Games Brief

A debate on free-to-play

2012-05-16T13:05:07Z

This post takes a special format: Cliff Harris of Positech Games and I exchange views on free-to-play gaming, and then share the conversation with you. Let me know if you think the format works, and don’t forget to join the conversation below!

Cliff Harris, Positech Games
Nicholas,

FreeToPlay is not the future of games, or at least I hope it isn’t. The entire business model is built upon cynicism, mainly the idea that players will think they can play game A for free, as opposed to game B which costs $30. We both know that someone, somewhere has to pay for the game’s development, and for that idea to work out, you either need to hook some ‘whales’ who pay out a fortune and subsidise everyone else, or you have to constantly nag all of the players to pay for in-game items.

Either way, the business model will lead to design compromises that do not exist in any other artistic medium. A writer or movie director can compose a piece of entertainment safe in the knowledge that the customer has bought into the idea of the entire work. Imagine the impact if the audience were asked every chapter or scene to pay a few pennies to access the next part of the story.

We wouldn’t tolerate free-plus-microtransactions in other media, why should we tolerate it in gaming? Free to play is nothing more than the new version of a very old idea, the free demo. The difference is that with a free demo, the understanding is you then make an honest pitch for the player to purchase the game at the end of the demo. The F2P model seems to rely on interrupting the player mid-game to constantly pester them for a few pennies.

How is this a better business model?

Nicholas Lovell, GAMESbrief

Cliff,

You start by making the mistake of thinking that all users love your work equally.

The idea that all users should pay the same price for a piece of entertainment, however little or much they enjoy it, is a bizarre concept born out of the limitations of physical media. In the old days, when there were no bits and distribution was exclusively by atoms, content creators had no choice but to fix the price. It was the only way to sell an entertainment product via retail stores. The consequence was that a superfan who loved that game would get hours of incredibly cheap value. A user who found after a few hours of play that it wasn’t for them was, in effect, subsidising the heavy players.

Free to play changes all of that. It lowers barriers to entry, which means people can play and enjoy the game while they work out if they want to spend money on it. It enables people to play the game for ever, for free. As long as the player is playing, the creator has the chance to say “hey, you’re enjoying my game. Here are ways that you could enjoy it for more, by spending some money with me.”

It’s more honest (because it allows players spend according to their level of engagement with the game), it is cheaper (because you build a title for continued play, you don’t have to spend all of the development and marketing budget prior to launch) and it is more profitable (because you let those who don’t want to pay play for free, while allowing those who love the title to spend much more than the initial price).

What’s not to like?

PRESS SPACE TO TAKE YOUR TURN

Cliff Harris, Positech Games

Nicholas,

I accept people are prepared to pay different prices for games, but this is why we have collectors editions and DLC. I don’t accept that we are just being shackled by the physical properties of the medium, because that also applies to books and movies. They capture the whole audience by having hardback or signed copies, and DVD specials with extras.

This is all fine. I have no problem with extra content being made available after a product is complete. The difference is that you are advocating designing the game around such a business model from the start, which I think makes for an inferior product. Books may come as hardback/paperback, but you don’t have to pay extra to get all the characters, that would be mad, yet it’s how F2P games are being designed.

The other problem is that the game is no longer a shared experience or level playing field. I can now be shot by someone with a gun I didn’t buy, or outrun by a car with engines I haven’t bought. Games are about fantasy and adventure and getting away from the rat-race and treadmill of real life. Is it not bad enough that MMOs feel like a second job, without importing all the envy and unfair competition from the real world too? Real world games would never allow this. Football teams don’t get more players if their team has more money, we accept that when it comes to games, it should be about skill, not bank balances. And as for barriers to entry, there are already none when the game has a free demo.

Nicholas Lovell, GAMESbrief

Dear Cliff

I think that we are coming at this issue from two different directions. I care about players, but I also care about the businesses that make games. After all, if it is hard or impossible to make a living from making games, fewer talented people will make fewer great games.

So I start from the premise that if the market is being changed by digital distribution and the immutable economic law that if the costs of making another copy of something trends towards zero, so does the amount that people will pay for that copy. In that environment, I think it will be very hard to keep the price that an end user will pay for a gamer at anything above very low (meaning iOS style prices). It is very hard to make a living at a price point of £0.69 for all but the very lucky. Even Rovio, often shown as the posterchild of iOS development, needed commitment and luck: Angry Birds was their 52nd game.

You’ve argued that you need to gross £100,000 (I think) to make a living. That means selling 145,000 copies of the game if the price is £0.69. You would need to sell 20,000 copies at £4.99.

There is another way. What if you can find a business model that allows people who love your game to spend more? If you design the game to allow those people who love what you do to spend a day’s wages over the course of a year of playing? In the UK, a day’s wages is £100. That would mean you would only need to have 1,000 players who loved what you do to make enough money to live on.

Isn’t that easier and more attractive than trying to appeal to everyone in the same way?

How would that business model work? You make the game entirely available for free, so that people can play, explore and experiment in your world. You offer a way for people to spend £1. They may be able to buy aesthetic changes like personalised outfits, new skins or new buildings that don’t affect gameplay. They may be able to level up faster, unlock items earlier than someone who plays the standard mode. They may even buy additional content (although in my mind, it is better to sell personalisation than content).

Then you need to make it *possible* to spend £100 per month. Not because people will (although some might), but because you want your biggest fans to have choice – about the personalisation, the status, the progress, whatever it is that excites them – and if they are *able* to spend £100 a month, maybe they’ll spend £10.

A thousand true fans, out of perhaps 100,000 playing your free game, and you have an exciting business that is all about making cool new stuff that your biggest fans will love – and want to pay for.

That seems to me to be the best of all possible worlds.

Cliff Harris, Positech games

“Ah but here is the fundamental contradiction. You suggest that because stuff can be copied, it’s natural price is zero, but then you also talk extensively about ways to get money from people for games by other means.

Ultimately, it’s just a shuffling of payment from all gamers equally to a few wealthy ones, but the same amount of money is being generated. The ‘free to play’ games are clearly nothing of the sort, they are more like ‘patronage’ games, where some wealthy people who suffer from gaming addiction subsidise everyone else’s leisure time. An interesting way to do it, but not something that is being done in the interests of making games better. If your business strategy relies on milking a core group of hardcore wealthy addicts, then it means games get designed effectively for a small hardcore subset.

Besides, the popular ‘thousand true fans’ model doesn’t require micro-transactions and free-to-play, they are unrelated.

You can have your thousand true fans who buy the game, without requiring them to be a subset of 100,000 casual players who value their playing time at zero.

I could just about get by with a thousand true fans by selling them $30 games, and many people do exactly this, like spiderweb software and the guys making hex-based WW2 strategy games. There are many people out there happy to pay $20-40 for a game that they really like. It’s a myth that gamers will only pay $0.99 for a game, it’s just that those gamers are a very loud, shouty minority.

You can have your thousand true fans who buy the game, without requiring them to be a subset of 100,000 casual players who value their playing time at zero.”

Nicholas Lovell, GAMESbrief

Dear Cliff,

Of course you can get by with 1,000 true fans paying $30 for your games. The difficulty is in finding them.

Free-to-play games suffer from this discoverability problem too: they need to spend to acquire customers in the same way that traditional games companies have to market their games. The difference is that, because their games are free, they can get many more people into the game to discover if they enjoy it. They can play the game for longer – often forever – before the paywall comes slamming down. They can get their friends playing without having to persuade them to shell out $30. And when they find a true fan, they can make a lot more than $30, while offering things that the true fan values.

There will still be companies making money from games that are single upfront payments for quite some time. Most of them will have established reputations, while new businesses are more likely to start by assuming the free is the optimum price point for consumers AND for the company.

The important thing is that a wider variety of good games will have a chance to get developed than ever got developed before. I think that is something that we can both agree is a very good thing.

Taptitude – a Windows Phone Success Story

2012-05-04T22:13:07Z

This guest post is cross-posted with permission from Four Bros Studio.

FourBros Studio began developing Taptitude early in 2011. This article is going to look back over the last year as the game has evolved to see how far we’ve come and how we got here. For those not familiar with Taptitude, it is a free Windows Phone 7 game with a collection of over 60 competitive minigames. We initially launched Taptitude in March 2011 with just a handful of relatively simple minigames, and have since updated it every week adding new games and platform features.

Taptitude is free to play, and is supported by pubCenter ads. In this buisness model, you are paid based on how many ‘impressions’ you get each day. The amount you’re paid per thousand impressions is refered to as ‘eCPM’. For example, if you get 10,000 impressions at $1 eCPM, then pubCenter will pay you $10.

Over the last year, we’ve seen exponential growth in our impression rate. For the first few months we made very little money, and only served a few thousand impressions per day. As we stuck with the project we added many weekly updates with features including online leaderboards, stars to unlock minigames, coins to purchase game upgrades, and stats to track your progress. Taptitude continues to evolve, but lets take a high level look at how we did on average over the last year:

We’re at nearly 100 million ad impressions, and much of that was in the last few months as you can see from this breakdown of impressions per week over the last year:

Over the same timeframe, you can see that our eCPM fluctuated pretty wildly:

We would love to get $3 eCPM every day, most of the time it’s closer to $1. In the next chart we can see how our revenue is a combination of both eCPM and Impressions:

As you can see, in the weeks of November we had a big spike in eCPM resulting in record revenue despite having significantly less impression than recent weeks. As we settled into the lower $1 eCPM we’ve had to grow our user base in order to make it up with impressions.

At the time of this writing, we are about half way through April and we have record impressions per day as seen by the following chart. There are two clear dips in this chart that show when we diverted our pubCenter ads over to AdDuplex during different marketing blitz efforts. The reason for this is that we either show a pubCenter ad or a AdDuplex ad, but not both. Toward the end of this graph, you can see our 1 million impression days!

* NOTE: the dips in pubCenter ads correspond to a spike in AdDuplex ads because this is where we marketed our game using AdDuplex.

The graphs above show how our impressions have grown over the last year, now lets look at how that correlates to our userbase growth:

In this chart, the orange line shows the cumulative downloads of Taptitude, and the green line represenets the number of unique downloads per day. You can see from this graph that we stayed pretty flat at around 350 new users a day for over 6 months! There are a couple spikes which tend to line up with getting featured in the Marketplace, releasing major new updates, as well as marketing campaigns that we ran on Facebook and AdDuplex.

Taptitude has been downloaded nearly 300k times in the last year. With this many users, it’s interesting to slice and dice the demographics. Lets look at the data we’ve collected in the last 30 days.

We publish an update for Taptitude every week. We wondered how quickly our users were updating to the latest version:

Most of our active users do a good job of staying on the last few weeks, but there is an anomoly where a significant portion of our users are still on v4.5. It turns out that v4.5 was the last version we released pre-Mango. Anyone that hasn’t updated to Windows Phone 7.1 (Mango) will be stuck seeing only version 4.5 on the Marketplace. We’ve asked our users why they don’t update to Mango, considering it’s free, and most of the responses were because they didn’t have a computer to update their phone with. Unfortunately this can’t be done over the air.

Now let’s break down which phones (devices) have played Taptitude in the last month:

Nokia is leading with the Lumia 800 followed by the 710, with the 900 making significant gains in the short period of time since its release. Despite this, HTC is actually the #1 manufacturer at this time due to the breadth of devices they offer:

We also keep track of the ‘culture’ of the phones that play Taptitude. This corresponds to the region that the player is from:

As to be expected, en-US is the primary culture considering Taptitude is only localized to English. This is followed by a significant portion of our users coming from Great Britain, Germany, and Spain respectively.

Windows Phone is a rapidly growing market where indie developers can be successful. We are looking forward to an even better second year as indie game developers, and can’t wait for Windows 8!

That wraps up our analysis of the last year of Taptitude. In a future article we will dig into some of the specific stats that we track in game to see how our users are doing. If you like this type of analysis, follow @FourBrosStudio on Twitter, and/or check out the Taptitude Facebook page.

UPDATE: thank you all for the interest in our post. Looks like many of you are interested in the per-day figures as well, so here is a chart showing our per-day revenue over the last 30 days.

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How much are Tablet users spending on Virtual Goods? ABout $62

2012-05-14T16:03:49Z

Magid Associates have released their latest gaming trends research (although 10 minutes of Googling and I still can’t find the original. I’m relying on GamesIndustry.biz’s write-up).

The key stats that leaped out at me:

Where are the active gamers (%age playing games on a platform in a week):

50% played console games at least once a week
44% played mobile games at least once a week
37% played social games
24% played handheld games

Where is the money on new platforms?

Tablets: The average tablet gamer downloaded 20+ apps last year, and 23% of them are paying for virtual goods, averaging $62 per spender
Smartphones: The average smartphone gamer downloading 10+ games last year and 14% of them are paying for virtual goods, averaging $25 per spender.

Note that these appear to be “self-reported” numbers, which can be very unreliable.

More details over at GamesIndustry.biz.

Kickstarter and the Gartner Hype cycle

2012-05-08T22:01:04Z

Yesterday, I wrote about the inevitable bursting of the Kickstarter bubble. (The post was originally made on Gamasutra).

I had meant to check out the Gartner Hype Cycle and a link from Tadhg Kelly reminded me to do so. Here it is:

It seems to me to be pretty clear that we hit the peak of inflated expectations at around the time that Double Fine raised $3.33m two months ago. We are now on the downward slide towards the Trough of Disillusionment, and we will hit bottom in October or so of this year.

Then, as developers and consumers begin to really understand the true potential (and pitfalls) of Kickstarter, crowdfunding will really start to come into its own in 2013.

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What’s the use of contracts?

2012-05-03T21:46:26Z

In this guest post from John Halton of Cripps Law, we look further at contracts, specifically for managing business relationships. Don’t forget to check out the recent Dear Jas post on contracts from the perspective of EULAs.

Shared under a creative commons license by Victor1558

During April, rumours swirled that the Prey 2 first-person shooter had been cancelled by Bethesda Softworks due to a contract dispute with the developer, Human Head – who were said to have downed tools on the project in November 2011. Bethesda subsequently announced that the game had not been cancelled, but delayed beyond 2012 as it “does not currently meet our quality standards”.

If the delay is indeed down to a contractual dispute, it will not be the first time that a developer and its client have fallen out in this way. This is a particular risk on projects – such as the development of video games – where the exact scope of the project is not clear from the outset. The client can become frustrated at the apparent lack of progress, while the developer can feel trapped by a fee structure that no longer reflects the scale of the work.

As the problems mount, sooner or later someone decides it’s time to pull the contract out of the bottom drawer and see what their legal options are.

The first thing they may discover is that the bottom drawer is empty: there either never was a contract (“let’s just get started and worry about the legal stuff later”), or the contract was never signed.

Or they may find the contract is there, but doesn’t help them. It may leave ownership of intellectual property unclear, resulting in an impasse in which neither party is able to use or sell the finished product. Or it may bear no resemblance to reality – either because it was a generic document which ticked the box marked “contract” but never reflected what was actually intended, or because it failed to take into account changes as the project went ahead.

Uncertainty abounds, tempers rise, lawyers are called in, the relationship collapses, and – most important of all – a great commercial opportunity is lost for everyone.

Given all this, the obvious question is: “What’s the point of having a contract in the first place?”

As I see it, in most circumstances there are only two main reasons for having a contract, and for caring about what it says. The most important is this: to make the parties think about things before the contract is signed. As a general rule, if the contract doesn’t mention something, that probably means the parties haven’t thought about it – or they’ve each thought about it, but haven’t talked about it to one another, and have signed the contract with very different expectations about what happens next.

A good contract will flush out issues that the parties may not have thought about, but which they then realise matter to them. Intellectual property use and ownership is a classic example; service levels, timescales and change management are another. This gives them the opportunity to reach an agreed position before the contract is signed – or, at worst, to walk away from the deal before it’s too late.

This in turn helps to build the commercial relationship: each party has a better idea of what they want and of what the other party wants, and so there’s a basis for trust and an avoidance of misunderstanding and uncertainty later.

The second reason for having a good contract is so that you never have to worry what a court will say about it. The vast majority of commercial disputes are resolved without ever darkening the doors of a court, and those that do reach court usually do so because the contract leaves things unclear (and because there’s a lot of money at stake – but that’s another story). A good contract gives the parties a clear basis for negotiation, which increases the chances of a deal.

Business relationships are like any other relationship: things will go wrong, arguments will happen. But they are also like any other relationship in this: prevention is better than cure. Better to understand where the other person is coming from, and leave as little as possible to chance or misunderstanding.

John Halton is a partner in the Advertising, Technology and Media group at Cripps Harries Hall LLP. He blogs at Law in the Cloud @johnhalton

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How long before the Kickstarter bubble bursts?

2012-05-08T11:22:18Z

This article is cross-posted with permission from a regular series of posts Nicholas is writing for Gamasutra.

Image shared on a CC license by Jeff Kubina

2012 has seen an unprecedented level of euphoria over crowdfunding sites. Regular readers of Gamasutra will know that Double Fine raised $3,335,265 in a record-breaking campaign to produce a game about which purchasers knew very little, except that it would be a point-and-click adventure created by two of the doyens of that industry: Tim Schafer and Ron Gilbert. Then InXile CEO and Interplay founder Brian Fargo followed the example, raising $2.9m to fund a sequel to 1988 game Wasteland.

Not only have two games that traditional publishers wouldn’t touch now been funded by fans, but they appear to have opened the floodgates to other Kickstarter projects. In a recent blog post, Kickstarter said that blockbuster projects draw more people into the crowdfunding ecosystem. Successful, large-scale fund-raisers don’t suck up all the available money; they increase the number of people funding projects, increasing the pool of potential funders for other projects. Kickstarter’s key statistics:

In the first two years of Kickstarter, the Video Games category saw pledges of $1,776,372. In the six weeks after the Double Fine project was announced, $2,890,704 was pledged (if you added Double Fine’s amount to that, you get $6,227,075.)

Before Double Fine, one video game project had exceeded $100,000. By March 29, 2012, nine projects had.

In the month before Double Fine, the Video Games category averaged 629 pledges a week; after (but excluding) Double Fine, that jumped to 9,755 pledges per week.

There are currently 314 projects live on the Video Games Channel on Kickstarter. Several are fully-funded already (like YogVentures). Others never will be (I’ve seen at least two massive open-world sandbox games proposed by people who have never made any games before). The ones I worry about are the ones that combine the two: fully funded projects by wildly-optimistic promoters. That is where the trouble will start.

Only 10% Spend On Development

Independent developer Warballoon raised $36,967 on Kickstarter to fund their iOS game, Star Command. Only they didn’t:

$2,000 just didn’t turn up (payments didn’t transfer) and when Amazon and Kickstarter took their fees, Warballoon got $32,000.

Prizes cost $10,000! Much more than Warballoon was expecting. (Note to Kickstarters: do your costings carefully, and remember to include postage halfway round the globe.)

Then: music ($6,000), legal and accounting fees to set up the business ($4,000), poster art ($2,000), iPads ($1,000), attending PAX East ($3,000)

Leaving $6,000 for development. Which was taxed, leaving $4,000.

So out of $36,967, only $4,000 went on development. I’m not picking on Warballoon: I think it is great that they shared their data. More than that, they spent their Kickstarter money on things that cost money (like music and attending events), not on things like coding which doesn’t (it costs their time, which is very valuable but is not cold hard cash).

The Warballoon team had a successful Kickstarter project, raised in the days before Double Fine, but they didn’t raise enough money to make the game if they needed to fund the salaries of everyone involved.

The Molyneux Effect

The second issue I see is what I am terming the “Molyneux effect.” Peter Molyneux is a creative game developer who inspires players and game makers the world over with his thoughts on what the games medium can deliver.

He also makes promises he can’t possibly keep. In the early days of his projects, Peter used to get so excited that he would start thinking about the things he was imagining before the practicalities of technology, time and budget started to cut into his dreams. (That was before the Microsoft machine got its hooks into him. Maybe it will start again now that he is independent again). Fans would then get furious that the grand promises at the start of development did not make it into final release (as thissatirical news piece shows.)

Now imagine that you paid for the game at the start of the process, because you believed in the grand claims, not at the end of the process, once you had a chance to read the reviews and see what is actually in the game. This time, fans will actually have entitlement, not just a sense of entitlement. The Internet will reverberate with their fury.

Can They Deliver?

I am convinced that Tim Schafer and his team at Double Fine know how to deliver a game (mostly) on time and (mostly) on budget. Brian Fargo too. Is that true for all 314 of the current Kickstarter projects?

What about the projects which get started but never finished? If publishers like LucasArts can cancel games that are almost finished or like Codemasters can pay for a game it never saw, what certainty do pledgers have that the game that they have paid for will ever see the light of day?

We Are Still In The Euphoric Phase

We are still in the early days of our Kickstarter relationship, the early days of falling in love. Everything our partner does is wonderful. We gloss over the risks, we ignore the downsides, because the glory of falling in love is everything.

I think we have about six months left of that period. Towards the end of this year, some Kickstarter projects are going to start slipping. Some will see their teams collapse amidst bicker recriminations. Some pledgers are going to start getting very angry.

Don’t get me wrong. I love Kickstarter. I love the way it allows fans to spend as much or as little they want on supporting projects that they love (or think they will). I love the way it gives people with different spending appetites different amounts to spend. I don’t think Kickstarter will replace publishers but it will enable games that appeal to niche (as defined by mega-publishers) audiences to get made and played.

Which is great. Just don’t expect the ride to be smooth from here on in. Listen for the screams.

The age of interaction: the rule of 1/9/90 doesn’t work any more

2012-05-08T08:59:51Z

Do you remember the rule of 1/9/90? It was a rule of thumb for web designers: 1% create, 9% comment and 90% consum. If your business depended on the 1%, you were typically in trouble.

New research from the BBC suggests that interactivity has broken through apathy and thanks to new technologies that make participation easier than ever before, the rule of 1/9/90 may be outdated.

According to their research covering 7,500 people, 77% of people are now active participants in sharing, commenting and creating on the web. Of the 23% who remain passive, nearly half are digitally literate: they are early adopters who choose to consume, not participate.

Of the 77% who are active, 17% are intense creators, 44% are comfortable initiating “easy” participations (uploading photos, starting discussions) and 16% are reactive.

So 1/9/90 can be updated to 20/60/20. I wonder if this should start influencing how we make games?

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Why economic gloom could be good for business in virtual worlds

2012-05-03T14:16:24Z

Zoya Street is soon to finish a master’s thesis on the history of Japanese video games, and works as editorial assistant at Gamesbrief

In my GDC talk, I explained how the fictional economies of Final Fantasy in the 1990s games got young people spending money on gaming when their finances were low, by reflecting the loss of stability of the real world economy while eliminating the possibility of poverty. After the talk, Nicholas asked whether the success of Final Fantasy games during Japan’s lost decade parallels the success of the freemium model during our current recession. In this post I’m going to suggest one reason why fictional economies might be so compelling in a recession – real-world financial gloom makes virtual wealth feel like an epic win.

The fictional economies of Final Fantasy games reflected the real world enough to feel relevant to players’ own lives and identities, but they differed in an important way; consumers were much less likely to end up poor in a Final Fantasy game than in real life. They had more control over their economic success. As long as they kept fighting battles, players would keep on making money. The productivism of capitalism was preserved, while its capricious win-lose dichotomy was eliminated. Final Fantasy games made players feel rich and successful, and on a fundamental emotional level, that feeling is worth spending money on, even in an unstable economy.

Just as the fictional economies of RPGs were appealing to Japanese in the 1990s, so the virtual economies of online games have captured the hearts and wallets of players today. Games with fictional economies provide escapes from economic doom in the real world, but the interesting and surprising thing about this form of escapism is that it closely resembles the very thing players are escaping from.

Virtual currency exchange rates are a great case in point. I am able to buy 20,000 gold pieces in Jetpack Joyride for 69p. Similarly, in the paymium title Infinity Blade II, 69p gets me 25,000 gold pieces. This figure is approximately equal to the average student debt in the UK, although this is set to double with the new tuition fee rates. Could it be that buying 20,000 virtual coins for 69p feels particularly satisfying precisely because so many people have a £20,000 weight on their shoulders?

Shopping and crafting in virtual economies feel like taking control. But it’s a particular kind of control. It’s not just about the control you gain by owning that object. It’s also about the control you have over your economic destiny, being able to exercise consumerism without suffering negative consequences.

The consumerism of virtual items often closely reflects the consumer technology marketing on which video games depend. Revenues are dominated by items that expediate gameplay, and this improved speed or ease of play is often narrativised as being down to superior technology. Using a newly-bought weapon in Infinity Blade gives the same temporary high as using a new smart phone; the thrill of increased speed, the fantasy of improved power, and the sparkle of shiny new material. It feels like control and mastery over technology through consumption. But virtual swords cost much less than iPhones, they break far less frequently, and I’m unlikely to be mugged for my virtual twin blades of Ember.

None of this is to say that successful fictional economies eliminate risk from players. Risk is an extremely important aspect of fun, but risk is much more fun when players feel like they are on a winning streak in spite of difficult odds. Reloaded found that in APB, players are 30% more likely to spend money on the game if they win their first fight (talk is on GDC Vault, 33:10). There has to be some risk present for that confidence boost to occur, but hidden mechanics that subtly increase the real win chance for that first battle without explicitly changing the odds of success have significant consequences for player purchasing behaviour. Success in the face of difficult odds motivates players to spend.

This hints at the power of what Jane McGonigal calls the epic win. Epic wins happen when it looks like the odds are stacked up against you, but you succeeded anyway.

This could be at the heart of the question of fictional economies in hard times. In a time of financial doom, economic wins seem all the more epic.

This could be why fictional economies that mirror the real world economy are effective at encouraging players to spend money. They feel like a continuation of the outside world, in which the risk of failure is very high. The wins feel more significant, and that sense of economic success is, for many players, worth spending money on.

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50 questions: Should I let my lawyer negotiate the deal?

2012-04-26T13:45:10Z

Together with Nic Brisbourne of The Equity Kicker / DFJ Esprit, I am writing a series of 50 questions you should ask when raising venture capital. We expect the series to run for a year, after which we will collate the answers into a book. We view this as a collaboration, so please comment to help make this series even more useful. This is #48 in the series.

“Going toe-to-toe with an experienced venture capitalist negotiating on concepts that are new, difficult to understand, and important to the future of your business is not an easy challenge,” says Nic Brisbourne in an Equity Kicker post. “But it is one that the best entrepreneurs step up to.” It is tempting to have your lawyer negotiate a deal for you, but while he might understand the legal issues, he doesn’t know your business like you do. Ultimately, you have to negotiate in order to represent your own interests. Read more at The Equity Kicker.

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A $50k IOS game grossing $1m per month

2012-04-25T11:43:08Z

Have you heard of Design This Home? I hadn’t.

But it’s in the top 5 of the Top Grossing Apps in the UK, Canada, Australia and Ireland, with 300,000 DAUs and is “set to gross $1m per month worldwide”.

Not bad for a game made by three full-time team members and a cost of around $50,000.

I’m not sure how they got to the position, but the company has other apps with a total of 10 million installs, so I’m guessing that there was a heavy element of cross-promotion from other apps. If you you know how they grew, do let me know.