Loot boxes and Micro-transactions

Mark Hamill wrote: »

Destiny 2, Forza 7 (is it 7?), Battlefront 2 (4 really) and Shadow of War are all sequels of popular gaming franchises. The Witcher example shows how word of mouth with reasonable advertising will get you big sales and will make you millions of profit if you actually make good games. Instead of what is happening now, making bad* games with exploitative gambling mechanics in order to catch whales and dolphins.

Sorry, I don't think I was entirely clear there, to clarify my point was that the profit made was comparatively low given the factors I listed. As it happens, I actually misread the link I posted, the $64m profit made by the company was from all revenue which includes the rest of the CDPR games as well as from GoG which they also own. I can't seem to get an exact number for the profit so I'll talk a bit more generally below.

So, with respect to The Witcher 3, when we break down the figures more, we see the marketing costs for The Witcher 3 represented $35m of the overall budget, roughly half the budget for the base game. That's about in line with what most publishers spend on larger titles with the exception of EA and Activision. Whether or not that's regarded as reasonable is a bit subjective I guess. As for how much it made, making millions of profit is, in the games industry at least, fairly useless. CPR are a bit of an exception because, as I said above, they also own GoG which brings in its own revenue but during the four years of development of TW3 as well as whatever work was being done on Cyberpunk, those teams weren't bringing in any money. So they ship it, it does well and they make, lets say several tens of millions of dollars. Now, they move onto pre-production for their next title and ramp up production on Cyberpunk. What's going to pay for it? That money they just made from The Witcher 3. I mean don't get me wrong, I'm sure some executives will get a new BMW out of it but generally speaking if you're going to sink ~$80m into a project over that period of time, you're going to need a hell of a return to be able to just start all over again on your next release.

Mark Hamill wrote: »

That article about EAs budget came from 2009, when Modern Warfare 2 came out. MW2s production budget was ~$50 million. Its marketing budget was $200 million!
That means MW2 needed to sell 5 times as many copies to break even. That means it had a 5-fold increase in risk. It is the marketing that is driving the budget to unreasonable limits and it's the marketing that bring that huge risk.

General point: **** this for starters. Activision announced a long time ago they were only interested in billion dollar franchises (where did the vomit smilie go?) and have since made it fairly clear they intend to use marketing, rather than relying on critical acclaim to achieve that. To be fair, I'd wager that no game or even franchises for that matter without a titanic marketing budget or astronomical levels of success can actually do that which is why the list of games which have is rather small, the likes of League of Legends, Overwatch, Halo and Assassin’s Creed being notable members of that club.

But yes, you're correct, there's definitely a fine line between needing a large enough marketing budget to effectively market your game in order to sell enough copies to justify your budget and that marketing budget being so high that it makes it incredibly difficult to hit enough sales to cover your overall budget. But even if you look at The Witcher 3 as a happy medium in this respect, it still represents a massive risk for any publisher. Just because EA and Activision try to go full Minority Report with their ad campaigns and their associated price tags, doesn't really negate this point.

Generic Dreadhead wrote: »

Is that speculation of are there figures? Would have thought loot boxes were brining in more moolah

The figures we do have from the last set of financials show Overwatch breaking the $1b revenue mark even before the latest eSports expansion. With sales hitting over 30m at that point, I think it's safe to say the loot box market played a fairly large part of those figures when you look at revenue generated by other games with those kinds of sales figures.

Mark Hamill

gizmo wrote: »

What needs to be considered though is that said profit is off the back of nearly four years of work for a team of around 200 people on the development side alone and was based on an existing and highly acclaimed franchise whose previous games had already sold 15m combined since the release of the original game in 2007. It's these kinds of figures which show why funding any of these kinds of big budget games can be incredibly risky.

Destiny 2, Forza 7 (is it 7?), Battlefront 2 (4 really) and Shadow of War are all sequels of popular gaming franchises. The Witcher example shows how word of mouth with reasonable advertising will get you big sales and will make you millions of profit if you actually make good games. Instead of what is happening now, making bad* games with exploitative gambling mechanics in order to catch whales and dolphins.

gizmo wrote: »

There's an important line in that article you linked. "That’s because advertising is critical to getting a game in the top ten rankings." As discussed earlier, these big budget games need to see big sales in order to earn their development costs back and one of the primary means of doing that is to get as many eyes on them as possible. Word of mouth will only get you so far and the percentage of the potential audience who read games magazines, peruse gaming sites and, even moreso nowadays, use Youtube for news is only a fraction of what these big games sell.

That article about EAs budget came from 2009, when Modern Warfare 2 came out. MW2s production budget was ~$50 million. Its marketing budget was $200 million!
That means MW2 needed to sell 5 times as many copies to break even. That means it had a 5-fold increase in risk. It is the marketing that is driving the budget to unreasonable limits and it's the marketing that bring that huge risk.

*Bad in that while the underlying mechanics may be very good, the overall games are invariably broken in some way to drive sales of micro-transactions.

J. Marston wrote: »

It really is puzzling. Witcher 3 made stupid amounts of money and at the same time, untold amounts of goodwill from gamers because CDPR didn't take the piss. 16 free pieces of DLC when the game came out blew my mind. Those Triss, Yenn and Ciri alternative outfits for instance, any other company and those outfits would have been €1.99 each.

Then the excellent expansions which were brilliant value for money.

If Cyberpunk 2077 has lootboxes and microtransactions, it will be the biggest heel turn in gaming.

I think they will continue they way they went with The Witcher,being independent they are beholdend to only themselves,and Cyberpunk will be a massive seller .

dudeeile

Generic Dreadhead wrote: »

Is that speculation of are there figures? Would have thought loot boxes were brining in more moolah

Of course it's speculation! It is rumoured to cost $20 million just to buy an overwatch team regional franchise though so not all fantasy.

J. Marston

Mark Hamill wrote: »

It's funny how very profitable games like Witcher 3 and Minecraft (before it went to Microsoft anyway) have loads of content and no microtransactions or loot boxes.

It's almost as if spending up to 3/4s of you budget on marketing as you do on actually making the game is not a sensible financial strategy:

Source

It really is puzzling. Witcher 3 made stupid amounts of money and at the same time, untold amounts of goodwill from gamers because CDPR didn't take the piss. 16 free pieces of DLC when the game came out blew my mind. Those Triss, Yenn and Ciri alternative outfits for instance, any other company and those outfits would have been €1.99 each.

Then the excellent expansions which were brilliant value for money.

If Cyberpunk 2077 has lootboxes and microtransactions, it will be the biggest heel turn in gaming.

marcbrophy wrote: »

I don't want to buy RDR2 next year, and have to buy a lootbox to get a better fcuking horse! :mad: :pac:

Thing is with Rockstar,at least they are straight swaps,real money for ingame currency.you know where you stand with it,and for a narrative based game like RDR2 like GTAV,it will have zero impact on enjoying the base game.

SOW2 has done something new here by actively hindering the single player game to a certain degree with lootboxes,and random ones at that..

As for Battlefront 2? what was going on in the demo looked disgraceful if you look at the time it would take to actually earn the ingame loot by playing versus buying the boxes.. I imagine after the backlash they will do a bit of back peddling but the fact that with these 2 games the main chat online is about a system that most people dont want and not the actual gameplay itself is a ****ing digrace..

Generic Dreadhead

dudeeile wrote: »

Loot box money is just gravy in overwatch, the multimillion dollar esports scene is keeping the game alive.

Is that speculation of are there figures? Would have thought loot boxes were brining in more moolah

dudeeile

IvoryTower wrote: »

I'm glad they have them in overwatch, it provides an income and as such a reason to keep improving the game. I've never bought any nor would I so it's great to see the game constantly evolving off the back of people buying clothes for their fave characters

Loot box money is just gravy in overwatch, the multimillion dollar esports scene is keeping the game alive.

marcbrophy wrote: »

Thing is Gizmo, I do really agree with you here, we are saying the same thing, except I think it's gambling. I don't have a problem with gambling at all either, I just don't want these mechanics in "mainstream" games.

Oh for sure, my opinion is just that if you explicitly call it gambling it introduces a moral argument that can distract from the point of whether they should exist at all in games. As we've seen in this thread alone, people have very different opinions on their validity in certain games. Some find no problem with Overwatch for instance while others completely reject it and to be fair, there are valid arguments on both sides. I tend to view it a bit more pragmatically from the money side of things, not the most popular view point of course, so I can see why they're there and understand the need for an alternate source of revenue but its their various implementations that I find more objectionable.

marcbrophy wrote: »

I love playing Forza Horizon 3. I get pissed off with it every time I level up and a wheelspin appears on my screen, giving me a "chance" to win a rare car. Why not award me the damn car for levelling up? :mad:

The usual three reasons really, they want to drip feed content at a slower pace maximising the use for the least amount of content possible, keep you playing and not trading in and moving on to other games and also to allow them to sell other things to speed up the process one way or the other that appeal to the smaller audience who don't mind spending more money.

marcbrophy wrote: »

It's a shítty side of gaming, that those who are willing to let it happen , get as vocal as those who want to take a stand against it

No problem with this at all, but I feel if folk are going to have a useful discussion about it, they need to also talk about a viable alternative to them, something that can often get lost in the din of general anger on the subject.

Mark Hamill wrote: »

It's funny how very profitable games like Witcher 3 and Minecraft (before it went to Microsoft anyway) have loads of content and no microtransactions or loot boxes.

The Witcher 3 is actually a good example when discussing this stuff. The budget for that game was $81m including marketing which was self funded by CDP, within the first six months on sale it had sold 6m copies and by the end of the financial year had sold around 10m copies. This has resulted in a profit of around $64m.

What needs to be considered though is that said profit is off the back of nearly four years of work for a team of around 200 people on the development side alone and was based on an existing and highly acclaimed franchise whose previous games had already sold 15m combined since the release of the original game in 2007. It's these kinds of figures which show why funding any of these kinds of big budget games can be incredibly risky.

Mark Hamill wrote: »

It's almost as if spending up to 3/4s of you budget on marketing as you do on actually making the game is not a sensible financial strategy

There's an important line in that article you linked. "That’s because advertising is critical to getting a game in the top ten rankings." As discussed earlier, these big budget games need to see big sales in order to earn their development costs back and one of the primary means of doing that is to get as many eyes on them as possible. Word of mouth will only get you so far and the percentage of the potential audience who read games magazines, peruse gaming sites and, even moreso nowadays, use Youtube for news is only a fraction of what these big games sell.

Dcully

Maybe this was mentioned already but SOW pc users can get infinite silver tier loot boxes thanks to a script cheat lol,

Mark Hamill

It's funny how very profitable games like Witcher 3 and Minecraft (before it went to Microsoft anyway) have loads of content and no microtransactions or loot boxes.

It's almost as if spending up to 3/4s of you budget on marketing as you do on actually making the game is not a sensible financial strategy:

EA now typically spends two or three times as much on marketing and advertising as it does on developing a game.

Source

marcbrophy

Deleted User wrote: »

I don't think this is a certainty

No, it's not a certainty at all, perhaps they just straight up start selling these items as dlc, rather than hiding them behind a game of chance. But then they get the dreaded "Pay to Win" label form fans

gizmo wrote: »

Is the more logical answer simply that they're not gambling, at least no more so than the football sticker packs Saruhashi mentioned earlier or the Kinder Surprise I joked about?

Price wise, I'd tend to go with partyjungle on this one, the base price won't rise, they'll just move to a different idea to generate additional revenue. Alternatively, we could see a decline in the types of titles which generally command the kind of huge budgets we see these systems in or perhaps less severe, a reduction in the amount of content in these kinds of titles.

For comparison sake, look at the food industry where the term "shrinkflation" is often used there to describe the shrinking size of products while the price remains the same. The reason generally given is that manufacturing costs rise but due to price sensitivity in the marketplace, it's unwise to just increase the price.

Thing is Gizmo, I do really agree with you here, we are saying the same thing, except I think it's gambling. I don't have a problem with gambling at all either, I just don't want these mechanics in "mainstream" games.

I love playing Forza Horizon 3. I get pissed off with it every time I level up and a wheelspin appears on my screen, giving me a "chance" to win a rare car. Why not award me the damn car for levelling up? :mad:

I'm playing Pro Evo 2018 at the moment, and in the myclub mode, I can't buy players to play football for me. I have to buy coaches who will give me the "chance" to scout out particular players, and even when you put 3 of these coaches together, you get a chance to sign completely random , usually made up footballers to your team. Fifa FUT works similar and it's annoying as all hell :mad:

I don't want to buy RDR2 next year, and have to buy a lootbox to get a better fcuking horse! :mad: :pac:

It's a shítty side of gaming, that those who are willing to let it happen , get as vocal as those who want to take a stand against it

um7y1h83ge06nx

With regards the whole game prices haven't risen with inflation it might be much better if the industry released less games. Focus more on quality games that will sell big.

I currently have 22 games on my wishlist, almost all released in the past year.

gizmo wrote: »

Is the more logical answer simply that they're not gambling, at least no more so than the football sticker packs Saruhashi mentioned earlier or the Kinder Surprise I joked about?

Price wise, I'd tend to go with partyjungle on this one, the base price won't rise, they'll just move to a different idea to generate additional revenue. Alternatively, we could see a decline in the types of titles which generally command the kind of huge budgets we see these systems in or perhaps less severe, a reduction in the amount of content in these kinds of titles.

For comparison sake, look at the food industry where the term "shrinkflation" is often used there to describe the shrinking size of products while the price remains the same. The reason generally given is that manufacturing costs rise but due to price sensitivity in the marketplace, it's unwise to just increase the price.

If you need to add this **** onto your game,maybe the games you are making are not good enough for me to spend my money on..

That would be my attitude to the whole thing.. Hopefully others start thinking along the same lines but i doubt it unfortunately..

marcbrophy wrote: »

The ratings boards are afraid to rock the boat, and I don't blame them really.
Lots of countries have a tax on gambling, and that would mean publishers having to class their game in the age bracket that allows gambling in the particular country, then if necessary paying the government of these countries the associated tax on any purchases!

Alternatively, they could stop doing it altogether, but it will most certainly raise the base price of these games at launch, if there's no future easy revenue streams!

Whole thing is a pain in me hole

Is the more logical answer simply that they're not gambling, at least no more so than the football sticker packs Saruhashi mentioned earlier or the Kinder Surprise I joked about?

Price wise, I'd tend to go with partyjungle on this one, the base price won't rise, they'll just move to a different idea to generate additional revenue. Alternatively, we could see a decline in the types of titles which generally command the kind of huge budgets we see these systems in or perhaps less severe, a reduction in the amount of content in these kinds of titles.

For comparison sake, look at the food industry where the term "shrinkflation" is often used there to describe the shrinking size of products while the price remains the same. The reason generally given is that manufacturing costs rise but due to price sensitivity in the marketplace, it's unwise to just increase the price.

IvoryTower

I'm glad they have them in overwatch, it provides an income and as such a reason to keep improving the game. I've never bought any nor would I so it's great to see the game constantly evolving off the back of people buying clothes for their fave characters

marcbrophy wrote: »

The ratings boards are afraid to rock the boat, and I don't blame them really.
Lots of countries have a tax on gambling, and that would mean publishers having to class their game in the age bracket that allows gambling in the particular country, then if necessary paying the government of these countries the associated tax on any purchases!

Alternatively, they could stop doing it altogether, but it will most certainly raise the base price of these games at launch, if there's no future easy revenue streams!

Whole thing is a pain in me hole

I don't think this is a certainty

marcbrophy

The ratings boards are afraid to rock the boat, and I don't blame them really.
Lots of countries have a tax on gambling, and that would mean publishers having to class their game in the age bracket that allows gambling in the particular country, then if necessary paying the government of these countries the associated tax on any purchases!

Alternatively, they could stop doing it altogether, but it will most certainly raise the base price of these games at launch, if there's no future easy revenue streams!

Whole thing is a pain in me hole

Robert ninja

Rating boards like those have always been unregulated do-nothings so it's no surprise that this is their attitude.

J. Marston

The ESRB and PEGI have both come out and said they can't/won't do anything about labelling them as gambling.

For the little it's worth I emailed both of them and the Department of Justice and Equality (http://www.justice.ie/en/JELR/Pages/WP15000254, they cover gambling apparently) and gambleaware.ie over the last 2 weeks outlining how lootboxes use gambling mechanics just to see what their thoughts were.

Only PEGI got back to me and said something like games have to "teach and encourage" gambling and/or have casino-related elements before they attach gambling warnings to games.

Gunmonkey

gizmo wrote: »

https://twitter.com/devolverdigital/status/918521223117770752

On point, as per usual :pac:

Best part is if you dared Devolver to make that game...they would, and it would be amazing.

M!Ck^ wrote: »

I never thought I'd 100% agree with Jim Sterling but he's right; all loot box systems are complete horse ****. It's been a slippery slope for some time now. Once we accepted any form of bull**** MT's and LB's, we were ****ed. Just imagine what will be acceptable 10 years from now.

Venom

Grumpypants wrote: »

It just makes zero difference to me if i get shot by a guy who bought it, compared to getting shot by a guy who got it through gamaplay. The end result is the same.

One spent time, one spent money.

You could argue the guy spending money invested far less than the guy spending time.

Except for the fact a game is designed to drag out a players progression to really inforce the idea of spending cash to reach the next goal. Battlefront 2 requires something like 3000 hours to unlock all the add on cards. The latest 2k basketball game has core game elements so gimped, it requires the player to spend money on nearly every aspect of its gameplay. Shadow of War forces the player to grind out ranks and orcs to get the real ending.

https://twitter.com/devolverdigital/status/918521223117770752

On point, as per usual :pac:

[Deleted User] wrote: »

Now you can treat Shadow of War like the f2p game it was trying to be

http://www.dsogaming.com/news/denuvo-seems-useless-middle-earth-shadow-war-also-cracked-just-day/

Time for the lads at Denuvo to start signing on I'd say. Three release groups releasing day 0 cracks for games utilising it now

froog

bigphil2 wrote:

Just because you dont have a problem with it,doesnt mean its not a ****ty way to a:get more money out of people for a full price SINGLE PLAYER game b:Bring Gambling into Video Games,Shadow of War may not be a kids game but Battlefront 2 certainly is and it is confirmed as Pay to Win

if it's kids people are worried about spending money, then parents should control their credit cards more no? if some 7 year old is pumping 100s into some computer game it's the parents fault. same as if a parent buys every sweet in the shop cause the kids want them all.

wes

bigphil2 wrote: »

Its up to the rest of us to just not buy the base game then

Yeah, that may be the only solution. Haven't bothered with Shadow of War already. Plenty of good games coming out in without this micro transaction nonsense.

Its sad for the devs, but this kind of micro transaction grinding nonsense will wreck gaming otherwise.

Now you can treat Shadow of War like the f2p game it was trying to be

http://www.dsogaming.com/news/denuvo-seems-useless-middle-earth-shadow-war-also-cracked-just-day/