How does Elite: Dangerous' Business Model Work?

Leighroy

Leighroy
Hi everybody,

I was under the impression that if you have a server heavy online gaming universe like Eve-O, you have to have an income stream aka a subscription, in order for the money to keep coming in to cover a recurring cost for the server and its upkeep. Currently, ED seems to be a one off charge as for standalone software. How do they intend to generate income with no subscription fee and no substantial microtransactions? Selling the odd paint job for a couple of quid occasionally does not seem sufficient.

Any ideas anybody?
 

Thygrrr

Thygrrr
League of Legends also lives almost exclusively on optional (i.e. also available by playing for free) unlocks and vanity items.
 

Corwyn

C
This was described by DB at a convention. The money from the kickstarter and the store are for getting setup and development. The continued running and support of the game will be from Frontier's other projects and products. If there are other forms of income for it, they haven't stated it.
 

King Hrothgar

K
Guild Wars uses the same model. The original Guild Wars servers were still alive and well last time I checked (a year maybe). They released a few addons for it (stand alone or combined) over the course of the first couple years but haven't done anything major for 7-8 years now. My guess is the sale of the occasional vanity item keeps them going and someone new periodically hopping into it. One important thing to keep in mind is that the amount of server power you need, and thus the costs, are proportional to your player base. As player numbers decrease, costs decrease. The game will sell new copies for the next few years without any addons. Additional addons of course will add more revenue. There is already one that's been semi-officially announced.
 

Jason S

J
With the offline scrapped it becomes much easier to put a subscription model.

Personally I think now they will at some point bring it in.
 

FaolGlas

FaolGlas
Most MMOs these days are on the free to play model (old stalwart WoW being one notable exception). Guild Wars and Guild Wars 2 do just fine, even rolling out major content for GW2 on a major basis, which everyone gets. They have a way to purchase "gems" for real money to get you in game stuffs - FD has the skins so far, and of course the physical items like mugs and t-shirts, and have as far as I know always said there would be paid expansions too (which is what kept GW1 going). So I don't see a need to move to a subscription model at all, it's a model that most are moving away from these days.

I avoid subscription models because I sometimes have weeks where I barely play, and then it's money wasted, but have ample online and MMO selections to choose from that don't rely on that to keep them afloat! While ED does need the servers, it isn't as server intense as some due to the way they have it set up, so may be less expensive for them to run on the back end than things like GW2 too.

Mmmm.... ship skins! Where's my credit card?
 

Turjan

Turjan
FD is not a studio that relies for its income on just one game!
But as far as Elite Dangerous itself is concerned, I'd guess they'll probably be using a similar model to that of Path of Exile. See this excerpt from PoE's FAQs :-

6. What does Path of Exile cost to play?
Path of Exile is 100% free to play, for everyone, forever. Our website will allow the purchase of many in-game perks and aesthetic upgrades, but all of these are completely optional, and players can have a complete, fulfilling gaming experience without spending a penny.

Beyond that, FD will charge for major content expansions to Elite Dangerous (e.g. planetary landings). A lifetime pass for such expansions (making all future content free to the purchaser of the pass) was available for quite some time in the E-D Zaonce store, but has now been withdrawn. So new purchasers of the game will need to buy such major content updates to play them.
 
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knowles2

K
I'm also sure Frontier is also looking to get a substantial income from licensing deals as well, books, toys, jewellery I'm sure there all type of deals frontier is looking at right now.
 

Toxic_Waster

Toxic_Waster
ED is not the only game who decided to go against monthly subscriptions. Guild War 2 did it too and as far as I know they're not doing too bad. Their revenue comes from the new subscribers who are more eager to pay one-time fee over monthly subscriptions. It's well known that the free software with paid upgrades generates more revenue than the straight paid version, but it also depends on the market share.
 
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deusx_ophc

deusx_ophc
Leighroy said:
Hi everybody,

I was under the impression that if you have a server heavy online gaming universe like Eve-O, you have to have an income stream aka a subscription, in order for the money to keep coming in to cover a recurring cost for the server and its upkeep. Currently, ED seems to be a one off charge as for standalone software. How do they intend to generate income with no subscription fee and no substantial microtransactions? Selling the odd paint job for a couple of quid occasionally does not seem sufficient.

Any ideas anybody?
Click to expand...

there is some decent cash in the mt model (lol made 1billion U$ in sales jan-sept). read the report here

also according to DB during his keynote at Nordic Games recently ED has a low break even (mainly due to the fact that they have infrastructure already in house (cobra/webshop) and no need for publisher/physical distribution cost.

so if they keep putting out interesting content (aka paint jobs, sidegrades, naming rights etc) and keep a good player base then all will be good

edit: also please note that FDEV are a successful business for 20 years, they have some key partnerships with ms, amazon et al. they are not JUST ed and the IPO was a first step to accelerate a transitional phase in their business model (lots to read this part of their website)
 
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philux

philux
Digital Combat Simulator (DCS) is a popular air combat sim framework that is around since 2009 and its development has been funded only by selling new modules (i.e., planes) to the fan base over all those years. However, in contrast to what I saw here people of the flight sim community are usually much more willing to continuously buy new modules for their favorite sim to support the devs. Conversely, I saw here a lot of statements by user along the lines that they ideally wouldn't spend anything more than the purchase price or try to spend as little as possible in the future.
This kind of attitude among large parts of the community might pose a problem in the future.
 

CreepyD

C
I did read that FD might license out the Stellar Forge, that could create nice cash - might just be a rumour, I don't know for sure.

Also I used to play Rift (monthly Sub). When that went free to play (micro transactions mostly for vanity items) they actually made more money from it each month.
Look at the mobile market, companies make an absolute fortune from micro transactions, even when they are purely for vanity items.
 

knowles2

K
philux said:
Digital Combat Simulator (DCS) is a popular air combat sim framework that is around since 2009 and its development has been funded only by selling new modules (i.e., planes) to the fan base over all those years. However, in contrast to what I saw here people of the flight sim community are usually much more willing to continuously buy new modules for their favorite sim to support the devs. Conversely, I saw here a lot of statements by user along the lines that they ideally wouldn't spend anything more than the purchase price or try to spend as little as possible in the future.
This kind of attitude among large parts of the community might pose a problem in the future.
Click to expand...

I think on average about 10% of the player base that will spend money on a game via Microtransactions.

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CreepyD said:
I did read that FD might license out the Stellar Forge, that could create nice cash - might just be a rumour, I don't know for sure.

Also I used to play Rift (monthly Sub). When that went free to play (micro transactions mostly for vanity items) they actually made more money from it each month.
Look at the mobile market, companies make an absolute fortune from micro transactions, even when they are purely for vanity items.
Click to expand...

That what they base their floatation on and stated in the documentation that one of the uses for the floatation funds , was the development and licensing of Cobra, their in house game engine, to other game developers, I would love for Stellar forge to be an extra module you can buy for it. Haven't heard anything more about those plans through.
 
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philux

philux
knowles2 said:
I think on average about 0% of the player base that will spend money on a game via Microtransactions.
Click to expand...

To support development, I would (already have done it). But I know what you mean. Every release of a new ship skin so far caused a ton of complaints.
 

cpbtrading

cpbtrading
They are a public company, they won't prop it up with other products or projects. It will have to stand on its own sales or after sales via, whatever they offer to us the players to purchase later. For instance dlc's, being part of this whole project, could give it the feet to run on for some time. Done at regular say six monthly intervals, they really could be profitable.
They have a lot planned, just got to get that right and hope sales are really good, not sure how many have been sold so far, but they will certainly be hoping for good numbers after release in December, for the initial game.
 

knowles2

K
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Rearden

Rearden
Corwyn said:
This was described by DB at a convention. The money from the kickstarter and the store are for getting setup and development. The continued running and support of the game will be from Frontier's other projects and products. If there are other forms of income for it, they haven't stated it.
Click to expand...

Do you have a link for this? This sounds such a terrible business decision (to put profitable products servicing a losing one) that my only guess is that you got it wrong. I have some serious doubts about the "pay for expansions" path but it has been using for guild wars so it is definitely not impossible and good luck to them. I prefer the subscription model myself and think its fairer (obviously depending on the price) as I can choose not to pay for months where I am unable to play for some reason and it better reflects the costs that the company is incurring. The worst of the models would be F2P which I would not play just on principle as I don't like P2W (and if it is not P2W it is not profitable for the company in my experience).

I would have to say however that the financial future of the game does not seem bright in any case if they are forced into an early release (which will affect future sales feeding a downward loop) like this not to mention the desperate cash grabs on the latest newsletter. At least Star Citizen is honest about only selling 3D pictures of ships you can't even fly (but I guess they can afford to).
 
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