A Brief History of Turbine’s Changing Business Model

An interesting new editorial over at GamePro takes us through the history of Turbine’s shift from a purely subscription-based model to a free-to-play hybrid model in regard to Dungeons & Dragons Online and The Lord of the Rings Online, with plenty of commentary from Warner Bros.’ Martin Tremblay and Turbine’s Fernando Paiz, Kate Paiz, and Adam Mersky. It really is amazing how well DDO is doing these days:

“I remember five years ago taking the temperature of the room on microtransactions in an executive meeting,” Fernando Paiz recalls. “And the reaction-even my reaction-was ‘over my dead body-we’re not going to cheapen this game.’ We weren’t ready, and neither was the consumer.”

…

When DDO went free-to-play, it was a risky move. Many industry observers saw it as a desperation play, to breathe life into a flagging franchise. Even Turbine had reservations. While not boasting millions of subscribers, a substantial player base was paying a monthly subscription. Seeing what they’d been paying for suddenly open to the unwashed masses was a big concern. “We were prepared for losing a big chunk when we announced,” says Mersky. “But we didn’t.”

Instead what happened is unprecedented for a 4-year-old MMO-the population more than doubled. According to industry watcher NPD, Dungeons & Dragons Online market penetration doubled in 2009, from 4 percent to 8 percent, and DDO only went free in September. More impressively, DDO added 2 million new players, reacquired 20 percent of its former players who had left the game, and doubled the number of monthly subscribers-now called “VIPs.”

…

George’s office is stacked with charts and tables, showing exactly what types of players are buying what items from the store, plans for new pricing schemes, and package deals. It’s clear to me that in George’s office a strange and emergent science is under practice, one that is intimately dependent on, but fundamentally different from, designing good games.

It’s that science that has driven monthly revenues for Dungeons & Dragons Online up 500 percent in a matter of months.

It’ll be interesting to see if the new business model does as well with The Lord of the Rings Online.