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Microtransactoins: Killing Games Through Economics

I’d like to start by apologizing that I missed my Thursday post last week.  I recently started a new job and my sleep schedule (and all scheduling) has been thrown off immensely. 

In Mass Effect 3 the multiplayer works by leveling up characters to get more abilities and winning matches to gain money for equipment.  The best equipment comes in a random package that takes about 4 wins to save the money for, assuming you’re playing on the lowest difficulty. Imagine my surprise when I went to go purchase this and realized that the package was also available for BioWare points, or for those who aren’t familiar with that concept, real money.

This says it all.

The idea of microtransactions in video games is to allow the player access to additional goods for real money.  Most games that allow microtransactions use this as their money-making model rather than charging subscription fees.  For example, the MMORPG Aion at first charged a monthly fee but has recently moved toward a microtransaction model.

Microtransactions are everywhere in gaming today, but the various MMORPGs out there seem to be keen on taking advantage of it.  The basic idea is that you can access various parts of the game, but to truly get any further you’ll have to pay to purchase the items that make that possible.  Often these items are available through other means, but acquiring them in the “traditional” manner would require significant time output.

If you’re familiar with microtransactions in any of the forms it takes in gaming, chances are you’ve probably got the same mixed feelings about it that I do.  At least, until you really think about it and realize that microtransactions don’t benefit gamers at all while, in reality, destroying the very games they attempt to improve.


Game Currency

Within video games there are two types of currency with which one acquires better items: time and money.

The game currency most of us are familiar with is time.  Consider World of Warcraft, a traditional MMORPG that has (as of yet) not succumbed to the lure of microtransactions.  In WoW you acquire better items by participating in raids, dungeons or various player vs. player matches.  In doing this you acquire the items you want through luck (a boss drops the item you want) or through in-game currency (arena points, honor points, raid tokens).

The currency used here is obtained in dungeons. This is the original implementation of this in-game currency with a list of terrible items.

In the days of The Burning Crusade, if one wanted the best gear for pve encounter he would have to raid the same place in hopes of getting a token that could be traded for the gear.  As players complained that they were waiting on the same drops, Blizzard introduced raid tokens which could be traded for gear that was almost—but not quite—as good as the gear obtained in raiding.

The idea of adding these currency microtransactions was to compensate for randomness.  Some players could defeat the same boss a hundred times and never see the items they wanted.  As a result, it felt like your time was wasted without compensation.  Thus, Blizzard added raid tokens to allow you to gain gear that was better than what you had, but which would still be replaced by the raid drop.

The key concept here, though, is that no matter how Blizzard gave you the items you were still trading your time for a better virtual good.  If you put in enough time you would eventually be rewarded.

That is what I mean when I say “time” is a game currency.  In any game you play you need to put time into it to get better items along the way.  In RPG games—especially MMORPGs—this is readily apparent.  In action games it is less obvious but still a system in use.

On the other hand microtransactions in the sense I am using refer to purchasing items with real-world money.   That concept is not particularly difficult.  Every game implements differently, but usually the same items that are available with real money are available through using time as your currency.


Microtransactions Favor a Certain Type of Gamer

The problem with microtransactions is, as this subheading states, that they favor a certain type of gamer.

Consider the probable reasoning behind allowing real-money transactions: some gamers do not have enough time to reasonably get the items they want.  They should not be precluded from enjoying the game, so allow them to trade real money for the items they’d like in order to skip the grind.

You know what’s a sound financial decision for me? Paying money for virtual weapons I can earn by just playing the game more. Even better is when they obscure the cost as “BioWare Points” so I have no idea how much that just cost me!

Of course, not everybody has a ton of money just laying around.  Personally, I would love to spend money on BioWare points to use in ME3’s multiplayer.  I’d love to get the best weapons without having to spend hours playing through matches.  Unfortunately, I just cannot justify spending real money—of which I do not have a ton—on something that is a virtual good.  This is especially true when I can get it by playing the game.

On the other hand, not all gamers have a ton of time.  Lately I’ve been quite busy and have been unable to play games as much as I’d like.  In a sense, microtransactions appeal to me for that reason: I can stay competitive without having to put in a ton of time.

This real distinction is a good reason for microtransactions.  Unfortunately there exist gamers who have neither a ton of time nor a ton of money as well as gamers who have quite a bit of both to spare.  If you fall into the former category, good luck trying to stay competitive in any game you play.  If, on the other hand, you fall into the category of gamers with money and spare time, you now have a massive advantage in that you can acquire these powerful items far more quickly than any other gamers.

When I say that microtransactions favor a certain type of gamer, however, I am not just referring to the lucky ones with time and money in spades.  I am referring to any gamer that can afford microtransactions.

Consider the case of ME3 multiplayer.  I have about 100 N7 points, which are basically a measure of how much you’ve played.  That puts me on the low end of the spectrum, especially when you see people with 500+.  In that time I have amassed quite a collection of additional weaponry and weapon mods, but I still am fighting with some generally poor equipment.

Imagine my surprise when I join a game and see someone with 10 N7 points and two of the ultra-rare weapons equipped.  For those not familiar with ME3’s multiplayer, it is almost impossible that he actually earned those items; rather it is far more likely that he purchased quite a few equipment packs and got lucky with them.

When I talk about favoring certain types of players, that is almost exactly what I’m talking about.  This guy—whose character was level 10 (on a max level of 20) put out more damage than two of the other players, both of whom were level 20.

Skill plays into these things a fair amount, but no amount of skill can overcome the massive handicap that comes with a low-level character and low-quality weapons.  Having the “best” weapons in the game for your character helps overcome that problem.


The Future of Microtransactions

Microtransactions aren’t going anywhere.  They make a ton of money for the developers who use them and they can be touted as a way to even the playing field (despite them doing the opposite).  No developer who has moved to this model is going to move away when they realize how much money it really can make.

The unfortunate side effect of microtransactions, beyond being unfair to some gamers, is that it generally detracts from the game as a whole.  When I play a game I do so because it is fun.  Earning rewards is part of that fun.

“Congratulations on purchasing the ‘Dragon Armor Pack’. Your character will now have the best armor in the game right away. Laugh as enemy attacks glance off the armor you shouldn’t have until the very end!

If I started a game of Skyrim and was instantly handed the best equipment in the game I would no doubt find myself somewhat bored.  The same would go for World of Warcraft, as the whole point of raiding—beyond seeing the content—is to be rewarded with better gear.  If you’re just purchasing that gear you have no reason to play the game.

When I first started thinking about microtransactions my stance was that it’s fine.  The players who buy their way to the top miss out while the rest of us can enjoy the game as it was “meant” to be enjoyed.

The problem with thinking that is that more developers are going to move to this model to remain profitable as gaming advances.  As they do so more players will succumb to this model of playing a game until eventually it dominates the industry.

If you wonder what ill effects this could have, just imagine a game in which all achievement is essentially based upon how much money you are willing to spend.  End-game encounters are meaningless because you’re already in the best equipment.  Anybody who has raided in WoW (or any other MMO, really) will tell you that once your entire raid has better gear certain encounters become trivial.  The fun of an encounter in these games is often the challenge and difficulty.  Walking into a lower-tier raid in WoW was something you did for shits and giggles, not a genuine sense of accomplishment.

Competitive multiplayer in video games will also suffer immensely.  While ME3’s multiplayer is co-op, any game with microtransactions and a pvp model of multiplayer is going to, essentially, force players to buy items to be competitive.

Consider World of Warcraft once again.  While the pvp items are not based upon real currency, you do have to spend time playing to get those items.  These pvp items make it more difficult to kill a player wearing them.  When everyone in the match is in all pvp gear it just adds longevity to the fight and keeps it interesting.  When one side has no pvp gear and the other is decked out in the best, the fight lasts about ten seconds and is not at all interesting for the person being trounced.

This is the N7 Valiant. It is the best sniper rifle in ME3. You can obtain it by just spending enough money and never playing multiplayer.

Anybody who has done any competitive multiplayer that is that one-sided will tell you it is more frustrating than fun.  But this is the road we are heading down, a world in which microtransactions dominate the gaming industry as just another way for the companies to make more money off us.

It’s hard to say exactly where this will go, but the point of video games is to be rewarded for your progress (i.e. time spent) in the game.  In a model where people can take the easy, effortless way out many will.  As this happens the content of the game becomes less meaningful because it is, simply put, easier.  It’s not hard to imagine a future, dominated by microtransactions, in which developers put far less effort into the content of the games because they know gamers will circumvent those challenges by just purchasing better items.

Again, you may think I’m being alarmist but look at what other forms of DLC have turned into.  What started as a way to just add fun but unnecessary content to a game has turned into a medium to sell players an incomplete package and convince them they need to spend that extra $10 to really enjoy the game.

The more that we, the gamers, buy into the idea of microtransactions the more the developers are going to create them.

  1. tako
    June 2, 2012 at 12:01 pm

    actually the N7 Valiant, while being 1 of the top 2 sniper rifles (Black Widow is the other), is not buyable with real money at all (at least not yet), it is only available from special events that occur every other weekend and even then you only have a 1 in 4 chance of getting it, so you’re actually forced to play for it

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