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LotR Online's Free-To-Play Switch Tripled Revenue
Last June, Turbine made the decision to switch Lord of the Rings Online from a subscription-based business model to a free-to-play model supported by microtransactions. In a podcast interview with Ten Ton Hammer, Turbine executives revealed that the switch has gone well for the company, with game revenues roughly tripling. The active player base has also grown significantly in that time. Executive Producer Kate Paiz said, "This really echoes a lot of what we've seen throughout the entertainment industry in general. It's really about letting players make their choices about how they play."
Yes, allowing people to actually pay (and play) when they want to, and not be forced to feel like they HAVE to get their money's worth with a subscription system, is proven to be better for both the gamer AND the company.
It was never unprofitable.
That may be true, but if they were making a profit it was a tiny one. A good friend of mine works at Turbine, and things were very tight and not looking good for a long time. It sounds like they were very close to shutting down entirely when Warner Bros. bought them last year and brought a nice infusion of cash, which allowed them to try the free-to-play model that seems to be working out well (also allowed them to hire some new people and pay the bonuses and raises they had been going without for years).