For some gamers, microtransactions are a horrible plight that has been afflicting video games for the last decade. For others, they’re something to just ignore while they enjoy their favourite games. And for another group, microtransactions are a great way to add new elements to a game.
Like them or loathe them, microtransactions have become an unavoidable part of modern-day video gaming, permeating just about every genre and every platform.
A Time Before Microtransactions
This wasn’t always the case though. Ever since video games entered the home with consoles like the Atari 2600, the Nintendo Entertainment System, and the Sega Mark III, gamers bought their games from stores, receiving access to all the games in one go.
Over time the distribution channels changed, with a mix of brick and mortar stores, online retailers, and digital downloads through services like Steam used today. However, all of these methods still charge gamers a flat fee upfront.
Until recently though, these games remained free of microtransactions, with the exception of expansion packs and add-ons.
Free to Play Games
You will find microtransactions in many free to play games today. They are a good way for developers to monetise their games, while still appealing to a broad audience. The typical model for free to play games is to give players an in-game currency or a finite number of lives, then when they use them up they must wait several hours before they can play again. If they don’t wish to wait, they can choose to buy more with real money.
Examples of this include PokerStars, which gives play chips to each new player, adding more every few hours. Additional play chips can then be bought for a small fee. A similar system is used in Candy Crush, generating the company $1.5 billion in 2018 as players spent money to buy additional lives in the game.
These free to play games are most commonly found on mobile platforms, covering just about every genre with games like Farmville and Call of Duty: Mobile all featuring some form of microtransaction.
For the most part, gamers accepted microtransactions for free to play games since the majority understood that it was necessary to pay for the game’s development.
However, in more recent years, microtransactions have found their way into blockbuster titles that consumers still have to pay upfront for. It started with map packs, additional weapons and cars, or expansion packs, all collectively referred to as downloadable content (DLC).
These were widely accepted too. With map packs for games like Halo: Reach and Modern Warfare 2, cars for Forza, and a whole new storyline for Grand Theft Auto IV, all proving popular. These types of transactions were seen as a good way to extend the life of a game beyond its usual lifespan, with the fans getting the enjoyment of an almost new game for much less money.
The opposition of most fans came when publishers began asking fans to pay extra to receive increased skill levels or to progress faster through the game. Many argue that this completely changes the paradigm from paying for content to simply paying to win.
Games like Star Wars Battlefront II and FIFA 19 were widely criticised by fans for this practice, with EA shutting down the premium currency feature in the former game after fans complained.
That said, EA alone earned $1 billion from microtransactions in the final three months of 2019, so it’s unlikely they will be going away anytime soon.
Paying for Increased Costs
It’s not all about greedy publishers wanting to extract every last penny from their games though.
Video games have been priced as $60 since 2005. Accounting for inflation in the US over the last 15 years, they should now cost just over $79. Games are also more detailed in terms of graphics, physics and features, meaning they cost more to produce.
For perspective, characters designed in 1997 would take around 1-2 weeks to create, while today they take around two months. Scale this up to every element in the game, and it’s clear to see why video game publishers need to find new ways to make money.
It is for this reason then that microtransactions are likely to stick around in some form or another for the foreseeable future. At least until developers and publishers find another way to pay for the increased development costs.