Hi everyone — welcome to another issue of Naavik Digest. If you missed our last one, be sure to check out our breakdown of major game publishers’ approaches to blockchain gaming and how they’ve evolved over the past two years.
In this issue, we have the first of a two-part examination of the underlying live service strategy of Bungie’s Destiny franchise and how its complex monetization schemes have grown unwieldy.
#1 How Bungie Lost the Plot With Destiny’s Live Service Model
By Mario Stefanidis, CFA, Naavik Contributor
This piece is part one in a two-part analysis of Bungie’s monetization strategy and microtransaction model for the Destiny franchise. Look out for part two next week.
Bungie’s Destiny has come a long way, revolutionizing the games industry and gaming as we know it. But in recent years, the series has developed in a way to maximize profits rather than one marked by a love for storytelling, which put Bungie on the map many moons ago.
Since the studio’s creation in 1991, Bungie has been synonymous with quality over quantity. The 12 games across the studio’s four franchises — Marathon, Myth, Halo, and Destiny — all have been well received (with the exception of Destiny 1). The company takes as much pride in its sequels as its original installments. Halo 3 is considered by many to be the pinnacle of the franchise, while gameplay and story-wise, Destiny 2 represents an upgrade to its predecessor.
Destiny 2 is an open-world multiplayer first-person shooter and sequel to Bungie’s short-lived Destiny, which lasted from 2014 to 2017. With its first new IP following the handoff of Halo to 343 Industries, Bungie successfully blended its knack for storytelling and sharp gunplay with role-playing elements to create a franchise like no other. While many fans consider Destiny to be of the looter shooter variety of games, the series has been adept at combining elements of competitive PvP shooters, full-blown MMOs, and even third-person action-adventure platformers for a unique mix that virtually no other developer has been able to replicate since, despite numerous (now-failed) attempts.
In addition to its revolutionary gameplay, Destiny is also considered to be a progenitor of the live service model, where a developer continually updates a game with new content and events to keep players engaged. Destiny 2 is frequently updated with new missions, environments, guns, and enemies in a living, breathing world, a model today emulated by many, but at launch unlike any game that preceded it.
Bungie had the opportunity to carve out something new after Microsoft established 343 Industries to continue the Halo franchise, and it chose to make a title that fully takes advantage of the online era. In a way this was necessary, so the independent studio could recoup its $140 million budget, at the time one of the costliest video games ever. It also had to secure its future by making sure its new IP stuck, since Bungie historically worked with one franchise at a time before moving onto another.
However, something ominous began to foment a decade ago. There was an exodus of game designers and developers after Bungie sold Halo; some went to its new parent company, while others went on to found their own venture. Then a second wave of exits occurred after the launch of Destiny 1 in 2014.
Journalist Jason Schreier laid out numerous reasons for employee unhappiness in a 4,000+ word Kotaku article published in 2015. The game's original story, which was written by long-time Bungie writer Joe Staten, underwent a complete reboot just a year before its release, with major plot threads, characters, and dialogue scrapped and rewritten. Staten left in the middle of 2013, just months before the game was first scheduled to release.
The team worked crunch time to put the game out by a new March 2014 release date, but still needed more time, leading to a second delay out to September of that year. In addition to the writing issues, they also grappled with the technical challenges of the in-house Tiger Engine, a new engine based on Halo’s.
The new story lacked focus, and instead of having a grand Star Wars-esque narrative, the game had a series of missions with lackluster dialogue and an incoherent plot.
Destiny’s 77 Metascore at launch fell way short of the 90 threshold it had to achieve to receive bonus incentives from its publisher, Activision Blizzard. Despite this, the game still made its budget back multiple times over, grossing $500 million in the first week alone and smashing analysts’ expectations. The anticipation Bungie built up after a year of delays and an extensive marketing campaign resulted in incredible launch sales. But for the first time, the studio had put out a lackluster game.
The crunch before launch was not the end of Bungie’s problems, however. The studio was obligated to ship two $20 DLCs over the next few months, followed by a massive $40 expansion about a year after launch. Given the game retailed for $50, this expansion would essentially have to be a full new game’s worth of content.
Bungie ended up pulling this off with two DLC packs, The Dark Below and House of Wolves, and the major expansion they had promised, titled The Taken King. But this process, and the loss of team members from harsh working conditions, led senior leadership to approach Activision with a new approach.
Instead of releasing major content with a planned roadmap, the studio could instead use microtransactions to make up for the loss of DLC, such as selling cosmetic items in the Tower, the game’s central hub. This could be complemented with a “dripfeed of free content” to tide players over until the launch of Destiny 2, which was originally planned for a September 2016 release date.
Due to the development circumstances of the first game, the release for Destiny 2 was again pushed back a year. Bungie was unable to get out of its contractual obligations under its publishing agreement to put out a yearly major expansion, though for the rest of Destiny’s life it did not put out other DLCs.
As pitched by management, an in-game shop called Eververse Trading Company appeared in the Tower in October 2015, where players could trade real money for the premium currency Silver. The only items in the shop at first were emotes. Everyone got 400 silver to start, the equivalent of about $4. With this Silver, one could buy two “standard” emotes, which cost 200 Silver a piece. More elaborate “Legendary” emotes cost 500 silver. Additional bundles were available at 500 for $5, 1,100 for $10, and 2,300 for $20.
Bungie’s rationale for these microtransactions was that they would "bolster the service provided by our live team for another full year, as they grow and create more robust and engaging events that we’ll announce later this year." Some gamers interpreted this to mean that the microtransaction shop would be a tradeoff for regular free content updates. Others were rightfully skeptical.
Indeed, the Eververse has persisted eight years later, and has now become an integral part of Bungie’s monetization strategy for Destiny. Free content is highly limited, and the microtransactions coexist with DLC.
Since the launch of Eververse, Destiny 2 has taken microtransactions to a whole new level. The experience has gotten to be so flagrant, it has been called “microtransaction hell” by long-time Destiny YouTuber and community member Aztecross.
It was seen as a liberating moment when Bungie freed itself from the shackles of its Activision publishing deal in 2019, one that granted the developer freedom similar to its split from Microsoft in 2007. But instead of paving the way for more creative liberties and a lower emphasis on profitability, the opposite has happened.
How did Destiny 2 devolve from a genre-defining entry in an exciting new franchise into something sinister? Next week, we will dive into the evolution of the Eververse store, the season pass system, the Engram loot box system, and much more. We will explore how Destiny 2 became the mainstream game with the most microtransactions in history, and why major outcry into Bungie’s practices reached new heights six years after the game’s launch.
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#2 Game of the Week: Exoprimal
- Platform: PlayStation, Xbox (Game Pass), PC
- Developer/Publisher: Capcom
- State: Worldwide Launch
- Genre: Third-Person Shooter
What You Need to Know:
- Exoprimal is a third-person hero shooter that combines elements of PvP and PvE in a way reminiscent of Bungie’s Gambit game mode in Destiny 2, blending competitive bouts against other human players in between cooperative, objective-based gameplay. You can watch a gameplay video here.
- Two teams of five players are pitted against one another in a dinosaur-hunting contest using sci-fi guns and mech suits that look and play much like the Javelins from BioWare’s ill-fated Anthem but with class-based, Overwatch-style hero ability sets.
- Exoprimal does have a narrative that it blends alongside its multiplayer progression system by letting you unlock cutscenes and story files that perform some light worldbuilding to help contextualize the dino-killing rampages you embark on. But it’s clearly not the focal point of the experience.
- Many of the developers working on Exoprimal come from Capcom series like Resident Evil and Monster Hunter, and you can really feel the latter’s influence in some of the larger-scale combat encounters.
- Though you might be inclined to compare Exoprimal to the Capcom classic series Dino Crisis, the two properties are entirely separate and have almost no connection in their gameplay or narratives outside the central fixation on prehistoric lizards.
- Exoprimal is very much a hodgepodge of other game studios’ big ideas, but it’s done in such a clever and engaging way that it manages to feel unique and fun when combined with the inherent absurdity of fighting hordes of dinosaurs raining from the sky.
- At $60, the game does feel like the kind of live service gamble that might get shut down a year from now. Considering how full the live service graveyard has gotten this past year, I’m not overly optimistic Exoprimal will be able to sustain itself in the long term.
- That said, its release on Game Pass is a perfect distribution strategy because it gives players the opportunity to try the game out without feeling the need to sink dozens of hours into a live service loop they might ultimately regret.
- Launching on Game Pass is also a great way to get groups of friends to try the game simultaneously. Many similar attempts at pay-to-play multiplayer games in this day and age, like Velan Studios’ Knockout City (before it went free-to-play), struggled to take off because they required friends to round up two to three others to pay just to try it out.
- The best live service titles have succeeded partly by starting as or eventually transitioning to free-to-play. While Exoprimal may eventually do the same, Game Pass effectively replicates the same conditions for helping to jumpstart the game’s player base.
- Outside of Game Pass, Exoprimal is monetizing through cosmetic upgrades and a battle pass, which has irked some players who still feel these strategies shouldn’t be implemented into full-priced, pay-to-pay games. Regardless, prices have been adjusted to account for the upfront cost, and skins and other upgrades are far less expensive than they are in free-to-play juggernauts like Fortnite.
- Overall, Exorpimal is an interesting, experimental multiplayer gamble from Capcom that feels both innovative and fun, even if a little derivative on where it drew its game design and aesthetics from.
- Whether it can survive the crushing competition of the live service market remains to be seen. Early Steam numbers are not promising, peaking at only a few thousand concurrent players a few days after launch. But it does appear likely that a good chunk of players are on Xbox at the moment. We’ll have to wait and see if Capcom releases any sales figures for the title going forward.
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