While the New York Games Conference came to a close last week, there were a number of great discussions and roundtables that kept us all informed and entertained.  One ‘Debate Club’ discussion that really stood out to me was the “Get a (Virtual) Life! The Challenges and Opportunities for Monetizing Virtual Worlds and MMOGs” talk.

Coming directly from the nygamesconference.com site:

Get a (Virtual) Life!  The Challenges and Opportunities For Monetizing Virtual Worlds and MMOGs
The lines between social networks, virtual worlds and games are blurring – so how do you monetize these new social gaming environments?

This panel will discuss the relative effectiveness of premium subscriptions, sales of music, video and virtual goods and ad supported content. What is working and what isn’t? How are brand marketers and their agencies navigating this new space? How do advertisers measure ROI and the effectiveness of these new and relatively untested campaigns? How do you handle license and rights issues as well payments effectively? This group of panelists will share their experiences with different business models as well as give advice for how to make smart marketing investments in this ever-changing landscape.

Panelists
Craig Sherman, CEO, Gaia Online
Matt Palmer, EVP & GM, Stardoll
Andrew Schneider, President & Co-founder, Live Gamer
Rob Uhrich, Senior Director, Digital Markets, PaymentOne
Sean Kane, Attorney & Consultant, Drakeford & Kane LLC
Jeff Freedman, Dir of Strategy and Bus Dev, Millions of Us / Virtual Greats

Moderator
Eric Goldberg, Managing Director, Crossover Technologies

While the topic is always certain to bring up a whole slew of varying opinions, all parties involved did manage to agree on one thing: microtransactions are the future of gaming.

Some highlights of the talk include an interesting discussion regarding young people and why they are an ideal market for microtransactions.  Games allow this group a freedom of expression and creativity within their own world.  Stardoll was used as an example whereby users can create a MeDoll, an in-game avatar that is based on an actual picture of the user.  These users can design and buy items for their rooms and personal clothing – thereby providing said outlet for individual creativity and expression – at a cost.
How to pay for it all was another interesting bit.  The panel discussed pros and cons of each side of the pre-paid cards vs. paypal argument, including the often tricky question of ‘Users are often under the age of 18’ question.  By being under 18 years of age, users are technically not able to enter a legally binding contract.  That and not too many 14 year olds that I know have a credit card.

While pre-paid cards and paypal were discussed, I think it was actually an over exertion of a very simple question: How do we actually handle and implement microtransactions?  Clearly a paypal method can work, but has tons of room for errors and problems (think fraud chargebacks), and pre-paid cards are good, but don’t allow for what most game publishers are looking for: an instant transaction, while gamers are looking for an instant gratification.  In other words, even if you’ve purchased a pre-paid card, that doesn’t always mean it’s fully loaded and ready to go for that super swanky 2008 NY Jets Brett Favre jersey Tommy from Wisconsin wants to dress is avatar in.

fatfoogoo is the answer to this debate topic.  By integrating a fully functional and real world tested in-game economy, publishers, producers, and operators can simply skip steps 2, 3 and 4, and start implementing their own microtransaction method today, not 9 months from now.