Nothing sells better than a free game, the gaming industry learned in recent years. Indeed, the revenues from titles using the free-to-play (F2P) monetization model the market’s cash flows. In fact, the model has been so successful that major studios are now adding F2P-styled microtransactions into , fueling yet another controversy in the gaming world—one that leads us to a larger problem with the F2P model. came to dominate games with an upfront cost To rake in of dollars, a game that players can access for free still has to sell them something, ideally throughout its entire life cycle. The most typical asset such games can opt for is in-game cosmetics with no impact on the gameplay, but it doesn’t have to end there. Battle passes, paywalled content, character progression boosts, new playable characters, various expendable materials for players to use… The opportunities are nearly endless. billions The F2P Trap Sometimes, players can enjoy a F2P game without putting in a single dollar, and sometimes, such games heavily nudge them into dishing out cash. Either way, it is interesting to look at how players’ spending behaviour seems to have changed over the years. Back in 2014, the industry estimated that only about of F2P gamers actually spent money on their preferred titles. That said, Fortnite, the F2P model’s poster child, had about of its audience hop on the microtransactions bandwagon, as per a 2020 survey. per cent 2.2 77 percent Sure, some of this change likely comes from gamers gradually warming up to the model, and many of today’s leading F2P titles are indeed super-solid from the game design perspective as well. Still, there’s a less rosy piece in this puzzle too. Over time, F2P developers and publishers have found more and more sophisticated ways of goading the user into making as many purchases as possible. Annoying pop-ups and banners every five seconds no longer cut it: Now, some of the rely on behavioral data and complex algorithms to get players to spend more. patents in the industry The real hook of F2P projects, though, transcends the ones and zeroes manipulating you into buying one more skin for your beloved character—it’s in your head. Sunk cost fallacy is a psychological mechanism that makes a gambler feed more and more money into the slot machine: You spent so much already, so you have to make it worthwhile, right? The same goes for F2P games, making them —why quit something you’ve invested so much in? We are, after all, loss-averse by nature, and the feeling of losing out than we find joy in gaining something. downright addictive brings us more pain Granted, from a developer’s perspective, “addictive” means “good.” The more time a player spends in your F2P game, the likelier they are to make a purchase, and then one more for the road, and all of that adds to your bottom line. But that’s hardly the most ethical approach. Gamers deserve better than that, and the industry can indeed do better. Getting Off The Hook While the F2P model may require some tweaks in order to weed out its most toxic traits, its full overhaul is hardly on the cards. The easiest way around the F2P sunk cost fallacy is to allow gamers to cash out on the assets they have accumulated over time. This simple solution transforms the equation, removing its most problematic piece: the loss. This way, when quitting a hobby into which you put so much money, you are not, strictly speaking, losing too much in terms of your overall capital. This, in turn, defuses a whole plethora of psychological mechanisms that would have kept you hooked otherwise. Steam has already allowed players to trade cosmetics for certain games, such as DOTA 2 and Team Fortress 2, on its in-platform marketplace. The platform also allowed modders to put up their creations, from custom cosmetics to more advanced projects, for sale. As a result, it has built a that treats gamers more fairly and rewards creators for their work and passion. As a downside, though, it also charged high fees both on cosmetics re-sales and mod sales. bustling economy Blockchain is the next logical step in this direction. As a decentralized network for moving value, it leaves less room for a centralized entity to dictate the rules and brings the entire system on the free-market rails. Yes, developers can still attach royalties to secondary sales (fair enough, they need revenue streams too), but in a market where so does everyone else, they would have to keep those competitive. Besides detoxifying some of the most troubling aspects of the F2P model, such an approach could also make it more profitable. Gamers would be more likely to buy in-game items if they could sell them off later, a suggests. If confirmed, this trend would be a blessing for the industry as it would allow developers to make up for the lost sales on resold items. recent poll As profitable as it is for the business, the F2P model has its long-established flaws, which in the long run threaten the integrity of pretty much the entire industry. Allowing players to cash out on in-game purchases makes the model more equitable, and blockchain is the industry’s best shot at making it work. About the Author: Adrian Krion is the CEO and Founder of the Berlin-based blockchain gaming startup and maker of the user-friendly gaming wallet . Having started programming at age seven, Adrian has been successfully bridging business and tech for more than 15 years, currently working on projects that connect the emerging DeFi ecosystem to the gaming world. Spielworks Wombat

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Blockchain is the Cure for the Free-to-play Sunk Cost Fallacy

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