Digital Distribution

While gamers have a limit as to how much money they can pump into the videogame industry every month, the videogame industry has virtually no limit to how many copies of a given game it can make. Burning discs is dirt cheap, and digital distribution (which we all know is the future of gaming) is cheaper than dirt.

We all know thanks to piracy just how cost efficient digital distribution is. This flat rate would sort of be like a monthly subscription to piracy. The gamers get all the games they want, but the videogame industry doesn't collapse because gamers continue to support game developers with their monthly contribution.

Monetary Distribution

The important thing is to think of this flat rate service as an added bonus, an extra option available to gamers, and not as a replacement for the current business model of the videogame industry.

The subscription cost would be determined by the game developers, but as I said before, it would probably come down the average amount the hardcore gamer spends on videogames in a month. The exact price of this service can be easily adjusted, and is therefore of very little importance to the overall concept. So let's just put it at an arbitrary 100$ a month.

Now I know what you're thinking. You're asking yourself: if gamers pay 100$ a month in order to play all the videogames they want, how do you decide what portion of the 100$ goes to which developers?

Simple: you look at which games a gamer plays and how often he plays them. How much of the 100$ a developer receives is proportionate to the percentage of time that gamer spends playing their games.

Let's take a guy who plays one hour of Halo 3, thirty minutes of CoD 4 and thirty minutes of World of Warcraft every day for an entire month. At the end of that month, Bungie gets 50$ and Infinity Ward and Blizzard both get 25$. In the end, the amount of money a developer gets is directly proportionate to how fun and addictive their game is.

Internet is the key

In order for flat rate gaming to work, gamers have to have an internet connection. The internet connection would be used to download games and check that your account has access to them (like Steam), thereby preventing piracy, and to track how much time you spend playing which games (like Xbox Live).

Naturally, not everybody has an Internet connection, but if you can afford to spend 100$ on games every month, chances are you do. Besides, like I said earlier, it's an option. If you don't have an internet connection or you can't afford the monthly flat rate, you can still go buy your games the good old fashion way.

Pros for the gamer

Gamers would get way more games for more or less the same amount of money they're already spending. Imagine owning every game ever made. Flat rate gaming turns this fantasy into reality. You pay your flat rate and in exchange, you get to download any and every game you want. You get to keep playing all these games as long as you keep paying the flat rate.

Flat rates also encourage gamers to try more games, since they're already included in the flat rate. This allows gamers to play games they would otherwise overlook, thus increasing their chances of finding a game they really like.

Finally, because developers get paid in proportion to how fun and addictive their games are, they're likely to spend more time and money on the game itself rather than hype and advertisement.

Pros for the developer

As I pointed out earlier, the money developers make with this system is based more on how good their game is and less on advertising and hype. If you buy a game now, you'll probably end up playing it quite a bit since you forked out 60$ for it, even if the game itself isn't all that good. However, with flat rate gaming, if you don't like one game, you quickly download the next. This way, if a game is lousy, the developers won't make a lot of money on it, no matter how much they hype it.

On the other hand, if a developer makes an excellent game, word to mouth will quickly spread, and more people will give the game a try since it's free to download (free meaning already included in the flat rate). Also, developers can potentially earn a lot more through flat rate gaming than they do now. In my earlier example, if a gamer plays Halo half the time (and many gamers surpass that), he gives Bungie 50$ every month! That's quite a bit more than 60$ per game.

So in the end, developers can worry less about ads and marketing and focus more on making a great game.

Creativity would also be a lot more appreciated, since gamers can play new and innovative games free of charge. There would be no risk of wasting 60$. You download the game and play it till you grow tired of it. The more hours of entertainment it provides you with, the more money the developers get.

Finally, the very nature of digital distribution itself would help developers. They wouldn't need to worry about publishers, pirates or the used gaming market.

OnLive

While this flat rate model could work very well with current digital distribution programs like Steam, it's ideal match would be cloud computing and cloud gaming services, such as the recently announced OnLive.

You don't download games, you stream them. Whether you stream one game for two hours or four games for thirty minutes each makes absolutely no difference to the providers of cloud gaming services. All the more reason for them to grant you access to every game available in exchange for a fixed monthly fee.

Because you're streaming games and not downloading them, you have absolutely no way to pirate them. In order to play games this way you have no other choice but to pay the flat rate.

Streaming games allows the service provider to know exactly how much time each gamer spends playing which games.

You would be able to stream any and every game you want, from any computer, anywhere, anytime. Just pay a monthly subscription and use your account to access the flat rate OnLive service as you please.

Make no mistake, this is the future we are heading towards. OnLive, Cloud computing, flat rate gaming... And don't forget the 60$ a month, 160Mbps internet connections that are already available in Japan. Combine all of these things, and you get a whole new era of gaming. Just remember where you read about it first.