【DTCG/DCCG】 What’s the ideal business model?

It looks like the Zems developer is at the stage they are seriously considering changing their business model from Free to play digital CCG to buy once business model.   Earlier this year, Duelyst CCG successfully completed its kickstarter with original business model of Buy once but later they decided to switch to Free to Play model.  So what’s the right answer?  Why did one company switch from one to another, and now the other company is looking to switch from the other way around?   Let’s take a closer look about this topic as a player point of view.

3 basic business models for digital card game

I like to simplify things and usually I do so by classifying.  For the digital card game business model, I see basically three types of business models.

  1. Free to play digital card game (F2P dCG)
  2. Pay to play digital card game (P2P dCG)
  3. Buy once digital card game (B1 DCCG)

We all hear the term, pay to win model, but that’s really a general limitation of business model #1 which I will discuss below.

First let’s take a look at individual model and how they differ in approach.

F2P dTCG/dCCG

Free to play refers to the fact, players can play entire game for free if they so desire. But we all have to understand, nothing is free in this world.  The developer spent money to build the game, and maintain server.  If there is no money making potential, the game would not have born.

So how the company makes money?

P2W Model

This is an infamous name for F2P model.  Basically, game allows option to play game for free, but also gives option to buy cards/packs with real money.   So in theory, player can play everything for free and get potentially every cards, that takes long time and before they can do so, others can simply pay and buy cards.   As a result, those who paid money and got better card can win game and result in unfair game.

Now, the WIN part can be modified and make game theoretically not P2W.  By this I mean if your starter free deck is as strong as other customized highly competitive deck then yes by definition it is not pay to WIN.  But perhaps your potential fun for the game is still restricted as you may not have full access to other cards that the player with money can get access to.

T2W Model

Alternatively, one may make money from advertisement but that would require significant number of players and playtime.  Even in an ideal world where NO player is allowed to spend a dime for the game i.e. no element of real money pay involvement,  the game technically isn’t a true free to play.  Why?  This is because your/our time worth more money than any digital card game provide you.

Let’s say a game gives you $1 worth of in game money every hour, which is far generous than any existing game currently does, but guess what?  It’s far below minimum wage.

Example: Games fit under this category include Hearthstone, HEX, Solforge, and many mobile platform digital card game

P2P DCG

Basically, it’s a digital card game analogous to real world trading card game i.e. one pays money for every booster pack and there is no free component.

The best example in this category is Magic the Gathering Online. The game requires players to buy booster packs and there is no free card element.

Magic succeeds with this model because of its name behind it, and physical counterpart.  Given the physical card popularity, digital counter parts allows those player to practice the physical card game.  Furthermore, Wizards provides option to trade digital game collection into physical card counter parts once all cards in set are completed i.e. essentially making general values of two equivalent.

Example: Magic the Gathering

B1 DCG

The third kind is buy once and play all the content model.  This is basically a classic model for video games.  You buy a playstation 4, Xbox One, or Nintendo Wii U game and then you are allowed to play entire content.

Example:  Scrolls CCG, Faeria SCG

Advantage and Disadvantage

F2P

Advantage

For players: This one is obvious at least at the first glance.  It’s free.  If you don’t plan to fully dig into the game, this is an excellent option as a player.   Because larger player pool is much easier to retain, even paid players benefit as we have better chance finding others to play with.

For developer: Easiest model to attract larger number of audience as the game is free. Anyone can potentially try without a fear.  Then once players start the game, the game can show its potential and potentially ADDICT some of them who are the ones that start spending real money into the game.

Disadvantage

For players:  Once a player gets serious about, the game becomes P2P, which itself may not be a true disadvantage if the game is fair in market value.  But what’s unfortunate is there is general tendency that F2P game market price are expensive especially for more hardcore gamers as the game is generally not designed to allow people to complete playset.  So it may be ok to put money every once and a while to boost a fun little, but serious money sinking in this type of game is usually risky and no value.  Particularly, games use dCCG with crafting system need to be looked carefully before spending too much money.

For developer:  F2P part is for advertisement, but limiting the game results in no longer F2P by certain standard.  In which case, the game loses advertisement value with bad reviews.  But then, if the game is too generous, those potential players who may have considered paying for the game feels no reason to do so.  So basically, developer needs to find a good balance spot where time and money are considered reasonable compensation between both end of groups.

P2P

Advantage

For players: I personally don’t see much true advantage here other than the fact, you know everyone is paying for the game and so no internal debate of why am I spending money when there is others who aren’t spending penny?

But again, to me F2P is nowadays simply a P2P for most core DCG players as most of us won’t satisfy with simple F2P element/limitation.  In general, we are likely to have more fair market game values in this type of game.

For example, Magic’s cards are expensive but we can sell them and values are relatively retained.  So it is totally possible for player to keep trading cards and go on even with newer expansion release.

For developers:  Obvious one here is every content they make costs to players.  No need to worry about free or devaluing your system.  If game remains popular, this model provides highest income to the company.

Disadvantage

For players/developer:  For this system, the disadvantages are the same for both players and developers.  The risk of game closing down always exist.  But P2P game especially when no established name behind is very risky.  Because the game may not have enough players in pool to play, which result in existing player to quit the game or not spend money, which further stagnates the game i.e. developer income, and results in less content update.  You see vicious cycle here.  Basically, this model nowadays, probably only works for game like Magic, but otherwise, they has to use F2P with P2P element.

B1P

Advantage

For players: This one is very obvious.  Players get to play all content by single pay just like a game you buy for console system.

For developer: It is likely to be easier for developer to get funding on kickstarter as player knows what they are exactly paying for.

Disadvantage

For players: The game has no trading component or even collectible component may be not as strong because simply everyone gets all.

For company:  The company needs to sell enough copies of game to make original development cost, but to me this is same as in any other model.  One concern company may have is what about constant update with new sets etc?  I personally don’t see much issue here.  It’s same as downloadable game content in may of console/computer games.  The company can continue to sell expansion with set fee each time they release one.  But obviously, the cases aren’t as easy as I think.

https://scrolls.com/wp-content/uploads/2013/05/Wallpaper_art.jpg

Scrolls used B1P model and merely after 4 years or so of its original announcement, the game is shutting down.  Now it may not simply because of the business model they used, but at least one sad example here.

Zems Online Case Scenario

So at last, let’s take a look at a real world case scenario.

The game is currently on Kickstarter and still 19 days remaining but they are at $5,233 out of $40,000 goal.  It looks like based on some comments from players, the developer is very seriously considering to change the business model from Hearthstone like Free to play (F2P) digital CCG model to B1P.

Personally, F2P dCCG is one of a red flag to invest because dCCG component prevents the game from having real monetary value in an event you want quit or simply even in a case you want to make certain type of deck, it becomes too costly.   Don’t get me wrong, I like the F2P part as I can play the game casually, but probably won’t consider putting real money or at least significant amount.

Now if this was F2P dTCG, I personally feels much more comforable, but as a player perhaps the best option is B1P model as long as the game can keep enough player base.

Zems Kickstarter Page

Duelyst CCG Case Scenario

undefined

This game actually done an opposite.  During kickstarter, the game promised to be B1P model and raised $137,707.  But later the developer decided to switch the business model into F2P CCG model.  The main reason behind this sounds like it is difficult to sustain the value with one time sale.

Duelyst Official Site

Simple Math is Answer

What business model is most suited for dTCG/dCCG, I believe really comes down to simple equation:

(# of paid player) x (# of average money spent per player) – (cost of game).

Yes. this is really simple math as it simply calculates total profit the company makes.

In F2P model, generally company relies on # of paid players to be much larger as F2P portion attracts wider range of  people and perhaps individually may not spend as much but total numbers are significant.

In B1P model, # of paid player is lower but each sales of game would get the company $X.

Though estimating those numbers are always challenge.

Conclusion

As a player, B1P is certainly a very attractive option at first glance, but perhaps sustainability of the business model for long run may not be easy.  In which case, as a player, we may lose whole game merely within a few years e.g. Scrolls.

Although there is no guarantee even with F2P, when dTCG is utilized rather than dCCG, there is a chance that players may be able to sell their inventory as long as during the time the game is staying healthy.  So personally, I feel this model is the best option.

What do you think is the best business model in dTCG/dCCG?

 

 

 

 

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: