Hi,

Although I don't watch South Park, I had chance to watch (notified by someone) an episode of South Park called "Freemium isn't free" ( can watch at http://southpark.cc.com/full-episodes/s18e06-freemium-isnt-free ) , gives "insightful idea" regarding freemium games imo.

When looking at freemium games, (at least those I checked) it seems that at the end , few whales spend ridiculous amount of money to make game sustainable and often games are tailored to ensure whaling them.

What I wonder is if it is because no matter how good your game is there is a large group that will never ever spend money or it is easier/more lucrative to design game for whaling. Asking same question from another angle, isn't it possible or viable to make a game you can get revenue from a large player base rather then small group of top players?

Thanks in advance

isn't it possible or viable to make a game you can get revenue from a large player base rather then small group of top players?

Sure. There are plenty of examples, like, say, Angry Birds, which don't have prohibitive in-app purchases, and still do fine by virtue of a very large user base.

There are also ad-supported apps that make money this way, i.e. Flappy Birds.

isn't it possible or viable to make a game you can get revenue from a large player base rather then small group of top players?

Sure. There are plenty of examples, like, say, Angry Birds, which don't have prohibitive in-app purchases, and still do fine by virtue of a very large user base.

There are also ad-supported apps that make money this way, i.e. Flappy Birds.

Thanks for response.

I am not sure if Angry Birds isn't that agressive on IAP because has a significant merchandise revenue. Imo, Angry Birds isn't type of game I favor ( same from Candy Crush , Flappy Bird etc line) , game for non-gamers.

And for Flappy Bird, doubt in game advertisement counts as freemium (unless an option to remove it by premium pack is offered)

And for Flappy Bird, doubt in game advertisement counts as freemium

I wasn't suggesting it did. I'm just pointing out that mobile games exist on a spectrum, from ad-supported through freemium, all the way to paid.

When you are deciding where to place your business model on that spectrum, it comes down to whether it easier for you to motivate 1 person to spend $50, 50 people to spend $1 each, or 15,000 people to watch ads?

Most of the thinking today around freemium monetization is such that whales and "chum" (as I like to call Freemium freeloaders who won't participate in the ecosystem) are a sort of natural consequence of the way in which the developer tunes their games. In short, developers tend to take the simplistic view that their sole goal is to increase revenue without consideration pf what share of that revenue comes from a certain amount of people. To their models, earning more revenue means the average player is more happy, even if all increases in revenue were due to whales. Its not a very realistic picture of the health of the game, and I find it pretty cynical, but its what they do. These games don't have a flatter revenue spread because they don't consider optimizing for it.

Given the dearth of "free" entertainment available today, you will always have people who are unwilling to buy into the entertainment they consume -- they'll grind forever if it doesn't cost them anything, or they'll just move on to the next thing. You'll never generate any revenue from them except from advertising. However, because of the need for a large, immediate user-base to penetrate the top-apps list where you need to be to make real money, they are necessary to the success of your app. The typical freemium titles use them to gain placement, which in turn draws whales to the game -- that's why I call them "chum".

Likewise, you'll always have whales who will buy every transaction available, either because they really enjoy the game or because of their own compulsions. The trade-off of relying on whales is that most games encourage whales by making high-end items exclusive, scarce, and/or powerful so that they can charge a high premium to an exclusive clutch of players. This has obvious effects on game balance, and also impacts who the developer will prefer to keep happy as the game changes and evolves -- a move that would alienate whales will never be considered, even if it would make the average player happier at a rate of 100-1.

I don't think eliminating the whales or the chum is the point, but I do think that a healthy game would have a strong "middle-class" of players who have spent something and that you'd see a gentle slope from people who have spent the least to those who have spent more, but are not whales. I also think that you'd make the most revenue by establishing such a middle-class of gamers and then focusing on raising the average revenue generated from them, its just that most games haven't figured that out. League of Legends is one that approaches that, so is TF2 -- both games do so by deliberately choosing to do so -- for example, in Leage of Legends, you can't really buy your way to victory because consumable buffs tend to affect the entire match rather than a specific player, which increases the enjoyment for everyone and encourages all players to participate in that economy. TF2 achieves it by making their entire economy of in-game stuff tradable, and through their crate-system which randomizes loot such that its not only the whales who have the best stuff. This is counter to a whale-based economy where exclusivity and scarcity drive revenues.

I think you CAN design a game where a broader class of player are encouraged to pay something, and the whole whaling aspect is less severe.

I think World of Tanks is a good example here. While most players still don't spend a single dollar, it seems the amount of spending players is way above industry standards.

The way they achieved this is ironically by making the paid items balanced and not game breaking. There are the "wallet-warrior"-whiners, but everyone that is a little bit knowledgable knows that MOST bought items and tanks are actually quite balanced (there are some OP premium tanks, but they seemed to be mistakes by certain designers that the dev cannot remove anymore without people threatening to sue them).

All the items that were pay-to-win in the beginning (better gold ammunition, some enhancing consumables) can now also be bought with normal ingame currency. They are not cheap if not bought with real money, but a very good player can afford them and still make a profit ingame.

Most of their revenue nowadays comes from players trying to grind faster with premium accounts (which will just increase the amount of exp or ingame money earned, not help you win), and people collecting virtual tanks. Their premium tanks seem to be quite sought after, not because they are OP (With very few exceptions), but because they again make additional ingame money and exp, help train the crews of other tanks, and because some of them are either wonderfully weird or even quite famous tanks people want to play.

And then there are the comp1337ionist collectors that gotta catch them all, of course...

Either way, thanks to a quite well balanced premium system, that gives the premium users nice incentives without penalizing the non-paying crowd, and a quite enjoyable game that is fun to play even when "grinding", I think they reach a much better spread of paying customers than the Las Vegas type Whaling casinos some mobile games seem to be.

Really, if you create a free game people would actually pay for, a lot of them might pay anyway because, you know, they like the game and want to support the devs.

And you can still Whale all you want without hurting the perception of the game as pay2win if you target collectors and individualists with premium vehicles and vanity items that do not give them ingame advantages, just lots of snubish individualism and envy from the other players.

Sorry for wall of text

And for Flappy Bird, doubt in game advertisement counts as freemium

I wasn't suggesting it did. I'm just pointing out that mobile games exist on a spectrum, from ad-supported through freemium, all the way to paid.

When you are deciding where to place your business model on that spectrum, it comes down to whether it easier for you to motivate 1 person to spend $50, 50 people to spend $1 each, or 15,000 people to watch ads?

I see your point, just for the records I hate games relying on showing advertisement which means they have nothing to offer suitable for monetization imo.

Most of the thinking today around freemium monetization is such that whales and "chum" (as I like to call Freemium freeloaders who won't participate in the ecosystem) are a sort of natural consequence of the way in which the developer tunes their games. In short, developers tend to take the simplistic view that their sole goal is to increase revenue without consideration pf what share of that revenue comes from a certain amount of people. To their models, earning more revenue means the average player is more happy, even if all increases in revenue were due to whales. Its not a very realistic picture of the health of the game, and I find it pretty cynical, but its what they do. These games don't have a flatter revenue spread because they don't consider optimizing for it.

Given the dearth of "free" entertainment available today, you will always have people who are unwilling to buy into the entertainment they consume -- they'll grind forever if it doesn't cost them anything, or they'll just move on to the next thing. You'll never generate any revenue from them except from advertising. However, because of the need for a large, immediate user-base to penetrate the top-apps list where you need to be to make real money, they are necessary to the success of your app. The typical freemium titles use them to gain placement, which in turn draws whales to the game -- that's why I call them "chum".

Likewise, you'll always have whales who will buy every transaction available, either because they really enjoy the game or because of their own compulsions. The trade-off of relying on whales is that most games encourage whales by making high-end items exclusive, scarce, and/or powerful so that they can charge a high premium to an exclusive clutch of players. This has obvious effects on game balance, and also impacts who the developer will prefer to keep happy as the game changes and evolves -- a move that would alienate whales will never be considered, even if it would make the average player happier at a rate of 100-1.

I don't think eliminating the whales or the chum is the point, but I do think that a healthy game would have a strong "middle-class" of players who have spent something and that you'd see a gentle slope from people who have spent the least to those who have spent more, but are not whales. I also think that you'd make the most revenue by establishing such a middle-class of gamers and then focusing on raising the average revenue generated from them, its just that most games haven't figured that out. League of Legends is one that approaches that, so is TF2 -- both games do so by deliberately choosing to do so -- for example, in Leage of Legends, you can't really buy your way to victory because consumable buffs tend to affect the entire match rather than a specific player, which increases the enjoyment for everyone and encourages all players to participate in that economy. TF2 achieves it by making their entire economy of in-game stuff tradable, and through their crate-system which randomizes loot such that its not only the whales who have the best stuff. This is counter to a whale-based economy where exclusivity and scarcity drive revenues.

I aim to make a (MMO) game with a good "Gini ratio" having a broader player base spending money. And liked the term "chum" (although whales prefer planktons ) players who are primarily there to give whales sport in financial terms. I am also interested in "social whales" (I think it is a good POV) of Ninja Metrics ( http://www.ninjametrics.com/social-whales ).

But the point is (unless you're Zynga) , I think no one creates a game to get highest revenue possible (a short term goal) in a long term game. What I worry is if it is because they have to target whales as a game is not sustainable otherwise. So is it because of irresistable urge to exploit who asks for it ( shut up and take my money crowd ) or an unavoidable situation to keep game running.

I think you CAN design a game where a broader class of player are encouraged to pay something, and the whole whaling aspect is less severe.

I think World of Tanks is a good example here. While most players still don't spend a single dollar, it seems the amount of spending players is way above industry standards.

The way they achieved this is ironically by making the paid items balanced and not game breaking. There are the "wallet-warrior"-whiners, but everyone that is a little bit knowledgable knows that MOST bought items and tanks are actually quite balanced (there are some OP premium tanks, but they seemed to be mistakes by certain designers that the dev cannot remove anymore without people threatening to sue them).

All the items that were pay-to-win in the beginning (better gold ammunition, some enhancing consumables) can now also be bought with normal ingame currency. They are not cheap if not bought with real money, but a very good player can afford them and still make a profit ingame.

Most of their revenue nowadays comes from players trying to grind faster with premium accounts (which will just increase the amount of exp or ingame money earned, not help you win), and people collecting virtual tanks. Their premium tanks seem to be quite sought after, not because they are OP (With very few exceptions), but because they again make additional ingame money and exp, help train the crews of other tanks, and because some of them are either wonderfully weird or even quite famous tanks people want to play.

And then there are the comp1337ionist collectors that gotta catch them all, of course...

Either way, thanks to a quite well balanced premium system, that gives the premium users nice incentives without penalizing the non-paying crowd, and a quite enjoyable game that is fun to play even when "grinding", I think they reach a much better spread of paying customers than the Las Vegas type Whaling casinos some mobile games seem to be.

Really, if you create a free game people would actually pay for, a lot of them might pay anyway because, you know, they like the game and want to support the devs.

And you can still Whale all you want without hurting the perception of the game as pay2win if you target collectors and individualists with premium vehicles and vanity items that do not give them ingame advantages, just lots of snubish individualism and envy from the other players.

I think that distinction between an F2P and a P2W game is if "there is a way to outsmart a paying one" or not. So I am ok with some advantages of paying players unless it doesn't enable god mode, doubt cosmetics have a good ratio to sustain a game.

I think that distinction between an F2P and a P2W game is if "there is a way to outsmart a paying one" or not. So I am ok with some advantages of paying players unless it doesn't enable god mode, doubt cosmetics have a good ratio to sustain a game.

Well, I could be wrong, but I think for some games vanity items DO bring in a ridicolous amount of cash (especially compared to their usefulness). I am not 100% sure TF hats and WoTs Premium tanks could bring in all the cash alone. But I DO know that at least in WoTs case, besides the premium tanks its mostly the premium accounts that drive the gold purchase, and AFAIK, premium tanks are equal or a close second to that.

To be fair though, the premium tanks are NOT just cosmetics. They are actually (mostly) quite well balanced to give a slightly different playstyle, while not being more powerful than normal tanks, and instead give additional perks to lower the grind. So while they are clearly not P2W and are actually more of a collectors item, they still provide enough advantages to make non-collectors interested in at least one premium tank.

Second point is: virtual tanks are highly attractive to virtual collectors. Generally they are closely modelled after historical vehicles, so both tank-nuts and history buffs might drool over them and go into pokemon-mode with their credit card... something that is much harder to achieve with hats, which not only will not make people not interested in vanity items buy them because of (to my knowledge) zero ingame bonus, but will also not really tap into the collector tastes of its normal audience as much (TF would have to sell weapons for that, I guess)

I think that distinction between an F2P and a P2W game is if "there is a way to outsmart a paying one" or not. So I am ok with some advantages of paying players unless it doesn't enable god mode, doubt cosmetics have a good ratio to sustain a game.

Well, I could be wrong, but I think for some games vanity items DO bring in a ridicolous amount of cash (especially compared to their usefulness). I am not 100% sure TF hats and WoTs Premium tanks could bring in all the cash alone. But I DO know that at least in WoTs case, besides the premium tanks its mostly the premium accounts that drive the gold purchase, and AFAIK, premium tanks are equal or a close second to that.

To be fair though, the premium tanks are NOT just cosmetics. They are actually (mostly) quite well balanced to give a slightly different playstyle, while not being more powerful than normal tanks, and instead give additional perks to lower the grind. So while they are clearly not P2W and are actually more of a collectors item, they still provide enough advantages to make non-collectors interested in at least one premium tank.

Second point is: virtual tanks are highly attractive to virtual collectors. Generally they are closely modelled after historical vehicles, so both tank-nuts and history buffs might drool over them and go into pokemon-mode with their credit card... something that is much harder to achieve with hats, which not only will not make people not interested in vanity items buy them because of (to my knowledge) zero ingame bonus, but will also not really tap into the collector tastes of its normal audience as much (TF would have to sell weapons for that, I guess)

I had read somewhere (prolly here at GD) that all people are not super rational (paying more for less when getting bulk game currency, acting as collector) , hope I can find a sustainable mechanism not to exploit weaknesses or overcater whales.

I had read somewhere (prolly here at GD) that all people are not super rational (paying more for less when getting bulk game currency, acting as collector) , hope I can find a sustainable mechanism not to exploit weaknesses or overcater whales.

I personally like to think of it of creating something that is highly valued by customers, no matter what its true worth is.

Lets take personal computers for example. For some reason, Apple computers usually demand a premium over a similarly specced no-name PC, and even then sell like hotcakes while the no-name PC waits for the Sale season in the shop shelf.

IF you look at the raw specs, there might be one or two clever solutions from Apple, but nothing groundbreaking. If you look at the build and materials used, Apple usually is rather on top of the game, still, the asian no-name companies learn fast, and apple look-and-feel-alikes are a dime in a dozen nowadays. If you look at the OS and Software, things tend to get even more "religion" and less tangible advantage, even though the difference is bigger here.

Apple, of course, has a recognised Brand by now and is master of advertising and selling stuff.

The combination of all these small things adds up to a product people really want to posses if they need it or not, rather than have to buy because, you know, gotta own a notebook nowadays.

From what I have seen is that by applying similar strategies in online economies, you can design a virtual good people want to own, even though it gives them little ingame advantage.

It could be a different playstyle, a better looking vehicle/hat/mount/whatever, faster leveling, a recognizable Brand/Person/Name/Whatever as opposed to a no-name one, the urge to finish a virtual collection (maybe by additionally giving achievments and additional goodies for completing the collection), that drives people to invest money in virtual goods without ingame bonus.

Lets say, you have a game where you fight cowboys as an Indian. it is free to play, and you get a no-name Indian. Good looking, but rather bland chap, with his single feather, and rather dull looking equipment. Does to job fine.

Or you could buy an alternative character to play as, Crazy horse. It is a historical figure many know about, and many might want to play as rather than average joe Indian warrior. Then you get this amazing 3D model, with the Feather crown, sparkling looking clothing and amazing weaponry. A true chief amongst Indians. Perfect to show off in front of these free loaders.

Make him play a little different (we know Crazy Horse went a little mental in battle, but seemed to be a very talented warrior, so he could be a better warrior, but somehow harder to "control"), but balanced against average joe indian, and some people might just pick him up for that, even though average joe does the job just fine.