Monetization expert: MMOs are dying because of clueless design, not insufficient demand
MMORPG players just love it when somebody declares the MMORPG dead, right? All those games you’re playing, all the games we’re writing about and sustaining us? Zombie games! You’re imagining it all! Thanks, mainstreamers!
Today’s somebody, admittedly, is Ramin Shokrizade, an economist and author well-known for his career and expertise in gaming monetization specifically, and he doesn’t mean literally dead in today’s piece on Gamasutra, in spite of its title. “What Killed the MMOG?” is an excerpt of an unpublished paper he penned in 2009 on RMT: real-money trading/transfer and gold farming, a problem developers told him “had no solution.”
Shokrizade describes the “industrialization” of RMT in factories run by massive organizations in China dedicated to making black market botter cash off the burgeoning MMO market in the 2000s. “Since the accounts are optimized for profitability, they tend to bring in perhaps ten times as much coin per hour as a maximum level account played for entertainment purposes, and hundreds of times as much as an account at half the level cap or less,” he wrote. Consequently, paying for in-game cash from RMT companies was just a logical move for buyers.
The problem, of course, as Shokrizade defines it, is that RMT devalues other in-game items, harms the economy, causes psychological damage, wrecks the currency balance, and sucks prestige out of play.
Since the paper is from 2009, it also includes a section on the not-then-dominant studio-sponsored RMT, suggesting that it had not yet yielded much success.
“A final point is that when money that a consumer has budgeted for gaming goes to an RMT site instead of the company that produced their game of choice, that money is removed from the development cycle. Some estimates have put this amount as high as 50% of the total spending by online gamers. This money does not go to paying developers, producers, stock-holders, and other investors and thus does not promote future product development or advances in interactive media technology. Some producers are aware of this problem but since they have already surrendered to the RMT industry, their countermeasures have mostly taken an ‘if you can’t beat them, join them’ approach which has to date yielded limited if any success.”
In other words, he was effectively arguing that RMT, one way or another, killed the MMO. Accordingly, his modern addendum to the paper points out that the “massively multiplayer” game has been surpassed, in part because it turned out that “developers would not wait for third parties to kill their economies” but instead did the destroying “themselves through the use of microtransactions and other methods.”
Moreover, “solving those problems was the goal of the 2009 Sustainable Virtual Economies and Business Models paper,” he posits. “MMOG’s have not been failing commercially from lack of consumer demand. They fail because they are thrown together almost randomly (what I call ‘Frankenstein Style’) without an understanding of the requisite systems for success.”
Even if you disagree, it’s still a fantastic overview of the RMT issues facing gaming, historically and in the present.