When I looked at the charts of the top earning games for the past year, I was surprised to see so many free games in there.

Sure, some free games can make money off ads and other means.But I never imagined that free games could make tens of millions every month off their user base.

It is a testament to how much gaming companies can generate excitement around games that are free to play.

Ad Revenue

One of the major sources of income for free games is ad revenue. It is especially true on mobile platforms, where users have to sit through picture and video ads when they are playing a game.

These ads make it easy for a game to get attention on mobile platforms. Most people, such as myself, do not want to play a few dollars to play an average, mobile game. I would much rather try out a free game for a little while, to see if it is enjoyable.

I do not mind sitting through the odd ad. And it is good to know that game developers are being supported. Many of the top mobile games on Android and iOS make millions each year through ads.

In Game Transactions

All types of games are embracing in-game transactions. Many paid games on computers and consoles have loot boxes, packs and other means of getting revenue from players in game.

I play a lot of FIFA and the Ultimate Team game mode is almost entirely built around transactions, with players able to buy packs with real money and then open them in game to get players and other items.

Free games like Fortnite are taking off thanks to in-game transactions. Fortnite managed to rake in around $300 million in one month in 2018. The game is exploding in terms of popularity, with many of its users happy to buy in-game items such as skins, weapons and more.

Are Free Games the Future?

With Fortnite and mobile games showing how users are willing to pay money for in-game content, is this the future of gaming?

I am often left wondering whether the single player games that cost $50 or $60 are going to die out. While those games make money, they require a lot more work to create and will only result in a one-time revenue proposition for the gaming company.

In contrast, free games often have a very basic structure, can be updated regularly and bring in revenue all the time. While single player games may never go away entirely, they are clearly being pushed to the side of the market.

 

Lowering Barriers to Entry

The beauty of free games is not only how much money they can make through in-game transactions, but how they lower barriers to entry. Many of my friends got into Fortnite simply because it was a free game. They had to pay nothing to start playing.

Having such a low barrier to entry means that it is easy to get new people interested in gaming, even if they had not considered it before. And many of these users end up falling in love with the game, which results in them purchasing in-game content down the road.