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Daily Reaction: The Dark Side of Free Games on PS4

July 3, 2013 Written by Dan Oravasaari

Free2playNightmare

Everybody loves free, but could an abundance of free titles have its drawbacks? Daily Reaction’s Seb and Dan discuss how the sheer number of free PS4 games could change the market and make it hard for some developers.

Dan: Looking at the mobile market, it is difficult to immediately understand why a significant portion of the games on platforms like iOS and Android are priced at 99 cents or for free. The thing is, that’s not necessarily the price developers want the games to be, but rather the price the market demands. Most console gamers will simply attribute the pricing structure of mobile games to the ‘poor quality’ or ‘small stature’ of the titles, so that developers can easily make profits back, but that isn’t the real reason.

The mobile market is highly competitive, as almost anyone can design a product to compete, yet everyone needs to maintain a feasible pricing structure. Mobile developer Fishlabs’ Michael Schade told GI.biz: “You can play with price point, have regular price cuts, but still the revenues are going down, down, down. Eventually, you have to go free.” This need to maintain profit has seen a logical inverse, where the cheaper you release at, the more return you will see on your product. As the market has saturated itself in products aiming to undercut each other, developers are continually releasing cheaper and cheaper titles in the hopes of being subsidized through advertising or by utilizing microtransactions.

Now, the real question, why should we care? The console scene is still structured at a $60 retail price point, but we have a flourishing independent scene of smaller titles that comfortably sell at prices from $5-15. While that is true for the moment, the issue is that we are beginning to see is a shift in the console market towards adopting the F2P model that has proved so successful elsewhere. Numerous games are launching with the PS4 using the F2P model, such as Warframe, Blacklight: Retribution and PlanetSide 2, and there’s sure to be far more in the future.

Not only that, we are going to continue to receive free PSN titles every month with PlayStation Plus. But, as the PS4 isn’t backwards compatible, these games are going to be new and, as PS+ is needed to play online, nearly everyone will be a subscriber.

Seb: Exactly, there is going to be a deluge of free PSN content on the PS4. You are going to have a huge host of ‘free’ F2P games, most of which are said to be enjoyable without paying, along with a free PSN game every month on PS+ (and these are big PSN titles like Outlast).

At a glance, that sounds awesome – you never need to buy a game again! But therein lies the problem. Sony has created a platform where players will have more free games than they can probably play as it is, so there is little incentive for them to go out and buy more PSN games, unless they have Journey-level hype.

Over on iOS and Android, we’ve seen a race to the bottom in price. With the number of free games out there, it’s becoming harder and harder for developers to be able to convince consumers to buy a game for even 99 cents. Everyone expects free games, everyone can get free games, and everyone ends up downloading free games.

The problem is that not all titles are meant to be F2P – it’s a business model that only works on some titles, primarily online ones. And, for the games that aren’t F2P, they might not be able to get on PS Plus as only one free game is given out a month, and more than one title is launched most months. Plus subscribers will likely also wait for games to go up for free, many of which never will – something that is being seen on the Vita now.

Another problem with PS+ is that it will impact the long term sales of a PSN game as, again, people are unlikely to buy older games unless they’re really, really good, as they’re getting tons of free new ones.

What we could potentially see is a market where the only viable option for PSN developers is to either go F2P or get on PS+. That must be a cause for concern for both Sony and developers, as removing pricing choices is the exact opposite of what the digital revolution promises. Equally, the developer may not want to sign for PS Plus if Sony doesn’t offer them a good deal.

We’re going to have two tiers of games – the first which manages to get on PS+ and downloaded by a lot of people, and the second which doesn’t, and only the core power-buyers end up getting. This is like on iOS, where developers have to hope that Apple features their game, otherwise it’s incredibly difficult to be successful.

One way Sony’ll likely try to incentivize gamers to buy PSN games is with heavy PS+ discounts, but that again will create a reliance on price cuts, an issue that Steam faces with their ludicrously good sales, which end up making people just wait until each sale.

Pricing is always tricky, and stopping the market from becoming solely focused on free titles has proved difficult for other digital retailers, but with the PSN being a more controlled store than most, there is hope (albeit only a little). Otherwise digital developers could be forced to pick between F2P and PS+, and may no longer have any choice about how they will sell their game. They will end up reliant on Sony deciding to promote their game on Plus. It will be a raffle, just like on iOS.

Do you see this as a potential issue for developers, or are we making a big deal out of nothing? Share your thoughts in the comments below, email us for $5 at DailyReaction@PlayStationLifeStyle.net or pay us $10 on Twitter at Seb and Dan.