Freemium - Tricks of the trade or legitimate practice?

It may seem somewhat ironic but the Internet has disrupted the traditional business models of the computer games industry just as it has many other industries.

The ability to distribute data electronically as opposed to on a physical disk has been an undoubted boon for many suppliers of digital or digitise-able content. It has also provided great benefits to the end consumer.

Not only does the Internet allow gamers located in different continents and time zones to communicate and play each other in real time, it also provides an efficient way of acquiring upgrades, expansions and even bug fixes to the original game software. Modern games consoles provide a platform which assumes a hybrid online/physical disk model.

These days of course gaming is big business not just on the traditional platforms and computers, but also on mobile devices such as tablets and smart phones - all of which have an Internet connection.

Playable game demos have always been important for the marketing of new computer games and magazines have been distributing demos on cover mounted cassette tapes, disks and later CDs and DVDs for almost as long as the industry has existed.

In is therefore no surprise that the playable demo has used the Internet as a means of distribution.

Combine the notion of online program upgrades and the idea of the playable demo and you get the 'Freemium' model as it applies to the computer games industry.

A player can acquire a basic form of a game for little or no money and have a play. If they enjoy the game and wish to experience more, they can expand the games parameters by paying for an upgrade from within the game's own interface (and 'in-game' or 'in-app' purchase).

The Freemium model for digital content is widely used in a number of industries. Many online newspapers for instance will provide a certain amount of information for free, but require an upgrade to read deeper.

There has however been much debate around the freemium model as applied to computer games, and especially those which appeal to younger children. Recently the Office of Fair Trading warned the games and online application industry of what it perceived as "potentially unfair and aggressive commercial practices" amid concerns that they could irresponsibly coerce children to pay to continue playing.

There is obvious concern over potential for children to spend or run up bills on in-game or in-app purchase.

It is yet one more area of online safety which parents and teachers will need to educate their children about. But like many aspects of e-safety, much of the learning is about ensuring that usual practice and knowledge is understood when contextualised within the online world. If a child has no concept of money or cost then what hope do they have of understanding a virtual purchase.

While it is undoubtedly possible to cite cases of some app and games providers applying a cynical approach to exploiting in-app purchases by bamboozling the end user into making purchases, the model when used responsibly is a legitimate mainstay of the software publishing sales strategy.

The freemium model is here to stay and is comparable to the way in which we pay for utilities per metered unit or cell phone call time through pay as you go.

One of the reasons that app and games producers use the freemium model is because it provides some kind of defence against the rampant piracy that the software, games, music and movie industry has suffered. Piracy is now so common place that many people simply expect all digital content to be free of charge and show little respect for the talent, energy, time and cost which goes in to producing it.

And yes, once again it is our responsibility to teach young people about piracy in the same way we would talk to them about theft of a physical item.

For teaching resources on gaming or online piracy, visit the E-safety Support Lesson Plans and E-safety Support Assembly Plans

Written by E-safety Support on October 10, 2013 18:48


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