On Micropayments In Gaming

Thanks to DIY Games for its article discussing the possibility of using micropayments to pay for videogames. The author argues: "With the spread of high-speed Internet and some experiments with on-line game authentication, it seems only natural that game developers, especially the smaller ones, take advantage of micropayments", but goes on to point out possible issues, both monetary ("The most obvious argument against micropayments remains the real transaction cost. As the argument goes, each monetary transaction generates certain fees and these fees may be higher than the payment") and technical ("...the regulation of micropayments by European bureaucrats.") Are there situations where you'd prefer micropayments for playing episodic, small, or regularly updated games?

Comments

woo

[Anonymous Coward]

the author obviously learned his grammar from engrish.com

Ridiculous

[Anonymous Coward]

I don't know what percentage of internet connectivity is still through a modem, but it's high. Sure, the percentage for gamers is probably less but there's still many areas where broadband isn't an option.

Shitty programming?

[Lehk228]

Everquest does something similar on a larger scale, you pay every month and you pay for the game and you pay for the expansions, and it's still fucking buggy, the idea of micropayments for games will just encourage shitty programming.

Re:Shitty programming?

[Ayaress]

The fact that its on a micropayment-like system doesn't cause it to have shitty programming. The fact that they have an addicted userbase that they probably wouldn't lose if they rigged up a system to kick them in the balls every time they logged on means they have much less incentive to fix the problems they have.

Less popular MMORPGs with scavenged userbases who live under constant threat of their userbase going back to Everquest have a good incentive to keep their bugs dead, and they do (or die).

micropayments scropayments...

[Anonymous Coward]

(with apologies to SpellJammer fans everywhere)
A payment is a payment, how big it is depends on your capacity to pay, and how much work it takes to get it to the seller.

We'll stop calling them micropayments the minute they take off, they'll just be "small payments" then. In the meantime, they're micropayments because some of the intermediaries(your local bank in most cases) charges a transaction fee that's larger than the payment.

The solution to large transaction costs are batches, arrangements with local distributors, etc...
In a decade, nobody still will have heard from micropayments, because, since it's been years since banks could track sub-cent amounts, the distinction between payments and micropayments has been artificial.

Alternate Reality Games

[NashCarey]

I am a creator of ARG's see http://www.realworldgaming.com/ to see some of the projects in play. While I don't ask for any money from players at the moment I intend to. I can't afford to market my game in stores, the risk involved can make the game flop (see Majestic by EA). But, I plan to take a small amount like $2.99 a month from players interested in playing future games to build my quality and allow for people have affordable gaming. Many time life just gets in the way and what better way than instead of paying $50 for a game than to pay only if you play, and when you play.

Micropayments are doomed

[AuMatar]

Wake up to reality already. People hate being nickled and dimed, they don't want to pay for every bit of content on the net. The fact that people have been discussing micropayments for years and that no one is using them yet ought to be a clue already. If a product is good enough that they wannt that particular thing, they'll pay for it without micropayments. If it isn't, they won't buy it even with.

Re:Micropayments are doomed

[Lisandro]

So damn true.

Re:Micropayments are doomed

[pjay_dml]

I just hope you are right. It just takes a bunch of willing people to get this started, and where will it end?
I fear, if the concept of small payments ever takes of, we could be screwed, as this would start an avalanch of new payments that will be asked for!
I agree with your point, but think of it, once they start batching payments, then it wont be 'percieved' as 'nickle&diming', but rather as a (possibly) justified payment for made consumption.
That could be the backdoor. If you make a call on a phone (an average call), aren't you being 'nickeled&dimed'?

Re:Micropayments are doomed

[Jahf]

Agreed ... micropayments for web services is not going to make people happy.

I was thinking that I would like micropayments for online gaming, but then realized that the online games I pay for already have my credit card information. So no, I don't need micropayments there either. I just need a good MMORPG to come along that is will to charge by the minute instead of the month.

If I found a game that would do this in a fair manner (let's say $.02 for 5 minutes of play, coming out to around $10 for 40 hours) then I could play as little as I wanted and not suffer or I could play as much as I wanted and the service would continue to make money instead of fleecing other players to make up for power gamers.

That situation definitely doesn't require micropayments. If the company is worried about covering their transaction costs, say that the minimum amount charged per month will be $1 (giving you 4 hours time every month that you need to spend) and aggregate all sessions into a single monthly charge.

I wouldn't mind seeing the credit charge system rearchitected to allow micropayments in some form, but overall the current schemes that talk about using it just don't seem feasible to me, either.

Re:Micropayments are doomed

[chris_mahan]

> to charge by the minute instead of the month.

Phone companies charge by the second, and they have worked out who pays for what (some calls you pay for (you call them), some call they pay for (they call you)).

Down to the second.

Re:Micropayments are doomed

[Anonymous Coward]

"If you make a call on a phone (an average call), aren't you being 'nickeled&dimed'?"

Yes. And people don't like it. This is why mobile phone plans come with "free" minutes. This is why people prefer to get their internet access for a flat monthly rate, even with modems.

I'd support it.

[Inoshiro]

If I could get some games that'd give me 8-10 hours of gaming time, which is all I usually have time for a month, for a price less than 20$ CDN, I'd probably go for it. I don't really like spending 70$ on a game, playing 10 hours of it, and giving up because I have other commitments.

The only games I ever get to finish are short ones.

Console or PC?

[obeythefist]

This wouldn't really work for console games, because only a very slim minority of consoles are ever plugged into the internet.

A vast number of PCs, gaming PCs are internet connected so they have the capability of making micropayments.

Clearly this is a move to raise revenue from the "ailing" pc game industry - generally the quality and replayability of a PC game is much higher than a console (eg, half-life, BF1942, hack/angband, etc). Games like that sell once but are played for years after the initial sale, because the replayability is there, and there are mods and so on.

So the gaming industry is at the point where the automotive industry was at years ago... why on earth make a product that is so good that the buyer will use it and use it and use it and won't need to replace it ever? Better to make "disposable" product and keep the revenue flowing! Of course this doesn't appeal as much to the PC gamer - the console gamer can easily rent as many games as he or she likes and plough through them quickly. The PC gamer has to front the full cost of each game bought - making the PC gamer a frugal customer indeed! This is where EverQuest is a success story, because the developers spent as much time as they would for any game, but they keep reaping in the cash and they don't need to do any more work to keep the cash coming in.

European regulation ?

[dago]

The rant against EU regulations falls someone flat for me. The main point is that micropayments are considered as electronic payments (!) and this fall under the same regulations aimin to protect customers against fraud/bankruptcy/... and to fight against money laundering

Another fact they forgot is that (micro)payments trough SMS, for SMS or web services, are largely used and probably generate more revenue in the EU than the other forms micropayments worlwide.

Micropayments and billing costs.

[tod_miller]

A simple business model:

Base rate $5 a month. This gives you 5000 world credits, or special bonuses, that allow you to progress in the game, etc.

When you reach certain goal points, moving through game chapters, which for the average player could be 3-4 days of playing, you can accumulate a few cents of transactions, that get dealt with in a very expensive way:

"insert into table user_trans(fldUser, fldItem, fldCost) values(" + theUser + ", " + theItem + ", " + theCostInCaseItChanges ")";

Now you use an expensive reporting system to

select sum(fldCost) from user_trans where theUser=938271

You then send a monthy bill, OR paperless, charge credit card / paypal and have thier bill available inside the game, with optional 'reality cloaking' so the prices appear as 'pint of ale' or 'Congestion zone charge' (GTA London... hhahaha)

So, there you have it... make games free, make enjoying them cost money! :-)

Re:Micropayments and billing costs.

[Anonymous Coward]

>>So, there you have it... make games free, make enjoying them cost money! :-)

Ive seen this.

I used to play a MUD called Achaea. Up until about level 20 its fine (100 level limit), but after that your rate of progress slows down to horrible levels. After level 50ish, you pretty much never level.

Of course, you can "donate" to get character points, essentially bypassing the need to level. Although the game itself is "free", im not impressed when i see someone with more money than sense spend ~£200 in one swoop and become more powerful that i will *ever* be.

Admittedly they are run by a business trying to make money, but its a shame that the only way you can gain enough power to kill the higher level monsters and complete the quests is by donating small fortunes.

No it won't

[tod_miller]

Business models are still based on users giving money for the next expansion. If you pay for shitty programming, when you know the last was shitty, then you are encouraging shitty programming.

Nothing else in the world can possibly encourage shitty programming.

Micropayments can actually tie a developer into keeping a game good, as it becomes a longer source of income, not just a WHAM bam, 2 week sales.

If people can get the game for a low price, but enjoy paying it, and the world evolves and keeps growing and devleoping, they will play it more and more.

Graphics are not really going to improve drastically in a way that will improve the possibilities for game developers - we can already model things as close enough to reality - what will improve is the number of things on the screen, and the resolution of the polygons and textures.

Therefore, we are not looking for new games for 'wow' factor in Graphics, I think Doom 3 may be the last of its kind... except for attention to detail, and artistic skills, there is no technical (bar some excellent culling and efficiency algorithms they use, but still, it is opengl library calls... pixel shaders... oh pixel lighting :-) ) advances that will make a game 'obsolete' anymore.

Unreal 1 is still a damn cool game! Replace the low res meshes with higher res, double texture sizes, increase level detail, viola, a whole new game.

What this means is - you can have a game that remains playable for far longer. Micropayments make that a viable business solution. For both customers and businesses.

silly

[andy_fish]

I see this going two ways, depending on whether they actually tell you how much you payed per month:

1) Say they tell you how much you payed per month. In this case, who cares how those payments added up? If you see that you payed $28.50 last month for the game, then you're gonna seriously evaluate whether that game is worth the extra money. Here's what's NOT going to happen: you're NOT going to curtail your spending for next month, because when you're constantly worried about your in-game spending, the game ceases to be fun.

2) they don't actually give you a monthly total, and your bank's monthly statement is an ugly mess of $1 or whatever charges. In this case, you might actually trick them into paying more per month than they think. But once people catch on to this trickery, you are going to have pretty low customer satisfaction. To me it seems like a business model based on disinformation is not a good business model.

Re:silly

[KDR_11k]

Number 1 is my prime worry here and why I dislike paid-for online services, in general. You can't just play around with random stuff since you're paying for time. You no longer want to "waste" time on things that might be fun but won't bring you any advantage in the game. I bet people playing GTA would spend a lot less time doing random crap and instead more or less go through a checklist of things to do (finish missions, collect packages, do stunts, ...) and try to do these things as fast as possible to avoid paying too much.
Also, people will demand faster paced games or devs would try things to artificially lengthen the game (slower speed of movement, unskippable dialogue, doors that open slowly, obstacles that are simply slow to get around, etc). You wouldn't be as peaceful watching a 30 minute cutscene if you knew you're paying money even while watching.

Or you could make it easier...

[*weasel]

Or you just have them precharge their tokens upfront, and cut them off when they run out.
It's really no different than the game card you get at any of these neuvo-arcades like GameWorks. Each game you play there is essentially a micropayment, and unlike physical tokens, there isn't a real cost to processing the transactions. There's nothing to move back and forth -- just an account to debit.

That way your actual CC/paypal/gamecard processing transactions aren't any more frequent, aren't made after the user has experienced X-tokens worth of content (which incentivizes them to decline charges, not pay, etc), and you gain the 'gift card' benefit. (people who pay $20 for 1000 tokens, but only ever use 500)

I'd recommend daily, weekly, and monthly caps as well - because you need to ensure you're not punishing your hardcore gamers.
But there you go: Micropayments that work.

Now you just need a single game good enough to justify consumers paying to play it by itself (E.g. a massmog), or a suite of games that can all share the same account processing (E.g. popcap games, steam)

Gunbound has some funny micropayments.

[88NoSoup4U88]

Gunbound, yet another freely released game (www.gunbound.net) also has some form of micropayemtns.

Gunbound is a Worms incarnation, with a few differences : the main one being that one is able to earn cash in multiplayer games, and spend the gold earned on items which enhance your avatar (more attackpower/defense power etc) :
So pretty much, it works like an MORPG , whereas the more you play , the more money you earn, the better your avatar gets.

Now the developers also make it possible for someone not to 'gold hunt' for several days to get his little enhancement, but you can pay them an ammount of money to buy your items, instead of working for them in-game.

While some might see this as cheating, I don't have a problem with it ; As for a newbie, you can still play on servers that have these avatars off (and thus the players possesing items do no effect) ; and making it even for all the players.

If you liked Worms, give Gunbound a go (keep in mind that there are -ALOT- of bad mouthed annoying kiddies ; but then again, there is also a mute button :O )

They are right ..

[RedLaggedTeut]

They are right in treating micropayments as electronic payments, because lots of people will invest $1.000s, then someone will hack, spam, and scam their way to $1.000.000 and people will get mad.

Now if people treated micropayments as toy money, everything would be fine, but some don't, which is reasonable because they spent real money.

Ultimately I think there still will be micropayments, in fact I toyed with the idea of creating such a server, because of its cool, physics like laws, but my glass ball predicts there will be trouble with micropayments, and eventually some banks will buy the MMOGs, and throw their hard and software at the problem ...

Micropayments for gaming is historically flawed

[Anonymous Coward]

The quality of any game with a multiplayer component is so varied that any kind of micropayment scheme sounds flawed. Most people resistant to the idea of playing MMOs cite the monthly fee as one of the major turnoffs.

Also, I'd point out that we had a micropayment scheme for video gaming before: it was called the video arcade. You might notice that, in the US, video arcades are usually operating at a loss, while nearly every child in the country owns or has owned at least one gaming console. I know of a lot more specialty gaming shops like Electronics Boutique then arcades. The marketplace seems to want to stick with the current scheme.

I don't know if this counts as a micro-payment...

[Anonymous Coward]

But I forked over $5 on Xbox Live for two new multi-player Spinter Cell maps. I'd do it again, as long as the quality stays consistent.

Micropayments are already here...

[sevinkey]

A lot of people like to pay for what the use, ESPECIALLY in the European markets. Those guys are willing to spend many times the price that Americans will for services just to not get the long-term contract.

I agree people will pay for a product that's costs, lets say $2, if it's good enough, but most vendors aren't willing to sell anything for that low of a price because of the transaction costs involved, and the banks aren't willing to lower transaction costs because it really does cost them more money to do more processing.

So you're left with two models for selling content on the web, subscription or micropayment. My company specializes in DRM videos, and we have clients offering videos in both subscription and micropayment environments.

People ARE willing to buy large amounts of micropayment credits, often times spending much more than the subscription cost of similar sites, because they can use them when they want without any contracts.

What isn't available yet, is a trusted centralized authority for providing access to webpages (which is where most people seem to bring up micropayments). Everything is there for this to happen, but no one has stepped up to the plate. I for one would be willing to pay for 1000 page views of quality content at $10/pop.

I'm starting to ramble... sorry.

No Thanks

[Lord_Dweomer]

I for one do not want micropayments for games.

First, it will encourage the large companies to start nickle and diming for every damn thing they can. Want to go to this zone? 25 cents. Want that new uber item? 25 cents. And of course, they would start out by giving people who pay these micropayments an edge over those who don't. You can get a free complete heal/mana regen for only .10.

And of course, there would be all the little games out there who would start charging tiny amounts to play, possibly a one time, or possibly for each time you play.And while they are fun and addictive, they in no way merit me paying something to play them. Some things SHOULD stay free.

I'd welcome this for MMORPGs.

[scowling]

I've been playing City of Heroes, but to be honest, it's getting repetitive and boring, much like every other such game I've played. I don't want to pay $14.95 a month for it -- but I'd definitely pay fifty cents an hour, metered, to play it.

Sadly, that's not an option, so I'm going to end up canceling my subscription entirely rather than pay fifteen bucks a month on a game that I'm not going to play every day.