So i went to a panel this morning that gave some insight into the business aspects of MMOs. I wanted to toss out a few tidbits that you might find interesting from the discussion. I missed the first 15 minutes or so but once I got in the room, the presenter was talking about buying games from box stores vs. online vendors. He said that box stores take up to 80% of the profit that the developer would otherwise make while online purchases only take 10% of the profit. Developers would rather you buy their products online; to save 70% of their profit margins. That may explain why our games take up smaller amounts of space on the shelves of the box stores each year.
Microtransactions are here to stay. We will see more and more of this going forward due to simple business principles. The profit potentinal from mass subscriber numbers and letting people pay for their level of consumption will generally result in more profits than the old subscription model. Microtransactions are currently a $1 billion a year business and growing. Did you know that 80 to 90% of new games now have an online component? That number continues to increase.
We learned a little more about gold farmers and their “fast livery.” Most of the gold farmers operate out of China (big surprise) but India is popular as well. The typical setup is started by a guy with some cash who brings in a bunch of young kids to work in his sweatshop. The kids move in there and sleep on cots with computers under their beds – or within easy reach. Their room and board is covered by the rich guy and they work 6 days a week or more with 14+ hour days farming for gold. Their wages are ridiculously low and paying for gold just encourages more sweat shops. It’s really the bane of the developers and something they continue to fight on a daily basis.
Did you know that the average MMO budget these days is $20 to $30 million with large AAA titles exceeding $60 million? Finally, if you are interested in working in the gaming industry you can typically get into it in one of three ways. First, you can get in through customer service or quality assurance. These guys typically make $20 – $25k a year starting out but the managers usually make in the neighborhood of $50k a year. You can also get in through the software world or the hardware world. Did you know that a 2007 survey of game developers found that the average starting salary for a rookie game developer exceeded $75k a year? Not too bad.
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