Why did the industry move from Singleplayer to the “Game as a Service” model…

In 2006, when Bethesda offered horse armor in Oblivion for $2.5, they might not have realized they were onto a goldmine. Back then, it was unheard of, laughed at, and seemed like a weird trend that would disappear in a few years. 

But Bethesda was the first company that started the Game as a Service model. Fast forward to today, and games-as-a-service (GaaS) titles like Candy Crush Saga, Fortnite, and Genshin Impact are pulling in billions of dollars and attracting huge numbers of players. 

With this model, games like FIFA’s Ultimate Team and Destiny 2 offer ongoing content, keeping players engaged without needing new releases each year. Many games don’t cost anything to start playing, but they profit from players buying things while they play. You don’t need research to understand that it benefits company owners’ wallets, but what about game quality and the gamer community?

Everything you need to know about games as a service

…and why it sucks

First, we’ll have to figure out what GaaS is and how it is useful (at least to game companies). 

GaaS is like a subscription for video games. Instead of buying a game one time, the game keeps changing and adding new content. Players might get to play for free, but they can pay for extras inside the game. This way, in theory, games stay interesting with new updates, and companies can make money over time. 

The concept of “games as a service” started with big online games such as RuneScape and World of Warcraft. These games charged a monthly fee, which meant steady money for the creators to make new things in the game. Later on, as more people started playing games on their phones, this idea grew.

Now, GTA V (the game that has made the most money from microtransactions) made over $8.5 billion because of GaaS. 

Concept of games as a service started with online games RuneScape, World of Warcraft, and GTA V

The GaaS model always follows its strategies:

  • 1

    MicroTransactions

    Players can buy additional content like characters, items, and weapons. These purchases are usually optional.

  • 2

    Regular Updates

    The frequency of updates, like new "seasons", varies by game and developer. For instance, companies like Epic Games may introduce new content quarterly.

  • 3

    Community Engagement

    The community isn’t just active on social media but also within the game itself, helping to promote and sustain the game.

  • 4

    Support

    As the player base grows, segmenting users (e.g., by paying vs. non-paying) can help tailor support and improve player satisfaction.

  • 5

    Marketing

    Buying traffic, launching global campaigns, working with influencers, and optimizing the game for search engines and app stores.

GaAs model strategies, difference between GaAs model and traditional model

After the success of early titles, many tried to follow suit but didn’t quite catch on, like Star Wars Galaxies and FireFall. Despite the billions Fortnite earns, some argue that these games demand too much player time with events and exclusive content. It was hoped these games would appeal to both casual and hardcore gamers, but the balance seems off. 

Bungie, known for Destiny, had intended to appeal to casual weekend players but ended up with continuous updates and challenges that seemed to require constant play, which led to some players feeling overwhelmed and dropping out. The issue is that there isn’t enough profit for game publishers to give up on. They might need to accept that only a few top games can thrive at any given time. Even more, Destiny devs had to delete some of the earliest gameplay addons because the game took TOO MUCH space on the hard drive and they were just adding more and more content. 

Eve Online, for instance, has managed to keep a smaller but dedicated player base without constantly chasing updates, unlike bigger games that try to do too much with too many players.

It’s sad to see games go offline, and not all of them deserve it. Some games that shut down, like Anthem, showed promise but couldn’t keep up. And the trend of games disappearing is worrying, as it could mean missing out on good titles that can’t compete with the biggest names, even if they are good games in their own right. Even though this new way makes money, it’s got some problems. Some games ask you to pay for something insignificant but important for the game (for some reason), which can feel unfair. Sometimes, it feels like these games care more about getting your money than giving you a good time. And if you don’t pay, you might not have as much fun as someone who does, which isn’t really fair.

Pros of GaaS:

  • Earlier release: games can be launched sooner than traditional models, allowing developers to iterate based on player feedback.

  • Continuous revenue stream: developers benefit from a more consistent revenue flow, as opposed to the one-time purchase model.

  • The extended life span of the game: regular updates and new content keep the game fresh and players engaged for longer periods.
Positive sides of GaAs model

Cons of GaaS:

  • Need for constant updates: the game must be updated regularly, which can be resource-intensive.

  • Multilingual content management: it is challenging to manage game updates in multiple languages, requiring complex localization processes.

  • Shorter production and QA cycles: rapid cycles can lead to frequent bugs and errors, impacting game quality.

  • Community building demands: GaaS relies heavily on user engagement and feedback, necessitating a dedicated team for community management.
Negative sides of GaAs model

What is the best GaaS payment model?

Free to Play (FTP)

This is the most common model in GaaS. Players can access the game for free but have the option to purchase additional content such as visual enhancements, boosters (like those in mobile games such as Candy Crush), and seasonal subscriptions. The rise of Battle Royale games, for example, shows the necessity of evolving game content to retain a strong player base.

However, F2P hasn’t always been viewed positively. Initially, it was synonymous with incomplete gaming experiences, where spending money was necessary to reach the game’s full potential. The releases of “Warframe” and “Path of Exile” challenged these notions, offering balanced F2P models that gained acclaim for their fairness and quality.

Some AAA titles have plunged headfirst into GaaS, like “Anthem” and “The Division 2”, yet have stumbled out of the gate with various issues. The use of players as de facto QA testers, among other things, is a worrying trend, raising questions about the integrity of game releases.

Before the influx of F2P and MMORPGs, traditional games could stand on their own, offering complete, polished experiences. Games like “Diablo 3” evolved post-launch with expansions like “Reaper of Souls”, which dramatically improved the game. This suggests that games could benefit from a focus on quality and completeness rather than a reliance on an open-ended service model.

GaAs payment model Free to Play (FTP)

Service Subscription

In this model, players pay a monthly fee to access a library of games from certain publishers. An example of this is cloud streaming services like Google Stadia, where games are playable on any device that supports Google Chrome, offering convenience and wide accessibility. These games are constantly updated and improved, which keeps players interested and ensures a steady flow of income for the developers.

A big draw for many is the social aspect of online multiplayer games. Those who don’t subscribe might feel left out, both in terms of gameplay and community. The subscription gaming market is big business, currently worth around 9.94 billion dollars, and it’s expected to grow to 15.90 billion dollars in the next few years. 

GaAs payment model Service Subscription

Pay to Play (P2P) + Downloadable Content (DLC)

This traditional model is more common in the console and PC gaming markets. Players purchase the game and then have the option to buy additional content. This model faces challenges such as high marketing costs, competition from established companies like Blizzard and Ubisoft, and longer production cycles. It is riskier and less common in mobile gaming.

Games as a Service (GaaS) has become a new norm. With this model, games like FIFA’s Ultimate Team and Destiny 2 offer ongoing content, keeping players engaged without the need for new releases each year. These games are constantly updated, with new seasons or expansions, and often rely on microtransactions for revenue. It’s a model that promotes a steady stream of content instead of one-time purchases, keeping games fresh and players coming back.

GaAs payment model Pay to Play (P2P) and downloadable content (DLC)

How EA found a gold mine in this industry

Electronic Arts (EA), one of the TOP computer game companies, is making a lot of money from games that offer ongoing services, not just from selling games once.

Two-thirds of their $1.8 billion from the second quarter (July-September) results in 2021 revenue came from these ongoing services. Only a third of the revenue came from selling the full games. EA expects to get 70% of their money from services in their games.

Games like Apex Legends are a big reason why, as they let players buy new outfits for their characters and offer special items for games like FIFA. This trend of games as services has been building up for a long time. EA’s old CEO used to say they sold services, not games. Most games used to cost $60 and didn’t have much new content after they came out. But now, almost every AAA game from other companies comes with extra content that can go on for years.

These service games cost a lot of money and effort to keep bringing new things to players. If the game has problems from the start, it can end up like “Marvel’s Avengers“, which didn’t do well and was really expensive for the company. 

EA games and services, Electronic Arts payment model

Curious why games are so expensive to make? Discover the real costs behind your favorite games. Click here to learn more about average cost to make a video game!

Finding the Middle Ground

The GaaS approach has several advantages. It reduces the risk for developers by providing a steady income stream. For instance, Rainbow Six Siege has seen massive success by adding new content instead of releasing sequels, boasting millions of registered players.

The GaaS model allows games to be released earlier, enabling developers to refine them over time with feedback from players.

It’s also called a soft launch for games and provides a steady income as players continue to pay for services and content beyond the initial purchase.

Furthermore, games can remain relevant for a longer time through regular updates and additions, maintaining player interest.

Not all games that follow the GaaS model become successful. This model usually means game developers and game development outsourcing companies have to keep adding new stuff to keep players interested and paying. But always having to come up with new content can make it tough for developers to try out new ideas, leading to games that might just repeat the same things over and over without anything really new.

Also, since GaaS games keep growing with more updates, players who don’t buy every new part can feel left out. They might not be able to join in on all the game’s areas or play with friends, which can be pretty annoying. Some people don’t like that GaaS seems to care more about making money over time than about making a great game from the start. 

Developers might put out games that aren’t finished or don’t have much to do, planning to fill in the gaps later. This can make the games seem empty or just not that great when they first come out. 

GaAs model keeps growing, advantages of GaAs approach