Put your hand in your pocket. Dig around. What did you find? A few coins? A paper? Or did you find a Smartphone? Yes. I bet you did. Now as you unlock your phone what is the first thing that your eyes see? You will say: “Just a bunch of apps”. Perfect. Now as well, its more than likely that you did not pay for this “Free” application. Because as the economist Milton Friedman said: “There is no such thing as a free lunch.” But one might think: “I just downloaded this application for free. How can they make money off me?”
Well that is a slippery question that has many answers to it. However this time I will focus on one, that is the ever growing gaming app industry. The Mobile Video Game Industry is set to make $30.3 billion dollars worldwide. The big name gaming apps that are generating this revenue are free-to-play. Some of these are Angry Birds, Clash of Clans, Temple Run, Candy Crush Saga, and Fallout Shelter just to name a few.
However the most interesting and lucrative part is how low cost these applications are to make. An application can cost to make between $10,000 to $250,000. One might say that is a high cost for a free to play application. However to create the average video game console/pc can cost between $1,000,000 to $140,000,000. That is a large sum and risk for the developer to take. As well for the consumer its a hefty tag to pay with the average game costing $60. This is why its becoming more intriguing, for big name video game companies to start creating free-to-play applications. Bethesda, the video game developer that has created iconic games like Skyrim (one of the highest selling games of all time) and Fallout, created a free-to-play application called Fallout Shelter. Within the first two weeks it made $5.1 million dollars, this game was created as form to advertise their upcoming game Fallout 4. But they might have stumbled within their actual cash cow with this free-to-play game, that will probably out gross the product that they were marketing for. Another highly addictive and revenue generating juggernaut is Candy Crush Saga. In 2014 they generated $1.5 billion dollars for a game that is just entering is third year of existence.
I wont give you any further examples since you know where this trend is going. Free-to-play apps make money. But how? Well through many different ways. One is in game purchases. The application offers you to shorten wait time, an extra life, an outfit, a character, more resources, pretty much anything in which the game revolves around. However they do this in a clever way. At the beginning they give you a few “tokens” in which you normally would pay, then they show you how they can be used during a “tutorial” and show you how advantageous it can be. So after playing the game a few times, the difficulty level starts going on an incline. Then eventually you are forced to either wait for your waiting time to end, or gain more life….but if you don’t want to wait, then you can pay.
Developers play with the addictive qualities of these games and smartphones to keep trying to fish for the money from your bank account. One might want to deny that these free-to-play games are going to go away but the forecast portrays that by 2018 mobile gaming will generate $45 billion dollars.
As you see this is the present and the future that is implemented into smartphones. But are you willing to get with the times, so you can spend your valuable time and money on a pointless application?
I’ll let you decide. I am gonna go read a book off my Kindle app…..wait….