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Lord of the Rings Online doubles its revenue after going free-to-play

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Turbine’s online role-playing game Lord of the Rings Online has doubled its revenue since it moved from a subscription model to a free-to-play model earlier last month, said the game’s executive producer, Kate Paiz. Paiz made the comment at GDC Online 2010 today.

Lord of the Rings Online is the second massive multiplayer online role-playing game, or MMORPG, that Turbine has shifted to a free-to-play model. Revenue for its first experiment, Dungeons and Dragons Online, jumped by about 500 percent after the shift. About 20 percent of Lord of the Rings Online users that quit have since returned after the game went free-to-play as well, with a 400 percent increase in the total number of players, Paiz said.

Here’s how the free-to-play, or “freemium”, model works: players are able to play online games with persistent worlds like Lord of the Rings Online for free but must pay for additional perks like armor or becoming more powerful at a quicker pace.

The freemium model isn’t necessarily new. Many successful smaller online games — like Maple Story — that have a smaller player base and might not be viable with a subscription model have used the freemium model.

There aren’t many dominant subscription-based games other than World of Warcraft. World of Warcraft, one of the largest online role-playing games, uses a subscription model because it has around 12 million subscribers and a massive amount of momentum in the MMORPG market. World of Warcraft creator Blizzard is also releasing the game’s third expansion pack in December — after its first and second expansion packs sold 2.4 million and 2.8 million copies in their first days respectively.