Sunday, October 23, 2011

Get Diablo III for free

Obscure payment models are the future. At least until some governments realize that a market economy works best when there is transparency. This post is about Blizzard's offer to let you play Diablo III for free if you subscribe to WoW for one year.

It seems that any subscription you have at the start of the 12-months commitment will automatically recur as often as is needed to keep you subscribed for at least 12 months. You can probably change your subscription plan to 6-months and it would cost you a lot of money if you didn't. But don't trust Blizzard to tell you this upfront.
Anyway, this is just my guess and if anybody was able to figure this out with certainty, please leave a comment!

At the current cost of a six months-plan, the one-year plan costs 131.88€ and thus each month costs 10.99€. By taking the offer you save 58€ that Diablo III's standard edition currently costs at Amazon. These 58€ are equivalent to 5.28 months of WoW subscription time. (You can make the same calculation for one-month plans where each month costs you 12.99€).

Let us be clear that this is a bet. Blizzard bets that you would only be subscribed for 6 months or less during the next year. You bet against this! If, even without this offer, you were subscribed for just seven months of WoW playtime during the next year and bought Diablo III separately, this special offer would cost Blizzard 7x10.99€ + 58€ - 131.88€ = 3.08€ and they would never offer it to you.

Now, most players will lose this bet, because Blizzard got all the data and knows best about the future evolution of WoW. They know what patches they have planned, have done extensive market research and probably have a few informants at EA and NCSoft. And based on that information they consider it unlikely that the average WoW player, who agrees to this offer, would have been subscribed for 7 months or more during the coming 12 months.

Those players, who do not agree to this offer, are probably the majority. And it is probably a safe prediction that these players are less enthausiastic about WoW. And as such, on average, they will be subscribed less months of the coming year, than the more enthausiastic players who accept the offer! Thus we can clearly see that, in the absence of this special offer, Blizzard expected the average player to be subscribed for considerably less than 7 months out of the next 12 months. I wish I could write this down in a way that it is easier to understand, but Blizzard did their best to make that really difficult.

Anyway, just keep these thoughts in mind before you decide that you are the exception and going to win that bet!

I ignore the fact that some players have considerable time left on their accounts, because they chose a 3-months or 6-months plan last time they resubscribed. This fact has some influence on the above calculations, but only Blizzard knows the numbers here.

Keep one thing in mind: By using a 6-month plan you pay 10.99€ instead of 12.99€ the month. That means that you save 2€ a month and 12€ during the six month period. One day of a 6-month plan costs you about 65.94€ / (365/2)= 0.36€.

Usually people do not resubscribe immediately after a subscription has run out. Sometimes they are on vacation or it's a weekend. Sometimes it's night and you don't immediately jump out of bed to resubscribe the second the subscription runs out. If, using a 1-month plan, you end up not being subscribed for about 12€ / 0.36€ = 34 days, the 1-month plan is superior to the 6-month plan.

Now, that seems like a lot. But keep in mind that Blizzard wouldn't offer you to save 2€ a month if they thought that this loses them money. Blizzard has done some market research here, too. And apparently they found out that the average subscriber of a six-month plan, would be subscribed for 34 days (or more) less if he had used a one-month plan.

You can generally assume that any special offer turns out to be profitable for the company, and is thus a bad decision for the average accepting consumer (not the average consumer!). But you are not average, of course :)


  1. You did not consider player who would not have bought D3 but can't resist a sale. I doubt there is anything more powerful than a sale... go ask Steam about my buy history. :-(

  2. +1 Kring - sales do work

    MMO economics has evolved the customer expectation into an unusual place. Would any economist or marketing vampire think a plan where a 200-hour a month addict and a 6 hour a month ultra casual pay the same is logical? I.e. all your blog posts on the death of the subscription model of MMOs.

    CCP offers you $2/month for 3-month, $3/month for 6, and $4/month for annual. Locking customers into a longer term commitment has many benefits to the publisher more than the probability-of-unsub vs discount calculation. What seems clever is Blizzard found ways (free Beta invite, D3) that don't hurt the bottom line as much as, for example, CCP giving you a 26% discount for subscribing for 12-months.

    There are also D2 players who will play D3 who have never played an MMO. This plan allows them to sample the heroin of MMO subscriptions at a greatly reduced rate.

    All the WoWInsider podcasters were saying it was a certainty that the next Starcraft whatever would be included in something similar/this. What if the plan and the brand is Blizzard not WOW? I.e., Activision-Blizzard Inc is not as concerned about whether you subscribe to WoW as much as you subscribe to Blizzard? Remember, you log into not And the RL$ you get from selling D3 drops can be used to buy WoW pets.

    "Most" players I know who are post-collegiate (or parent funded minors) get their subscription automatically billed to their credit card which will "automatically recur" in perpetuitiy and without a gap regardless of whether there is a 12-month plan or not.

    Nor do I think the 12-month commitment is a subscription pre se; you just need to have an ongoing subscription for 12 months. "Any qualifying game time added to the account may apply to the 12-month subscription requirement." Presumably, someone with a 1 month recurring subscription who recruits 12 friends (@1month free each) would satisfy this without ever paying anything.


    I am super impressed with one facet. Marketing will say the people who value something the most will pay the most so extract the "consumer surplus" from them.

    Signing up for a WoW annual pass probably cost me zero dollars and might have save me $60 assuming I would have given in to D3. The D3 AH is innovative and I really wanted to see it. Many of the WoW gold/AH/crafting bloggers I read already have their D3 plans made. So now I get to see it for no incremental cost. Regardless, the entire year of subscriptions costs the same as the TOR CE I preordered a few months ago. The $150 for TOR CE, like the other CE I buy, is very much about additional publisher profit.

    But if you really like D3 and want the CE, then Blizzard gives CE owners 4 free months of WoW which also reduces the 12-month time commitment. They did not have to do that.

  3. Of course, you are right Kring. There are always those people who think that something that is "cheaper than usual" is a bargain, no matter whether they actually need it or end up using (playing) it.

    But this effect is old by now. Hardly worth writing about ;)

  4. > There are also D2 players who will play D3 who
    > have never played an MMO. This plan allows them
    > to sample the heroin of MMO subscriptions at a
    > greatly reduced rate.

    You can only get a free D3 with the 12 month subscription if the WoW account existed before Blizzcon. You cannot use this offer if you haven't played WoW until now.

  5. Perhaps this is Blizzard's first move in offering an 'all-access' pass for its stable of games, in the way that Sony already does? I've never been that into Sony games but the all access pass idea is interesting as it lets you try games without the pressure to play them (you just want to be playing one or more of them at a given moment to 'justify' the fee).

  6. Your calculations assume that Blizard gets full price for Diablo 3 sales - this is not true due to sales tax, and store and distributer cuts.
    Where as the Wow subsciptions are probably mostly paid directly to them - with no store cut.
    Some people will play via game time cards, but I suspect it is a much smaller proportion than the subscriptions.

  7. I must definitely not be average. I play for 12 months and pay for 12 months. So with this I save no matter what.

    This offer is only a bad idea for people that only play part of the year and often let their subscription lapse.

    For everyone else that pays a full year, it is like getting free stuff for paying for something you where paying for anyway.

    Just think about the last year for me and the next year for me.

    Last year:
    12 months of WoW @ $15 per month.

    Next Year:
    12 months of WoW @ $13 per month.
    1 mount all my characters will get.
    1 New release game on release day.
    1 Access pass to the next beta.

    Do you remember all those people that where offering $500+ for a beta invite to cata?

    This is a god send for that type of player. Now they get the beta invite for free with the subscription, and it is 100% legal too.

    If anything, they just scammed themselves.

    I would have paid $15 per month, so they lost $24 there. I would have purchased the mount for $25 so they lost money there. If I wanted to play Diablo I would have bought it, so they lost money there. And if they offered the option to buy a beta invite for 25 bucks I might have considered buying that too.

    They lost a lot of money from me.

    They better hope people that normally do not play all year long buy it or the end result will be a huge loss of cash over all.

    They might be typing to lure the part timers in and you might consider those people as getting scammed, but for everyone else, this is a bonus, not a scam.