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How Much Money Do Free-To-Play MMOs Make?

simoniker writes "Over at Gamasutra, a new feature article discusses how much money free-to-play MMO games make, with specific real-world stats from game developers willing to discuss how they make money with microtransaction-based PC games. In particular, Puzzle Pirates co-creator Daniel James reveals that 'the average revenue per user (ARPU) is between one and two dollars a month, but only about 10% of his player base has ever paid him anything. As a result, he says, approximately 5,000 gamers are generating the $230,000 in revenue he sees each month.' It's obviously quite a different model from the regular $15/month for World Of Warcraft, but it evidently works for some companies."

22 of 157 comments (clear)

  1. If you advertise it as free by Xaoswolf · · Score: 4, Interesting

    most people are going to play it like it's free, as in, not paying for anything. You'll still have a minority that will help to boost the sales by paying a whole lot more than they should for in game items. Likewise, I have never played a free MMO that didn't have someone running around the home city just shouting out advertisements.

  2. Re:5,000 equal $230,000 a month by PMBjornerud · · Score: 3, Informative

    Wow, when did $46 become a micro payment?

    From when you RTFA:

    Three Rings' MMO Puzzle Pirates takes in approximately $50 each month from each paying user (ARPPU) for a total of $230,000 a month, all resulting from microtransactions.

    --
    I lost my sig.
  3. Re:bad math by Knave75 · · Score: 4, Informative

    if the average user gives an average of 1-2 dollars per month, how can 5000 users generate 230,000 dollars?

    I believe that the average per user is $1-2 per month.

    However, the average per paying user was something along the lines of $50. So the math would go something like:

    ($50/paying user)(5000 users) = $250,000

    or

    ($1.50/user)(160,000 users) = $240,000

  4. Re:Dear free MMO companies by Mprx · · Score: 5, Informative

    Puzzle Pirates is written in cross platform Java. Works on every major OS.

  5. Wait What? How Bad is My Math... by greymond · · Score: 4, Informative

    "(ARPU) is between one and two dollars a month, but only about 10% of his player base has ever paid him anything. As a result, he says, approximately 5,000 gamers are generating the $230,000 in revenue"

    So 10% of the player base is paying him and that player base equals 5,000 people. So there are 50,000 people a month playing - nice.

    But wait a sec...ARPU is only $2 on the top end and 5,000 people pay this, so that's $10,000 a month - where is the other $220,000 coming from!!!!! Even if all 50k people were spending $2 a month that's be $100k - Where did I miss something?

    OH I GET IT NOW - From the actual article....
    "Indeed, James reveals that Three Rings' MMO Puzzle Pirates takes in approximately $50 each month from each paying user (ARPPU) for a total of $230,000 a month, all resulting from microtransactions."

    This is different than what the blurb mentioned - I guess it did get me to read, but only this time - you're tactics won't always work on me!

    1. Re:Wait What? How Bad is My Math... by Anonymous Coward · · Score: 5, Informative

      And if I add apples and oranges, I can eliminate the national debt as long as I remember to divide by zero!

      10% of the player base is paying him

      No, 10% of the player base has ever paid him. Some other % (presumably smaller) is the 5000 players paying monthly.

      ARPU is only $2 on the top end and 5,000 people pay this, so that's $10,000 a month

      No, the average is over all of the players, so thats (total players)*$2 a month.

  6. Re:Dear free MMO companies by Anonymous Coward · · Score: 5, Insightful

    None.
    We sit in Starbucks all over the nation, sipping our latte all day long, waiting for the master to return.

  7. I think 6 by geekoid · · Score: 5, Funny

    is it 6? I'm guessing 6, 6 right?

    "approximately 5,000 gamers are generating the $230,000 in revenue he sees each month."

    If you knew, why the hell did you ask me?

    --
    The Kruger Dunning explains most post on /. http://en.wikipedia.org/wiki/Dunning%E2%80%93Kruger_effect
  8. Re:Dear free MMO companies by SleepingWaterBear · · Score: 3, Insightful

    Well, dunno about studying or socializing, but if you can afford a mac, you're probably not ransacking couches for Ramen money.

  9. Re:Dear free MMO companies by Capt.DrumkenBum · · Score: 5, Funny

    "ransacking the couch for ramen money" That sounds really dirty to me for some reason.
    Is that what you kids are calling it these days? In my day was just called it sex, I guess I am just old.
    Get off my lawn.

    --
    If I were God, wouldn't I protect my churches from acts of me?
  10. Re:Dear free MMO companies by Quirkz · · Score: 5, Informative

    Some of us are browser based. I play www.KingdomofLoathing.com all the time, and it's platform independent. I also run my own game at www.Twilightheroes.com.

    With just under 30k accounts, maybe 2,000 of them active in a given month, I'm not really quite "massive" yet but my own experience is that I pull in on average less than $0.50 per account per month, with some fair bit of fluctuation. I'd be jumping for joy at an average of $2/player.

  11. Re:Dear free MMO companies by Plaid+Phantom · · Score: 4, Funny

    No no: that Mac is *why* they're plundering the furniture. ;)

    --
    All comments are properties and trademarks of the voices in my head. Not like I'm gonna claim them.
  12. Re:5,000 equal $230,000 a month by mysidia · · Score: 3, Insightful

    Yes... the ongoing decline is partially caused due to rampant USD farming.

    Once upon a time, the $$$ you earned were based on real work, and/or legitimate investment using your own cold hard cash.

    And then the $$farmers (botters) came... and didn't follow the rules... they exploited bugs, that allowed them to leverage obscene amounts of phoney $$$ they weren't supposed to have access to.

    They created an inherently deceptive market. Distorting the value of things such that it would be valued increasingly higher, at ridiculous price momentum.

    They got their cronies in place throughout the political arena, so $$farmers have better representation than the people.

    Instead of the past fair work/investment-based economy, huge profits came from breaking the game rules.

    They bring the world economy to the verge of collapse. And the real world is by no means out of the woods yet.

    The $$farmers continue to look for and try to get short-term fixes from their puppet government And matters continue to worsen

    In 48 months, $1000 may be a "micro" payment.

  13. Re:Dear free MMO companies by Omestes · · Score: 4, Insightful

    Odd, I got a Mac in college when my PC crapped out thanks to some defective parts after $300 of upgrades. I decided I had enough of futzing with my computer, and fixing things, so I bought an iBook. With student discounts it was cheaper than most comparable Wintel laptops, and did pretty much the same stuff, and I got a free iPod with it. Sure, I couldn't game, but I had more important things to do.

    It actually served my purposes fine, and it was damn cheap. Hardly a status symbol. Hell, even if it was a status symbol it might have left my dorm room 4 times 3 years.

    Stop generalizing to justify your own selection of OS as being far superior to everyone elses. And stop deluding yourself into thinking you OS choice has anything to do with anything that actually matters. Its shallow, and obnoxious.

    And just so you don't call me a fan-boy (which is also vapid, I might add) I'm typing this on my Windows gaming rig, sitting next to my Ubuntu laptop, which is sitting next to a Mac Mini I'm fitting into a mini media center.

    --
    A patriot must always be ready to defend his country against his government. -edward abbey
  14. Re:Dear free MMO companies by Dr.+Zim · · Score: 5, Interesting

    Actually, as an openly gay mac user, I have to say I've gotten far more dick when I leave my computer at home.

    If you think your hardware choice will get you laid, I'm guessing you don't get much from either sex.

    --
    (name withheld by request)
  15. Business is about to get better by petrus4 · · Score: 3, Interesting

    I was looking at Warcraftrealms.com overnight; WoW's population is about to drop like a rock. It's already begun, in fact.

    Character classes have been nerfed into the ground, with the Paladin or DK now being the only two worth playing. Any originality is gone. WotLK had the worst instances the game has ever had, and the only thing the developers now focus on is the Arena.

    I can see it in my own behaviour; I'd be lucky to log into WoW once a week, now, and even just this last night, while I got up planning on playing WoW, it never happened, even though I spent practically the entire night idling on IRC, bored.

    When I'd rather spend a night vegetating on Freenode than playing World of Warcraft, (which I used to genuinely love, incidentally) I know that the game has truly died in the ass...and it has.

    I'm starting to think Guild Wars might be worth a look. WoW sure isn't getting much of my time these days, that's for sure.

  16. Re:Dear free MMO companies by Darinbob · · Score: 3, Funny

    Kids these days. When I was in school, we ransacked the couch for ramen.

  17. Re:Dear free MMO companies by Veggiesama · · Score: 4, Funny

    You heard it here on Slashdot first, gentlemen. Gay men aren't attracted to your operating system.

    We already knew they weren't aroused by the size of your external hard drive, but the jury's still out on whether or not you should wear an anti-virus shield when having unprotected file-sharing with another anonymous gay man. Some call this controversial practice "bare-backuping," and it remains highly controversial in online gay communities.

  18. Re:Dear free MMO companies by drtsystems · · Score: 3, Interesting

    I actually have noticed that a disproportionate amount of mac users bring their laptops places (library, class, coffee shop, etc) than PC users on campus, but I attributed it to a different reason. I've found Macs to be better suited to portability. Apple laptops are very portable compared to many WIndows laptops (the $500 massive PC laptop doesn't exist for Apple customers). Most Windows laptops I see around campus are massive and heavy. OS X also handles sleeping very gracefully. Maybe this has been improved with newer motherboards and/or Win XP service packs, but Windows always seemed to give me problems with not sleeping and crashing when waking up from sleep. Obviously this isn't always the case, there are plenty of portable PCs, but it seems the ones that college students buy aren't those.

  19. Re:Dear free MMO companies by TheRaven64 · · Score: 3, Informative

    Proper sleep support is really important. For a while I owned a PowerBook and a ThinkPad (well, I still do, I just don't use them much now). To take my ThinkPad somewhere, I needed to shut it down, then when I got there reboot and reopen all of my applications in their last state. With the Mac, I shut the lid and opened it when I got there, with all of my applications in exactly the same state I left them. I theory I could do the same with my ThinkPad, but it only had an 80-90% chance of coming out of sleep mode correctly, and I didn't think even a 10% chance of data loss was acceptable every time I closed the lid. The battery on the PowerBook also lasted about twice as long. Guess which machine I took with me, and which I left at home...

    --
    I am TheRaven on Soylent News
  20. Re:Dear free MMO companies by polle404 · · Score: 3, Funny

    You read the article, AND researched the game?
    You ARE new here!

    --

    ~men are from earth. women are from earth. deal with it.~
  21. Re:Dear free MMO companies by Quirkz · · Score: 3, Informative

    Yes, that's fifty cents per active account. People who don't log in or play generally don't donate.

    Server costs are about half of my income for two dedicated servers (one file server, one database server). Doesn't leave a lot of profit (especially if I want to do any advertising or hire out any services), so at this point it's still more of a minimum-wage hobby. On the other hand, that beats the hell out of hobbies that *cost* money and it's still fantastically fun, educational, and rewarding.