Monday, May 31, 2010

Getting Screwed!







Trust, Money and False Expectations




And that’s when the person is a friend.


Misplaced trust is dangerous.



Money on the table













Negotiating the Price






Carson 63000 said...

Really enjoyed that post, Sid. That's about the clearest explanation I've seen yet of that point of view, and I've seen quite a few people try to explain it on forums etc. and not really succeed.

Klepsacovic said...

Do gamers need to make a consumer protection agency? The idea makes me laugh, but somehow I can't see it as being completely ridiculous.

Tobold said...

If you buy a car that is twice as expensive as the one you are currently driving, will you get twice the value for money? Of course not! Luxury in every market has extremely diminishing returns, you pay a lot of money for a just slightly better product.

But just because some people buy a Rolls Royce, car makers don't conclude that making a Honda Accord is leaving money on the table. Read Joel's famous piece on Camels and Rubber Duckies to see how money is being made through price differentiation: Having a basic product which gives most of the functionality for a small price, and then offer different luxury versions with small incremental benefits for large increments of price.

That is how most markets work, and the MMORPG market is moving in exactly the same direction. A $25 sparkle pony or CopyKat is exactly this!

And the people who pay little for the basic package actually benefit from this, because the outrageous profits the companies make on the luxury version are reinvested and end up helping the basic version.

sid67 said...

@Tobold: I don't entirely disagree with you. I understand the purpose of luxury products and price differentiation.

My issue here is that you and others are defining "Luxury" as some crap game on Facebook or a "Sparkle Pony".

I accept the inevitable that developers are going to chase these dollars. I don't like it, but I accept it.

But what I don't accept is negotiating such a lousy definition of "Luxury".

$25 for a Sparkle Pony?! Really? Shouldn't we be asking for so much more for our hard earned money?

syncaine said...

Its also worth considering that perhaps the old MMO formula of $15 a month is unfair towards the devs. I'm not saying we all start buying $25 epeen ponies to support the needy, but don't we all realize that paying $15 a month is peanuts compared to any other form of entertainment, other genres of gaming included?

My point being that SOME re-balancing is probably needed, and I think right now we are going through an awkward phase of figuring it all out. $15 a month is perhaps a little too player friendly, while the current RMT model is not a good balance of cost/service in most cases. We are still looking for that happy middle.

Callan S. said...

Where is it a rule that luxury has diminishing returns?

But talk that way and as sid says, yeah, the companies are happy to give only a tiny bit more luxury for alot more money.

No, sometimes alot more luxury costs only a little more. But if you don't want to check whether it does, the company is happy to supply the tiny amount of luxury for large amount of cash.

Indeed I've thought about how much it cost them to make the burning crusade expansion, or the lich king expansion. These cost about $90 Australian.

Now compare how much it cost to develop those to recoup just $90 per person, with developing a sparkle pony (what, maybe cost them $300 to make? Prolly less) and recouping $25 from each person?

I think sids right - it teaches them sparkle ponies, hand over fist, make more money than real expansions/content.

Your buying your way into a style and no substance future.