The “App Store” lawsuit between Apple and Epic Games has not yet concluded. The dispute between Apple, which protects its own interests, and Epic Games, which forces Apple to share the profits of the App Store, has not yet been concluded. Although Apple is forced to open its App Store in Europe under EU policies, it has not yet given in in other regions. However, Disney doesn’t care about this. In order to launch a new business, they chose to invest US$1.5 billion in Epic Games. The target is the little golden chicken “Fortress Heroes” behind the company-the most popular service game in the world.
Game as a Service (GAAS) first originated from massively multiplayer online role-playing games (MMORPG). Players need to subscribe to the game to obtain a continuous experience, and game manufacturers also need to continue to provide game content updates for players. Players keep playing. However, games with a monthly fee system are highly competitive. Therefore, in the United States, South Korea and other areas where early online games were more developed, in-app purchases of props and character upgrades quickly appeared. This approach also made service-oriented games more popular. consumption patterns began to gradually change.
The vigorous development of Facebook’s earliest social games also led to the development of this type of business model. Later, between 2010 and 2011, after iOS and Android added in-app purchase functions, this consumption model also appeared on mobile phones. The business model of “purchasing items” has also begun to become more and more common in home console or PC stand-alone games, and the DLC (Downloadable Content) business model has also begun to enter the players’ field of vision in large numbers. Many stand-alone games that have been purchased with money, DLC that requires more money to obtain other content has also begun to disgust players. The most famous one is the Darth Vader Gashapon event of “Star Wars: Battlefront 2” – it is a shooting game that has been bought out, but can be purchased through Spending money on gashapons to quickly acquire powerful characters puts players who also spend money into an unfair situation.
▲ DLC revenue in 2022 will be nearly 50%, which is a glorious period for DLC. (Source:Newzoo）
Traditional service-based games refer to “the game itself is free”, but there will be character appearances or powerful props that need to be purchased. Revenue from these “items” is used to maintain game operations: representative games of this type include “Genshin Impact” and “Fortress Heroes” , “League of Legends”, etc.; in addition, it is a payment buyout, and you need to pay to purchase other content or purchase props and character appearances. Representative games include “The Witcher 3”, “Diablo 4”, “Civilization 6”, etc.
Service-based games, a theoretical permanent revenue generator
For game manufacturers, a major advantage of service-based games is that they can stabilize and grow revenue through continuous revenue streams. Game developers can continue to make profits after the game is released, rather than relying solely on one-time revenue from the initial sales of the game. . In addition, through regular updates and new content, game manufacturers can maintain player participation and interest, thereby increasing player retention and recommendation rates; for players, service-based games provide continuous gaming experience and freshness. Players can look forward to regular updates and new content, allowing them to keep getting fresh content in their favorite games without letting them become stale. Since the game community is now extremely developed, players can also use the community to reflect their own ideas and thus influence the future development of the game.
Games such as “Fortress Heroes”, “League of Legends” and “Become a Creator God” should be famous examples of service-oriented games. These game types are also very different, whether they are shooting games, DOTA battles, or world building. Etc., these games do not have a basic threshold for consumption. The main purpose is to create a game that is fun and has a high player retention rate, and then makes money by selling appearance, materials, etc.─And service-oriented games like “Absolute Force: GO” The scarcity that the game gives to appearance materials also makes players willing to spend a lot of money to collect rare appearances.
▲Part of the cooperative appearance of
Games such as “Diablo 4”, “The Witcher 3” and “Civilization 6” are extremely popular, so players are willing to pay to continue to purchase expansion content – even if games such as “The Witcher 3” and “Civilization 6” are released later. It has been more than seven or eight years, but due to its open nature and constant updates, players are willing to keep playing it again – and at the same time, players will have more confidence in the company’s next game.
Maintaining revenue requires a lot of development efforts and decisions
However, for game manufacturers, continuing to provide game updates and content means that they need to spend more resources and efforts to update games under the same game structure. The balance between development costs and business models is also a headache. Different from single-player games that require a one-time payment, true service-oriented games need to be developed from the perspective of “sustainable game operation” so that players can stay active in the game.
Service-based games that are free and rely on in-app purchases sometimes sell some powerful props or characters, causing the game to become a “pay-to-win” situation. Players with more paid content in the game , you will have unfair advantages─sometimes these advantages are powerful characters, and sometimes they reduce a lot of time. This can lead to pressure on low-spending or free-to-play players. For this kind of free game that specifically uses in-app purchases as a means of profit, from the early stage to the middle of the game, paying players will account for a certain proportion of free players. Therefore, the more players you recruit in the early stage, the more paying players you will have.
But as the game’s mechanics gradually improve and players begin to enter a cycle of doing the same thing every day, free players will leave faster than paying players, so the proportion of paying players begins to increase, but this also means that the game There are fewer and fewer novices entering the game, causing the game’s revenue growth rate to begin to decrease. Typically during this period, some developers may rely too much on content updates that force players to consume, leading to players leaving who feel the payment is increasingly worthless.
Disney launches new foundational strategy
One of the most successful service-based games in the world, “Fortress Heroes” has always been at the top of the battle royale shooting game and a source of confidence for Epic Games to compete with large companies. Nearly seven years after its release, the game is still being updated continuously to maintain revenue and player numbers. The most powerful business method of “Fortress Heroes” is to cooperate with various IPs to allow players to use different game or cartoon character appearances. This is also an important factor in Disney’s willingness to invest US$1.5 billion. IP cooperation is particularly important for content manufacturers like Disney.
Although service-based games provide a sustainable profit model, they also require continuous investment to maintain player popularity and stickiness. Players’ perceptions of “free games” and “paid games” will also affect the design model of game companies. But currently, the most successful DLC in the world is the free game appearance, and the most successful Lootbox is the beautiful or powerful character. The more money you make players pay, the harder it will be to leave. A game that only buys appearance is easier for more players to stay regardless of whether they pay or not. The opposite is true for a game that requires spending money to strengthen itself, but designing appearance is better than using it. Items or characters that make players stronger are more difficult.
But for Disney, it is more important whether the fantasy characters they create can endure for a long time. Therefore, games that sell appearance like “Fortress Heroes” may be more in line with Disney’s own needs and appetite.
(Source of first picture:Flickr/steamXO CC BY 2.0）
