Gamasutra has an interesting look up at the MMO free to play/micro-transaction vs. traditional subscription model up - talking with SOE's John Smedley, Three Rings' Daniel James and EA Mythic's Mark Jacobs. Unsurprisingly, there are differences in opinion on the utility of the micro-transaction model, with some participants in the discussion coming down on the side of the traditional subscription model:
"You know, everyone thinks it's just so cool to say that the subscription model is passé, that it's dead," notes Mark Jacobs, general manager and VP. "They love to talk about their new models and how they are going to revolutionize the MMOG world. But MMOG publishers are spending a lot more on their games than anyone thought they'd be spending five years ago."
"If your game doesn't have the production values of a leading-edge game, if they are two-dimensional and not three, if they have lower system specs, okay."
"But if you're investing as much time and money as we are on our MMOGs, if you need to pay for the servers and the customer support, if you want to make a real profit on your game, subscriptions are the only way to go."
Snap! Certainly, there are times when the subscription model works well, and times when it doesn't - Chinese players are increasingly moving away from WoW in favor of the domestically produced micro-transaction games. I can't foresee subscriptions ever going away, but companies are increasingly seeing the benefits of the micro-transactions.
MMOG Business Models: Cancel That Subscription! [Gamasutra]