The increasingly popular "freemium" business model for mobile and PC games may be coming to the Xbox 360 in a big way. Microsoft is reportedly working on a new initiative to bring free-to-play games to the downloadable Xbox Live service. That is, games that are free to download but then charge players for additional items, weapons, levels, or in-game currency.
It is becoming a very popular revenue model for the iPhone. In fact, the top-grossing iPhone game, Smurfs Village, is a "free" download. Users, however, must pay for 'Smurfberries,' the game's virtual currency, once they start playing and become hooked.
It's a bit of a risky move, because there is no upfront charge and it allows some players to play through without paying anything. Some will be perfectly happy with the free experience. So it is a very difficult balance to try to extract as much money as possible, but without making in-game transactions a mandatory part of the experience.
Only certain games will work with a free-to-play model.
The PS3 kick-started the idea of bringing free-to-play games to the console world, with the release of a PS3 version of the hit online PC game Free Realms.
No details have emerged on what games may come to the Xbox 360, but it sounds like Microsoft wants there to be quite a few.