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The Curve: how the videogames industry is showing how to make money when everything is going free

By on February 20, 2013
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I’m deep in the drafting of my next book, The Curve, to be published by Penguin in October 2013.

One of the things that I believe in doing is in testing my ideas, theories and arguments in front of a live audience before I finalise how I explain what I believe. It helps me adapt my message so that it resonates with the audience and, in particular, helps me understand where I am not explaining things well or where readers, listeners or viewers can receive a different message from the one I am intending to transmit.

To that end, I travelled to Montreux to give a 15 minute talk on The Curve to an audience of event professionals at their EMEC 2013, their annual conference. They recorded the talk, and you can now view the fifteen minutes on Understanding the Curve on their website.

It features Elite, Double Fine, David Braben, Tim Schafer and Trent Reznor. If you watch it, any feedback would be gratefully received.

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About Nicholas Lovell

Nicholas is the founder of Gamesbrief, a blog dedicated to the business of games. It aims to be informative, authoritative and above all helpful to developers grappling with business strategy. He is the author of a growing list of books about making money in the games industry and other digital media, including How to Publish a Game and Design Rules for Free-to-Play Games, and Penguin-published title The Curve: thecurveonline.com
  • That is a very good point. I will need to think how best to represent that in my thinking.

  • Alexander Symington

    It’s a very good presentation.

    One thing I would mention is that this concept of the curve seems to have broader applications than the model you outline in the final slide. In particular, you end by saying that successful curve implementations begin from free in order to maximise their potential audience. However, Kickstarter – the main specific example presented – really doesn’t involve any meaningful free content (unless you consider the pitch video). Not only is every everyone who will experience the end product paying upfront fees, but by crowdfunding they are making much more faith-driven purchases than in the traditional product-based model, as what they are buying doesn’t even exist yet. At the bottom of the curve (below the minimum pre-order tier), the dynamic becomes almost the opposite of the Nine Inch Nails example, because the users there, far from getting free content, are making charitable donations to the developer without getting anything tangible in return!

    Kickstarter seems to be a different type of successful curve to the freemium one, a curve that is made up entirely of ‘true fans’. What the curve seems to separate out here is how dispersed their fandom is: whether they are focused on a single designer’s work (dinner pledges), a broader genre (pre-order pledges) or whether they simply love the medium in general, and want to see quality games get made regardless of whether they will personally play them (donation pledges).

  • I love the coffee slide because it helps put perspective on how mobile gaming has gone from being an ‘availability’ to an ‘experience’ based product within a timescale that can be measured in months rather than hundreds of years. It also highlights that with the monitization debate still focusing on quality we may be trailing behind our customers expectations as I think they probably consider quality as a given and already make purchase decisions on emotional resonance.

    And one last point on coffee – this is an industry that *really* owns the term ‘evil’ after 300 years of enslaving Africans. Using that as perspective the Smurfs wouldn’t even make it to the naughty step.

  • I think the only thing that is a little “dangerous” to say to non-gamers is the example with Tim Schafer and Kickstarter: “A game which nobody wanted, the publishers said” was your phrase. But it’s strikingly important WHO made this Kickstarter project. If I had launched that campaign, then “the gamer world” wouldn’t want that game.
    But it was Tim Schafer who said that, so it’s clearly the VIP bonus.

    Just saying that non-gamers shouldn’t think that it’s the genre itself that is popular, but Tim Schafer’s fans.

  • What can I say, you are a gamer’s gamer 🙂

  • Funny how i understood every single reference you made, even the elite one although I’m Swedish and not 40 yet.

  • Pingback: The Videogames Industry is Showing How to Make Money When Everything is Going Free - W3i Blog()

  • Great talk. Given my background is in evolutionary biology and behaviour, it’s always nice to hear a bit of Zahavi. Handicap Theory can help to explain / frame an awful lot.

    In terms of the presentation itself, I’d probably take out the stuff about Joe (didn’t seem to resonate very well?) and potentially the stuff about ‘you’re not my usual audience’. Perhaps one self-depracating mention is fine; more than that seems laboured.

    Only other thing: for that specific audience, perhaps the ‘here’s how you apply it to events’ was a little too cursory?

    Other than that, great stuff. Looking forward to the book, but surprised / disappointed that it’s not out until October. How’s about an early edition for us Gamesbrief fans?

  • I think the speech was really cool, and I had to laugh every time your audience didn’t get what you were saying or who you were referencing 😀 ! (definitely no gaming audience, who where those guys??)

    I only have one tip for the slides: http://de.slideshare.net/itseugene/7-tips-to-beautiful-powerpoint-by-itseugenec

    That’s a presentation about more beautiful presentations, and I found it really astonishing and simple to adapt those rules and tips. And I didn’t do it like they recommended before as well… I was writing stuff and bullet points and more bullet points on my slides. After reading those tip slides, I tried to alter my most recent presentation and use the new rules and tips: the resulting new presentation looked way cooler, more comprehensible and more memorable.

    With your presentation, namely this came to my mind: There were 4-5 slides with very many words, and I couldn’t decide on what to focus. On the one hand, I didn’t want to miss something you said, on the other hand I wanted to see if there’s something more important written on the slide. And that was a thing one could improve, I think.