Destiny's business model leaves Bungie walking on eggshells

Never has a successful game been on such fragile ground, and Bungie can ill-afford to lose player goodwill

Launching a new game is a fraught, tense process; there are many tricky steps along the way and messing up badly on any one of them can sink several years of effort into commercial failure. For an online game, the complexity is even greater; managing questions like server and network resources, players' in-game behaviour towards one another and so on adds layer upon layer of potential difficulty and challenge to the launch (and post-launch management) of a game.

When Bungie launched Destiny, the company decided to do something even more difficult. It launched a large, complex, multi-platform game; it made that game into an online game, reliant upon network code and infrastructure for even its most basic interactions; then, just to make things really interesting, it decided to use an experimental, untested business model for the game. Destiny is a persistent online game that eschews both F2P and paymium style microtransactions, and conventional MMO style subscription fees. It aims to earn roughly the same amount as a game like World of Warcraft not by asking users to hand over their credit card details and set up a monthly payment, but by convincing them to buy a fairly expensive new slice of content every few months.

I've found this to be a really, really weird model right from the outset. I understand the logic; players are less likely to try out games which have a subscription fee, so Destiny would never have achieved its enormous launch numbers if people expected to be paying $10 per month down the line. Moreover, core gamers don't like F2P transactions (in theory; in practice, they're perfectly fine with them if the implementation and the game itself are done right) and a game like Destiny would sink like a lead canoe if there was a hint of pay-to-win in its business structures. By charging people for content, not time, Destiny effectively repackages a similar payment structure to World of Warcraft or any other subscription MMO into a form that's more palatable, in theory, to gamers of all persuasions. Paying for content is what gamers always say they want to do, when they complain about subscriptions or F2P; Bungie hit upon a way to get ongoing revenues out of Destiny without leaving the "pay for content" model which their consumers want.

"If Bungie screws up, the player simply has to do nothing, opting not to go through the active process of buying the next expansion"

The problem, as I saw it, was attrition. Subscriptions are hard to get; convincing consumers to set up a monthly subscription is an uphill struggle. On the other hand, they're also very persistent. Consumers often stick with subscriptions even during periods when they're not playing a game much, or at all. I've been up to my eyes in research work for a few months and haven't logged in to Final Fantasy XIV once; Square Enix is still doing nicely out of me every month, and I haven't bothered stopping the subscription because, well, the expansion pack is coming out, and there's an odd psychological finality about cancelling a subscription which I'm not ready to commit to. This makes no economic sense - one in the eye for the devotees of homo economicus - but it's a state of mind that a great many gamers with an MMO subscription can recognise. Once you have a subscription to something, you're committed; that's a somewhat irrational state, and it means that you simply don't question what you're spending in the same way that you would if you were buying a new product each month.

This latter condition is precisely what Bungie is pushing its users towards; they force them to make an active decision, every few months, about whether Destiny is still a big enough part of their gaming diet, or whether the new content is appealing enough, to pay for something new. There's no sense of continuing to pay for something to which you're committed; there's a new purchasing decision any time, and that makes it vastly easier for a consumer to say "no, I'm out" and bail at any time. Perhaps that's okay, in Bungie's eyes; I don't know how long they want Destiny consumers to stay in the game. If they're hoping for World of Warcraft longevity, they'll be disappointed; if they really just want to sell a fixed amount of content over two or three years, well, perhaps they're doing okay. I don't know what percentage of Destiny players have upgraded to The Dark Below and House of Wolves, but my sense is that it's much, much higher than I'd originally have expected, which is a testament to what a slick and addictive game Bungie has constructed.

That doesn't mean that the attrition problem I highlighted isn't real; it's an economic and psychological reality. It just means Bungie has done a great, great job of avoiding this problem up to this point, skating through on goodwill to some extent in rougher patches, redeeming itself gloriously with fantastic content like the Raids and pretty much the entirety of House of Wolves. All the same, it makes the entire process of managing this vast post-launch project altogether more fraught; if Blizzard screws up, players have to make an active decision to go through the process of cancelling their subscription, but if Bungie screws up, the player simply has to do nothing, opting not to go through the active process of buying the next expansion. Everything has to be done better, especially as the game ages and that initial goodwill wears thin; new goodwill must be generated in its place, on an ongoing basis, to keep the player base sweet when new problems arise.

How much of the goodwill generated by House of Wolves was spent, I wonder, when the creative director on the next expansion, The Taken King, made some cocky, arrogant-sounding comments about the company's pricing in an interview with Eurogamer at E3? It set the Destiny-focused corners of the internet alight with fury; Luke Smith, the Bungie staffer responsible, has since backtracked humbly (describing the tone of his quotes by saying that had it been another developer, even he would think "that random developer looks like an Asshat") and the company has rethought some aspects of its approach to pricing for the Taken King expansion. It might be enough to satisfy a goodly proportion of the fanbase; I hope so, as I don't think Smith's comments were remotely bad or unpleasant enough to justify having a serious economic impact on his company, but many players may feel that Bungie has betrayed a deeper lack of respect for the consumers whose money they're asking for every few months, and that's a position they're equally entitled to take.

"Destiny remains a grand experiment in the games business; a game in uncharted waters, reliant upon ongoing revenue that simply won't materialise if enough consumers decide they have had enough"

What Smith, and perhaps Bungie more generally, may not yet appreciate is the extent to which their business decisions have navigated them onto ground entirely made out of eggshells. Their players don't have the same commitment that World of Warcraft players have; that's a social and psychological difference that stems from the lack of a subscription but extends through the systems of the game itself, which de-emphasise social play and bond formation, asking players who want to engage with the tough co-operative raids to import their own friendships into the game rather than giving them an opportunity to form new ones. That's a bigger deal than you might imagine; players who engaged with WoW and subsequently left often had no way to stay in touch with the friends they had made in the game. Your Destiny compatriots, on the other hand, are probably also in your phonebook and on Facebook; the social cost of not buying that next expansion pack is that much lower. What that means for the developer (and the publisher) is that the kid gloves can't come off, at least not often, in dealing with the playerbase. You can make unpopular decisions, if you're sure they're necessary, but you'd damned well be the world's finest diplomat when the time comes to announce and explain those decisions to your players; a controversy that would be a storm in a teacup for another game could be millions of dollars of lost revenue for Destiny.

With the release of House of Wolves, all of the content pre-bought by Destiny players at launch (those who bought the premium edition received the first two expansion packs as part of the bundle) has been exhausted. The training wheels are off; from now on out, the curious fragility of one of the most popular games of the decade finds itself without a cushion against failure. Destiny remains a grand experiment in the games business; a game in uncharted waters, reliant upon ongoing revenue that simply won't materialise if enough consumers decide they have had enough, lacking even the inertia of a subscription fee system to sustain it through mishap. I love Destiny and wish it the very best; but Bungie needs to be better, to execute more perfectly, now than they ever have before, because they find themselves reliant on consumer goodwill to a greater extent than any game company ever has.

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Latest comments (14)

Klaus Preisinger Freelance Writing 2 years ago
I argue Destiny's business model was not untested, because there are three Borderland games . Just as Destiny, they were one time purchases, upselling the customers with story, character levels and classes. To be honest, Destiny might have shinier graphics, more ominous music and deathmatch, but Borderlands is stronger when it comes to story, itemization, builds and no-bullshit co-op.

Destiny is a textbook example of how to be so omnipresent and so dominant with the PR gospel that people forget there is even a competing game already on the market.
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Phil Elliott Project Lead, Collective; Head of Community (London), Square Enix2 years ago
Totally agree with the point about the need to import friends. I don't have enough people on my Xbox One friends to attempt the raids, while there are no tools in-game to find like-minded folks to join with. I know I could go to the forums and try my luck there, but that's several steps away from making it easy for me, and I'd have thought they might have watched WoW's LFR system with interest.

But the game itself is just brilliant. After a long time away, just that intro screen music was enough for me to sink back into familiar comfort. The happy truth is, I just *want* more excuses to play longer, and play more.
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Pete Thompson Editor 2 years ago
Like a lot of people I stopped playing Destiny because it became boring soon after completing the "Story" missions and reaching level 20 because the pve content is not in the game and I do not like pvp / Crucible. I got the digital guardians edition which came with DLC1 & DLC2 but I've not yet completed DLC 2 because I couldn't believe that there was very little in the way of new content as the majority of "story" missions take place in areas seen countless times during the "campaign". £20 for each DLC and very little to show for it, DLC1 took 45 minutes to complete and again added no new areas, so far DLC is just as vanilla as DLC1.

It's a shame, as Destiny is a good game, and I still get excited when loading it up again after a short break of getting bored with it, but that excitement only now tends to last no more than 20-30 minutes before becoming washed out by constant linear re-spawning enemies and the same ol same ol environments. Maybe instead of adding DLC that takes players over the same areas that they have been through countless times before and got bored with a long time ago they should be adding more planets with new experiences and species to conquer / help / forge alliances with or to battle against etc. There's more than 3 billion planets out there and Destiny gets a handful of playable areas and races.

Edited 1 times. Last edit by Pete Thompson on 26th June 2015 5:37pm

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Show all comments (14)
Ron Dippold Software/Firmware Engineer 2 years ago
Activision gave Bungie a Palantír, and it's been whisssssssspering to theeeeeem.
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Lewis Pulsipher Game Designer, Author, Teacher 2 years ago
Doesn't Guild Wars use something like you describe for Destiny? Their revenue comes only from sales of expansions, once players have purchased the base game. And it has worked for them (though I don't know how they're doing lately).
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Payton Liu Production Support Analyst, IBM China2 years ago
Having put countless hours into Destiny (PS4 version), I've got a few thoughts to share.

So how did i get involved with this game? Just like most other gamers, the marketing campaign by Activision and Bungie (short to ActiBungie in below), especially the E3 live demo (the 2013 one, before major changes were made to the game). Then I got into the close beta (and it got opened very soon...), which was kind of fresh (nope, I failed to notice anything weird - the limited level 8 and boring story missions, etc.) I thought the finished game must somehow be different and better than this simple beta. Oh boy, I can't be more wrong... (just like most Destiny players feeling now.)

I must say ActiBungie has on their hands a very "successful" business model. It delivered, and net them tons of cash and counting. Though this model hasn't brought them most positive praise yet, as you can see from various (or lots of to be precise) gaming news and forums (you gotta see the official forum, feel like a war zone everyday).

Why people hating this game so much, but at the same time seemed can't quit playing it? The simple answer is: the game was designed to be very addictive. Almost like taking drugs if I must say, or like gambling. I don't know what changed during 2013, but the game feel rather different from the first few trailers and E3 showings. Could Joseph Staten leaving the team has something to do with this directional change? We might never know.

ActiBungie has taken every step making Destiny like a bad hobby that you can't give up. The random engram, the random rewards after finishing activities (Strikes, Raids, Cucible matches, etc.), no match-making for most rewarding activities - Nightfall Strikes, Raids, Trial of Osiris and high level (32 and up) Prisoner of Elders and DLC designs. The random parts of the game will make sure most gamers cannot get valuable items easily, or fairly (don't know the logic behind this one). This will push gamers to invest more time into the game. The no match-making parts will make sure majority lone gamers can't get end-game items at all. (Yes, there are highly skilled players who can beat difficult parts of the game by themselves, but they are in very small numbers.) In order to get those end-game items, one will have to make friends or try to convince their real world buddies to play Destiny. I have to admit it myself, I made some good friends who share similar thoughts and play well. Now comes the DLC parts. When your friends have those DLCs, what will you do? ActiBungie answered that for you - buy every possible DLC to keep up. See where I'm getting now? ;-)

This model should work just fine if ActiBungie keep pulling out good stuff. Well, it hasn't, only the money grabbing part works at the moment. (works too well might I say) May be Activision got pushy, or they are trying make 2015 their biggest year ever? The Taken King controversy showed us the corporate greed at its finest. I'm sure this is just the industry new low, if nothing can be done, there will some one (or Activision itself) to create an even lower bar.

Klaus pointed out a good example - Borderlands series, which I spent more time than Destiny as of now. 2K Games and Gearbox Software seemed to have a healthy relationship as publisher and developer. The vanilla games have loads of contents to play with, DLC charged reasonably (the smaller, cheaper; the bigger, more expensive). Major DLC releases in Borderlands 2 have so much content that I still have not got enough time to play them all. The itemization works like a charm, and they just boosted the drop rate of legendary (equivalent to Destiny's Exotic items, but there is no limit to equip them in Borderlands) 3 times which made the dropping of super rare items (Skullmasher, I'm still hunting for this one...) easier than before. However, when you look back at Destiny, I'm yet to find the mystical exotic engram (guaranteed top-tier item), and I've just got a handful of purple engram (small chance of top-tier item) with hundreds of hours played. As far as story, game play, itemization and additional contents go, Borderlands win by miles. For me, Destiny only shines on gun play.

Well, enough of that. I'm quite done with Destiny now. Marketed into purchasing the season pass, I will not keep injecting cash into this behemoth. The Taken King is the turning point for me, and it's likely to be for many other gamers. Bad hobby is hard and tough for people to get rid of, but it's not impossible.

Additional note: this is just my personal opinion backed by some facts and experience. I'm certainly not trying to convince you, but only to encourage more and wilder discussion of the matter. Like it or not, year 2015 is to be marked in gaming history for the better or worse.

Edited 4 times. Last edit by Payton Liu on 27th June 2015 8:01am

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Klaus Preisinger Freelance Writing 2 years ago
GuildWars is selling a box and as of late an expansion in a similar way to how Destiny is bundling the expansion with the base game. But for the most part Guild Wars was monetizing ingame gold, fashion stuff and random chests. Their publisher ncsoft has rather detailed numbers in their quarterly reports. According to them, the game was still earning $170k per day 30 months after release. Should be enough to run most studios, but Activision has higher sales targets for Destiny to put it mildly. I doubt it actually is 16 times bigger in terms of revenue.
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Axel Cushing Freelance Writer 2 years ago
The first Guild Wars did this. GW2, interestingly, has also been catching flak for its proposed expansion plans. Until recently, GW2 has been making most of their money on character slots and cosmetic items.

I think Klaus and Payton brought up something I hadn't necessarily considered about the Borderlands. Perceived, yes, but didn't really "think" about. Aside from the news crawler at the character select screen, there wasn't really any sort of pressure necessarily to get the DLC content. I went through the games blissfully unconcerned about missing anything if I didn't buy "The Secret Armory of General Knoxx" or "Tiny Tina's Assault on Dragon Keep." I was unconcerned because there was nothing to remind me that they even existed outside of the news crawler. To go back to GW for a moment, aside from character meshes and power sets you didn't have, there wasn't much to indicate necessarily that there were expansions to be had. Aside from a sailing ship icon on the map screen, you could have gone all the live long day in just the main game's zones and been unaware of the expansion areas.

This brings me around to Destiny. There is no way to avoid the presence of the expansions. The map screen has large gaudy icons which practically scream, "You need to buy more stuff!" NPC quest givers, different social hubs, characters with "levels" so high as to be impossible without access to those expansion areas, to say nothing of the shaders and gear, all of it is a crass and grotesque assault that rubs your face in the fact you don't have the expansions. The subscription path isn't tenable. The way that Bungie has handled expansions so far is probably doing more to drive players away than basic boredom. Destiny is fundamentally broken, and their efforts to try and fix it only break it more.

If you asked, "Well, smartass, how would you go about it?", probably the first thing would be an open commitment to giving players the most bang for the buck. Schedule two content updates per year, one "public access" update that benefits everybody, one "annual" update for a modest price ($20 USD seems to be the upper limit on this). Don't make it so players who are getting just the public update are screwed out of advancement, but make the new content in the annual attractive enough to lay their money down. Second, figure out what the game wants to be when it grows up, then start moving towards that. Find what works, rip out what doesn't, and get it polished to a mirror gloss
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Javier Rubio R&D Gaming Programme Manager, Vodafone2 years ago
I willl be pleased to pay that amount every four months, the big destiny problem is that they don't allow me that, the only way to enjoy the game is dedicate your entire life to the game, be in a clan and time to play continuously six or seven hours several days per week. This reduce the base of possilbe fans of the game.

During the last DLC I played without the clan and after three hours of PvE and finish the game I realize that I could raise my level without a clan because there weren't matchmaking in the mission that give you the objects to raise the armors
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Craig Page El Presidente, Awesome Enterprises2 years ago
I think I quit Destiny around level 12, it got incredibly boring re-playing the same levels over and over again.

I too was fooled by the demo, it looked good, and I thought they took out all the story and most of the game to encourage you to buy the full version. But nope, the full version also had no story and was missing most of the game.
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Chris Payne Managing Director & Founder, Quantum Soup Studios2 years ago
an experimental, untested business model mean episodic? Telltale may beg to differ. Though I'll grant you it's never been done on such a top-tier AAA project.

Shame Destiny is so light on plot though - hard to see how episodic can work if players can't really engage with your storyworld. Life is Strange is certainly higher on my TO-BUY list, just based on the trailer...
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Alfonso Sexto Lead Tester, Ubisoft Germany2 years ago
As a regular player (not as a member of the industry, let's leave this clear) the "Red Bull exclusive mission" was so incredibly insulting to me that it is the only reason for which I'm internally debating if I'll get "The Taken King" expansion or quit the game completely (Before that, I was totally going to buy it)
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Gil Salvado 3D/2D Artist 2 years ago
@Klaus Preisinger
And not to forget to mention Guild Wars 1 back in 2005 and it's successor Guild Wars 2 from 2012. Especially the initial GW did pretty damn well with this sort of business model.

Edited 1 times. Last edit by Gil Salvado on 30th June 2015 2:08pm

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Payton Liu Production Support Analyst, IBM China2 years ago
Just saw this one on GameSpot by Danny O'Dwyer, seems mainstream media finally caught up.

The Point - Destiny: The Hardcore Gamer's Slot Machine

The concern is real, as most viewers (gamers) agreed with Danny. As I said above, Destiny is drug addict equivalent.

Edited 1 times. Last edit by Payton Liu on 5th July 2015 8:47am

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