Many of the biggest free-to-play online games – Fortnite, League of Legends and Pokemon Go, to name a few – use micro-transactions to generate revenue. They’re so-called because they involve the player spending small sums of money so that they can acquire virtual goods, such as items, weapons and character skins.
Sounds innocent enough. However, there can be problems with this way of monetising games and there is some debate about whether micro-transactions should be allowed or not. In this post, we’ll run through exactly how these transactions work and look at what aspects of them people find controversial.
How Do Micro-Transactions Work?
The way micro-transactions work is straightforward. You purchase set amounts of a game’s own virtual currency using actual, real-life money. Then, you can exchange the in-game virtual currency for items or bundles of items. In many free-to-play online games, players can earn virtual currency for free and are gently encouraged to purchase more of it. The items that can be acquired from a game’s store include things that are purely cosmet-ic (character skins and decorative items), as well as things that can help you make pro-gress in a game, such as weapons. The non-cosmetic items don’t give players a clear-cut advantage (you can make just as much progress without buying them), but they can make it easier and quicker for players to make progress.
Are Micro-Transactions Acceptable?
The general consensus seems to be that micro-transactions are an acceptable way of monetising online games. However there are some stipulations: the game has to be free and players have to know exactly what they’re getting. When Crash Team Racing Nitro-Fueled was released, you had to pay to get the game. Developers initially said there wouldn’t be any micro-transactions, so once you bought the game, that was it. However, the game soon introduced them and that caused frustra-tion amongst many players. Why should you pay for a game only to have to pay again to acquire additional content? In the case of the Crash game, the micro-transactions involve purely cosmetic content. You can actually acquire all of this content through earning the in-game currency during normal gameplay, however it would take hundreds of hours of playing to unlock it all. Mi-cro-transactions let you access it much more quickly. With micro-transactions, players want to know that what they’re paying for is worth it. For many games, the in-game store will show you exactly what can be purchased with the game’s virtual currency and, for bundles, what the bundle comes with. This is where we get to loot boxes, which are the most controversial aspect of micro-transactions.
The Loot Box Controversy
Many online games, such as Apex Legends, use loot boxes as a form of monetisation. These are boxes that contain one or more randomly determined items, though there’s a catch: you don’t know what you’re getting until you’ve paid. In some games, you have to spend real money (and use the game’s virtual currency) in order to acquire a loot box. In others, you’re given loot boxes for free, though have to pay for a key to open them. Either way, you can’t get hold of the contents of a loot unless you pay. What people think is controversial about loot boxes is that there’s no way of telling what’s inside. You could buy one and get useful items; likewise, you could buy several and not get anything you want. Game developers set the odds for each item that can appear in loot boxes and they rarely disclose what these odds are. Some have likened loot boxes to a form of gambling. When you gamble, you spend mon-ey hoping to win and make a profit, though the chances are slim. Loot boxes work in a similar way: you spend money hoping to get certain items, but there’s no guarantee you will. Belgium completely banned loot boxes in 2019 and was the first country to do so. Other countries have introduced restrictions or have indicated that they’re looking into the mat-ter. The UK, for example, efforts are being made to include loot boxes in the country’s gambling laws. What concerns people is that loot boxes can encourage people to become addicted to gambling, especially minors.
Summary
Micro-transactions are a staple of the free-to-play online game sector. Many of the biggest games generate billions of dollars in revenue annually through these optional transac-tions. Though they can be controversial, mainly when loot boxes are involved, they seem to be accepted as a preferred way of monetisation. If games weren’t reliant on micro-transactions, they would probably have to include ads to generate revenue. That would surely not go down well with players, as gaming is meant to be an immersive experience that takes you away from the real world. Micro-transactions are here to stay, though loot boxes may well be adjusted or outlawed altogether in the coming years.
