Gamehackery: What Does the Subscription Boom Mean to Gamers?

It's not a coincidence that the new microsoft office (Office 365) and the recently announced Adobe Creative Suite (including Photoshop) are being offered as subscriptions (rather than products).

Everything is coming up subscriptions. You can subscribe to coffee, to tea, to cloud data services and to toilet paper.

No, seriously. You can subscribe to toilet paper.

So, it's no fluke that DDI was a subscription service. Don't expect that to change. From a pure business point of view, the subscription model is the most important development in the gaming industry in the past ten years.

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Smoothing Out the Boom and Bust

The big advantage of a subscription program is that it creates dependable revenue streams for the company. It may not be more than they would get selling products, but it's a lot easier to plan for and manage.

They may lose some subscribers, or gain some, each month, but even those changes will follow on fairly predictable trajectories.

It also means you have an ongoing relationship with that customer -- making it easier to continue to offer them additional products.

A Subscription is a Relationship

A purchase can be fairly anonymous. A fistful of lawnmower money may buy a players handbook, but it doesn't forge a connection between the purchaser and the company that produce the book.

A subscription, though.... that's a relationship. It builds a connection between company and customer that the company can use to offer additional products and services.

It's also a data mine that just won't quit. The company has your name, your address; they can build a history of your purchases and study what you're interested in. In the case of DDI, they're able to track what classes are being created, what rules are accessed in the DDI most often, and can get a pretty good idea of how many active games are going by studying the number of characters that are incrementally leveled up in a given month.

What Will We Subscribe For?

Assuming that we don't expect Charmin and Mountain Dew deliveries from our favorite game companies, what sort of things are gamers willing to pay an ongoing subscription for?

To date, the DDI has proven that we're willing to pay for digital tools. Character Builders, Online databases of game rules and data, etc.

Over at Paizo, though, is a towering demonstration of the power of good content to drive subscriptions. Paizo, by the way, will let you subscribe to just about anything they're producing -- including their monthly card decks (mostly item cards, with play support cards like chase decks and critical hit decks mixed in).

And that's not all. We've seen dungeon-a-day and adventure-a-week. New magazines are appearing. Subscribe to Obsidian Portal or one of the other campaign managers to track your game.


Fiddling with Knobs and Dials

So, the real alchemy that the brains behind the businesses we support is trying to strike the right balance of price and service for their subscription models.

For example, there's a limit to what we might be willing to pay to Wizards for DDI. From their point of view, any single individual's price point is not particularly interesting. They need to take a guess at what the numbers of their subscribers will be at each price point.

So, at the moment the price is $9.99. They've hit upon that price because they believe that more than half of the people who would pay $4.99 would also play $9.99, but less than half of those that would pay $9.99 are willing to pay 14.99.

Of course, they set that price during the 4e heyday, and now they're in the last trimester (we hope) of birthing their new version. But outside of the tabletop world, ideas about subscription services have changed. The Freemium/Free-to-Play model is becoming more and more expected across industries where a product's market position isn't so strong that there's no need for it.

"I want to Buy it, not Rent it"

Sure you do. And I don't blame you. But you're fighting a losing battle.

In typical subscription programs -- along the magazine model -- you get your content in the mail each month and it's yours to keep. But when we start looking at RPG Tools as a Service -- like DDI or Fantasy Grounds -- when your subscription ends you no longer have access to that data.

A subscription for a service offers so many benefits to the company (steady revenue, durable connections to customers, and awesome data) that it's critical for a company to propel you over those concerns. Maybe it's better price, or better services, or both. You can expect that companies with the necessary support structure to handle a subscription program of some sort to move in that direction.

What's more, as more and more products and services are available by subscription, fewer customers will balk at this sort of scheme. We will become used to subscribing to Microsoft Office, to Photoshop. It won't be unusual to have a subscription to underpants.

Other Models

Here are a couple of other example subscription services that make interesting models for potential RPG/Gaming services:

• Bespoke Post - Once a month subscribers are offered a "Box of Awesome". Past boxes have included wine decanter kits, a himalayan salt block, and high-end shaving kits. Subscribers can opt out of a monthly box if you're not interested.
• Freemium Services - like Dropbox or Evernote. Or Free-to-play games. (next week's column will look at micro transactions, so stay tuned)
• Quarterly - A wide variety of quarterly subscritions to themed boxes of odds and ends curated by interesting folks like Veronika Belmont (Tekzilla, The Sword and Laser)

You've Got Mail

So, you tell me -- what's important for you in a service you'll subscribe to? Are you more interested in tools or content? What subscriptions do you maintain at the moment (besides your EN World subscription, right?)

 

[delericho]

In a larger sense, this business model could be stated as "For every 100 people that use our free rules, 10 of of them will buy the rulebooks, and 1 will voluntarily become an adventure path subscriber. If we sell those people a high enough volume at a high enough margin, their business can support us in making new general interest products that we can release for free and sell in hardback to attract the next 100."

Fair enough. There's a problem, though - WotC, as a larger company, have much higher requirements to succeed. WotC would probably starve on Paizo's current feast.

 

[Ahnehnois]

Fair enough. There's a problem, though - WotC, as a larger company, have much higher requirements to succeed. WotC would probably starve on Paizo's current feast.

Indeed, this is uncertain. It is entirely possible that after so many hundreds (or thousands) of people, the proportion of diehard converts decreases. Diminishing returns. It's also entirely possible that the number of potential players is limited. I make no claims that Paizo's business model would meet WotC's goals. Or that any business model would. My perspective, as always, is that rpgs are a great hobby for players but are not very amenable to being monetized.

I do not, however, think that increased reliance on subscriptions on their part would help.

 

[tomBitonti]

I completely agree, indeed I essentially said it was an opinion!

The view of the OGL I put forward there was based on a bunch of websites I'd read and certainly wasn't intended to be authoritative.

Hi, yeah, I should definitely have read through that more carefully. Was on a roll catching up to the thread and moved to quick!

Thx!

TomB

 

[delericho]

My perspective, as always, is that rpgs are a great hobby for players but are not very amenable to being monetized.

You're probably right. Especially now - between the 3e SRD, the Pathfinder version, and the various free games, there's more material available at zero cost than a person will ever use; if you prefer a hardcopy, then according to eBay a copy of the 3.0e core rules can be had for $20 with ease; and with at least eight distinct versions of D&D alone out there, I'm really not sure how much space there is for a ninth version.

I do not, however, think that increased reliance on subscriptions on their part would help.

Well, there's a threshold of pain, below which a person can pay for a subscription and barely count the cost. That's why I'm still a Pathfinder AP subscriber despite never actually having used one of the adventures. I suspect, as RG noted in the OP, that WotC have calculated the price for DDI that maximises their income, probably based on that factor.

There's another benefit, and it's the flip side of the "you lose it all when your sub lapses" issue. When 4e was released, I picked up the core books and gave it a go, and promptly set it aside. A couple of years later, my current group formed, with a number of people who were rather more keen on the edition. But by that time there were at least a dozen books out there for the edition - and it simply wasn't possible for me to "catch up" - the cost, and the time to read, was prohibitive.

But a subscription was cheap, and gave access to the Compendium and the Character Builder, which was close enough. I couldn't catch up on the books, but I could afford to pay a low(ish) monthly fee for access to all the stuff I needed. Starting an active sub meant that I gained access to all that stuff.

(Or, at least, it would have. What actually happened was that our DM maintained the characters on his machine, and printed out what we needed as we needed it. So I didn't actually have to subscribe, which I daresay WotC would consider less than ideal.)

 

[Ahnehnois]

Well, there's a threshold of pain, below which a person can pay for a subscription and barely count the cost.

I would think that's an extremely low threshold on average. How many gamers are kids? Or college students? Or young adults with no jobs and huge debts? I doubt the gaming industry is immune to the overall economic climate of the past few years.

There's another benefit, and it's the flip side of the "you lose it all when your sub lapses" issue. When 4e was released, I picked up the core books and gave it a go, and promptly set it aside. A couple of years later, my current group formed, with a number of people who were rather more keen on the edition. But by that time there were at least a dozen books out there for the edition - and it simply wasn't possible for me to "catch up" - the cost, and the time to read, was prohibitive.

That's a good point, but it also is a problem with 4e. If you just pick up the 3.5 core books, set them aside, and start a game years later, you're not missing all that much. With 4e, the "everything is core" mentality, the proliferation of numerous releases with minimal substantive content, and the constant revisions push the game away from that mentality. It is, to coin a phrase "butter scraped over too much bread" (Or if you like this approach you'd use a different phrasing.)

Is that working though? Trying to get away from having three books be "the game" and spreading it out over more releases? Not the way I would go. Most non-D&D games are far more complete at first release out of necessity. People have been crying for a more comprehensive initial 5e release, and WotC seems to be saying they'll get it. The subscription isn't as big of a benefit in your scenario if you can buy a fully formed game at a reasonable price from day 1.

 

[Hussar]

/snip
So I wouldn't say that the rules are tangential at all. They're the thing that attracts people in the first place, even if they're not the direct source of income for the company.

I'm not sure that's true. I'd say that the setting and adventure paths are what attract people in the first place. Paizo has made a very strong business out of producing fantastic adventures and setting fiction. That's mostly what they're known for.

WOTC is far better known for rules creation.

And, let's not forget the fact that a very large chunk of Pathfinder's rules are OGL. It's not like Paizo has any choice about putting it's rules online. So much of it is OGL, they could try to close content it, but, at that point, it's not even worth it. They might as well make it all OGL and gain tons of goodwill from fans for doing so since trying to close the gate at this point would be very difficult.

But, it is interesting to note that nothing Golarian is OGL. None of the setting material is OGL. That's all behind that "paywall".

 

[delericho]

And, let's not forget the fact that a very large chunk of Pathfinder's rules are OGL. It's not like Paizo has any choice about putting it's rules online. So much of it is OGL, they could try to close content it, but, at that point, it's not even worth it. They might as well make it all OGL and gain tons of goodwill from fans for doing so since trying to close the gate at this point would be very difficult.

I will be very interested to see what happens when Paizo decide the time has come to do Pathfinder 2nd Edition. Do they stick with the OGL-based ruleset (in which case, why bother with a new edition?), or do they go for something significantly different - and in the latter case, do they open it or keep it closed?

 

[Ahnehnois]

I'm not sure that's true. I'd say that the setting and adventure paths are what attract people in the first place. Paizo has made a very strong business out of producing fantastic adventures and setting fiction. That's mostly what they're known for.

While there is some truth to that, I think Pathfinder is still much better known than Golarion. Obviously the two are connected. That being said, look at it as a matter of sine qua non. Take away the ruleset and what is Paizo? I can't imagine they'd be even as well known as they were when they produced Dragon for WotC. Even if their adventures were killing it. Take away their setting and what are they? Maybe less profitable, but still easily the #1 rpg in 2013. Someone has to take all the gamers' disposable income.

After all, there are plenty of better settings out there. And, arguably, better rules. Their success started by capturing a large and disenchanted base of orphan customers. Not their add-on content.

And, let's not forget the fact that a very large chunk of Pathfinder's rules are OGL.

Well, most of their post-core stuff isn't.

But, it is interesting to note that nothing Golarian is OGL. None of the setting material is OGL. That's all behind that "paywall".

Again, that's the free-to-play model. Attract as many customers as possible by making the essentials free, then charge for add-ons. Golarion is decidedly an add-on.

 

[Li Shenron]

"I want to Buy it, not Rent it"

Sure you do. And I don't blame you. But you're fighting a losing battle.

The way I see it, the battle is between your company and my wallet. As far as subscription goes, my wallet stays close. I can still play the game. Who's losing the battle?

What's more, as more and more products and services are available by subscription, fewer customers will balk at this sort of scheme. We will become used to subscribing to Microsoft Office, to Photoshop.

If the subscription model remains successful, it will probably be because customers will have no choice: probably most people need MS Office or Photoshop for work, so the subscription model will work as a sort of blackmailing, they either buy a subscription or won't be able to work properly. Those SW product can take advantage of a dominant position on the market, especially MS products due to being tied to Windows, in fact every now and then they get fined for that, at least in the EU.

So, you tell me -- what's important for you in a service you'll subscribe to? Are you more interested in tools or content?

It totally depends on the product at stake.

For a RPG? Nothing, it's almost impossible I would subscribe. I don't see the reason why I should commit to spending a certain sum, no matter how small (and I mean it... I wouldn't subscribe even if it costed 10c, I just wouldn't bother) for buying stuff that I simply don't need. Nice to have maybe, but to me RPGs are fundamentally pen & paper, occasional props can improve gaming but the fundamental fun comes from your own mind, everything else is purely optional, and sometimes even gets in the way. In many ways, I just think RPGs are not even meant to be a business in the first place.

Other products, once again it depends... but in general I detest the idea of subscribing to entertainment. I don't want any TV channel, book/magazine or online gaming subscription. I want to watch a movie when I feel like, read a book when I feel like, play a game when I feel like. A subscription is a model that makes me feel like I must "consume entertainment at a steady rate" (a purposefully horrible sentence here) otherwise I'd be wasting my money.

And that's what I think most subscribers actually do, waste their money or waste their time. A small minority are doing just fine, but most people subscribing to an online MMORPG are either not playing enough (and thus paying much more compared to what they would if the game was just bought once) or are compelled to play too much instead of studying, working or at least move from the sitting position. Same with TV subscription, it's not easy to watch it just the right amount, assuming such thing exists, in my view I would be either watching it more than I should or less than what I've paid for. It's not against the law, but I don't want to end up like that.

I would understand much more a subscription to that toilet paper to be honest.

 

[delericho]

Other products, once again it depends... but in general I detest the idea of subscribing to entertainment. I don't want any TV channel, book/magazine or online gaming subscription. I want to watch a movie when I feel like, read a book when I feel like, play a game when I feel like. A subscription is a model that makes me feel like I must "consume entertainment at a steady rate" (a purposefully horrible sentence here) otherwise I'd be wasting my money.

The other model that I can see catching on is the micro-transaction-based pay-per-use model, where the provider gives you access to their library of materials to use as required, and you pay a small fee each time you actually do so.

The advantage of this over subscription (for the customer) is obvious - they have the same level of access, but are only paying for what they actually use. (They may well not end up paying less overal though - under this model you'd pay every time you accessed your PHB too.) The downsides are that it takes more effort to set up and administer, and to process the payments, and that there's the possibility of service degradation at peak times. (Though all of these issues should reduce with time.)

I can't see the pay-per-use model working with RPGs, because it does depend on the high-use items being behind the wall, and I suspect the market would respond to that by moving to some other game. But for entertainment products, I can certainly see this happening. We're in the last generation or two of physical media, and will be moving to digital delivery soon enough (and, unfortunately, I've just discovered that DVDs are nowhere near as durable as I thought...). I won;t be at all surprised when some company (quite possibly Disney) decide to stop selling their movies entirely, and instead provide access via an online portal allowing you to watch anything they own... for a very small fee.