Oh Look, By Making LoTR Free Online, Revenue Shot Up

from the gee,-who-coulda-predicted-that? dept

About a year ago, we highlighted how the online MMO based on Dungeons and Dragons had gone free after trying to charge for a while, and showed how going free didn’t mean you lost money, but it could work well as a part of a business model. And, indeed, reports from earlier this year showed that revenue had increased 500% for the “free” game — once again highlighting how “free” does not mean “no money.” In fact, the success of this free effort was so well received that Turbine’s owners agreed to let them open up the Lord of the Rings MMO as well.

And, as a whole bunch of you have been submitting, once again, it looks like, by going free, they’ve been able to make a lot more money. In just a few months, they’ve doubled their revenue by embracing free. The game is now free to play, and so a lot more people are playing — and many of them are choosing to then pay for certain additional offerings within the game. Once again, the point is the same, if you recognize where and how free fits into your business model, you can make a lot more money. No one is saying that everything is free or that anyone should stop making money. It’s all about understanding the economics of how to use free to create a more efficient market to make more money.

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Comments on “Oh Look, By Making LoTR Free Online, Revenue Shot Up”

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24 Comments
Derek Bredensteiner (profile) says:

Re: Re:

WoW does do free as part of the business model, no? They just insert it at a different point. You pay to play more than 10 days, instead of pay to play with more in game stuff.

I don’t think their small monthly fee is a barrier to entry that prevents people from playing their game. The time to download and install, the system requirements, the learning curve, the time commitment, those are larger barriers that I would think they’d want to focus on first.

Anonymous Coward says:

Re: Re: Re:

WoW had relatively low system requirements for a long time (that may have changed). The learning curve is the game.

The barrier for me (and many other former WoW players) to play WoW again is the monthly fee. LoTR and other MMOs are slowly finding this out.

However, I’ve tried several similar F2P games. I want to have an MMO on the backburner, but I don’t have enough play time to justify $15/month. But a F2P system that lets me play as I go works great. When the time comes for me to pay, I don’t mind, since I’ve enjoyed the game for so long for free.

The best part is that even free players add value, since they increase the enjoyment for the paying players.

Anonymous Coward says:

I like where you’re going with this, but an increase in revenue does not mean an increase in profit.

What do all the free players cost them in resources? Bandwidth on this scale isn’t cheap, not to mention processor power and redundancy.

show what the impact is to the bottom line of an income statement and maybe more companies will start buying into the idea.

Jay (profile) says:

Re: Re:

LotR isn’t the only one to do this. Nexon games has been doing this for years. Maple Story, Dungeon Fighter…

With the same concepts in those Korean based games, they’ve come to embrace anyone wanting to play the games and have actually strived in the new markets that they’ve created. Last I’ve checked, Nexon now has a 3D game that’s free to play that looks quite impressive.

(No, I’m not a rep for them, but I have played their games and found them to be just as addicting as WoW can be.

Jon B. says:

I’m not an MMO’er but my MMO-playing friends refer to going free-to-play as a death knell for an MMO. Making the game free to play will change the type of people willing to play the game and therefore alter the dynamics of the community in a way that may scare off the more mature players that have money. Also, giving an an in-game bonus to people who pay extra just means that those who can afford it have a competitive advantage. I’ve never been a fan of giving a competitive advantage to people just because they have more real-world $.

The immediate jump in revenue is expected, but I doubt it lasts.

What’s funny here is that the things that aren’t scare (copies of the game, in game items) are the things that cost money while the the things that ARE scarce (bandwidth, connections, in-game player space) are the things they’re giving away. That sounds lop-sided to me.

Murdock (profile) says:

Re: Re:

Unlike several asian MMOs most use Free2Play MMOs sell items in game that do not give an advantage over another player when it comes to damage, healing, stats, etc. Most everything that you can pay for in-game is a cosmetic or ease of use type of item. New sparkling armor with no stat bonus over non-sparkling armor. More character slots, mounts, etc.

Very few US MMOs sell “power ups” things like “+42 Sword of Smiting” “Fire resist armor” etc.

This helps prevent the rich=powerful situation.

Del Boy says:

Re: Jon B.

I agree with most of what Jon said, except it sounded a bit off at the start:

My MMO-playing friends refer to going free-to-play as a death knell for an MMO. Making the game free to play will change the type of people willing to play the game and therefore alter the dynamics of the community in a way that may scare off the more mature players that have money.

That statement kinda contradicts the rest of his post… but I get where he is coming from.

Me as a player:
Look at Guild Wars as a model: Free to play online. With the addition of yearly additions to the game which you buy. Worked so well that there is going to be a free to play sequel.
As an early EQ player I’m used to pay n play & I have done the whole guild wars thing, They feel different not because of quality in gaming or the free versus pay options.
Its the grind of pay as you play… these games are always targeted at monotonous leveling, kill, med, repeat. Its community is based on status on how well you manage the toil it also keeps you hooked into those pesky monthly payments.
Guild wars caters for a broader level of player & rewards you based on tactical & team abilities.

I’ve tried WOW & its EQ (Everquest)all over again – I doubt now with hindsight that I would want to put so much time into a game just so you can flash off a shiney rare armour set in the community. I have seen marriages destroyed by the pay n play model….you pay so you will play & progress is slow (Makes more cash long term) – so a death siren on pay to play MMO is maybe not such a bad thing.
Short term making the pay to play mmo’s free will increase revenue but long term it won’t work out so well I reckon … not without some other method of topping up the income – Like Guild Wars model.
Money doesn’t make a quality community – it makes snobs.

Xythlord says:

Just because it's free....

doesn’t mean it will work, but it still relies on a smart business model. I have played LotRo since it’s change to F2p and while it is enjoyable, it doesn’t feel like you are missing out by not paying. What they do offer as premium content is game enhancing options to make it easier, faster, etc.

Another MMO, Everquest II has also recently went to a free-to-play model, with the idea that they exclude as much regular content as they can get away with, and charge for everything else. One is inclusive and one is exclusive, and it will be interesting to watch and see which philosophy will prove to be the more economically viable one.

Anonymous Coward says:

No ones mentioned the real elephant in the room…Eve.
Pay to play, and they pay and pay and pay. most serious players have more than one account. They spend ungodly amounts of money. (and every once in awhile a good scam will net someone ungodly amounts of real world currency).
Granted, it’s a special case, nearly a special psychosis all its own. Wow breaks up marriages? Eve has people in the bushes outside someones home, ready to cut the power on demand, so that the enemy titan is floating free for the ambush.

Bengie says:

Re: Eve

I only played Eve for a bit, but in Eve you can buy game time in game.

Several people that I met who only played for a year or two were able to create enough in game currency in 5 days to purchase 30 days of game time for all 3+ of their accounts. 3 seems to be a magic minimum number. One toon to mine, one to move stuff and one to defend.

jsf (profile) says:

Re: Re: Eve

I have played Eve off and on since shortly after it’s launch, and yes most serious players do not spend a dime on the game. Eve has a mechanic where you can purchase Game Time Codes from other players using in game money.

If you have the time, knack, luck or combination of all three you can easily make enough in game money to pay for 2+ accounts.

I know a couple people that got lucky enough early on that have 4+ accounts that they have not paid for in over 4 years. Even as a relatively casual player I was able to pay for one of my two accounts with in game money after about 4 months of setting up my money making scheme in game.

TDR says:

Just to clarify, Del, GW isn’t truly F2P because you have the buy the game initially (and its other campaigns/expansion if you want them) before you can play it. After that, yes it’s free to play as much as you want, which is one of the many things I like about it. It’s the only MMO I’ve ever played. At least until GW2 comes out. That game is going to pwn everything else in sight. Seriously. Looks to literally turn MMO conventions upside down and inside out. Which is cool. šŸ˜€

tuna says:

Re: Re:

The D&D online basic game is free to download. We game as a family and have been enjoying the game without spending a penny.

If we get to a certain level we may buy the expansions but I think the basic game will probably take us a year or so to get through.

I canceled my WOW account almost immediately after downloading this.

Old EQ Player says:

Pay model still exists, madness.

I have stopped playing Everquest when the level cap was 70.
Several years ago.
I had a level 70 Wizard & Beastlord. It took me 3 years to build these characters up, the leveling was so slow & I had only a limited amount of time in which to play, Family, Friends & work always came first.
I quit because I realised just how little I was getting from the game in terms of real life advantages in the real world.

I still have 1 friend who still plays it. His hours of play are about 5 YEARS out of the 8 or so EQ has been around.
No surprises then that hes single – no job, 37 & lives with his mum.

When I visit him he is always on a raid & has very little time for me while I’m there.

So I re-activated my account for a month just to see if the game still had any interest to me. My friend invited me into his guild which lead me to a raid that night.
I arrived at the raid meeting point then spent 3 hrs waiting on everyone showing up, getting ready etc…
I sat there numb watching everyone floating up & down in levitate spells. It all came back to me in a rush.

It was like watching a film you have seen a million times but never really liked. I found the blank wall next to my monitor more interesting to stare at.

Finally the raid got underway… 10mins later 60+ dead people & a promise of another 3 hr wait while everyone recovers….

I logged off. Deleted the EQ folder, snapped the disks & felt so much better for it.

Never ever ever ever again. NeverQuest.

Guild wars rocked as I could log in play a good game no matter what level I was, then not play it again for months without falling behind my friends so badly that it was a problem.

Guild wars 2 – promises a blend of the original GW & current style MMO’s like WOW. Free to play – and most importantly no need to get 30hrs a week in just to be cool.

Magnificent Nobody says:

MMO Addiction.

I’m surprised no one has mentioned the increased correlation we’re beginning to see between MMORPG’s and the drug trade. People were already starting to complain about the addictiveness of video games, MMO’s in particular. Giving away “free samples” in the hopes of creating buzz around your product is nothing new. Give the masses something to become addicted to, then profit from that addition down the road. It’s a smart, proven tactic. If Blizzard had done this back in 2005, the wife and I probably would have stayed with WoW for much longer.

Maxwell Evans says:

Eve

EVE’s player base is reason enough to play the game, to be honest. I’d probably pay my subscription even if EVE was little more than a chat room.

Of course, if it was just a chat room, the player base wouldn’t be nearly so excellent.

EVE weeds out the young and the socially inept with a certain iron ruthlessness. You must make friends in the game to survive, let alone progress, and experienced CEOs and Executors have information nets that ensure they’ll know pretty much everything you’ve ever done on the day you apply to join their ranks.

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