Posted by: Snafzg
On: May 23, 2009 at 05:43pm
I was working on a post for Massively and came across this interesting bit of information I had not heard of before, called the 89/10/1 Rule:Many of these sites, like SuperSecret.com, are free-to-play, but rely on something called the “89/10/1 Rule,” says John Davison, co-founder of WhatTheyPlay.com, a Web site that helps parents navigate the many game choices for their kids. This rule, Davison says, assumes that 89 percent of your audience is playing for free, 10 percent is paying for something and 1 percent is spending a lot of money, buying new clothes or convenience items for their avatars.The big word in there is "assumes," however, the ratio seems pretty realistic to me. I can't believe I haven't heard of this rule before. I mean, I know F2P game developers must use something like this to pitch to their investors, I just haven't seen this rule come up before. Maybe it's because I don't really follow the F2P scene.
Just for fun, let's assume the rule is true and that Free Realms, Runes of Magic, and Wizard101 are achieving it. Let's also pretend the minimum monthly fee is $5 and the big spenders drop at least $15 per month, which isn't unreasonable.
- Free Realms (1M accounts): 100,000 are paying $5 ($500K) and 10,000 are paying $15 ($150K) = $650K/month
- Runes of Magic (1M accounts): The same as FR, which is $650K/month
- Wizard101 (2M accounts): Double FR and RoM, which is $1.3M/month
- World of Warcraft ($15/month sub): $75M per month
- Warhammer Online ($15/month sub): $4.5M per month
There are four things I think we should consider.
Accessibility - A free MMO will almost always have greater accessiblity than a subscription-based MMO, which is why you see quite a few F2P MMOs with account numbers in the millions and WoW as the lone subscription-based wolf. Actually, WoW has become so successful because of a different kind of accessiblity - ease of entry, which is something many other subscription MMOs face plant on. Due to both types of accessibility, I believe the growth potential of F2P MMOs is a lot larger, even though they may not make as much money as a result.
Demographics - I haven't checked recent global statistics but I'd wager the amount of kids in our world (aged 5-13) is a lot higher in population than the 19-34 male gamer demographic. Most F2P games go after kids while most subscription-based MMOs go after the latter for the simple reason of economics. It's much easier trying to hook a kid by giving him or her a zero entry barrier F2P game than immediately asking for $15 plus the cost of the box. Once the kid is hooked, it's off to mommy and daddy begging for the RMT goodies. Parents want to keep the kid quiet (let's be serious, most do...). Cha ching. Easy sale!
Development Costs and Quality - I think these two go hand in hand. The more you spend on an MMO during its development, the more quality you're likely to get. You don't always get top-notch quality in games that are expensive to make, especially at launch, but chances are your graphics, sound effects, feature set, expansiveness of content, and other things are going to benefit from it. Most subscription-based games have higher development costs. I believe WoW was $60M to make and WAR was $80M+. I hear Free Realms was $20-30M, but that is probably the most expensive F2P MMO ever made. I can't imagine the development budgets of most other F2P titles costing much more than $10M. Subscription MMOs make more but owe more. F2P MMOs make less but owe less.
I don't think we really have enough information to predict whether or not F2P will overtake the subscription system any time soon but this rule makes it pretty interesting to do comparisons and estimate where various F2P titles are at given their development costs. Personally, I see no problem with having both types of MMOs in the space. I do find it interesting that while most things around us are inflating in price, MMO subscriptions haven't really done so lately. Do you believe this is because of competition from F2P entries in the genre or because $15/month is lucrative enough, even when you only have a few hundred thousand people playing your MMO?
Personally, I don't see it going up any time soon.
