Microtransaction (Concept)

Microtransaction

CONCEPT

Small payments made with actual money which result in an in-game bonus, such as an extra item, character, etc...

Overview

"Microtransaction" (sometimes shortened as MTX) is a term referring to real-money purchases made in a game after the initial purchase, for individual items or packs of items. This should not be confused with expansions, which are usually differentiated by the amount of content present as well as a typically-higher cost. Similarly, DLC is sometimes (but less often) distinguished from microtransactions.

Microtransactions were first popularized with the Xbox 360 (Platform)'s Marketplace distribution platform. While designing the Xbox Live Marketplace, Microsoft envisioned players paying a quarter to download a new shirt for their character, to match them to their lifestyle. This idea quickly spread, fueled by the seventh console generation's heavy focus on internet-connectivity and centralized operating systems.

The idea of microtransactions saw significant success and criticism both, with many players feeling the practice encouraged charging for already-finished game features. The most infamous example of this time was Elder Scrolls IV: Oblivion's add-on "Horse Armor", an add-on which added protective armors for horses but 200 Microsoft Points (roughly $2.50 USD), generating significant negative response but also "millions" of sales according to Bethesda's Bruce Nesmith (Person).

Microtransactions quickly proliferated the casual games market of the late-'00s to early-'10s, as well as the mobile game industry. This led to increased negative perception, as players felt that games were making themselves more time-consuming and difficult with the specific aim of enticing players into buying $0.99 to $4.99 USD microtransactions which would allow them to skip long wait timers or make it through particularly difficult sections. This also led to worries about microtransactions offering stat boosts compared to freely available items, giving paying players an edge in online games. While some games have offered statistically better weapons for pay, the practice has remained niche and controversial.

Nowadays, microtransactions are near-ubiquitous in Free to Play (Concept) and Live Service games. The average price has also increased, with one of the most common types of microtransaction offered being "skins" to change player appearance, which in some games can cost as much as $10-$15 USD.

Off-shoots

While the traditional microtransaction is a direct one-to-one purchase, the format has seen a number of permutations and re-imaginings over the years. These changes are often made to circumvent regulation/player push-back, as well as make more money.

Premium Currency

One common approach is to obfuscate the immediate cost of the transaction, often by having a player spend real money on in-game premium currency. This currency will typically only be available for purchase in bundles of certain amounts, rather than letting the player pay for an exact amount of currency. From there, the currency is exchanged for an item or items, and any remaining currency is typically left on a player's account for any future purchases.

Loot Box/Gacha

Popularized by various VALVe Software games, including Team Fortress 2 (Game) and Counter-Strike: Gobal Offensive, loot boxes (and their sister-approach, gacha, operate on giving the player a random (often low) chance of getting any specific item. This is done by grouping items together, with more desirable items being given a higher "rarity", correlating to lowered odds of the player receiving them with any given attempt.

This approach is arguably the most controversial, with many noting similarities to real-life gambling. These perceived similarities led to a 2017 push calling on the ESRB to classify loot boxes as gambling (which would make any game with loot boxes an immediate Adults Only.) The ESRB denied in 2017 that loot boxes were comparable to real gambling, though in 2020 the board attempted a compromise by introducing a new rating indicator for whether or not a game's microtransactions involve random chance.

Battle Pass

Battle Pass (Concept) systems offer players new items as they gain in-game experience. While not necessarily paid, these systems will often have items divided by "free" and "paid", with the paid items (usually the most desirable items offered) only being unlockable after purchasing the pass.

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