Thought Leaders in Online Gaming: Scott Hartsman, CEO of Trion Worlds (Part 2)

Sramana Mitra: I don’t know if you saw this Economic Developer Survey that came out about gaming. Mobile apps in general are large portions of games – somewhere around 50% both on Android and iOS, but the developers make $500 a month or less.

Scott Hartsman: That’s exactly right. I saw a report last week where somebody drew out what the long tail looks like on PC versus the tail on mobile. On mobile, only a fraction of the top 1% is making any money at scale.

Sramana Mitra: The long tail of PC is healthier, is that what you’re saying?

Scott Hartsman: Correct. Not only that. The head is a lot wider than the top fraction of 1% of games.

Sramana Mitra: I know that Trion did not start out in the free-to-play mode. Can you talk about the evolution of Trion and the industry through the free-to-play movement?

Scott Hartsman: At the point Trion got its start, the dominant business model even in PC online, was you would ship a box to a retailer and charge a monthly subscription to your game. Industry-wide, the assumptions around what would work really changed as consumer habits changed. The internet continues to grow even bigger. Online gaming continued to get bigger also and more players chose to play games online. The customer behavior back when Trion first started was that people would frequently purchase a game and make friends to play that game inside of the game itself. You can get away with having some amount of a barrier up front.

We started to see that the economic issues globally caused that barrier to become an even bigger problem. In terms of customer behavior, players started migrating with their friends in packs. What would happen is players would all go play the games that all of their friends could go play. The greater the barrier up front, the less likely it would be for a group of players to adopt your game. This very much impacted the kinds of games we were making at that time, which were big, synchronous MMOs where the success depended on having a large group of friends to play with.

For us, it was both the economics as well as the social pressures of being able to get more people into our games with as little friction and as few barriers as possible. We wanted to do this while trying to invent a business model that was palatable to core gamers where the perception of fairness is incredibly important and the perception of getting value for their money was very important. Over the past few years since Trion’s been founded, the approach to business model and what’s acceptable has changed pretty dramatically. All the legs of the chair that we built our original assumptions on are no longer there.

Sramana Mitra: Does that mean that you’ve had to reintroduce as a free-to-play game?

Scott Hartsman: Rift converted over to a free-to-play game. It was a six-month development effort. It launched as free-to-play in July of 2013. Defiance, which originally launched in April of 2013, has been going through its free-to-play conversion right now. It has been free on PC for a couple of months now. It went free on PlayStation last week, and the free version for Xbox is upcoming.

Sramana Mitra: Can you tell us a bit about what it entails to make that shift to free-to-play?

Scott Hartsman: It’s always interesting going to a conversion versus starting a game that way from scratch. With Rift, we were very fortunate in that we had a large team of developers that worked on Rift. They have about six to eight months to actually get all the work planned out and done. They had a solid commerce platform on the back-end to make it all happen on.

In a lot of ways, the way we think about it at the highest level is pretty simple. Obviously, we need to make money on games because we have costs, and we need to keep growing and building. Since we need to keep making money off of a core gamer audience who has this strong sense of what’s right and fair, we tend to think of shopping more as an exercise in gameplay than an exercise in commerce or marketing. We have individuals who are on the development team themselves who are game designers and system designers. People like these are already used to dealing with resources as they balance games. Money now just becomes one of the additional resources that they balance for and make sure that the game is fair and profitable.

In a lot of ways, it pushes some of the business responsibilities down to the team level themselves, which at least on most of the teams that I’ve worked with in my career, is visibility that a lot of the teams have always desired in the first place. It lets them run their games like standalone businesses themselves and keeps them very aware of how healthy everything is, how our customers are doing, and what we can make that will interest audience to play and to buy. We’ve had that model work really well for us. It worked very well for us on Rift, and then, we carried it through to Defiance. We’re also carrying that same model through into our newer games.

This segment is part 2 in the series : Thought Leaders in Online Gaming: Scott Hartsman, CEO of Trion Worlds
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