User:MoEldali/sandbox

Week 4

I have decided take on the topic of micro-transactions, specifically within video games. Although there are already general articles about micro-transactions, there are no specific ones pertaining to micro-transactions in video games, or at least none that go into any specifics. In the past few years of video game releases, some of the most notable and trustworthy companies had there games fail because of this new and popular business model that they conformed to.

The general article on Microtransaction is already very short and holds no specifics on the various games that took this business model into overdrive. I hope to use some raw data from the data set provided by Super Data (https://www.superdataresearch.com/market-data/digital-console-additional-content-in-%20todays-market/). In addition to this I have found various articles from gaming websites that looks into specific games that were destroyed by micro-transactions.

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The Data Behind Microtransactions

Microtransactions have become increasingly common in all kinds video games. Smartphone, console and PC games all have conformed to the use of microtransactions, due to its high profitability. Many companies and games, especially smartphone games, have taken on certain business models that offer their games for free, relying purely on the success of microtransactions to turn a profit.

SuperData

SuperData is a company that does Qualitative and Quantitative research on video game markets and spending habits of consumers. SuperData collaborates and is essentially hired by a variety of companies, ranging from banks to game developers. They work in favor of the companies that either hire them or share data with them, creating business strategies, outlining profitable regions in the gaming market, and making companies seem more appealing to investors .

The Data Collected

SuperData gets a massive amount of data involving consumer spending habits, consumer games preferences and even their interest in certain brands. This information is obtained through the companies they work with. PayPal and Visa are two of the companies that share consumer spending habits with SuperData for them to conduct their research. Notably enough, SuperData’s work is targeted to support these companies that thrive off microtransactions, and is not easily available to the average consumer whose information is what’s making there work possible. The three major console companies, PlayStation, Microsoft's Xbox and Nintendo also are primary data sharers with SuperData. In addition to this, companies like Google, Apple, Blizzard and Twitch are also partners. With all this data collected, it allows video game companies, like EA, Blizzard and Ubisoft, to implement microtransactions safely into there games, knowing what regions and types of business models they will have success with.

Ethics Behind the Data and Microtransaction

Data

The collection of this data on consumers, although technically legal, can be considered unethical. Companies are selling data about consumers, involving there spending, bank information, preferences, ect, all to overall understand the consumer better, making business models for gaming companies safer and more profitable. Considering all the companies involved, the limits to the data being shared are endless. Visa, Google, Microsoft and PayPal already have so much data on consumers already, and are freely able to share it. Google in specific hold information on more than just video games, which raises questions of what they are sharing. With the microtransactions already under a negative spotlight from the gaming community, people may not be happy to hear that data on them is being shared to make microtransactions possible .

Microtransactions

In the eyes of gamers, sometimes microtransactions are done the right way, and sometimes they are done the wrong way. Data shows that most gamers (77%) like microtransactions when they are done “correctly”, mainly supplying cosmetic items and other non-game changing products. The other side of the argument is those who believe games that require microtransactions to be successful are what ruining the gaming industry. Certain companies like Blizzard and EA, and a variety of other smartphone companies have had vast amounts of criticism due to there choices with microtransactions. Games like Hearthstone and EA’s Star Wars Battlefront 2, took on business platforms that either force their player base invest what was considered an unreasonable amount of time, or buy into microtransactions, so they could keep them selves on an even playing field with other players.

The profit in Microtransactions

The data from a variety of sources, including SuperData, show that microtransaction can vastly increase a companies’ profits. Free smartphone games like Clash Royal, Clash of Clans and Game of War are all in the top 5 most profitable smartphone games of 2016, despite being entirely free. Microtransactions alone are what make their profits. Grand Theft Auto as another example, was a game that held the price of a standard game (60$ USD) on release, yet they through microtransactions they have made more money than they have on game sales. The data speaks truth, where its clear that microtransaction is a business model that all game companies are conforming to, and for good reason.