Tobold's Blog
Saturday, August 04, 2012
Is the subscription MMORPG business model dead?

So EA Bioware raised the white flag and will make Star Wars: The Old Republic Free2Play before it reaches its first birthday. The number of remaining MMORPGs with a pure monthly subscription business model is dwindling, although of course many Free2Play games offer monthly subscriptions as one option. And I noticed a certain trend: The less a game is like World of Warcraft, the more likely it is to remain on monthly subscriptions. The more a game plays like WoW, the faster it goes Free2Play.

The explanation is easy: The monthly subscription market for MMORPGs never managed to develop sufficient price differentiation, most games cost between $9.95 and $15 per month. So people get to choose between games that play more or less the same, and cost more or less the same, but with one of them having a lot more content and a lot more players than the others. Competitors like SWTOR would have to create games that are not only as big as WoW in 2004, but as big as WoW is 2012 to compete, and that is pretty much impossible.

But note that people are still happily paying monthly subscriptions for games that are very different from World of Warcraft, because there WoW isn't a direct competitor. So maybe the monthly subscription business model isn't dead, but could continue if developers only started having some ideas of their own instead of only making games that play like World of Warcraft with a new coat of paint. The quest-based, hotkey combat MMORPGs are condemned to try to scrape by as Free2Play.

First of all, swtor doesn't play like world of warcraft. We can say also that it plays like lotro, everquest, Aion and many many others. All the MMORPG out there, the major ones, are using the same model. Quests to level up, dungeons, dailies, warzones, raids, crafting. Still Swtor have an enjoyable level up and somewhat "challenging" at times where you have to fight tough enemies and use all your abilities..stuns, cc, healing. Wow now is one-button spam festival, making it worth only for high end raiding.

The truth is that many good MMORPG games out there forced to go f2p because they couldn't compete wow. But that in no way means that they were less of a value.

Justin bieber and britney spears sell millions more copies than thousand high quality artists cannot sell, this doesn't mean something. You can judge the quality of a product from its sales.Wow is a fashion now, a celebrity. 13 years old girls playing along with their grandmothers.

All these of course have nothing to do with your topic, but it has many to do with the trolls that will follow to bush swtor and say how bad it is and how good the wow is, e.t.c.

Is the type of players filled with hate, who love to see other people's works burn.
Every game has these people, they're optimistic vultures - pecking at any sign of weakness in some sick hope they'll get lucky and be able to claim the kill.
There's nothing you can do to console or work with them - they work to rot a companies good faith
as though they're some kind of cancerous 'anti-fan'.

On topic now, I don't believe swtor is not profitable at this stage. But f2p model proved to be more profitable than a subscription model in many many cases. And all have to thanks Turbine for this. They made the first most successful (profitable for them) f2p model as far as I know..

From one hand you have the celebrity, justin bieber(WOW), and from the other hand you have so many good f2p games..lotro, DDO and soon GW2. So it is very difficult for a game with a sub to keep a solid playerbase. Except if they offer something very very different which is a risk to take. EVE is different and can hold a solid playerbase for so many years.

The easy way is to make a traditional MMORPG, go f2p, offer good things in the cash shop for people having the extra cash to pay to win and bingo. On the other hand, being innovative is so much risk and I don't blame them. When still 10 millions playing wow, you get a nice feeling for the current playerbase. These people will kill you if you don't have bartender and damage meters to your new MMO, how can you take the risk to be innovative?

and no, GW2 is no innovative. Is still quest, pvp, dungeons. The only thing is change is the way they offer you the quest. Either I see a questmark on an npc, click him and ask me to kill 10 rats, or go next to him and suddenly in the event ui appear I have to kill 10 rats..voice acting, dynamic events is just a different quest sell dealer.
You seem to have bought into the rhetoric of the anti-F2P side. "The quest-based, hotkey combat MMORPGs are condemned to try to scrape by as Free2Play." could also be spun as "You can't fundamentally change an MMo after it has launched. So existing MMOs with significant installed based are locked into a decade old business model. New or more nimble MMOs can use the business model currently preferred." Just a different spin; after all companies don'r convert to F2P because they think it is worse for them than a subscription. I am not saying either is right. But I do think that the forumnistas regarding F2P as bad is an outdated view.

In fact, many (most?) people outside the special snowflakes who infest online forums actually seem to prefer to not have to commit to paying every month even if they get busy. E.g. AT headline begam with "good riddance"


Ignoring the recent TSW & SW, which everyone assume will be F2P soon, are there actually significant numbers of subscribers paying subscriptions in a subscription only game. There is EVE which is tiny relative to WoW; nobody else springs to mind.


I would also like to point out that millions (idk perhaps most) of the people listed as WoW subscribers do not pay any subscription fees. If you rent X hours of game time in an Asian country without subscriptions, then Blizzard counts you in the reported subscriber numbers.


I draw an analogy with MMOs and smartphones. You can say that the smartphone market is horrible since nearly every manufacturer is doing poorly. You can also say the smartphone market is wonderful and extremely profitable. Both are true; it's just that nearly all the profits in the market are made by one company and the rest are in trouble.


I wish we still had Tobold Sunday topics. I think the most interesting news was a recent interview where CCP said they only have 4 content designers. I don't think there will every be a commercial success that is a sandbox. But the draw is it is so leveraged. If you get the virtual world down, you don't have to fight the Red Queen's Race of trying to keep content in front of content locus.

For someone complaining about trolls who follow to bash a game and say how bad it is, you sure don't like World of Warcraft...
SWTOR was a joke. Bad graphics, a laundry list of missing features, virtually no end game, and tedious leveling. It failed because it deserved to fail.

I don't think we really have the ability to say the subscription based model is dead until someone releases something that can actually compete in that space.

Rift was a somewhat more modest release and they're doing well as a subscription basis. TSW might do the same, jury is still out, but again a very modest launch.
@ Giannis "Is the type of players filled with hate, who love to see other people's works burn.
Every game has these people, they're optimistic vultures - pecking at any sign of weakness in some sick hope they'll get lucky and be able to claim the kill.
There's nothing you can do to console or work with them - they work to rot a companies good faith
as though they're some kind of cancerous 'anti-fan'."

You should reread what you wrote Giannis....because your posts sounds like you are that exact type of anti-fan towards WoW. You do seem to have a lot of contempt for the game while defending SWTOR.

SWTOR was the first game I've played since WoW that I saw the potential of being a hit as big as WoW. The game in my opinion was just launched rushed.

If the game was launched in the state it is right now it probably would have retained at least a million subs.

The devs have already stated that the legacy patch and features like dungeon finder are things they wanted in the game on day 1. But because they were rushed the game launched incomplete. Especially to the WoW players that are used to features like dungeon finder.

The raiding scene was also in shambles at launch. Hard mode dungeons were largely ignored by players. On my characters I never need them for gear so we just went straight into raids....that were largely boring. No cc was used. Me and another sorc healed so healing was super easy. The encounters were all simple 1 or 2 mechanic deals. The only times the raids wre difficult is when we had to deal with bugs during the raid encounters.

Launching SWTOR then, when the game was not ready for it completely doomed it to losing subs. And it really is a shame because the game WAS still fun despite those things. It has a lot of potential that was wasted.
I don't think it's necessarily a dead model, but it's likely to be a heavily deprecated one. Clearly there are still a lot of people who'd be willing to pay a monthly subscription for access to a game/world/community that meets their needs. That's a very real market, and the vast majority of those people would end up paying less in a F2P setup. (I've never actually seen a F2P setup where I'd feel it necessary to spend £10 per month.)

It's just that games can make more money by having a larger playerbase, some of whom buy from the cash shop.

I'm sure that smaller, more specialist games could do well from a sub model. And actually suspect most of these games will continue to offer both.

But I wonder what happens when the F2P market is big enough that simply going F2P isn't enough to guarantee a customer base large enough for that type of cash shop to pay for itself.
First of all, swtor doesn't play like world of warcraft. We can say also that it plays like lotro, everquest, Aion and many many others.

All of which have gone Free2Play, which was exactly my point.
What F2P is about is this:

MMOs are almost all static overhead. What I mean by that is it costs about the same to run the game with 10000 customers as it is with 1000000. The only variable is bandwidth, which is cheap compared to development costs, overhead, etc.

It's better to have a guy who pays you $2 to play than to price him out by demanding $15.

F2P lets millions of people set the price they will pay for the game. This results in maximum possible revenue because you are getting the most everyone is willing to pay.

WoW doesn't go F2P because it has millions and millions of people who are paying $15/mo who would spend nothing or much much less in a F2P model, so it doesn't make sense for them. That is the benefit of being the big dog.
Final Fantasy XI is still under a subscription model and is still alive and well. It recently announced a new expansion and is finally dropping PS2 support which has been holding it back technically for a long time. I have high hopes.
You know, the largest online game is not World of Warcraft, it is League of Legends. According to Xfire, players are logging three times as many hours in LoL as they are WoW.

So it seems at least as likely that many online games must go to Free2Play not because they can't compete with WoW's subscription offering, but because the biggest game is free.
Since when is League of Legends a MMORPG? And once we open up to all online games, LoL is far from being the biggest, there are tons of Facebook games with more players.

World of Warcraft is the biggest monthly subscription MMORPG, and the most profitable online game.
I would like to make a distinction between could some company make a successful subscription MMO and will someone make a successful subscription MMO.

If the belief amongst executives who can fund an expensive AAA MMO is that the subscription model is dead, then for the foreseeable future, it is dead. Whether it should be dead or whether a profitable one could be made does not really matter. ( It is why iOS games that can be funded by the sweat equity of a few people are so much innovative than large financial commitments that prefer risk adverse: Wow expacs, CoD n+1, ... )

If someone on your board of directors or a large stockholder asks "if Sony execs are saying sub model is dead; if EA/Bioware could not do sub with the SQ IP, if turbine and LoL had great success, why do you want to do something different?" what do you say? I think the change is that 4 years ago, you would have to justify not having a subscription. Regardless of what is best for your game, I think the paradigm has shifted so one has to justify why your game is not F2P. Except WoW.

Existing games staying subscription does not mean the business model is not dead. It just means that customers, especially MMO customers, resist change. IMO, the business model is dead just means that new AAA if any????) will not be sub. ( In the same way SWTOR showed its design began with TBC WoW, perhaps the Skyrim design is too far along to convert to the 2012 conventional wisdom but I expect F2P or B1.
Rift is a WoW-like and still chugging along as a subscription game, a feat I attribute to having a solid product and more importantly, having excellent project management. Honestly, Rift and TOR were comparable products in quality at launch. The difference is that Trion must have set reasonable staffing and budget goals because they stabilized at a subscriber level that still allows them to pump out new content at a regular pace, whereas TOR was saddled with unreasonable revenue expectations and crippled with a design that was inherently overpriced to produce sustainably.

Honestly, I wouldn't say that Rift is anything other than a very competent, solid theme park MMO. But they're succeeding, because they know how to focus efficiently on what they do well. So it is possible to carve out a space as a subscription WoW-like, provided your project management and design aren't as obviously self-crippling the way TOR was. (Honestly, was not every single MMO blogger saying in 2011 that TOR's story-driven content would be unsustainable as a long-term model?)
"Since when is League of Legends a MMORPG?"

You are an ironic person to ask that, you who have many times complained that most people's definition of MMORPG is narrowly defined as quest based, hotkey combat, raiding end game, etc.

I think what you mean to ask is "since when is League of Legends a direct competitor to SWTOR?" They aren't, at least not directly. But it does affect consumer expectations for cost, and certainly affects the choices of consumers on a budget.

I can tell you (anecdotally) that the content in Free2Play games and even subscription games leads me to regard D&D Insider as massively overpriced for what they offer. I know they aren't direct competitors, but that's still the reason I refuse to pay for it.

"And once we open up to all online games, LoL is far from being the biggest, there are tons of Facebook games with more players"

I dispute this. My measurement was total hours played. Facebook games may have players, but you don't play them for more than a few minutes at a time.

The important thing is that Facebook games would not cause you to stop playing other games, you still have plenty of free time. That is why total hours played is so important when it comes to the pricing of other games.
@ Samus

How exactly does saying people using Xfire logged more hours in LoL then WoW prove anything besides that more people use Xfire for LoL then WoW?

Quoting those articles as "proof" is hardly conrete proof of anything.

I can do it too.
More people on XBL logged more hours in Call of Duty then Minecraft. So Minecraft obviously doesn't get played that much!
I love how an objective observation of MMO business models inevitably turns into a 'my game is better than yours' tribal free-for-all.
TOR going "F2P" but you won't be able to do any endgame raiding w/o paying. I also get the feeling that they might not let you surpass the current level cap when it is extended later this year.

To the guy talking about WoW, it's at 9 million now, not 10.

It still bugs me that people call LoL an MMO. How is it massively multiplayer? Because a lot of people play it? The matches are 5v5 in a non-persistent world. If the definition of an MMO is that many people play it, is CoD or BF an MMO? Is Diablo 3? What about Facebook games?

Either way, I don't understand comparisons to LoL. What does LoL have to do with MMORPGs? They are very dissimilar types of games with completely different design challenges.
The subscription model is crap (for me anyway) because to get the most of your money you need to play the same game over the time you've subscibed for. For die hard fans of a particular game this is probably ok since that's what they do anyway.

The free to play (but pay for more) model is much better for casual gamers or game hoppers, because you only pay for what you actually use.
Tobold, I think you put it the most succinctly I've seen anyone put it yet:

Similar products competing for the one market with no price differentiation.

The fanboys start whining about how their favourite is a unique, special snowflake with qualities that are underappreciated, but the fact is they're still 3rd-person avatar, hotbar combat, questing through themed zones diku-clones, as opposed to EVE's uniqueness or the new rash of FPS or RTS MMOs.

Tobold's talking about the difference between apples and oranges and people are complaining it's not fair to lump tangerines in with mandarins.

The only thing I see as a bit of a red flag is the concept of F2P as being 'scraping by'. We've seen from many successful F2P conversions that a flagging subscription game turns quite healthy by allowing its devotees to spend more than a sub allows, thus subsidising the (negligible cost of) free players.
Some of my own personal bugbears reviewing peoples' comments:

1) The assumption that endgame = raiding, and that it deserves the bulk of post-release dev attention.

WoW's 'blues' made a series of posts about the incredibly low percentage of players who actually raid, and the lower percentage who clear those raids successfully being the sole focus of developer resources. These people also tend to be the noisiest, so I can see how that might mix the signals.

2) GW2 is innovative.

GW2 is not innovative. Much like Rift did before it, all GW2 is doing is taking components of other diku-MMOs that work, and combining them with some professional polish. Its 'events' are little more than (occasionally roaming) quest hubs that are only sometimes available. It's an illusion that requires your cooperation to work. TERA does the reactive combat better. TSW does it the same, but has a tenfold more intricate skill system. Rift's invasions are more dynamic than GW2's, which are a carbon copy of Tabula Rasa's, albeit less epic in scope. It is no prettier than Rift, TSW, or WoW's upcoming new zones, except in the eye of the beholder.

3) The definition of 'successful'.

Why are people still chasing WoW-numbers? Is it still the remnants of a bunch of jilted ex-WoW players who have turned into crazy-ex mode and desperately want to see something come along and kill it? I've seen people call SWTOR's subscriber levels 'fail' and in the same breath call EVE a success. The mind boggles.

It's about expectations, possibly, but it should be more about profitability.
I agree, it appears developers are stuck in a rut of trying to make WoW a genre instead of looking outside the box and realizing that WoW is a game and does not define the MMO genre.

I don’t know if it’s a funding thing or what, maybe the only way a development studio can get funding these days is by making the pitch “well imagine World of Warcraft but with (X) feature tacked on it’ll sell millions”….Bazzinga!

Time and time again we’ve seen the same pattern when this happens. The hype sucks people in followed by a mass exodus shortly there after.

This is exactly what happened with swtor, and if you think that swtor is not just another derivative of the EQ/WoW model then answer this… what system or mechanic did you feel you had to learn over what you already learned from WoW? ….ya, I can’t think of one either.

Swtor simply did not try to fix any of the issues with the WoW format we’ve had for years, in fact it added to them. The majority of the game is simply a single players game with instanced off areas for group play. The open world group areas were avoided and despite the emphasis on story and the leveling journey it still included the victory concision of the endgame gear treadmill that simply telegraphed to the players the endgame was the destination.

It seems to me that swtor was intended to have a different identity because putting in a higher quality leveling game but then adding in a WoW endgame is like mixing oil and water.

The net result was a community of players that space bared past tens of millions of dollars worth of voiced story so they could get to the Skinner box gear grind.

So basically more so then likely any other recent triple “A” MMO attempt once you take the staples out of the tacked on Bioware game you end up with a week copy of WoW.
I can’t say if GW2 will be successful or not but I do think it has allot of well thought out systems that from the ground up have been designed to remove barriers that get in the way of players grouping.

The combination of these game systems and their effect on the community I think will be GW2 overall innovation.

I also have to admit my first hour in the game I actually had to figure out what was up with the dynamic events, combat, skills connected to weapons, dodge mechanics, and the importance of exploration so the first time in 13 years I felt I was in a MMO that was teaching me new things and that felt good.
@Logun24x7: I dunno about the SWTOR evaluation there. I think it depends on how you play it. I got a couple really solid months of entertainment in there. Every day I'd come home from work and meet up with a friend over voice-chat and basically we'd play co-op KOTOR3 together.

That was how we approached it. We didn't space-bar any of that expensive VO, we relished it. And eventually, we hit the PVP/raiding treadmill and THAT'S when we quit.

All in all, it was a very satisfying experience. Maybe not an MMO, but the most satisfying way I can think of playing the game.
@Sine Nomime and bigeye

You might be right. The truth is that I became sick of the wow community the last years. I don't hate any MMO and I don't hate wow. But in all those years I have tried every MMO released with a good faith and everytime it was the same story.

First month, a huge playerbase from wow into that new MMO. Whine-whine-whine on forums.."why we don't have bartender?" "we want damage meters" , "we want pandas" .. and then a series of doom threads.. "I am back to wow, you are pathetic" , "I hope you burn and die, stupid MMO" and then after the first month this moving cancer is off and back to wow, leaving a small community behind that doesn't necessary loved the game, but they have the good faith to buy some time to the devs to make it better.

so, you are right, I am a hater too, but a hater of wow community as it is the last 2-3 years, not a hater of any game. What I said about wow, that is a fashion and a celebrity I truly believe it. But you will never see me doing a post saying wow is dying and how happy I am because wow lost subscribers..when Blizzard fired up some of their employers I was the first to make a post to blame blizzard, how can they sack people with so much profits, but thats was it..

Also my post is very much affected by the last days posts I read on the net about swtor going f2p from wow people. I am not fun of swtor, I only played 3 months of it and not straight 3 months. I also play lotro and Aion and I will play gw2. I am a gamer and I am sick of the same story, I am sick of the wow community and what they do t o every new game out there
@Giannis: I am more sick of the ex-WoW or non-WoW community in other games. It doesn't matter which game you go to, dumping on WoW seems to be the fashionable thing. Usually with the fervor of a jilted lover.

It's most noticable on launch or free-to-play conversion/events, in the /general channel, where it's virtually impossible to go an hour without hearing someone in a starter zone talking about how 'this game shits all over WoW' (or the complete opposite), usually followed by some long-time devotee of the game complaining, "WoW players have ruined the MMO-sphere, go back to WoW, at least this game doesn't dumb things down like WoW, etc."

It sounds like some crazy people I know who will be completely in love with their girlfriend/boyfriend for three months, then they have a break-up and all you can hear about is how they're the scum of the earth and have no redeeming qualities whatsoever, everything about them is shit, even the stuff they thought was awesome before they discovered some minor personality flaw that rendered them incompatible in that one area. Woe betide any who dare to bring up how much fun they were having a few months ago.

I wish it didn't have to be so adversarial, so 'all or nothing'. Can't people just accept games for the function they serve, then go play the game that suits their current needs best? :P
@Cam I'm not saying swtor was a bad game, I found it entertaining for a month or two. But as you point out the its just not sticky enough and the endgame doesn't offer anything new over MMO's that came before it.

So I would agree that it makes for a good coop Kotor but not a MMO.

I think that's where GW2 will step it up. Removing the gear grind will prevent players from feeling like there missing out and moving the real massive fights out to the open world will allow all player to join in on the fight if your in a huge guild or not.

A dynamic world where events chain and change the world (ie: a friendly town taken over by bandits)means you can return to the zone and discover something new later in the game.
Because you scale down to the level also means that even after you cap you can go back to the lower zones and the content doesn't become trivial.

I think this will make the game far more sticky for players regardless of what their play-style is.

Removing the classic faction system most MMO's use basically doubles the amount of concurrent players you get to interact with over other MMO's that stick to the classic 2 faction system. And that's a good thing because GW2 simply gets better the more people that are around you regardless if they're grouped with you or not.

As far as the community go's I also believe game mechanics effect community, with GW2 removing things like kill stealing, node jacking, and allowing all players to revive other players in battle this all generates a positive experience interacting with other players.

Its a great ice breaker to meet new people to revive them in battle and simply a stroke of genius having this in a MMO where community is vastly important.

All of the above and more are some of the things GW2 is bringing into the MMO space and maybe alone don't sound overly innovative but when you see all these systems working together and how much more fun they make the game and massive interactions you realize just how Fracked up the MMO space has been up to now.

So with AreanNet moving the MMO genre forward like this, and on top of this being F2P I really don't see any MMO's being able to pull off the P2P model by sticking to classic MMO conventions.
Cam Wrote:
I've seen people call SWTOR's subscriber levels 'fail' and in the same breath call EVE a success. The mind boggles.

This is because SWTOR cost so much more to develop than Eve did.
I agree with them, SWTOR is a financial failure and Eve is a financial success based on their own development costs and sub numbers.

It doesnt take a genious to work this stuff out...
"Is the subscription MMORPG business model dead?"

That is a matter of great debate. The F2P models often offer "gold" or "premium" monthly memberships. These memberships often cost the same (or a little under) traditional monthly MMO prices. They unlock content and lift the boundaries placed on Free to Play accounts. So, I would have to say "No" the subscription based model is not dead.. But rather has become an option.
@Remi: That's exactly right.

The problem with this line of thought is that people will swing it like a hammer to convince folks that one game is better than the other, when the reality is that SWTOR enjoys a more popular response than EVE. It just spent a truckload more money to get it.
This comment has been removed by the author.
What games are sufficiently different from WoW that they maintain their subscription model by virtue of their differences? I can only think of a few other sub models right now: Rift, Eve, and...hmmm. Probably some others, right? The Secret World, sure...for the moment. Give it a few months.

Eve I can accept; it's very, very different from WoW. But Rift, which I love, is still just a "Wow+" experience in which you play the same game but with better features. And The Secret World has a lot of thematic differences but in the end you're still playing a behind-the-shoulder them park game that just happens to have a much more elaborate quest structure than normal.

Anyway....I'm having some sort of critical failure of info, I can't even think of any other subscription model games out there right now. Hybrid models, sure....Age of Conan is a good example, where they use the free play time to try and lure you to paying by the month....but that's not quite the same best as I can tell.

(Sorry had to redo post!)
If these game makers would pull their heads out and pay attention, they would see that people are successful at both types, f2p, and subs. The problem is, some will play f2p or sub, old gamers like myself refuse to play f2p games, where you have a ton of kids, spammers, and gold bots. Simple solution: Make a f2p, but have 1 dedicated server for subs only. Best of both worlds. You milk your f2p players, and get your hardcore gamers who refuse to lump into a f2p world where community doesn't matter.
Golag of Quellious
Its easy to see people will pay a sub, if the game is good enough. However some will only play if its f2p. Personally, I think f2p is a horrible horrible deal, opens up the game to way too many people simply trying to be jerks for no reason, spammers, gold botters, and the list could go on. So the answer is simple, and we've been asking for it on EQ Next forums. Open a f2p game. Have 1 (or more if you find the desire is huge) dedicated sub only server. f2p junkies can game hop all over, oldtime hardcore gamers can play their sub only game. Every game has multiple servers already anyway. How is it so hard to come up with this easy solution for such intelligent game designers? Tons of people all over on forums are saying, its not the sub thats the problem, its the quality of the game, the lack of challenge of the game, the community of a game, that determines if they'll pay or not.
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