Rethinking Microtransactions and In-App Payments

28th January 2012


First, we bartered chickens when we needed goods and services. Now we make microtransactions and in-app purchases by flinging numbers through the air courtesy of plastic cards. And beyond that–well, as far as video game purchases go, we’ve picked up this bad habit of buying numbers with more numbers.

Take a look at Microsoft’s setup for purchases on Xbox Live, for instance. If you want to buy a digital game, you must first purchase Points in denominations that typically cost more than what the game retails for on the PlayStation Network. And once you buy your game, you never seem to have enough Points left over to buy another game. You must go back and purchase more Points.

Interestingly, there’s talk that Microsoft is thinking of ditching its Points system–or rather, is thinking of phasing it out over a span of time. That would seem to be good news.

It’s unfair to suggest that the Points system doesn’t have its upsides. After all, you can save up your leftover points to buy your Avatar a new hat, or a pet hippogriff. But getting rid of Points won’t only be a good thing for gamers. It should prove a decent long-term decision for Microsoft, too, and not just because Points are confusing for many. Simply, gamers are warier than ever about how much money they dish out for games, especially digital games. With the PlayStation 3’s increasing user base and Apple’s App Store receiving an increasing number of ports from the Xbox Live Marketplace and the PlayStation Network, it benefits Microsoft to offer its users a dollar-to-dollar value for their purchases. Otherwise, said users may opt to buy the same game on the PSN or the App Store instead.

In the same vein, digital marketplaces have also pushed the act of game shopping up to a tempo that’s almost frantic. The fewer obstacles people have in between themselves and the purchase of a game, the more likely it is that the game will be bought. In other words, people want to take out their credit card and say, “I’ll buy this game for $10.” They don’t want to say, “I’ll buy 500 Points, and on top of the 300 I already have, that should be enough–no, wait, I’ll actually have to buy 1000 Points–“


Hopefully, Microsoft Points will indeed be relics of the past by the end of 2012. Next up: To convince Nintendo that it’s time to end Nintendo Points. The company should already have enough incentive, given how quickly the division between Points and dollar values has already segregated the Nintendo DSi Shop and the Nintendo 3DS eShop.

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