The rise of the "Annual Pass" model

In the mainstream gaming world there has always been an upfront investment to play the game, the problem with this historically is that it often meant a huge cash injection for the company right away and then a slump until releasing their next product.

Then video game developers came up with a few ways to add longevity to their projects by releasing content over time, single player games might get episodic content while multiplayer games might get new scenarios and levels. This is a great way to make some extra money from the devoted fans by giving them something extra at a reasonable price using the existing game resources to save money.

This model has its problems though:

  • Creates a barrier of re-entry: Nothing puts a player off more than coming back to a game after a few months and discovering they need to purchase two or three map packs in order to play with their friends.
  • Alienates new players: Just like the returning players the new players feel discouraged as well. Unlike the returning players though these guys will never know what the good days were like.
  • A fickle community: Gamers tend to move on quickly, bringing out new content too slowly means whatever you are bringing out might not be exciting enough to being back the same volume of fans.

This in turn means for most companies it is more profitable to keep putting out new games at full retail price every 12 months rather than supporting their older games until the numbers slowly drop off.

One solution that has arisen in popularity lately is the Annual Pass, a nominal fee paid upfront while you are excited about the game which gives you something straight away (normally cosmetic) and promises 4 or 5 content packages over the next 12 months that you won't have to pay for.

The prices on annual passes I have seen look fairly reasonable as well, at around 35% of the overall price of the upcoming content. This works great to retain the player base and leaves the old model intact in case people don't want to commit to an annual pass.

Is this a good thing for the games industry?

I think so, it can obviously be abused, if you are going to be pay $60 to $120 for a game you would expect to be getting a fairly complete experience and not feel cheated by being asked for more money to get a great experience. 

Battlefield 4 is a game which pushes this line a little bit by having expansion content available from release date and also offering priority server queue positions to premium pass holders.

Other games such as Dead Rising 3 do a lot better, straight away you receive a few items of cosmetic value that you may not even notice. The remaining content sounded like it will be great value compared to buying each of the episodes separately.

There is definitely a good and bad way to use this payment model, for the most part I think the games using it so far have done a good job at increasing the longevity of their product and keeping gamers happy.

Could this model be useful for iOS games?

The world of iOS is very different to that of mainstream gaming on PC or consoles. While I would like to believe there is overlap (and upcoming controllers might help with that) there currently isn't.

You are also not marketing to someone who wants to sit down for a few hours and have an engaging experience, on iOS you are marketing to someone who wants to kill some time while waiting for the dentist or on a long car ride. It's a different world where games like Angry Birds or Tiny Wings can reign supreme even with their small design scale.

The freemium or in-app content models have proven to work well in this world, for the most part episodic content has worked better on iOS simply because the payment model is a lot less convoluted and has a history of always being there where as payment models on consoles may still be thought of as a new thing.

The real question is, do you love Angry Birds enough to pay $6 for all additional levels and content throughout the year instead of $3 each for 6 packs?

For some people the answer would be yes, Rovio could implement a non-renewing subscription in-app purchase system to allow it as well. Would it be financially beneficial for them if they did? 

No matter how I run the numbers in my head or think about their average players, I'm still not sure of this outcome.

Could an annual pass work on iOS? Maybe... This remains to be seen but I think it has potential, let me know if you come across any games that have implemented this model.