Economic trends aren’t pretty: People with elite backgrounds are hoovering up an increasing share of new income and wealth. Automation is obviating more and more jobs. In the years to come, we’ll need new forms of employment.
Let’s crystal-ball this: Will there be a new way for the working class of the future to earn a paycheck? Sure: by playing video games.
That’s the bold prediction of Edward Castronova, an academic at Indiana University who studies the economics of online games. In a white paper, he argues that within 20 years, “playing games for money will come to be seen as a legitimate occupational choice for those whose skills are not valued by brick-and-mortar labor markets.”
Sounds nuts, right? But Castronova lays out the trend lines. First, consider how online games have evolved. Fifteen years ago, you typically paid about $15 a month to play. But in the past decade, game companies have devised the free-to-play model: It costs nothing to join the action, but if you want something cool – specialty armor, for instance – you have to buy it. This model has been wildly profitable. A top-rated free-to-play title, like Clash Royale, now brings in about $2.1 million a day from such purchases.
As with casinos, most revenue comes from “whales,” a tiny percentage of players who spend thousands annually. A study last spring by Swrv, a firm that helps companies market in-game items, discovered that just 0.2 percent of players are responsible for 48 percent of all revenue. A small population of high-spending players is…
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