Why a $150 Million Star Wars Game is Going Free

I’m not sure where they’re pulling the $150 million figure from (it has been suggested many times that the game cost far more than that before it was even released), but it’s still interesting to note that even CNN Money has picked up on the fact that Star Wars: The Old Republic is going free-to-play and has editorialized about the reasons behind the transition.

The Old Republic, which launched in late December, was supposed to be the next Warcraft. It started off strong, attracting more than 1 million players in its first three days — a record pace. But within a few months, the subscribers began drifting away. EA won’t comment on the game’s current paying audience, saying only that it’s north of 500,000.

“The message from players exiting the game is clear: 40% say they were turned off by the monthly subscription, and many indicate they would come back if we offer a free-to-play model,” Electronic Arts (EA) CEO John Riccitiello said on a recent call with investors.

It’s a straightforward economics problem. The subscription business model cuts off casual players, who can’t justify paying $15 a month (particularly in this tough economy) for a game they only touch on occasion. That leaves the hard-core players, who are often reluctant to split their time between more than one or two MMOs at a time.

So EA and its rivals are trying out plan B.

…

By dropping its subscription fees, Star Wars could attract upwards of 10 million players a month, according to Michael Pachter, a well-quoted video game industry analyst with Wedbush Morgan Securities.

10 million players? That sounds a bit too ambitious to me, but I suppose it’s possible without an entrance fee.