That Little Parasite in Your Wallet: The Problem of Micro-transactions in the Modern Video Game Industry

Why micro-transactions should not exist in modern video games.


Tiankuo Zhang

Here is a screenshot of Genshin Impact’s Store, where $3 in game currencies allows the player to complete 1 roll, which only has a 0.6 percent chance of giving the player a 5 star character. In order to get a 5 star character, it requires on average a payment of $120 to 160 in game currencies.

Within the past 50 years, gaming has evolved from the quarter-slot arcade cabinets to the dedicated consoles and computers of today. As with all advancements in technology, changes in monetization have also come forth. But in the case of games, a parasite had developed – a parasite known as the micro-transaction.

What are micro-transactions? 

Micro-transactions are a model of gaming monetization where players may purchase in-game items or in-game currency for a small amount of money. This model is often found in free-to-play games but has now also become a method for paid games to monetize themselves over a long period of time. The micro-transaction model does have its upsides, including being one of the few systems that allow the players to choose and pay as they please, benefiting those who are unable to invest 10 to 20 dollars for a game. However, the rise of micro-transactions has also created a plethora of shady practices and poor game design that has become a standard in the gaming industry.

What are the issues with micro-transactions?

The primary issue with micro-transactions is that they are often detrimental to the game and its experience. A great example of this would be the mobile game Clash of Clans, a strategy/city-building game where one builds up armies to invade other players and build bases to defend against invasions. All of this sounds good on paper, creating an engaging and mentally stimulating game. Yet, the existence of micro-transactions severely detracts from the game’s overall experience. This comes from the wait timer system, where one either has to wait around 5-15 minutes to recruit units to build an army or cough up a premium currency to speed up this action. This ties the game’s progression to either waiting or using micro-transactions, resulting in an uneven playing field in favor of those who can shell out hundreds of dollars to progress in the game. 

Aside from the diminishment of the gameplay experience, micro-transactions also prey on user addiction through their usage of the loot box system. An example of this is prominently shown in a very popular game known as Genshin Impact. The primary way to progress in this game is through the wish system, which can be described as a digital roulette, where the game chooses an item at random, and then grants it to the player, with rarer characters having a lower chance of being selected. This is shown by 5-star characters who compose around half of the game’s playable cast but are locked behind the wish mechanic with only a 0.6 percent chance of ever being chosen. This is all fine until one realizes that players can purchase rolls using real money. The ability to purchase rolls turns the game’s wish system into gambling; it preys on people’s thirst for wins and can cause them to spiral, resulting in gambling addictions or causing addicts to relapse. “The worst monetization method by far is gacha with its terrible game design and how they sometimes use gacha as an ‘endgame,’” said Justin Tin ’23 while expressing his displeasure with the gacha system. “Such games include Genshin Impact, forcing players to grind currency or buy it for gacha, as some of the most powerful characters are locked behind the mechanic.”

Another predatory tactic that often arises from the usage of micro-transactions is limited-time events. This monetization tactic is found in multiplayer games such as League of Legends, where cosmetics such as skins and icons are sold as limited-time items to capitalize on the fear of missing out. Though, this tactic is less stigmatized by the public, as we have normalized seasonal sales and limited-time offers. Yet, in video games, the usage of this sales tactic is horrid, as these events can grant advantages for players, pushing them to make purchases with the promise of power and progression. 

What can they be replaced with?

An easy way to replace the micro-transaction is with the single purchase method. In this method of monetization, the consumer pays a lump sum of cash and then owns the game in a physical or digital medium. This method is a feasible alternative for games that do not necessarily need a long-term monetization plan, as well as multiplayer games. “The initial purchase should be all you need and after that, it should be a true skill, not your money,” said Subah Mehrin ’23, noting his approval of single purchase methods and their ability to create equal playing fields. Even so, this plan does have its downsides, in that the game is no longer free to play. This may alienate users that do not have the discretionary funds to invest in a game, as well as cause a decrease in the overall appeal of a game. However, a solution to this would be to offer a demo version of the game with less content, allowing prospective consumers to test out the game and pay for a more immersive experience. 

An alternate way of implementing long-term monetization games is with the games as a service model. In this model of monetization, the player pays a monthly subscription to play the game and that would be the only payment. This system works for many massively multiplayer online games (MMOs), acting as an initial paywall for the tradeoff of removing micro-transactions. 

However, this model also has issues, one of which is the fact that these games often cost a lot of money for the consumer over time. To counter this, the game could offer trials, as well as long-term discounts that may incentivize players to pay for longer-term subscriptions.

One final alternative for monetization is advertising and product placement. This method works for most mobile games since they can have pop-up and banner advertisements without being overly annoying. Likewise, this method does also has its downsides, because it requires interaction with a third party and, therefore, hinders its ability to be self-reliant. Moreover, it could generate extra revenue if there were an option that allowed the player to make a one-time payment that removed all advertisements. This would create a single purchase system that would still remain free to play.

Put simply, micro-transactions just do not have a place in our world. They are parasitic, they encourage bad game design, they prey on people’s weaknesses, and they exploit our emotions. Game developers need to step away from micro-transactions for the sake of the consumer, and for the sake of modern gaming.

Put simply, micro-transactions just do not have a place in our world. They are parasitic, they encourage bad game design, they prey on people’s weaknesses, and they exploit our emotions. Game developers need to step away from micro-transactions for the sake of the consumer, and for the sake of modern gaming.