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Illustration: Annelise Capossela/Axios

Google's announcement of a plan to pay some game developers based on how much their games are played has stirred concerns among industry insiders about the downside of game subscription economics.

Why it matters: The concern over engagement-based payments is that they incentivize developers to make games that are artificially longer or that pressure their players to keep coming back.

  • Those worries are on the rise as players, developers and publishers reckon with the impact of increasingly popular subscription services from Xbox, Apple, PlayStation and Google, which provide gamers access to scores of games for a flat monthly fee.

How it works: Google's approach will give developers whose games are accepted into the Stadia Pro subscription a cut from a pool of 70% of the revenue generated by Pro. The cut will be based on player engagement for a given game.

  • Stadia isn't logging total hours. It will instead reward daily check-ins. If a player plays a game for two days, that's two moments of engagement.
  • Some gaming subscription services offer a mix of upfront payment for putting the game on the service, followed by engagement-based revenue, but a Google rep declined to specify whether upfront payments are part of this.
  • Stadia complemented its news with the announcement of an unusually generous split to new games signed to Stadia for their first $3 million in revenue.

What they're saying: Johan Toresson, a talent scout for acclaimed indie-friendly publisher Raw Fury, told Axios that engagement-based payments incentivize the creation of games that press players to "log in every day, put every waking hour into the game" he said.

  • "While there is usually an up front paycheck, which is great, the people curating these platforms clearly signal that they are more into these types of retention-heavy projects, which in turn likely leads to projects being bloated with unnecessary padding content just to keep you in there."
  • Some games can derive engagement simply by being fun enough to play every day, he noted. And subscription gaming plans do seem to encourage people to try games they otherwise wouldn't have seen or bought.
  • But the impact of paying for engagement worries him (and others) who fret for the fate of more self-contained projects.
  • "This model wouldn't make sense for establishing the value of say Bukowski's 'Women,' Cass Khaw's 'Hammers on Bone' or Gaspar Noé's 'Irréversible' on the amount of time spent reading or watching them (or amount of times it's re-read and re-watched), so why should it for games?" he said.

The bottom line: The industry's business models have affected how developers get paid — and what kind of games they make — since quarter-munching arcade cabinets in the '80s rewarded creators for making games hard.

Go deeper

Meet the Black developers making your new favorite games

Image via The MIX

The Media Indie Exchange is putting Black developers at the forefront with its Black Voices in Gaming Freshman Class, an initiative to highlight developers with games coming out through 2022.

Why it matters: The game industry grapples with diversity across the board, leaving developers who are not cis-gender white men isolated or even alienated from the broader community.

Exclusive: Sony’s PlayStation boss moves past console wars

Photo illustration: Axios Visuals. Photo: Courtesy of Sony Interactive Entertainment.

PlayStation’s competition goes far beyond its gaming rivals, Sony’s head of PlayStation Jim Ryan told Axios.

Why it matters: With entertainment converging on every screen imaginable, old distinctions between the business of games, movies, streaming and even social media are becoming less relevant.

Jill Biden to travel to opening ceremony of Tokyo Olympics

Photo: Tasos Katopodis/Getty Images

First lady Jill Biden will travel to the opening ceremony of the Olympic Games in Tokyo on July 23, the White House announced Tuesday.

Driving the news: The White House's announcement comes a week after Japan's Olympics minister said that the Games — which are scheduled to run until Aug. 8 — will be held without spectators after Japan declared a COVID-19 state of emergency in its capital.