In years past, it was relatively easy to produce a quality video game on a modest budget. In more recent years, however, the cost has risen astronomically, due in no small part to the advancement of technologies and the larger teams required to produce AAA-quality games. As a result, it’s easy to get caught up in sales numbers and “units shipped” and not realize that many games struggle to break even. As the cost of production goes up, so does the cost of the games.

The most expensive game of all time, in terms of production costs, is Star Wars: The Old Republic, with a budget of $200 million. The title is PC-only, which makes it even harder for publisher EA to recoup that expense.

The recently released Grand Theft Auto V (GTAV) comes in second place with a budget of $137 million. GTA V was released on both Xbox 360 and PlayStation 3, but even with multiple platforms, making back that budget could be a tall order if there wasn’t so much excitement and hype for the game.

Where are we going with this?

The methods used to pass on that cost to gamers have been particularly annoying to gamers at the start of this latest video game generation. “Micro-transaction” has become a four-letter word.

The launch of the Xbox One has been rife with controversy and debate. Read on for a look at a new and contentious trend this console generation: the rise of “paymium” games.

Passing the cost to gamers


Every Xbox One gamer pays for the game disc itself at that reviled $60 price-point, and then are, well, let’s call it “gently harassed” throughout the game to part with even more money to get the “definitive” experience. In an extreme example, players of Gran Turismo 6 (GT6) can spend as much as $140 in-game for a single car.

Granted, GT6 is a PlayStation 3 game, but there are several next-gen launch games with micro-transactions like Assassin’s Creed IV: Black Flag. To say that the reception to this business model has been mixed would be an understatement.

Monetizing Xbox Live Arcade

The Xbox Live Arcade is full of free or low-cost arcade-style games, and for some gamers the question has been “how do developers make money?” Games like Crimson Dragon have answered that question definitively: stuff your games with micro-transactions.

Progress through the game is governed by how effectively the player earns in-game currency, and this more often than not requires the player to repeat various sections numerous times (this is known as “grinding”) in order to progress. It’s a not-so-subtle way of enticing gamers to pay real-world money for in-game progress. This isn’t good, and it’s led to the adoption of another phrase: “pay-to-win.”

A patch was released for the game that purportedly “rebalanced” it to allow for easier progress, but its troubling business model remains intact.

Furthermore, Crimson Dragon is proof that it’s not just the big developers and publishers like EA and Rockstar that are struggling to turn a profit: indie developers and minor game publishers are experiencing the same problems, likely to an even more severe degree.

A matter of fairness?

This is clearly an industry in turmoil. With things changing rapidly, there’s no way to tell if so-called “paymium” games are here to stay. The explosive popularity of the Wii console gave way to a flattened industry, and desperate times call for desperate measures.

There’s no denying that the market for “core games” is in decline. Until that trend reverses, we’re likely to continue seeing full-priced games supported with micro-transactions. With gamers decrying this as an affront to fairness, it’s clear that something needs to change.

With that, game publishers find themselves walking a tightrope. Do they release games at a lower price to entice more impulse buys, or do they stick with the $60 business model and count on micro-transactions to pick up the slack from slower sales?

Does Xbox Live Arcade lead the way?

Killer instinct

Another Xbox Live Arcade game, Killer Instinct, is doing something interesting that might pave the way for new game delivery methods in the future. The game isn’t free-to-play like Crimson Dragon, and there aren’t any micro-transactions. Instead, gamers are able to download a portion of the game – for free – with all of its features intact to get a feel for what the game has to offer, and then they can choose for themselves whether to purchase the full game in a one-off transaction, instead of being nickel-and-dimed as they progress throughout the game.

Maybe Killer Instinct has it right. Clearly the paymium or pay-to-win model is broken, unwelcome and detrimental to gamers everywhere. Interestingly, it may be up to the smaller developers to introduce a better way. Until then, gamers can vote with their wallets and support forward-thinking developers instead of the ones who seem set on sticking to draconian business models.