[MUD-Dev] Business models for commercial text games

[Christopher Allen]

Emil Eifrém:

> Comments? Are these the main sources of incomes for other text-based
> commercial muds? Is the practicality issue something to worry about?

The model that Skotos uses is that we charge $10.00 a month for all of
our games, and over time we hope to eventually have quite a few (our
second, "Galactic Emperor: Succession" debuts in beta tomorrow).

As there is no way that we can develop all of our games, so we have a
royalty system for external developers. We currently have seven
external projects being developed by them with various levels of
ambition over the next year.

The way that royalties work is that we pay out 20% of our revenues as
royalities, or $2.00 per player. The player's usage is divided up
three ways. One-third is based on percentage of raw logged time usage
(you were in game A 90% of the time, game B 10%, the royalties are
splite 90/10). As we don't want to always encourage raw time usage,
one-third of the royalty is based on frequency and regularity -- a
game you play every day will be rated higher then one you play once a
week, and a game you've played for years will be rated higher then a
game that you've played only for a month. The last one-third is what
we call 'acclaim' -- the first two numbers are averaged and presented
to players at the end of the month when we ask "Please show your
appreciation for the StoryBuilder's that you have enjoyed this month
by ranking the following games". If they don't rank, the order will
remain the same.

Once we have determined the royalty payment, we also split the
royalties among the creators of the content. 5% goes to the brand
owner, 5% to the original StoryBuilders, and 10% for the ongoing
StoryBuilders. Our current Skotos Seven are all created original
content, so they get the full 20%. If someone wanted to write a
Paranoia, Lovecraft Country, or other game based on one of the
licenses that we aquired, they would get 15%. If one of our Skotos
Seven finished the game, got it rolling, but didn't want to maintain
it for year after year, their royalty would be 10%, and the remaining
10% would go to the ongoing StoryBuilders.

We consider a minimally successful game to be a game that has about
1,000 active "full-time equivalent" players, i.e. 1000 players who
largely play the game, or more players if they play multiple
games. (At this size you would see approximately 75 to 150 online
simultaneously.) At this number of players we can offer Skotos
professional staff for escalated customer support, and can afford to
do marketing and advertisting for the game.  Royalties to the
StoryBuilders would be $2000 a month. As there are many commercial
text based games that have reached or exceeded this level of success
(Achaea, Avalon, Eternal City, etc.) we think this is very
achievable. Our own Castle Marrach is close to this level (just
released last September), and it is a more MUSH-like game.

We know that there are text-games with 10K+ players, in particular,
two from Simutronics. If a StoryBuilder's game grows to this level,
royalties would be $20,000 a month -- enough to hire a couple of
people from the game volunteers to help full-time in growing the
world.

An important note, at approximately a total of 10K to 12K customers,
Skotos is profitable. As most graphic MMPOG's will require at least
100K customers to break even, we are quite likely to survive when
other don't. We can also take more risks with niche genre's -- for
instance we have two historical games coming out (Golden Gate: 1949,
and a Renaissance Naples game) and a spy game.

Now you could go out and write from scratch your own game and
theoretically make more money, but you'd have to find a good driver
(we use DGD), you'd have to write your own library (ours is quite
modern, has two scripting languages built in, and can be edited on the
web or in XML). Even that might be fun, but supporting 24x7 servers
and customers on a day-to-day basis isn't nearly as fun, but is
essential for a successful commercial game company. Plus, I know of
few game programmers who like to program credit card code or do
customer support.

Our business model isn't perfect -- Simutronics has found ways to get
about 25% of their player base to pay for premium services (a private
room, priority access to support, a type-ahead buffer, additional alt
characters, access to quests, etc.) Others have found way to pay for
specific items and skills (Achaea). We would like to find some ways to
fit these ideas into our model.

Another problem is that at our lower end of the success scale (1K
players) the game does not generate enough royalties to completely
justify the work of a talented engineer -- that we why we are working
so hard to make our tools easy to use by non-programmers. There are
many authors out there doing professional books that are making
significantly less money a month then this for similar amount of
effort.

If you are interested in learning more, check out our web site's
StoryBuilder section at http://www.skotos.net/storybuilders/ .

-- Christopher Allen

------------------------------------------------------------------------
.. Christopher Allen                                 Skotos Tech Inc. ..
..                           1512 Walnut St., Berkeley, CA 94709-1513 ..
.. <http://www.Skotos.net>               o510/647-2760  f510/647-2761 ..

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