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Emergence of the Free-to-Play model inthe Video Game Industry
KTH, School of Industrial Engineering and Management (ITM), Industrial Economics and Management (Dept.), Industrial Management.
2013 (English)Independent thesis Advanced level (degree of Master (Two Years)), 20 credits / 30 HE creditsStudent thesisAlternative title
Den Free-to-Play affärsmodellens uppkomst i dataspelsindustrin AMÉLIE CAUDRON Examensarbete Stockholm, Sverige (Swedish)
Abstract [en]

This paper aims to investigate the emergence of the Free-to-Play business model as strategic change at a French leading video game publisher. Through a case study, observations, interviews and a questionnaire, the new business model was extensively investigated while the facilitating factors, the nature of the strategic decision itself and the changes that followed served to illustrate this example of strategic transformation in a creative, fast-paced and technology intensive industry today.

It is found that strategic decisions tend to emerge naturally in a bottom-up rather than top-down direction, facilitated by enthusiasm and openness of the employees to emerging market trends. The survey shows that they attribute more importance to renewal values such as innovation and creativity, which explains the climate of dynamism and entrepreneurship that dominates in the workplace. The reorganization necessary to implement the new business model yielded a shortening of the chain of command, as more and more business and support functions were integrated directly in the studios.

The   product   lifecycle   was   also   considerably   altered.   Moreover   both   the development process and tracking conducted as a follow up are centered around the customer, through  the  three  key  parameters:  acquisition,  retention  and  monetization.  These  three parameters are placed on a much different timescale than traditional retail games and require constant efforts from the development studios in charge of the game. The player is now an active contributor to the value chain, as it is now paramount to understand his needs and to react extremely quickly to his feedbacks on dedicated websites and online communities.

Place, publisher, year, edition, pages
2013. , 74 p.
Keyword [en]
Free-to-Play, business model, video games, innovation, Ubisoft
National Category
Economics and Business
URN: urn:nbn:se:kth:diva-142902OAI: diva2:704869
Available from: 2014-04-17 Created: 2014-03-13 Last updated: 2014-04-17Bibliographically approved

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