for ways to avoid some of the negative effects, or finding better alternatives, would be my goal... but without practice it's all academic).

    And I do agree with @Dislekcia about the primacy of making a good game. I wouldn't get tied up about freemium monetisation unless I had a game that people were playing for embarrassingly long amounts of time (and it sort of fitted the model in other ways).
  • Had a look into Gasketball (I hadn't heard the failure story until now, I knew the game from the very cool trailer Kert Gartner did)

    http://www.penny-arcade.com/report/article/going-broke-with-success-how-an-app-with-200000-downloads-led-to-devel



    A couple things that stick out for me:

    Having an in-app-purchase during a free game for unlocking the full game is a method that has been proven to make less money. It was proven to fail on several platforms (including repeatedly on IOS) long before Gasketball launched.

    The creator's of Gasketball are stubborn and not business smart. They talk about Dragonvale and say it makes them sick to their stomach due to the in app purchases and they say it has zero gameplay.

    I think Dragonvale is kind of fun, I like that sort of gameplay, it's pretty padded and not super interesting but then I'm not 100% into that sort of game. But Dragonvale fits the freemium model very well, while Gasketball doesn't. Of course Dragonvale made tons of money, and that's perfectly fair.

    And as @Dislekcia pointed out, that doesn't mean we all have to make Dragonvale.

    Though Gasketball is a game I have even less interest in making, and their monetization strategy was staggeringly dumb, despite having a cool game and cool trailers.
  • The muscle you need to make a freemium game work is rather staggering. On iOS I saw a figure that charting requires at least 50000 dollars in marketing spend to get enough eyeballs and game the app rankings. Also, the companies that get it right are making several million dollar a month, wouldn't be surprised if that 95% was made up of very few companies.

    Overall though my biggest problem is that the kind of games that interest me just don't seem compatible with the model. Can anyone imagine if journey, gone home, the unfinished swan or any other of a host of games like it were freemium? I think these are still really special experiences that deserve to exist...and will always find an audience, even if they dont mint money
  • BlackShipsFilltheSky said:
    I don't think we can armchair design a freemium innovation, that'll come out of actually experimenting (which is what @Fengol is advocating I believe).
    This is why I asked @Fengol if he had a prototype that practised this.
    Fengol said:
    It's a pity you weren't at GGJ2013 where, as an exercise, we went through the batch of ideas and how to monetize them.
    So I am kinda taking that this kind of idea of making a prototype which incorporates F2P concepts and such has not been done. If the proponents of the idea aren't willing to put in the effort should they really expect someone else to? It's a novel idea but as with any area of making games it's just an idea prototypes and such are what matter.

    Or to rephrase I am wondering why you are bringing up armchair design when you are exactly the kind of person who I expect to be able to whip out a prototype going "Hey this is how you do this" you make games as addictive as crack, and you're interested in this kind of model.
    BlackShipsFilltheSky said:
    (I suggested that limited list of constraints because they're also opportunities, figuring out how the psychology of in-app-purchases work, and then searching for ways to avoid some of the negative effects, or finding better alternatives, would be my goal... but without practice it's all academic).
    Like I said I thought it was a good list, and as I said above I would hope someone who is a proponent of the idea to make a prototype showing how it can be done.

    ---

    With regards to Gasketball. One of the analyses I read a while back gave the game's major flaws (in terms of F2P) as setting a cap for user spending, and having a UI which poorly led people to spending money. From my experience in F2P design the UI is one of the most important thing in getting people to actually spend money since that is there means to spending money. With the more steps added the less likely they will spend.

    Or a simple put: Make it easy for people to spend money on the game.
    BlackShipsFilltheSky said:
    And I do agree with @Dislekcia about the primacy of making a good game. I wouldn't get tied up about freemium monetisation unless I had a game that people were playing for embarrassingly long amounts of time (and it sort of fitted the model in other ways).
    Ye, I kinda always have a worry when these kinda threads come up. That there isn't a disclaimer in the OP going: UNLESS YOU HAVE MADE REALLY COOL GAMES AND PEOPLE ARE TRYING TO GIVE YOU MONEY DON'T WORRY ABOUT WHAT WE ARE TALKING ABOUT.

    There are people lurking here for info about making games, and really how are they to know that this is something that they shouldn't really be thinking about, or that it is, currently, purely an academic discussion?

    Also I'm not saying that these kind of discussions are bad: just that we should be mindful of our audience when we give information.
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  • Personally, I think the cap for user spending is actually the pivot point around which F2P is going to turn. Think about it this way: We already know that when there's no cap, F2P games make most of their money off a very small group of "whales" that spend large amounts of cash. So making a cap-less F2P game hinges around being exposed to enough people to up their chances of catching a few whales.

    As soon as you put a cap on your F2P, suddenly the game can't subsist off of whales and needs to be something that loads of people will pay for. If whales were capped at $10 or $15 dollars total, then you'd see F2P game earnings come down by a factor of 10 or more. That's a big deal, so you'd have to ensure you can get more paying customers. How do you do that? Well, that's the tricky part, isn't it?

    To me, earning caps are crazy important to push for more ethical designs. Stuff like new content coming out generally circumvents that cap, because you're paying once for something you then have. That's the LoL model and requires ludicrous amounts of churn-ready developers and artists. Paying over and over to get around an artificial hamstringing in the game itself? That's not cool. Earning caps prevent that.
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    @dislekcia I think a cap would make F2P far more ethical.

    But would that come about due to more savvy consumers, or outside forces (like governments banning capless games)? It's certainly not going to come from the distributors or developers. I can't see capped spending F2P competing directly with capless F2P games.

    Would that mean we'd have the same sorts of games making the money, just they'd put in more work for every purchase. Like the way there is a theoretical limit to spending in Magic the Gathering and you get a new thing for every purchase. So there is content for every in-app-purchase and In-App-Purchases aren't looped.

    Or would that mean that there is a hard limit imposed on F2P games as to how much money each player can spend in a game (like $30). The last time I saw freemium figures it suggested that the whales were everyone spending $20 or more, and that the percentage of revenue earned by them was less than a third of total earnings. The vast majority of paying players were under $10.

    Admittedly I saw those figures a year ago, and I can't recall which game(s) the data came from. Has the revenue generated by whales gone up exponentially since then? (or was it always much higher?)
  • Ah, I did find some info that contradicts my previous info a bit:

    “The top 10 percent of players can account for as much as 50 percent of all in-app purchase revenue,” says Andy Yang, CEO of the mobile monetization research firm PlayHaven.

    (I assume he means "paying players")
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