May 22 2010

Why in-game ads (Updated)

Here’s why…

Below is a screenshot of my developer’s dashboard, showing the number of ad impressions in a group of random weeks. (Most players are not playing on Nightflyergames.com, or even aware that it exists and that’s fine with me.)

Below is this week (I had to do a cut and paste to make the screenshot fit in my blog layout… The black line is to make the location of the break obvious, and the other splotch of black is to obfuscate a line which lists todays earnings.) Notice how my normal baseline gets compressed to a near horizontal line near the x-axis:

The vast majority of those impressions are coming from DayTrader, which I released 2 years ago. I’ve done no promotion for that game since. Even though most of the players seem to be in developing countries, and my eCPM is around US$0.05 for that traffic, DayTrader is paying the cost of this server today. (And since the rightmost dot will keep slowly creeping up for the next several hours, quite possibly tomorrow).

So that’s why the ads are there. I still think it would be madness to write a business plan that solely was dependent on in-game ads for revenue– one minor contract or small sponsorship will cover the costs of my hobby into next year and beyond. But they let me capture random spikes like this with no cost to the player, so they’ll stay in. Even though they can be a bit annoying.

EDIT 5/23/10:
So Daytrader ended yesterday with 16k impressions/plays, and looks like it’s going to do about the same today. I also figured out what was occurring:

The traffic is mostly playing at a site “whatzfun.com”.* I knew that from the start of the spike, but I couldn’t figure out -why- the game was getting played there. As it turns out, Daytrader is sitting on it’s front page at the moment. Whatzfun is a minor arcade, with 26 games. What’s interesting is what games it’s providing– they’re all either stock market/trading games or hospital games. The site is using 2 Google Ad-sense ads, a Wild Tangent skyscraper ad, and a footer which is some type of referral program with a site called “ztage.com”. I’m not familiar with zstage, Wild Tangent and Google are contextual ad providers. With Google it’s possible to look up** what it would cost to advertise in those spots by checking what it would cost to advertise for keywords such as ‘Stock Market’, ‘Daytrader’, or ‘Broker’.

Keyword CPC
Broker $4.83-$6.48
Daytrader $1.98-$2.47
Stock Market $3.64-$5.20
Stocks $3.44-$5.16
Trading System $3.36-$4.25
game $0.44-$0.65
flash game $0.41-$0.61

Data acquired from Google AdWords Traffic Estimator at 2:23 pm AKDT on May 23, 2010. CPC is an abbreviation for ‘Cost-Per-Click’ and is what the advertiser is paying Google for each click the ad generates. (Google then pays the website running the ad some percentage of that).

One of the mysteries of the web is that if you get enough people to look at something, eventually someone will click it. Assuming the webmaster for “whatzfun.com” has a way to get traffic to his site cheaper than what he’s making from the contextual ads, he’ll turn a profit. To give himself the best chance of doing so he’s targeting high CPC keywords. Best of luck to him, he’s welcome to use my game in his plan… I was baffled and concerned because there was no reason for -this game- to develop a following at this time. I’m much happier knowing that it didn’t, and the reason for the sudden increase in plays.

*- I feel under no obligation to provide a link. You’re smart enough to enter the address in your browser if you’re curious.

**- The link has a session id variable in it, so it may not persist. Do a search for ‘Google Adwords Estimator’ and you’ll find the tool if the link breaks. Obviously, be smart and use the search result that points at an https from adwords.google.com…

EDIT 5/25:
26,000 plays yesterday. Up from a long term average of about 100 per day. Put another way, my DAU (daily active users) has increased by a factor of 260 times over the past 4 days. I’m choosing to assume that will continue, and I’ll have 6.2 million DAU by Friday, and 1.7 BILLION users by next Tues. NightflyerGames will acquire both Activision and Electronic Arts the week after. LOL :)

Oct 05 2009

What is a short form game worth?

An interesting facet of the Flash Game Development Scene (for lack of a better term) is the fact that there is basically no monetary barrier to entry into Flash Game Development. Distribution channels already exist to put your game just about everywhere, and many flash game portals gleefully exert no editorial control whatsoever, allowing their users to rate games up or down at will. This means that in this arena, a truly well made game from an amateur can compete successfully with work produced by professional Flash artists.

Because the amateur and professional have different expectations for compensation, and different definitions of success, the question ‘What is appropriate compensation for a given game?’ is complex. Professionals may fear, perhaps justly, that the existence of the amateur in the same distribution channels tends to drag them down, to the point where they can not produce independent IP cost-effectively (ie: make enough to pay rent). Some amateurs (including to some extent, me), may be more interested in distribution, feedback, and e-peen, than hard cash. Players meanwhile, are consuming the end product only, and potentially get confused when asked to incur substantially different costs for two products that they don’t perceive as different.

The current primary system for ‘monetizing’ flash games (sponsorship and in-game advertising) is fairly complex and does not favor professional developers. Alternate microtransaction systems have been deployed by at least 3 serious players, and other models are being proposed all the time.

Out of historical interest I think it’s worth noting that there was a market for short-form games prior to the internet. Back in the early to mid ’80s, short-form games similar to the smaller flash games of today were distributed in magazines and books, usually as BASIC programs, or sometimes as ‘machine language’ hex listings.

Tom Halfhill, who had been a senior editor of Compute! magazine, was kind enough to answer an inquiry about authors rates and reported that authors of these listings in the early 1980′s were paid $100-150 per page, with average programs running about 6 pages ($600-900). After Compute! added disk based distribution some authors were receiving as much as $5,000 depending on how much space the program took up on the disk. Another source reports much the same… Analog was paying $60/page capped at $360 in 1984.

Using Mr. Halfhill’s inflation calculator (java applet), these numbers can be adjusted to 2009 equivalents of $815 (Analog) – $2007 (Compute!) for a six page game (1983 as a starting year). The top-end disk based games get adjusted to $10,363 (using 1985).

For comparison, FGL reported the average accepted sponsorship bid for January 2009 as $743, and Sep 2009 as $1589.[1] Note that these averages don’t tell the whole story– we know that some developers will accept as little as $100 for exclusive rights including source code, and we also know there have been sponsorship deals in excess of $10,000. The total volume of the short form game market is probably larger than it was in the ’80s. FGL alone reports $184k in transactions for September, and they do not represent 100% of sponsorships.

I don’t want to suggest that it’s a bad thing for flash developers to be looking at other models, and I look forward to playing the long-form microtx games which are on the horizon! However, I think that the current compensation model for independently produced short-form games appears to be in line with historical pricing for independently produced short-form games in at least one distribution channel.

-TF

[1]- Link. Requires an FGL account.

Edit 10/7: Changed link for ‘excess of $10,000′ to a better overview.

Aug 26 2009

Barnstormer reaches #2 on Casual Collision

Sometime this morning, Barnstormer reached #2 on the list of most popular games played on Casual Collision. Although it’s truly a great game and obviously CC’s users recognized this, possibly this success has more to do with me pointing my Mochimedia traffic sharing ad at the game.
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