The Free-To-Play vs. Paid App Debate

Is it Better to Make Apps People Driven or Revenue Driven?  The Experts Debate.

Mobile usage is widely available in the entire world. Research shows that there were 6.8 billion mobile subscribers in the world as of December 2012. That is a huge figure considering that there were only 5.4 billion mobile subscribers in 2010 and 6 billion in 2011. Ten countries in the world have more than 100 million mobile subscribers:

  • China – 1.15 billion mobile subscribers
  • India – 906 million mobile subscribers
  • United States of America – 321 million mobile subscribers
  • Indonesia – 260 million mobile subscribers
  • Brazil – 259 million mobile subscribers
  • Russia – 227 million mobile subscribers
  • Japan – 128 million mobile subscribers
  • Pakistan – 120 million mobile subscribers
  • Germany – 112 million mobile subscribers
  • Nigeria – 143 million mobile subscribers

It’s a Fact – Mobile Subscribers in the United States Love Games

Based on research conducted by Flurry, US mobile subscribers spend at least 2.5 hours per day using smart phones or tablets. They spend at least 2 hours and 7 minutes downloading and playing different applications and 31 minutes browsing and searching on the mobile web.
A large majority of the time, approximately 80%, is spent on applications.  Games account for at least 32% of this time while 18% goes to Facebook, 8% to utilities, 8% to entertainment, 6% to social networking sites, 2% to news, and 2% to productivity. The other 20% of time that’s spent on the mobile web is divided as such: 12% for Safari, 4% for Android Native, and 2% for Opera Mini.
popular free-to-play games

Of all the different activities, games take up the largest portion of time spent on mobile devices. This only shows how Americans are fond of mobile gaming. Research shows that an average US mobile gamer is between 25 to 28 years old. Social gamers, on the other hand, are usually between 35-39 years old.

Those who play with their smart phones constitute at least 22% of all gamers from the US, including tablet, social and video game console gamers. Most people play games with their smart phones. In fact, at least 69% of gamers prefer using their smart phones while playing games. Meanwhile, 21% of the entire US gaming population plays games using a tablet and 18% play games with their iPod touch.

The Popularity of Free-To-Play Games Has Increased

You might be surprised to know that the most widely enjoyed applications available both in the iOS App Store and the Google Play Store are free to download. In fact, at least 34% of the top applications, in terms of revenue, are free-to-play. In the US alone, at least 90% of mobile games are free to play.

Approximately 91% of US mobile gamers are willing to pay for games in the market.  37% of this group of gamers will play the free trial version first, and are then convinced to upgrade to a paid gaming application. This only shows that many US gamers try to enjoy the free version of a game first. When they find the game interesting or enjoyable, then they voluntarily buy the full version of the game.

How Monetization Works With Free-to-Play Games

free-to-play game monetization

Supercell is the game developer behind the popular games Hay Day and Clash of Clans, which were both released in the summer of 2012. Supercell was unknown before then in the gaming market, but it has now made a name of for itself. In fact, its Clash of Clans has already made its way to the top of the charts and is currently the number one game in the iOS App Store.

What’s interesting is that these games are both free-to-play. Now, the question lies on how these kinds of games become profitable, when they are not paid apps.

“The huge irony here is that if the monetization is not your number one priority, that actually leads to better monetization,” said Supercell CEO Ilkka Paananen.

Now, how does this work? According to Paananen, Supercell has always believed that creating games is not all about the mathematics, the revenues, and the monetization machines. In fact, according to him, it is still about creativity and art while providing a good game both in design and in content. This is where monetization comes in.

“When you prioritize engagement and retention – making a great game that people play often and want to play for a long time – they are happy to pay. We want to design games that people can theoretically play for years,” Paananen said.

This explains why some US mobile users try downloading the free-to-play games to check whether they like them or not. If they are really not enjoying the game, they will settle with the limited free-to-play version. On the other hand, if they find the game interesting, most gamers will be willing to shell out money to download a game they enjoy and will be able to play for a long time.

Why Supercell is a Successful Game Developer

Supercell’s strategy is to provide a good game for its target market without forcing them to buy it. They just develop a free-to-play game that’s fun and eventually it gets more popular. People download it because they love the game, nothing else.

clash of clans free-to-play

This is the philosophy that works for Supercell, which is why they are now on top, considering that they are a small team that is new in the gaming industry.

“It’s going to sound really naive and simple, but the single biggest lesson that Mikko and I have learned is that if you really want to build the next generation of games companies, it’s actually all about the people.” For Paananen, it is all about providing what the people want. People driven, so they say, and not revenue driven.

The Future is in Free-To-Play Games

The success of this method is showing as Clash of Clans and Hay Day are two of the most downloaded gaming applications in the iOS App Store and the Google Play Store. Many gamers have been willing to download not only the free-to-play versions, but also the full versions of the games. This is probably why most game developers such as EA, Zynga and Rovio are now threatened with a newbies like Supercell on top.  Other companies will have to adjust their monetization strategy to keep up with the new trend.

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