Game publishers, multiplayer intermediaries, game development studios, social networks and virtual worlds now have the technology available to transition to new business models such as free to play and time-based play.
The Video Gaming Industry is currently experiencing explosive growth, especially in the area of online, multiplayer gaming. DFC Intelligence, a strategic market research and consulting firm, estimates that the worldwide online game market will reach $8 billion by the end of 2008.
Revenue is expected to continue to rise and pass $13 billion by 2012, said DFC Intelligence. In addition, the industry is looking at new business models focusing less on license revenue and more on the possibilities of recurring revenue via initiatives such as subscriptions, in-game charging for assets, new levels and in-game advertising within virtual environments. The Wall Street Journal estimates that the market for in-game items will reach $5 billion by 2011.
Fran Heeran, chief technology officer at Valista, commented: “In-game purchases and in-game economies are an important pricing model for the gaming industry. In-game purchases enable recurring revenue and expand the customer base to include casual gamers. Free to play is a business model that is extremely popular throughout Asia. Gamers have little or no upfront cost to play, but instead pay for in-game digital goods and assets, such as access to special features and levels or clothes for an avatar. In the coming years, revenue from advertising and digital distribution and virtual items is expected to equal revenue from subscriptions, which is currently the dominant pricing model in the western world.”
Valista’s In-Game Commerce Solution is a white labelled offering that game companies (publishers and studios) can deploy to provide both the real world and in-game payment capabilities enabling publishers to monetise their game assets and support in-game economies.
Valista’s In-Game Commerce Solution leverages the ValistaPlus platform, which is built in a modular fashion to allow customers to determine which modules best fit their needs. ValistaPlus Modules include: Payments, Subscriptions, Stored Value, Settlement, Discounting, Bundling, Loyalty, Eligibility, Licensing and Entitlement Management. The ValistaPlus platform supports a wide range of payment instruments including, credit/debit cards, direct to bill charging, stored value, and loyalty programs.
Beyond the benefits for game developers, Valista’s In-Game Commerce solution also provides advantages to end users. It provides increased functionality, an outlet for self expression by allowing them to personalise their spaces and a means for communication. These advantages can be utilised to maximise the monetisation potential of in-game charging.