Thursday, 21 February 2013

The Financial Burden of Free Content



By Cameron Hills

Source Article:  Why An Indie Chose Free DLC Instead Of Microtransactions by Allistair Pinsof, February 13, 2013.

                Sometimes free is not free.  TANSTAAFL (There ain’t no such thing as a free lunch) is a term that has been used since the mid 1800’s and verified to the 1930’s and 40’s.  The concept is that something called free always costs someone, if only “Society.”  A decision to charge or not to charge for additional game content has to be considered in combination with the other marketing efforts of the company and the depth of the developer’s pockets.  To understand the decision we will look at the costs, the benefits and the balancing to make this all work.

                Free DLC (DownLoadable Content) cost a company in terms of time and money.  Time spent developing free content is time that could be spent on new games for money.  Employees cost money for payroll and benefits.  Fans also pay the price in that they have to wait longer for new games instead of the free content.  Also, how motivated are the programmer’s and artists when they know they are putting the company at risk working on free rather than paid content?

                On the other hand, companies spend money on marketing efforts.  They have to ask themselves “Is it better to spend $20k on game magazine ads or pay a team of artists, level designers and programmers to work on free content?”  As Phil Savage of PC Gamer points out “If you give people free things they will like you.”  This builds up the company’s profile and players feelings; a term finance people like to call Goodwill.  In addition, Steve Piggot, Torn Banner President, feels that free content is “investing in our fans.”  “I just think for us it’s more important that people are happy….”

                In the end, the decision to provide free content depends on the characteristics of the company.  Do they have the financial resources to put out the free content and work on the next game or add-on pack?  Is the free product of high enough quality to leave a positive sentiment with the game owners?  Will that translate to sales of the next game or add-on pack?  Does the company have sufficient marketing skills to get more bang-for-the-buck out of traditional advertising and marketing?  Every company and every project is different.  Developers have to make a case by case decision.

                In the end, it comes down to the fans and how they respond to these efforts.  Yes, they like free content.  But will they translate that liking a company for providing free DLC enough to stick around for future games and expansion packs?  Stick around to see if Torn Banner can make this happen.

No comments:

Post a Comment

Note: only a member of this blog may post a comment.