Piracy vs Freemium. What's worse?

[ArenMook]

Let's talk about something that I've been thinking about for a while -- the effect of piracy compared to the effect of freemium games.

I'm sure we all know the great (and very few) freemium "success stories" like Supercell and Candy Crush Saga making millions of dollars each day. And I'm also sure many of the readers of this forum have also tried their luck with this revenue model, whether professionally, or just to test the waters while working on something else.

To add a bit of context to go with the story: with a traditional ("premium") sale model, the games generally have a demo (or a "lite" version), and a full version that the players can choose to buy if they like the demo. The Freemium games on the other hand, tend to merge the "demo" and the "full" versions into one, offering a limited amount of experience to non-paid users, with many incentives to improve this experience for a price. As an added benefit of the freemium revenue model, it draws the players in before asking them for money -- kind of like selling drugs on the street: "the first hit is free".

Another good benefit of freemium games is that they are not affected by piracy to the same extent as premium games. They are free, after all -- anyone can distribute them... so it's no wonder that many major companies have switched to this revenue model amidst all the "piracy is running amok!" cries of the PC market.

Now, I may be alone here, but I actually think piracy is far prefferable to freemium games, but likely not for the same reason you may guess. While I do believe that piracy in games is at worst a neutral force (no sales lost, extra bug reporters), and at best a free form of advertising (if pirates like the game and tell all their friends that it's awesome it means more sales), the real issue for me lies in the ability to rate games and the quality of feedback resulting from such ratings.

To get the obvious out of the way: pirates can't rate games they didn't buy. If they try a game and happen to not like it, they will move on to the next one. No harm done. Those that like the game enough to buy it will do so, and will leave some constructive feedback in the process, seeing as they got involved enough to get that far after all.

On the other hand if a freemium player downloads a game and doesn't like it, chances are he's going to leave a bad "review" before moving on to the next game, with a 1/5 rating and a pointless comment along the lines of "I don't like it". Something like that is entirely negative in nature. It has no positive effect at all, and simply causes disappointment and hinders the developer's ability to continue making a living, directly affecting the income, and worse -- their desire to do so.

And so I ask -- am I the only one who sees a major flaw in this model?

In my opinion the player shouldn't have a right for a public opinion unless they paid to express it. Chances are, this will mean that only the happy players, and the really unhappy ones will be left, with the useless noise filtered out. As an added benefit, this would mean that the bot farm services that offer to spam-rate your app for a fee would be far less lucrative, assuming that requesting a refund would also delete the review, of course -- which would be a good addition as well. Bottom line is, no pay = no say.

What do you guys think?

[Zapgun]

A couple of thoughts here:

A) I have a real mixed opinion about freemium. On the one hand, I think the core concept is fair and honest. It lets players get a feel for the 'basics' of a game before they decide to buy into a richer product set (and in this way its like a demo).  I also think its a good way to add content to a game and provides a way for players to buy extras without additional expense or hassle - its convenient for players, and good for developers.

I think where freemium falls down is when you start trickle-feeding players content to squeeze more money out of them (I can think of a few F2P MMOs that are perfect examples of how horrible this can become). Another example are the games that come out broken, or with 90% of the content, followed a week later by "add-ons" which should have been part of the original package.

When using the freemium model, I think you have to be very careful with the core quality and content in your initial free release, what add-ons you decide to charge for (or give away for free), and how much you charge - otherwise your game will come off feeling like a rip off and/or drug deal, resulting in alienated players. And for god sakes, avoid skinner boxing your players.. they are not rats! (I won't get into the ethics of that just now.. a topic for another time).

B) As for piracy, its unavoidable. You can't really stop it anymore than you can stop people from rating your product somewhere on the internet, and generating positive or negative comments about it. Your only "full protection" against piracy is probably to have an always-online DRM/remote game-save feature - which looks great on paper, but has been so badly received by players as to be generally despised (SimCity4 anyone?). Alternatives are to use something like a hybrid model such as Starcraft's & Steam's 'offline' mode, but those again are not foolproof. I feel the real advantage with Steam lies almost entirely with marketing and being able to get your game out in front of a lot of players quickly.

This is why I think freemium is a good model for the modern world - if its not abused. It provides a way for players to test games, pay for things they like with minimum hassle, and if combined with online play though a lobby you control, makes it inconvenient for players to pirate your game (they can still do so in solo-play, however).

C) Reviews: This is such a tough one. Being a developer and pouring your heart into something only to have some player rip it apart can be very soul destroying. However, its (again), probably unavoidable that someone, somewhere is going to give your game a 1 star rating, or start a rant, etc. etc. The best you can do here is make a good game and lets your player base see the 'human' side of who you are through posts, chats, etc. Building a community that you moderate and participate in can go a long ways towards this, as well as let you slay any trolls that pop up so they don't poison your community. I am a big fan of free speech, and honestly, bad things are going to happen - know that going in and accept it, but also remember that your player base is like a garden, and you should put some time into feeding and weeding it.

If you don't want to face that task yourself (and I don't blame you), find a community rep to help you out - they can shield you (or your developers) from the worst of the hateful words of trolls and their like.

- Zapgun

[Trithilon]

I agree with your views on the importance of bonafide reviews. There are a few problems here...

Firstly,
Pirates have such an abundance of games, that the value for a certain game in their eyes is REALLY low... they would barely bother to even rate or play beyond the FTUE if it doesn't impress. They make for extremely biased and dishonest press if they form an early opinion without playing it enough. This is because they are not invested enough since it was free for them.

Secondly,
There is a growing perception among the masses about Freemium games designed to cripple their experience & milk money. I have read MANY reviews on the Playstore where people complain about staying away from a game because it as IAPs.
And speaking for my self an general observation, when I pay for games - I tend to actually care for how well the game is make and I tend to leave feedback when I am impressed a lot more.

Thirdly,
You need to think from the mindset of a pirate. Why would he pirate?
Did you think those people might actually want to pay but can't? (And thus go to such portals)
Also, did you ever try Carrier billing? I am guessing that a lot of these pirates would be able to pay-up only if they had a credit card.
Why not experiment in a market - say like India/China/Korea - on the vodaphone/softbank store using a local Carrier billing SDK?
Even if you sell for lower denominations - like 10 cents, its frictionless. Could amount to a lot of copies sold.

What say?

[ArenMook]

Just to clarify something again -- I don't consider piracy to be a concern at all. It has only had a beneficial effect in my eyes, so I see no reason to curb it. Most people consider piracy to be a big issue, but in my opinion it's the freemium products (because you can't really call them "games") that are hurting the industry, not pirates. With Starlink, I made it free, but it's not "freemium" at all. There are no consumables, no "pay to progress", nothing. There are simply two unlocks -- one unlocking the game's features past the "lite" version, and another -- completely optional -- boosting the max number of ability points that players can't even see until they get to mid-high levels. Both are one-time purchases, so the player can never spend more than $5 on the game. Which, coincidently, is what the game costs on PC/Mac/Linux.

[Zapgun]

Aren you're using exactly the kind of 'freemium' model that I would, (I would consider a free game with two in-store purchases to be a kind of 'good' freemium - guess our terminology differs slightly on what freemium means).

Like Trithilon, I'm very leary of heavy freemium games, so what you're currently doing sounds right to me.

[Nicki]

Piracy is a service problem, so it's really a non-issue. Once the game is easier and more convenient to play legally, people will want to play it legally too - this does not mean you should try to put stumbling blocks in the way of the pirates, but make the legal experience better.

Freemium, or it's newer evolution of free to play curbs the idea of piracy, because its earning model is entirely different. Sure, people can hack inapp purchases too, but as long as this is difficult to do, then it's negligible.

Getting bad reviews from "browsing users" is an annoying issue, but in general the people who like an app won't go to review unless tey really, really like it anyway. Only people with a gripb, intentionally seek out reviewing. There are ways to entice honest reviews, such as requesting a review after the user had a success in the game (just won a game or leveled up), which will skew your ratings upward. If you want to be more tricky about it, you can give your users X amount of ingame currency for reviews, but Apple frowns pretty harshly on that, as they see it as manipulating the reviews. Just asking for 5 stars is ok though.

The whole market for free to play games is very different from premium games. With free to play, the user is not invested until he's spent time and effort in the game. With premium, the users has to overcome the barrier to entry before even getting the game, and once he has the game, he's invested: ("I payed for this, I have to enjoy it") so that he tries extra hard to enjoy it, otherwise he just feels like a dummy buying something bad - and no one likes to feel like a dummy. Premium requires a lot more marketing/trailers/pictures for the user to actually be interested without trying the game though - free to play titles can get by with a snappy title and icon, if they're lucky.

Alternatively, you have to "buy users" to get started. You can buy commercials that pays per install, which means you're essentially buying a new user. Once you hit a critical mass, it will snowball from there by itself. Buying users may sounds cynical, but it's not really, it's just marketing - the most soul sucking job of them all.

[amaranth]

Freemium is as evil or as fair as you make it.

Evil Freemium = game that uses psychological principles designed to extort hundreds or thousands of dollars out of a core group of players who can't stop playing. There are a lot of companies using this technique on people who are prone to repetitive addictions that won't let them stop playing.

The style of freemium you are using doesn't appear to follow the "path of evil". In fact, I think your freemium strategy is better than forcing people to pay before they've had a chance to play.

[ENAY]

I think Freemium is bad for business. A girl who I used to work with a few years ago. She would every day download all the new free games on iOS. Didn't how matter how bad or good they were. It was free entertainment for her, she never bought anything. Now, if quality freeware didn't exist she might actually have to pay (if only a little) to play games.
Granted totally awesome games are never free, but half decent games for free, nobody can ever complain at that.

Success stories are few and far between, but do free games like Angry Birds really have to make their money just out of merchandise? Usually businesses cannot survive if their business model is making a loss, that is why they go bankrupt. Subsidised industries such as for example, farming, even if they are not profit makers, food is essential so governments have to pitch in and help to continue a service.

Making a loss on selling games and making up for it by doing other things, to me is bad and open to corruption.

It's just going to come back and bite us all in the end. I think piracy hasn't got a dent in freemium games.
Pirates were never going to buy the stuff anyway, but people who play stuff for free, they probably might have..

[SGE]

I am a bit worried by the amount that consumers (across all forms of media) expect to receive for free.
The general impression I get it that people expect 90% of their content for no cost and if and only if something is truly awesomely top shelf according to their personal prefs, then they might be will to shell out a few bucks for it, but we should feel very grateful if they do.

Sorry, I read a lot of forums.
Maybe I should stop that, I'm not sure it's helping my outlook on life   

What do we think of the trial/eval model?
Allow someone to play for an hour or two, then make them hand over the cash if they want to keep going.

I'm planning on entering this space in a bit so this conversation is very interesting.

[ArenMook]

It's true, the amount of "entitlement" the players feel on mobile platforms these days is obscene. I blame the iOS approach personally. Tiny prices to begin with were fine back when games were extremely simple, but as the games got more advanced, the prices remained the same. These days you can find some AAA quality games for mobile devices, and yet they cost 10% of what they would if they were on PC -- simply because they have to remain competitive price-wise in order to compete. And that's just premium games. Freemium evolved into products rather than games -- something that hooks the whales and farms them for all they've got. It's less about games and more about psychology. Less about making fun stuff, and more about "where do we move this BUY NOW button that would result in 1% more revenue?".

[Dan Wilson]

It's one of those conundrums where people tend to believe the mobile markets (iOS/Android) are gamer's markets, but they really are not.
They are mobile device markets, these are not devices designed to play games, they are designed for other things and they also play games...
Unfortunately that being the case we saw 99 cents being the hallmark stamp in the beginning for simple (fake websites) or apps that existed in the beginning of the mobile cycle..
The problem is, you make a game for a console, and every single user in that market is a gamer, but with mobile only a percentage of them play games, and a smaller percentage are "gamers" so you need to cast a very wide net to get enough sales to justify development, which includes a 99 cent price tag or a fermium model...
I work for a mobile development company in a games division, and we do a lot of client work, and I personally hate the current freemium model of games, but companies see it as the holy grail....
I am fine with the old freemium model, the demo/game hybrid, IE the game is free and comes with the 1st level, and you pay X to unlock the rest. That is the real version of freemium what we have in the market now is the F2P model which is give them something that will hook them just long enough to give us a direct line to their bank account then charge them for everything.....

I don't see this model going away anytime soon. While the smaller studios can't hope to survive on this model, with the exception of the few lucky ones, big business sees this as a very viable model. You have X cost of dev/marketing and then you squeeze people over 12 months for 5-10 times what they would have paid with a standard premium game....