F2P boosts Turbine’s MMO.

FEB. 26, 2010 • Since taking the MMO to a free-to-play model last September, Turbine Inc. says more than 1 million new users have come to Dungeons & Dragons Online: Eberron Unlimited. In addition, the franchise’s paid subscriber base has more than doubled, and franchise revenue has grown more than 500%.

Impact: In 2009, we saw a measurable decline in the willingness of consumers to pay a $15 a month subscription.  In the meantime, we have seen a significant increase in consumer’s willingness to pay for virtual goods.  The economics are clear, if a consumer thinks they are going to spend over $15 a month it makes sense for them to pay for a subscription.  However, under a free-to-play model if you can get three times as many people paying $5 a month the revenue is the same and it will depend on your operating and acquisition cost.  The acquisition cost for a free game should be significantly below a premium subscription game.  Furthermore, once you have consumers on board it is easy to get them to slowly bump up their spending levels without really realizing it.