In 2004, I traveled to Thailand to learn more about young gamers who congregate in Internet cafes to play online games. With the help of bilingual research assistants, I interviewed approximately 60 gamers, parents, and game shop owners. On average, each interview lasted for approximately half an hour.
In May of this year, I returned to Bangkok and Chiang Mai for a second round of data collection. We interviewed approximately twenty participants, and these conversations were even more detailed.
I'm writing up most of the results elsewhere, but one of the most intriguing findings to emerge from this longitudinal project seemed more appropriate for Terra Nova.
Simply put, the finding is this: free-to-play virtual worlds pose an enormous threat to those worlds that require users to pay for gameplay. This surely comes as no surprise to regular readers of this forum, but the topic deserves further discussion.
In 2004, the game Ragnarok Online was nothing less than a cultural phenomenon in Thailand. Daily newspapers and weekly magazines carried stories about the game, and cyber-cafes were packed with obsessive Ragnarok fans. For most Thai youth over the age of 12, Ragnarok was their very first experience in a massively multiplayer virtual world.
Thai teenagers do not have access to credit cards, so developers came up with a different system for extracting payment. Local convenience stores such as 7-11 and Family Mart sell cards for a wide variety of on-line games. Ragnarok players can purchase chunks of game time by purchasing one of these cards. For 399 baht (approximately $10), a gamer can buy a card that guarantees unlimited monthly play.
Two years ago, most of the gamers with whom I spoke were quite pleased with the game's pay-as-you-go system. They loved everything about Ragnarok, and the costs seemed reasonable.
Today, the situation has changed dramatically. Although Ragnarok still has a small core of devoted followers, most have moved on to other titles such as PangYa, Lineage II, or Maple Story.
This trend alone is not very suprising. As Richard Bartle, Jessica Mulligan, and Raph Koster (among others) have documented, MMO growth and attrition patterns are relatively easy to predict. However, I was particularly intrigued by the reasons that participants mentioned for quitting the game.
When asked why they had given up on Ragnarok, many gamers mentioned that they had become bored with higher-end play. "When I reached the highest level," reported one player, "there was nothing much to do except wandering about and maybe fighting with other players." Another gamer described the game as "a dead end."
Once again, widespread disappointment with end-game content is not exactly earth-shattering news.
Yet, almost every single player who had quit Ragnarok mentioned that they could no longer justify spending money on a game that was no longer fun. It was especially difficult to justify this expenditure in the face of games that (seemingly) cost absolutely nothing. Thus, many Thai youth have stopped paying subscription fees and moved – in droves – to “free-to-play” games.
As noted in previous Terra Nova discussion threads, the free-to-play business model allows players to participate in fully functional virtual worlds without paying a single penny. (Or, in the case of Thai gamers, a single Baht.) However, in order to obtain attractive clothing, powerful weaponry, and new character classes, players must convert real-world money into in-game currency. (Note: In an attempt to balance the economy, most of these games have two types of currency: (a) the currency that is generated as a result of activity in the game, and (b) the currency that one can purchase with real-world money.)
The free-to-play games have been enormously successful. Maple Story claims to have 47 million players, while Yulgang claims to have somewhere around 400 million. These figures should be taken with bushels of salt, but the free-to-play model is clearly successful. And, as my research suggests, the free-to-play titles have seriously weakened Ragnarok's player base. (Lineage II, on the other hand, appears to be doing very well.)
During the coming year, NCSoft will introduce several on-line games targeted at American audiences. Dungeon Runners (fantasy), Smash Star (tennis), eXteel (robotic warfare), and Soccer Fury (soccer) all rely on the free-to-play model that has been so successful throughout Asia. Games like Maple Story and Pangya are already available in Europe and the United States.
In the long run, what might this mean for the future of Azeroth, Norrath, and Telon? Have these free-to-play games already started stealing players away from the market leaders? Will younger players and low-income players gravitate toward the free titles, while older and more affluent gamers continue to shell out monthly subscription fees?
What do you think?