By now it’s expected that major American multiplayer games like World of Warcraft
will charge customers a monthly subscription fee.

But the news out of
Asia’s booming gaming market suggests a different approach may be more
lucrative: Throw open the gates to your online world, while tempting
users with small purchases that help them look good while they’re

Some of the most popular games in Asia are given away for free and
charge no subscription dues, but collect micropayments for custom
avatars and other items. Social networking is a key feature of the
games, and it turns out players are quick to fork over yen and yuan to
tweak their appearance to their liking.

At Hangame,
Japan’s number one internet game portal, customers wind up spending
between 30 cents and $10 an item to customize the look of their avatar,
visible during social interactions and in the otherwise free games.

The image “” cannot be displayed, because it contains errors.Games range from Flash games that are easy to play with just a mouse
key or arrow, to more complex sports and RPG games. Social features
include a chat window, web pages and blogs. Player profile pages,
showing avatars in their customizable virtual rooms, produce 200
million page views a day, said Murota, and around 200,000 customers
send e-mail to each other every day.

In an online game, an avatar becomes "an idealized version or
statement about who you want to be," said Michael Steele, evangelist at
Emergent Game Technologies, and a former consultant for the Korean GoPets.

The popularity of online gaming in Japan, China and Korea dominated more than a few sessions at the 2006 Game Developers Conference
in Silicon Valley last month, where U.S. companies looked for advice on
developing games that appeal to the massive Asian market.

Presenting a Case Study of a Casual Game Community Portal, NHN Japan’s general manager Noriyoshi Murota logged into a live Japanese online Pachinko
game. At about 4:30 a.m. Japan time, more than half the players
inhabiting the online arcade were paying customers, with custom
avatars. Players can look around the virtual room and compare their
play — and their appearance — with others.

"Microtransactions make Asian games more fun," said Nicole Lazzaro, president of XEODesign. "In games where people play together, the value of the game increases with the number of players."

"Everyone understands that $10 per month adds up to $120 per year,"
said Lazzaro. "This big commitment limits the market. A free game
removes the barrier to entry, connecting as many of a player’s friends
as possible. It is easy to spend more than $10 a month in
one-dollar-and-fifty-cent impulse purchases. Plus, we all play what our
friends play."

In the United States, a handful of online offerings have adopted a similar model to Asia — notably Linden Labs’ Second Life.
It’s free to use, but charges players to purchase and develop virtual
property, and allows users to make and sell items to one another. But
these games are the exception, not the rule.

By Kathleen Craig