«Market Leader» - news and previews making you rich.

Sunday, 20 April 02:15 (GMT -05:00)


Market Leader Free Newsletter
Your Name:
Your Email:

Business And Politics News

Investing In Video Games: Pay To Play Or Free To Play?

Investing In Video Games: Pay To Play Or Free To Play?

The video game industry in the US and Europe seems to have reached its climax. Millions of gamers are looking forward to purchasing their own copy of another bestseller. They are ready to pay monthly fees for playing online and to buy various artifacts and items to take advantage over their enemies. Investors now seem to be more willing to invest millions in the industry.

The video game market of the CIS states is not as developed as the western one. Consequently, it presents special interest to the giants of the global video game industry. Pay to play and free to play are the 2 basic business approaches to earning on MMORPGs.


What are the essential differences between these two business approaches?

 

 

 



Pay To Play Or Free To Play: Which Is Better For Investors?


According to Vladislav Tsarenko, Masterforex-V Academy’s video game expert, pay to play (PTP) and free to play (FTP) are essentially different approaches. PTP implies monthly or annual fees for playing a certain MMORPG while a free-to-play MMORPG speaks for itself: no fee is charged unless a gamer wants to buy some artifacts or to upgrade his/her character to get an edge in the game.  


Free to play. FTP is more popular among developers. Its major advantage is that a gamer can test it for free without any limitations. That is why such games are more popular and widespread. Everybody likes freebies. If a free-to-play game is really awesome, then sooner or later some gamers will want to upgrade their characters or simply to get an edge over their enemies. A gamer’s desire to become stronger, faster and better than opponents seems to be the major market driver. It makes more and more video game developers start their free-to-play MMORPGs, with millions invested in these projects.  Such upgrade fees are usually small for an average gamer – $5 to $10. Of course not all the gamers who play FTP MMORPGs pay such fees. Moreover, when a game’s rules and conditions are really tough, most gamers will start leaving the game. In this case, others won’t upgrade because this just won’t make any sense. So when creating a successful FTP game, a developer should focus on the balance between the paying minority and the “we like freebies” majority. Numerous bonuses and promotions should help developers encourage their clients to pay.

There are many free-to-play games on the net, including Perfect World, Allods Online, Land Of Chaos, Granado Espada etc.

Pay to play. Unlike FTP, a gamer, who wants to play a PTP game, has to pay a monthly fee to get an access to it. This approach is often used for the industry’s coolest, high-budget games created by the world’s best developers. Considerable funds are spent on advertising campaigns and beta-testing to make such a game extremely popular and highly anticipated even before the official release. World Of Warcraft (WoW) may serve as a striking example of a play-to-play MMORPG.  This game was highly anticipated because it was a sequel to the famous WarCraft series created by Blizzard, a video game giant (for more details read the article “Tips For Investors: Blizzard Conquers Video Game Industry”). As a result, over 13 million gamers around the world keep paying monthly fees ($10 - $15) to play this MMORPG.

However, developing a pay-to-play game is always risky. Such a game should be really good to interest gamers so much that they would want to pay regularly for playing it. That is why developers always start beta-testing before the official release of a PTP game.  During the period of beta-testing gamers get a free access to the game in order to decide whether to continue playing it after the official release.

The biggest advantage of this approach is that EVERYONE PAYS. Another plus is that all the gamers are equal in rights and cannot buy an edge over their opponents, like it is done in a free-to-play game. The major drawback is that a PTP game can fail to come up to gamers’ expectations. In this case, the game is doomed to become unprofitable because nobody (or very few gamers) will pay. The Russian version of Warhammer Online is a striking example. The developers ignored the fact that the CIS’s gaming community is far less willing to pay for games, thus preferring free-to-play MMORPGs.


These are some of the most popular pay-to-play games : World of Warcraft, The Lord of the Rings Online, Warhammer Online, Star Wars: The Old Republic.
 

 

диаграмма

 

Hybrid approaches. To tell the truth, these days there are very few games that are 100% PTP or FTP. Most pay-to-play games are modified so as to provide free-to-play options up to a certain level. Later a gamer will have to switch to the paid mode if he/she wants to continue playing and developing his/her character. Moreover, some PTP games offer some items a gamer can buy for his/her character. Fortunately, they don’t give gamers an edge over their opponents. On the other hand, free-to-play game projects offer their clients an opportunity to get a premium/VIP account. This is a set of certain bonuses and VIP services for those clients who have paid a certain monthly fee.

Therefore, developers strive to utilize the strong sides of both the approaches to make as much money as possible. Once again, WoW can be cited as a striking example here. The developers have recently allowed their clients to play WoW for free until they reach level 20. Moreover, the gamers can pay to change the name of their clans or to purchase pets. Blizzard has recently confessed that by rendering these “small” services the company earns big money. For example, a pet costs up to $25.

The bottom line:
When investing in a MMORPG it is necessary to determine which business approach it will be based on.


If it is a pay-per-play game, an investor should find out if the advertising campaign is good enough to make the game highly anticipated and to attract an army of devoted fans who will be paying monthly fees.


If it is a free-to-play game, everything is simpler. The only thing an investor should do prior to investing is to evaluate the quality of the game, i.e. whether it is good and interesting enough to make gamers pay for various items that will make their characters better, stronger and faster than their opponents. Once again, make sure that both the paying minority and the “we like freebies” majority will get what they want. The former will pay only when they want to get an edge over the latter.

Market Leader and Masterforex-V Academy would appreciate if you could participate in a survey. Please, visit the Academy’s forum for traders and investors and answer the following question:


In your opinion, what kind of MMORPG is better to invest in?
 

 

You are free to discuss this article here:   forum for traders and investors

 

Add to blog
Got a question? – Ask it here »
 

Shares of Google, as stated by Optionova, fell after the production of the quarterly report

Google discharged its fiscal effects for the first quarter of 2014. Markers have been expanded contrasted and the same period a year prior. Notwithstanding, certain variables befuddled gurus such a great amount of, that in the wake of summing up, the shares on the stock trade fell. Why did it happen, examiners of binary options broker Optionova will retell of it.  

Publication date: 18 April 12:28 PM

Specialists of American doctor's facilities started to utilize Google Glass, as it got known to Optionova

 A standout amongst the latest improvements in Information Technology - Google Glass - just about promptly after all vital tests turned into a prominent item in the Internet space. Occupants of numerous nations like to investigate all the upsides and downsides of this advancement, and at exactly that point because of the consistent screening to discover the date of the arranged section into the business sector of unique glasses.

Publication date: 14 April 04:33 AM

Saudi Arabia Destroyed USSR: Can It Destroy Russia?

 

Some Western experts say they have found Russia’s heel of Achilles. The USA thinks the best way to press Putin is to manipulate oil prices since Russia is an export-oriented economy. In particular, it depends on oil and natural gas exports. Therefore, too weak prices may finish the Russian economy, US politicians believe.
 
The experts say that Saudi Arabia may help the USA and the West in general to implement this ambitious goal aimed at undermining the Russian economy, which depends on energy exports.
Publication date: 08 April 11:40 AM

In Optionova they figured out, that in several years Apple will speak to a "transparent" iphone

 The USA IT- goliath Apple affections to patent different developments. Regularly these licenses are never utilized, however the thought stayed for possible later use. Then again, in some cases the organization deliberately enlists that will be utilized within its future overhauls. As of late it got realized that Apple needs to get records on the transparent Savvy. Examiners of paired alternatives intermediary Optionova will tell the subtle elements.

 

Publication date: 02 April 08:29 AM

Sanctions Against Russia and Consequences For Ruble, Dollar and Euro

 

The EU promises to impose tough sanctions on Russia, thereby following into the USA's steps. The leaders claim Russia will have to pay for annexing the Crimea, which used to be a part of Ukraine. These sanctions are promised to be divided into several packages and rounds to introduce them gradually. The ultimate goal seems to be a complete breakup of all the economic and political relations with Russia.
 
Market Leader and Masterforex-V Academy tried to figure out the possible consequences of these sanctions for the involved economies and their national currencies.
 
Publication date: 28 March 06:38 AM

As it turned out by Optionova, Google will secure Gmail clients from the security administrations and spies utilizing extra encryption

  

Google normally upgrades its email administration Gmail. This time, the Internet giants protected its clients from the security administrations. To build security, the whole trade of letters was exchanged to a protected HTTPS- convention. Unapproved persons have no right to gain entrance to Google's servers to the conveyance. About the preferences of this strategy will let you know about the investigators of double choices by the representative of Optionova. 

Publication date: 27 March 05:38 AM

George Soros on Ukraine, EURUSD Prospects

 

It seems like the entire world is currently watching and discussing the situation around Ukraine and the Crimea (which was recently joined the Russian Federation after the local referendum).
Publication date: 24 March 10:30 AM

EU Abandons South Stream, Consequences For Europe, Russia and Natural Gas Futures

 

It is common knowledge that the EU has always complained about the South Stream, long before the Ukrainian crisis. These complaints are based on Europe's desire to preserve its energy independence and to get cheap (or almost free) energy sources from outside (since there are no domestic energy sources).
Publication date: 20 March 12:43 PM

China on the Verge of Crisis: What Expects China's Economy and Renminbi?

What is really happening to the Chinese economy? What is wrong with it? Its health is raising more and more concerns worldwide since this is the world' second-biggest economy and the largest manufacturer of consumer products.

 
Indeed, this is not just an ordinary emerging economy. This is an economic heavyweight. Therefore, it cannot but worry experts circles worldwide, especially as some experts call it the major locomotive of the global economic growth. Yet, the locomotive seems to be slowing down.
 
The pace of the Chinese economic growth is currently slowing down indeed. Experts predict that China's GDP growth may slow down to the lowest point in 25 years. Yet this may happen this year.
 
Well, it should be noted that most markets (both emerging and developed ones) have close economic ties with China. They benefit from that. At least, they used to be since more and more analysts start predicting a «hard landing» for the Chinese economy. If this is the case and the doomsday scenario manifests itself, the entire world may fall into another global economic recession followed by a tough crisis. Or maybe the economic picture we are currently seeing in China is painted deliberately to prevent the forthcoming economic disaster? Let's think about it together…
 
Publication date: 20 March 07:37 AM

US Sanctions Against Russia

 

As you probably know, the USA and the EU have been threatening Russia with tough sanctions for a few weeks if the latter doesn’t withdraw the troops from the Crimea. Indeed, the Ukrainian political crisis is far from being over. On top of that, the situation keeps escalating as we are nearing the referendum in the Crimea scheduled for March 16th. The referendum is going to decide whether the Crimea is a part of Ukraine or Russia…
 
While the situation in the region remains unstable, Brussles started working on possible sanctions against Russia. So, what are the possible scenarios of this conflict? Let’s ponder on this question together with Masterforex-V Academy.
 
Publication date: 14 March 08:51 AM