The State Of Free To Play PC MMOs 2015

One of my favorite words in the English language is “free.” And in this article I’m highlighting the state of my favorite market, free-to-play. While contentious in the right context, free-to-play is the fastest growing sector of the PC gaming market, raking in $8.7 billion in 2015 according to SuperData Research. Publishers are choosing to release games as zero-cost products with the intention of generating revenue through in-game cash shops, premium account status, and Founder’s Packs. Analytics firm EEDAR recently released a report discussing the state of f2p.

It comes as no surprise that MMORPG’s and MOBA’s are the primary revenue drivers of the free-to-play market. MOBAs are at the forefront of lining their bank accounts with cash currencies such as gold. It’s fascinating to recognize that MOBA’s as a genre didn’t gain widespread attention until 2012, with meager beginnings as Aeon of Strife. But they have exploded in popularity and established the free-to-play model as an accepted precedent.

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As with mobile games the top revenue drivers are a small minority of players, typically identified as “whales.” They reach deep into their wallets and inject the majority of cash into free-to-play titles, bolstering their accounts and helping to keep titles afloat. According to EEDAR “the top 1% is responsible for 15% of all revenue, while the top 10% generates 62% of the total.” Spending is not ubiquitous across the entire playerbase. Nearly half of all f2p players will never spend a dime—a fact reinforced by some MMOs.com reviewers.

League of Legends stands triumphant as the unchallenged king of the f2p MOBA nation, while DOTA 2 trails behind at a respectable pace but dwarfed by LOL’s shadow (Not surprising. In 2014 League of Legends’ active monthly users was 67 million while—according to Steam Charts—Dota 2 averaged 521,000 in October, 2015). Due to the genre’s success a number of titles have entered the MOBA arena, some persisting while others flounder. Creating a doppleganger title wont be enough to survive the deluge. Developers looking to contend will have to change the formula, such as SMITE’s third-person POV and Heroes of the Storm’s objective-focused gameplay.

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MOBA titles generate the majority of revenue from hero cosmetics and full body skins, accounting for 36% of all microtransactions. Fascinatingly, the second largest revenue driver is Hero and Champion unlocks. While DOTA 2 provides players every champion for free, League of Legends continues to lock champions behind a payment wall. It’s no surprise that Riot has chosen to continue champion unlocking when it account for 20% of all MOBA microtransaction revenue. The overall North American market is expected to grow to $501 million by the end of 2015, up from $406 million in 2014.

MMORPG developers continue to search for the sweet spot appealing to Western players. Black Desert Online’s choice to impose region-specific payment models exemplifies the uncertainty of optimal monetization.

Traditionally buy to play and subscription based games have incorporated free to play elements, such as cosmetic cash shops and premium account status. Guild Wars 2’s decision to make their base game free before the release of Heart of Thorns was a brilliant choice that lead to a 7 million user mark according to ArenaNet’s own metrics—an increase of 2 million since August. The number of free to play players that converted and purchased Heart of Thorns is unknown, but MMOs.com speculates that it is far larger than if the game’s base remained buy-to-play. We predict that more traditionally buy-to-play and subscription based games will either transition to a free-to-play model or make some portion of their game free-to-play.

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Free-to-play is easiest to analyze in the MOBA sector thanks to similar monetization models. But MMORPGs are almost ubiquitously incorporating cash shops, generating significant revenues at $3.88 average revenue per user. And more titles will likely adopt similar models, choosing free-to-play to reach the widest possible audience and bank on whales to support their games. While MOBA’s continue chugging along, selling cosmetics and, in the case of LoL, heroes. With more contenders entering the f2p arena it's both an exciting, and overwhelming, time to be playing MMOs. 

Sources:

EEDAR - Deconstructing The PC Free-To-Play Market
SuperData Research - Global Games Marker Report 2015