D&D Online Makes “Freemium” Model Work, Gets 500% Revenue Increase

Dungeons and Dragons Online, an MMORPG by Turbine, recently switched from the usual online game business model of charging a monthly subscription to a “freemium” model. Players get the game for free, but can pay for additional content or items with an in-game store. Unlike others who have tried similar ideas before, Turbine went to great lengths to prevent the game from being crippled for users unable to pay for extras.

How did that turn out? DDO has had a 500% increase in revenue and their player base has effectively doubled. An interesting post over at Wow.com has the full story.

“Everyone can play through the content without ever getting anything from the store, and they’ll have a fine time of it. What we’re pretty proud of with the whole system is the fact that the player owns any content they buy.”

I pressed for a bit of clarification. He obliged by likening most subscription-based games, like WoW, to renting something. When you buy an expansion pack for WoW, you only have access to that content, or any content, while your subscription is active. If your subscription lapses, you can’t play what you bought anymore. “If you buy a content pack from the DDO store, on the other hand, it’s yours forever, regardless of whether you’re currently subscribed or not. If you’re normally a VIP and have a rough month financially, you can go back to the free-play model and still play what you purchased in the store,” Currie said.

What I’m wondering now is whether we’ll be seeing Turbine try to apply the same model to some of their other games, such as Lord of the Rings Online? (LOTR Online is sold in retail stores, and operates with a fee structure very similar to World of Warcraft‘s, so it doesn’t seem all that likely.) What effect will this have on the gaming industry, or on the content industry in general over time?