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Everything you need to know about in-game purchases

What are in-game purchases?

In-game purchases, technically known as microtransactions*, involve players trading real money for virtual goods and services. Often, the player does not buy what they want directly, and instead trades a fixed amount of real money for a given amount of a premium currency* used by the game. Once they have this premium currency*, the player can then use it to purchase the items or perks they wanted. Sometimes this premium currency* can be slowly earned through normal gameplay, but it's unlikely that you can earn a useful amount this way.

An important thing to remember is that it's usually not possible for players to get a refund on an in-game purchase, nor can the premium currency* be converted back into real money.

How can in-game purchases benefit players?

There are actually several ways that microtransactions* can benefit everyone. In-game purchases allow fans of a game to get more entertainment out of an experience they are already enjoying, while also providing some extra income for the developers.

One common example of a useful in-game purchase would be cosmetic changes to the player's character. Gamers really enjoy making their characters their own, and while it's usually possible to do this without spending money, many games also offer special or "limited edition" costumes that players can acquire and use to dress up their characters.

Other common examples of useful in-game purchases include virtual "tickets" that give you access to restricted "members only" areas of the game, the ability to change the player's online nickname, or access to a virtual chest where they store some of their extra stuff. For an example of an in-game perk, some games also require you to get a virtual "trader's license" before you're allowed to sell your in-game goods to other players. These licenses are usually only available via in-game purchase, and typically expire in about a month.

Yet another way in-game purchases can benefit players comes from ad-supported* games. Many of these games offer an option to pay a small amount (often only a dollar or two) to permanently hide the advertising from that player. Some go further, permanently hiding advertisements if you buy any virtual item, no matter how cheap the item might be.

Two other things commonly available as in-game purchases can be very useful, but they are also ripe for potential abuse. These are items that cause "time acceleration" or "stamina recovery". These can often be earned in small quantities through normal gameplay, but purchasing them is the primary way players acquire them. Used sparingly, they can be a huge help; when a game is design so that the player needs to use them, there's a serious issue. The next section will explain how these items work, as well as a few other ways microtransactions* are abused by unscrupulous game developers.

Potential abuses and dangers

Put simply, games can be designed to force the player to spend extra money. They might be subtle about it, giving the player the chance to earn the items and resources on their own, but actually make it incredibly boring and difficult to do. All the while, the game's shop offers a quick and easy solution -- all the player needs to do is spend a little money. Some games aren't even subtle about it, and routinely display reminders that the in-game shop has what the player needs.

One common example of this tactic is to limit how long the player can play the game. This is usually done using "stamina" or "energy". This "stamina" will restore itself over time, but players can usually purchase "stamina recovery" items that either restore it instantly or just a bit faster. By using these items, a player can resume the game much sooner than if they had simply waited.

To illustrate how these stamina systems work, let's imagine a dungeon crawler* that uses stamina. Each time you enter a dungeon, you lose a fixed amount of your stamina. Different dungeons require different amounts of stamina, so you need to choose which ones you visit carefully. Generally speaking, harder areas are more rewarding but also cost more stamina to visit. Thus, when you first start playing the game, you can play for a fairly long time every session, as the entry-level dungeons don't cost very much. Later on however, the game forces you to take longer and longer breaks between sessions, as visiting the harder dungeons uses up your stamina faster.

Limits like this aren't always a bad thing; in fact, games sometimes use limitations like this to ensure that their players are taking enough breaks and getting some fresh air. The catch comes with how quickly your stamina regenerates. A good game will ensure that your stamina restores quickly enough to be reasonable, allowing the player to play at a comfortable pace despite having them take breaks now and then. Bad games on the other hand, act like a crack dealer -- it starts out free, but once you're hooked on their game, you'll need to start paying to continue having fun.

Another common example of exploitation comes with the "time acceleration" items. Sometimes, crafting items or constructing buildings in a game will take a little bit of time. Just like you saw with the stamina system, simple items and buildings are created quickly. This allows new players to make a lot of progress in the game before the time it takes to perform an action starts to impact the gameplay. Creating better items and buildings will always take longer than the early items, so eventually you'll be looking at delays measured in hours and even days. The solution of course, are "time acceleration" items that can be purchased from the in-game shop. These usually work by automatically completing a task of your choosing or by advancing the game's clock to save the player time.

Do you see the risk here? Both features I've just described prevent the player from continuing their game. Sure, they could just do a little and move on, but a lot of gamers want to play for fairly long periods. In order to do this, they'll need to buy item from the game's shop using real money.

Although adults can sometimes be a bit too loose with their spending, young children are especially vulnerable to this tactic. As a general rule, kids don't like to stop having fun or wait around for things to happen. And this is where things have become very ugly in the gaming industry. While games usually do make it very clear that you're spending real money -- often displaying a notice that parental permission is required, perhaps even requiring a password -- studies have shown children have trouble understanding that they are leaving the game and making a purchase. The end result is a huge thousand dollar bill that nobody saw coming or really agreed to pay.

Unfortunately, while what's described above covers the bulk of the risks with in-game purchases, there is something worse lurking in the depths of the gaming industry. In this case, some of the games are marketed as free to play* or freemium* have a dirty secret. Either by inept design or deliberate sabotage, these games favor their paying customers to such a degree that they effectively punish or cripple their non-paying customers. Since the only way to compete in these "free" games is to spend money, players began calling them pay to win* games -- an insulting twist on the term free to play*. For obvious reasons, these games are best avoided entirely.

Small side note here: there is a similar term known as pay to play*, but it does not mean the same thing as pay to win*. Pay to play* games are just games that require their players to pay a regular subscription fee, whereas free to play* games do not have such a requirement.

Summing it up

In game purchases involve spending real money on virtual goods. This can be a good thing, and may make games more fun, but it can also be a serious problem. Be sure both you and your children understand that these payments are using real money, and that you know when games are taking advantage of your desire to play them.