View From the Road

View From the Road
View from the Road: No Such Thing as a Free Lunch

John Funk | 7 Jun 2010 17:00
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There's an oft-repeated acronym in one of my favorite novels, Heinlein's The Moon Is a Harsh Mistress: TANSTAAFL - There Ain't No Such Thing as a Free Lunch. It's a common saying both in and out of the book, and one that you've probably heard before. Its meaning is twofold: Literally, it means that somebody is paying for everything, even if you aren't. If you're being treated to lunch, the money is coming out of somebody's pocket. Even if it's on the house, they're taking a loss by using ingredients and manpower that they could be using to make money, but aren't.

It also has a figurative meaning: If you aren't paying with cash, you're expected to pay in some other way. Maybe I'm buying you lunch because I want to make you think more favorably of me. Maybe this is a business transaction and I want you to go with my company. Maybe I just want you to owe me a lunch later.

This saying also applies even if we're talking about, say, games instead of food. Between Friday's announcement that Turbine would be taking yet another of its formerly subscription-based games - Lord of the Rings Online - into the free-to-play market and the success of games like Sony's FreeRealms, it seems that "free-to-play" is a popular business model in online gaming these days.

TANSTAAFL. Nothing is free.

See, the reason that most MMOGs historically use subscriptions is because they're incredibly expensive to operate. On the technical side of things, you need to pay for hardware, electricity to keep your servers operating, maintenance fees, bandwidth charges, and the like. Just keeping the 20,000 or so computers that comprise WoW's server clusters up and running runs Blizzard a staggering $136,986 per day. That's before you factor in the money that has to go to the technicians, the maintenance teams, and the armies of customer support representatives who help players in-game - and every new player means a slightly heavier load.

That $136,986/day figure, by the way? That's just what it takes to keep the lights on. MMOG users expect a continually evolving world. These aren't games where work stops after you ship. Programmers, artists, writers, voice actors, modelers, designers - they're all working on new content every day of the week, and they have salaries that need to be paid, computers and workstations that need to be upgraded and maintained ... you get the idea. Manpower isn't free; neither are electricity or computer parts or anything like that.

These expenses don't suddenly go away when your game becomes free-to-play. You still need to keep servers up and running, and you still need to pay people to create new content lest your community get bored and go play some other game. But now, you don't have guaranteed revenue streams from subscription - you need to find some other way to monetize the game.

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