Editorial: Discussing Direct Pay-to-Win, Indirect Pay-to-Win and Cosmetics

With government intervention looming over the video game industry it is shocking there has not been a more earnest dialog about the nature of microtransactions. Though the topic is far from having been explored in depth by many commentators the underlying conceptions of the issues are often left unexplored.

Typically the commentator will have a pre-established position on what they consider pay-to-win or even tolerable microtractions. More in-depth analysis may even include motivations and some sciences, but beyond this frame of context there has been little discussion about the context and qualifications of the issue itself. This editorial is not to serve as a definitive end all case made by a pompous writer, but to instead serve as a starting point for future dialog and to begin to redress the underlying nature of the issue at hand.

Pay to win mechanic’s discussions often developer a peculiar, but not unfounded division of people into two camps. Setting aside whether ether group agrees with the mechanic itself and the levels of tolerance they will give to its existence the lines break down as such. One side believes pay to win encompasses everything that gives a player a distinct advantage over other players. Degrees of severity being the debatable aspect along with what is tolerated when. The other camp draws the line saying only purchases that give a definitive advantage qualify as pay to win. Thus a weapon that is without a single doubt superior to 95% of what you can get in the game is pay to win, but time savors, certain skins, and other mechanics are not.

To their merit both sides have a point, but rather than limit the pool of what qualifies as pay to win it serves the discussion better to categorize mechanics properly into: Direct Pay-to-Win and Indirect Pay-to-Win.

Need For Speed Payback - Drift Run

Direct pay to win being the more obvious to gamers of the two. Any mechanic or purchase that grants you an immediate and direct advantage over other players is a direct pay to win microtransaction. These are oft considered the most unacceptable and egregious monetization system. Met typically with near universally hatred, unless of course you are a toxic developer who calls their audience free loaders. Other than those individuals most can agree direct pay-to-win mechanics/items undermines the core experience by introducing mandatory purchases to level the playing field.

Though they are hated, they are more directly fair than their counterparts. When pay-to-win is direct and not obfuscated behind lootboxes there is a price you know you have to pay before skill returns to reign as the deciding factor of the competitive nature of the experience. Once all relevant players have the hypothetical $3 weapon the game boils down to whose strategy is better, who is more skilled at wielding the weapon if the game isn’t purely stat based.

Yes the affront of having to pay to return to an enjoyable game is ever present.  There is no sugar coating the direct demand it enacts on players. There is no justification a user can make to render it anything than what it is and that is why direct pay to win is as opposed as it is.

Indirect pay-to-win, contrary to its counterpart, offers an indirect but distinct advantage to players over each other. Where direct pay to win has a theoretic cap till more is demanded of the user base indirect other than spending limits does not.

Fallout 76 promise broken

If we take two players of the relative same skill level, competence, and time investment potential and put them into a game with time savors. The player who purchases them will have an advantage over those that have to grind out the material in order to reach the same level.

In Fallout 76 the player who purchases the Fridge will have to hunt for less food and can spend their time on more advantageous pursuits. Those that purchase the scrapbot  won’t have to devote as much time to collecting material. The same is applicable for any purchase that either increases rates or directly gives you the items/resources. When you don’t have to do it the same rate everyone else does you are free to pursue other elements of the game including what may make the game actually fun.

With their less offensive nature companies are able to get away with implementing and charging players vastly more than they otherwise would have been capable of if the demand was more direct. It’s easier to justify a time savor than it is to justify being forced to purchase the weapon directly, but at the end of the day the effect is the same. You are paying for the advantage over other players. Except now with the indirect model there is no upper cap on how much can be spent.

 

The best part for companies utilizing the indirect style is there is no guarantees they need to maintain for the item’s power or outrage to contend with over the gradual power creep the direct style tends to incur.  Nor is the company beholden to your success. Didn’t get the item you desired? Try again with another time savor.

Where direct microtransactions can be likened to being stabbed while facing your assailant, indirect is akin to being stabbed in the back. There is a debatable preference between the two, but everyone should be able to agree it is best to avoid having knives placed inside the body altogether.

Where the aforementioned is hotly debated and more readily condemned the middle ground many are eager to accept in the pursuit of moderation is the allowance of cosmetics only. Now while shortly it will be argued how this method can be wrong, there is a point where it is acceptable.

The first example comes from Japan where the developers often implement a slew of small skins that are sold for between a one to two dollars, with bundle packs offering slight discounts. At the same time the company typically releases decent free skins as thanks for the players continued support of the project. Though these cosmetics exists at no point are you required to purchase them and in fact they are entirely avoidable if you so choose.

Then the Holidays come around and you see the $4 mega pack that contains all 6 outfits. You’ve been playing the game, it’s been good to you, and you enjoy playing it. In this case there is no harm in purchasing the cosmetics. Especially as these companies often give you nearly as many are a generous amount of free skins for supporting their game.

Another alternative is Warframe, where cosmetics are more tied to gameplay, but grinding them out isn’t entirely a lengthy, tedious task. Most of the time it can be accomplished in an hour with any duplicates acquired during the process sellable on the player market for extra in game currency. Alternatively you can skip the hassle and purchase any frame.

Warframe has three saving graces for its system. Firstly the game is predominately PVE. There is a PVP mode, but in addition to not being the primary focus of the game it also balances and negates frame bonuses. So a noob with basic equipment can still go toe-to-toe with an end game player and skill is still a deciding factor.

Secondly the game is free to play and receives massive expansions and mechanic overhauls at a regular rate. These expansions are not your typical “here are two new PvP maps”, but fully fleshed out open world maps, sometimes with new mechanics, but always a plethora of quests.

Finally the in game marketplace rewards play. During the course of your adventure you will unlock extra frames, skins, and items you simply do not need and you can liquidate these items onto the community store for currency that you can save to purchase the new items you’ll want. There are entire communities of players who solely farm and profit in real life and in game from the farming out items.

Warframe is far from perfection and without controversy, it is important to remember when the developers who themselves are gamers not professional money managers and marketing execs accidentally invented a slot machine for skin colors, they removed it once they saw one user had developed a particular problem with the mechanic having spent over a hundred dollars in a hour.

Where we can articulate where, how, and why cosmetics can be implemented properly the notion that they do not matter needs to be dispelled entirely. From the moment you are born you are judging things based on appearance, as noted in a report by Parents.com. You will continue to do so for the duration of your life as science demonstrates from as young as three years old you are forming evaluations of people based solely on their appearances, often their faces, as expounded upon by Psychological Science. You can’t help it; according to The Atlantic, it is hardwired into your brain to formulate judgments based on appearances.

It’s not merely limited to just facial recognition and determinations. Looks will impact the way society treats you all the way to the amount of money you make over a life time. According to Daniel Hmermesh a researcher and academic in the field, appearances have numerous implications towards your life. More attractive people will enjoy more earnings and more people will want to be around them. They’ll enjoy better deals and as other research shows people are more compassionate towards them.

“In addition to whatever personal pleasure it gives you, being attractive also helps you earn more money, find a higher-earning spouse (and one who looks better, too!) and get better deals on mortgages. Each of these facts has been demonstrated over the past 20 years by many economists and other researchers. The effects are not small: one study showed that an American worker who was among the bottom one-seventh in looks, as assessed by randomly chosen observers, earned 10 to 15 percent less per year than a similar worker whose looks were assessed in the top one-third — a lifetime difference, in a typical case, of about $230,000.” –Daniel Hamermesh

Appearances can even be a deciding factor in whether you are hired or not when you are job seeking. Yes that means you very much should dress for the occasion and remember to dress for the job you are seeking as looking too good can negatively impact your ability to get hired as well.

Day to day you comb your hair, brush your teeth, drive a decent car, keep your property looking nice, and even are nice to complete socially uncouth (I can’t swear) individuals purely to keep up appearances. If you went to pick up your date looking horrible would the date go well? Well unless she or he is using you for free food it probably won’t.

To watch people turn around and with a straight face tell everyone “Cosmetics don’t matter1” when the science of our existence very much does indeed show it does, is disingenuous.

Let there be an argument made for how it should be implemented, but do not in good faith say it doesn’t matter. For in our illustration of the point, we could spend an entire thesis documenting the extent to which the science and practical experience shows through statistics and anecdote the extent of the role  appearances play in our lives.

To the extent this is a dynamic in our lives, children are being bullied for how they appear in Fornite. Much in the same way you used to need to keep up with the fashion trends to be wearing a base game skin is paramount to be bottom tier trash in the vicious circles of youth.

Professor of economics at the University of Texas, Daniel Hamermesh, mentioned in a New York Times‘ piece…

“It’s a matter of simple prejudice. Most of us, regardless of our professed attitudes, prefer as customers to buy from better-looking salespeople, as jurors to listen to better-looking attorneys, as voters to be led by better-looking politicians, as students to learn from better-looking professors.”

That’s not even before getting into the various tactical advantages a skin can have. A dull colored, even camouflaged skin will stand out a lot less than a neon pink circus reject or a base skin with its pasty colors being visually protuberant from within the environments. Is it any wonder some of the best unlocked skins are all dark tones? Epic is not oblivious to it.

There then lies the more indirect advantage to cosmetic rewards. When they are desirable for individuals to maintain their status in the community, they must achieve them or alternatively they are a symbol of success, a mark of accomplishment. Regardless of individual views on the matter users will spend more time with the game to achieve them.

The industry term is “Player Engagement Rates” or “User Engagement Rate.” In the most basic sense it is the amount of time each individual user spends with the product or game. Often it is aggregated for corporate in an “Overall User Engagement Rate,” to determine the viability and potential profitability of a franchise.

How this is important is simply the longer the product creator has you in interacting with the product the more opportunity they have to sell items to you. The more they sell to you the more they increase your sunk costs which can lead to a feedback circle that will keep players engaged with the experience regardless of the subsequent quality drop.

Cosmetic rewards can keep players engaged for upwards of hundreds of hours and if they cannot reach the goal near the conclusion of seasons the opportunity (marketing buzz word) to purchase your way to the goal rather than losing the prize is available. With a peak of 250 million users if only 10% purchase a single level at a dollar (not actual price) then the returns the company would see $25 million in profit instantly as there is no cost to the company to give you free levels or the skin. $50 million at two levels, $75 million at 3 and if just 25 million users purchase 4 levels that’s S100 million in profits. The revenue potential from such little work is very enticing to companies and is exactly why battle passes are so lucrative even if they’re only offering unlockable skins.

As you can see there is no good method of expanding a company’s revenue stream. Each iteration of microtransactions comes at a cost and the discussion must then go down to nuance and what’s tolerable if avoidance is not possible.

Rather sad when you take a step back and consider that the incoming regulation could have been prevented if the industry merely adopted a sustainable monetization revenue rather than attempt to invent and patent the most egregious extraction methods possible. If the industry doesn’t think the governments around the world are not going to be advised by scientists aware of how even appearances can be manipulated they’re sadly mistaken.

The industry now at the AAA level is not one that sees itself as one with the consumer. Rather the consumer is merely a beast of burden that must be tolerated in the acquisition of capital and social proof. When you have an entire industry at the top level ran not be industry veterans, but professional money managers, politically connected individuals, and big money associates this isn’t a mentality that will change. At best the glove can be softer, but it will always be made of iron. For our part the best we can do is arm ourselves with knowledge and hold discussions in honesty rather than obfuscation.

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