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Dollar Per Hour of Entertainment
Today I want to talk about the classical “$1 Per Hour of Entertainment” measurement of value. This has been a staple of videogame value discussions for decades. There are multiple problems with the formula though, and I think we should collectively abandon its use even as general rule of thumb.
The first problem is foundational: what qualifies as “entertainment”? When people evoke the formula, they typically do so with the assumption that hours spent playing a game are hours spent entertained. But is that actually the case? There are dozens and dozens of examples of “grind” in games, where you must perform a repetitive, unfun task to achieve a desired result. If you actively hate the grinding part but still do it anyway because reward is worth it, does the entire process count as entertainment? Simply because you chose to engage with the game at all? That sounds like tautology to me. May as well add the time spent working a job to get the money used to buy the game in that case.
Which brings me to the second problem: the entertainment gradient. Regardless of where you landed with the previous paragraph, I believe we can all agree that some fun experiences are more fun than others. In which case, shouldn’t that higher tier of entertainment be more valuable than the other? If so, how does that translate into the formula? It doesn’t, basically. All of us have those examples of deeply personal, transformative gaming experiences that we still think about years (decades!) later. Are those experiences not more valuable than the routine sort of busywork we engage with, sometimes within the same game that held such highs? It is absolutely possible that a shorter, more intensely fun experience is “worth” more than a mundane, time-killing one that we do more out of habit.
Actually, this also brings up a third problem: the timekeeping. I would argue that a game’s entertainment value does not end when you stop playing. If you are still thinking about a game days/months/years after you stopped playing, why should that not also count towards its overall value? Xenogears is one of my favorite games of all time, and yet I played through it once for maybe 80 hours back in 1998. However, I’ve thought about the game many, many times over the intervening decades, constantly comparing sci-fi and/or anime RPGs to it, and otherwise keeping the flame of its transformative (to me) memory alive. Journey is another example wherein I played and completed it in a single ~3 hour session, and I still think about it on occasion all these years later. Indeed, can you even say that your favorite games are the same ones with the highest dollar per hour spent playing?
The fourth problem with the formula is that it breaks down entirely when it comes to free-to-play games. Although there are some interesting calculations you can do with cash shop purchases, the fact remains that there are dozens of high-quality games you can legitimately play for hundreds of hours at a cost of $0. By definition, these should be considered the pinnacle of entertainment value per dollar spent, and yet I doubt anyone would say Candy Crush is their favorite gaming experience of all time.
The final problem is a bit goofy, but… what about inflation? The metric has been $1 per hour of entertainment for at least 20 years, if not longer. If we look at 1997, $1 back then is as valuable as $2.01 today. Which… ouch. But suggesting that the metric should now be $2 per hour of entertainment just feels bad. And yet, $1 per two hours of entertainment also seems unreasonable. What games could hit that? This isn’t even bringing up the other aspect of the intervening decades: loss of free time. Regardless of which way inflation is taken into account, fundamentally I have less time for leisure activities than I did back in high school/college. Therefore the time I do have is more valuable to me.
At least, you’d think so. Lately I’ve been playing Hearthstone Battlegrounds (for free!) instead of any of the hundreds of quality, potentially transformative game experiences I have on tap. Oh well.
Now, I get it, nobody really uses the $1 per hour of entertainment metric to guide their gaming purchases – they would otherwise be too busy playing Fortnite. But, fundamentally, calculating the per hour rate is about the worst possible justification for a discretionary purchase, the very last salve to ease the burn of cognitive dissonance. “At least I played this otherwise unremarkable game for 60+ hours.” Naw, dawg, just put it down. Not every game is going to be a winner for us individually, and that’s OK. Just take the L and move on. Everything is about to start costing $80, and you sure as shit don’t have 20 more hours per game to pretend you didn’t get bamboozled at checkout.
But you know what? You do what you want. Which is hopefully doing what you want.
Following the Money
Aug 14
Posted by Azuriel
Found a news article (via Reddit) with a refreshingly straight-forward headline: Newzoo: North American gamers spend an average of $325 annually The Reddit conversation focused mostly on how inexpensive gaming is as a hobby in dollars-per-hour terms, compared to going to a bar/movie ($20-$80) or even a concert/sporting event ($150-$800+). You know, traditional talking points.
After actually reading the article itself though, that wasn’t what this report is about:
What’s conspicuously missing is “percentage spent buying the game.” At least, I assume unlocking exclusive content does not count. And actually, all those percentages are kind of weird. Is character customization not also exclusive content? Are content packs not battle passes? Who knows.
Regardless, the through line is clear:
There’s a tangled web of chicken vs egg speculation about why player growth has slowed. Market saturation? Higher prices and too much “maximizing value” squeezing people out? Shaky economic future? The rise of lifestyle/live-service/forever games like Fortnite, Roblox, etc? (Time) Competition from short-form video content?
Funnily enough, most of these points were covered back in January in the Hopes of the Game Industry. And the answer is… Yes. All of those things, simultaneously. There have been tremendous layoffs in the games industry this year, including high-profile sequels and nearly-complete games thrown in the trash. We mourn the loss of what could have been, but the suits see how only ~12% of gaming hours are spent playing new games. Why risk $100m+ and eight years building a game when you can “maximize value” out of established ones? And if you don’t have any of those games, just buy’em up.
Again, it could be an interesting debate about which happened first. Did escalating prices for new games send players back into the arms of familiar classics? Or did the introduction of microtransactions start making games stickier, as a means of assuaging sunk costs?
True answers, if any exist, are academic at this point. Developers are following the money and it’s hard to blame them. Well, aside from being increasingly incapable of making fun games even after 4-8 years and tens millions of dollars and are now choosing to erode your consumer surplus instead.
You can certainly blame them for that.
Posted in Commentary
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Tags: Consumer Surplus, Dollar Per Hour of Entertainment, Follow the Money, Recurrent Consumer Spending Opportunities, State of the Industry