A game like Fortnite costs nothing to download and nothing to play. Yet it runs on thousands of computers and pays thousands of staff. In its first two years it took in about 9 billion dollars. Nobody paid to get in.
An outfit
++
A dance
++
A bag of coins
Sold inside, after the free download.
The money comes from things sold inside the game. An outfit for your character. A dance. A bag of coins. None of it makes you better at the game. People buy it anyway, and every sale goes to the makers.
Things sold inside it
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The download
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The phone maker
Where does a free game's money come from?
The download. Free means a small hidden charge.
Not yet. There is no charge for the download, hidden or not. If there were, far fewer people would come in, and the shop inside would have fewer people to sell to.
The phone maker, which pays for popular games.
Not yet. Phone makers do not pay games to exist. It runs the other way: the phone maker takes a share of what the game sells inside.
Things sold inside the game, like outfits and coins.
Right. The download is free so that as many people as possible come in. The shop inside is where the money is made.
1 of 20
Of every 20 players, about 1 ever pays
Here is the odd part. Most players never pay a penny. In many free games, fewer than 5 in every 100 players ever spend anything. The game has to earn all its money from those few. So it is built to find them.
Move the control to set how many players in every hundred pay. This uses a made-up round rule: 1,000 players, and each paying player spends 10 dollars a month.
What 1,000 players bring in a month100 dollars
If every player paid one dollar1,000 dollars
1 in 100 payOut of 1,000 players, 10 pay 10 dollars a month. That is 100 dollars a month from the whole thousand, or 10 cents a player.
What 1,000 players bring in a month200 dollars
If every player paid one dollar1,000 dollars
2 in 100 payOut of 1,000 players, 20 pay 10 dollars a month. That is 200 dollars a month from the whole thousand, or 20 cents a player.
What 1,000 players bring in a month500 dollars
If every player paid one dollar1,000 dollars
5 in 100 payOut of 1,000 players, 50 pay 10 dollars a month. That is 500 dollars a month from the whole thousand, or 50 cents a player.
What 1,000 players bring in a month1,000 dollars
If every player paid one dollar1,000 dollars
10 in 100 payOut of 1,000 players, 100 pay 10 dollars a month. That is 1,000 dollars a month from the whole thousand, or 1 dollar a player.
What 1,000 players bring in a month2,000 dollars
If every player paid one dollar1,000 dollars
20 in 100 payOut of 1,000 players, 200 pay 10 dollars a month. That is 2,000 dollars a month from the whole thousand, or 2 dollars a player.
Two in every 100 pay 10 dollars a month. How does that compare with every player paying one dollar?
It is more. Ten dollars is more than one dollar.
Not yet. Ten dollars from each of twenty people is 200 dollars. One dollar from each of a thousand is 1,000. More per person can still be less in total.
It is a fifth as much. Twenty payers bring 200 dollars; a thousand payers would bring 1,000.
Right. Getting a small sum from everyone would earn more, but nobody has found a way to make a thousand people pay. Finding twenty who will is what works.
It is the same. Twenty times 10 is 200, and a thousand times 1 is 200.
Not yet. A thousand times one dollar is 1,000 dollars, not 200. The bars only meet when a fifth of players pay.
Move the control.
499 playershalf the money
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1 playerthe other half
Real numbers. One 2016 study of mobile games found that under 1 in 500 players brought in nearly half the money. Game makers have a word for these players: whales. It just means the few who spend a lot. The whole shop is built with them in mind.
5,000Players
↓→
2 in 100Who pay
↓→
15 dollarsEach pays
A game has 5,000 players. Two in every 100 pay, and each of them spends 15 dollars a month. How much does the game take in a month?
dollars
Right. A hundred payers, at 15 dollars each. The other 4,900 players brought in nothing, and the game still wants them: a full game is what the hundred are paying to be part of.
Who is each of these in the free game's deal?
One card at a time. Tap the pile it belongs to.
Card 1 of 5
A player who bought an outfit for the weekend.
A player two years in who has never opened the shop.
The studio that made the game.
A streamer who buys every new outfit on the day it comes out.
A player who looks at the shop every day and always closes it.
A player who bought an outfit for the weekend. → Pays
Not yet. This one pays. An outfit is a thing sold inside the game, and buying it is where the game's money comes from.
A player two years in who has never opened the shop. → Plays free
Not yet. This one plays free. Two years of play cost the game something to run, and brought in nothing, and that is allowed.
The studio that made the game. → Earns
Not yet. This one earns. Every outfit and coin bag sold goes to the studio, less the share the phone's app store keeps.
A streamer who buys every new outfit on the day it comes out. → Pays
Not yet. This one pays, and a lot. A player who buys everything is the kind of player the shop is built around.
A player who looks at the shop every day and always closes it. → Plays free
Not yet. This one plays free. Looking costs nothing; only a purchase moves money, and none has happened yet.
The few who pay
↓→
The studioearns
↓→
The many who play free
Right. Whoever buys a thing inside the game pays. Whoever only plays, plays free, however long they stay. The studio is the only one that earns, and it earns from the first pile alone.
Free gamea few pay a lot
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60-dollar gameeveryone pays once
A different game costs 60 dollars up front and sells nothing inside. Who pays for it, and what does the studio need from them?
Every player pays once, so the studio needs many buyers, not a few big spenders.
Right. This is the older deal. A game sold this way has no reason to find whales, and no reason to keep you coming back after you have paid.
Advertisers. Games are paid for by ads.
Not yet. Some free games do carry ads, but this one charges at the door. Sixty dollars from each player is its whole income.
Still a few whales. Every game lives off a few big spenders.
Not yet. There is nothing inside to spend on, so nobody can spend more than 60 dollars. One player cannot pay for five hundred here.
Lesson complete
A free game earns from things sold inside it, and a few players pay for almost everyone.