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CSR Racing is one of the App Store’s more aggressive sellers of virtual currency. Its creators gross $12 million per month.
Image courtesy NaturalMotion Games

“Freemium” apps, which cost nothing to play but charge real money for digital currency, are officially dominant on the App Store.

The increasingly popular virtual-Springfield game The Simpsons: Tapped Out calls them donuts. DragonVale, which has remained high on the top-grossing chart since its release nearly a year ago, has “food,” gems” and “cash.” A coin by any other name is still a coin: units of virtual currency that you can earn slowly by playing the game, or rack up quickly with a real-money purchase.

Of the 50 highest-grossing apps in the Games section of the iTunes App Store, only three do not support in-app purchases.

Smaller game developers are now faced with a dilemma: Make a game with coins, or miss out on big profits.

For some, the solution has been to add coins to existing games. Lima Sky recently updated its classic tilt-controlled endless jumping game Doodle Jump with in-app purchases and upgrades that can be purchased with coins. As a result, Doodle Jump has shot up the top-grossing chart, an impressive feat for a game that’s now nearly three years old. It was one of the early breakout hits on Apple’s devices, but found itself obsolete in a coin-centric world.

“The update was mostly a response to current player expectations,” says Lima Sky head Igor Pusenjak. “Players today are expecting a game to have content that can be upgraded, unlocked or customized.”

Pusenjak says that profits have risen “considerably,” although he said it was too early to share specific data. He attributed part of the bump to the normal sales increase the game would get after releasing any major update, but noted that the new coin-ified Doodle Jump does seem to be doing much better than it would without coins.

Significantly, players mostly seem happy about the update. Doodle Jump’s iTunes rating is currently hovering impressively close to a perfect five stars.

Not everyone is happy, though. One of the reviews of the new update rates the game with a solid four stars, but laments, “I’m sick of all these in-app purchases.”

CSR Racing, which has been criticized for its aggressive habit of pushing players to buy its in-game currency, is earning over $12 million per month because players are shelling out for coins in the game.

In other words, CSR Racing will make more money tomorrow than most mobile games will make in their entire lifetimes, all because it allows players to spend as much as they want. If you’re the team making a competitor like Real Racing 3, what are the odds that you’re not going to strongly consider doing things the CSR Racing way?

“Designing a successful freemium game is … more difficult than designing a traditional game,” CSR Racing lead Jason Avent said to Hookshot Inc.

A closer examination of Apple’s top charts shows that this is not necessarily the case. The fifth highest-grossing game on the App Store right now is Slotomania, a simple slot-machine game with a hideous interface and no actual “game” mechanics.

Funzio, now part of the Japanese social game giant Gree, creates games like Modern War, Crime City and Kingdom Age (seriously, that’s a real name of a game). All three are in the top 75 top-grossing games. These are low-budget games with shoddy, derivative designs and very little gameplay, but they’ve got collectible goodies that hook players, and that’s all it takes.

How many more games like this can the market sustain until everyone, like that Doodle Jump reviewer, is sick and tired of all the coins? For now the money train is still chugging along, and for iOS developers, the choice is clear: Get on board, or pass up on big potential gains.

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