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| Dec 14, 2022

The Wild Rise of Roblox, In-Game Currency, and User-Generated Content

New generations of gamers don’t want to sit back and watch. They want to create.

It’s common for older generations to stereotype younger people based on their attention span alone. Failed ventures like Quibi bet on this very phenomenon, assuming that young consumers just wanted shorter, more “bite-sized” content. But as most people living with a pre-teen understand, kids are capable of maintaining attention for hours on end — they just have to be an active participant. The difference between generational preference is not defined by the length of content, but who gets to make it. Just ask half of America’s kids, who all use Roblox. 

What Is Roblox?

Especially popular among children and teenagers, Roblox is a booming online platform that allows users to play games created by other users. Just like Minecraft or games like Mario Maker, a huge part of the draw is how Roblox allows users to design levels, spaces, and games. It is the active participation and creation that makes the game so compelling and popular. 

But it wasn’t always easy. Just a few years back, Roblox was on its last legs. For almost a decade, Roblox sat back as tech giants like Facebook, Apple, and Google dominated the gaming scene. (Remember FarmVille?)

Roblox also had to watch as Minecraft — a game similar to Roblox in its user-generated, open-space gameplay — exploded in popularity. While Roblox has been around since 2006, nothing accelerated its growth quite like the pandemic. In 2021 alone, the community grew from 32.6 million daily active users to nearly 50 million across 180 countries. While sheltering at home, users of all ages utilized the social sphere of Roblox to plan get-togethers, playdates, birthday parties, and so many other events made impossible by the pandemic. 

“At a time like this, where people are housebound, being able to escape into the digital world and have these kinds of fun, imaginative experiences with a friend is very, very relevant,” Roblox chief business officer Craig Donato said at the time. 

User-Generated Content (UGC)

User-generated gameplay can be more fun for gamers because it allows them to be creative and express themselves in ways that traditional pre-designed games may not. When kids play games that have been created by others, they have the opportunity to interact with a wider variety of users and experiences. 

For today’s kids, this format is more engaging and stimulating than playing the same pre-designed games on repeat. User-generated games also often allow for more customization and personalization, which can be especially appealing to kids who want to express their unique identities and skill sets.  

The companies making these games believe UGC is changing the industry for everyone’s good. According to Uri Marchand, the CEO of game software Overwolf, UGC represents a paradigm shift. “Those folks are playing games like the Roblox ecosystem and the Minecraft ecosystem, they’re used to endless content and endless opportunities,” Marchand says. “It’s almost an impossible mission for a single studio to create content in the amounts that consumers demand. UGC is the strategy to enable that for the new generation of gamers growing up right now.”

This shift does not just apply to video games. 

As evidenced by the video-creation revolutions led by Tiktok and Youtube, new generations are tired of watching pre-packaged content. Fresh platforms like Patreon and Substack now allow for an unprecedented amount of user-generated content, featuring innovative ways to grow audiences, get paid, and even land lucrative brand deals. With all the tools at their disposal, new generations are more than capable of creating and interacting with other people’s content at an unprecedented level. 

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Explaining Robux

Robux is the virtual currency used on the Roblox platform. It’s a way for users to enhance their experience by purchasing in-game items and accessories for their avatars, as well as access to certain games and features. Within the game, there are several ways to earn Robux, such as completing tasks or selling virtual items, but they can also be purchased with real currency. 

The platform offers a three-tiered subscription to Roblox Premium, ranging from $4.99 to $19.99, that buys users between 450 and 2,200 Robux. Users can also purchase Robux a la carte. For example, $100 will buy 10,000 Robux. As with games such as Minecraft and Fortnite, users still get the basic game for free, which in Roblox’s case includes access to the game-design studio. 

Although it may be the most successful, Roblox is not the first game to tout its own in-game currency. Millennials may recall the winter wonderland of Club Penguin, a mass multiplayer online game where users could customize their own player, their house, and accessorize using currency bought with real dollars. While both were released around the same time, Club Penguin sits in the nostalgia graveyard, while Roblox now pulls an average of $200 million a year

Critics and Rumors 

Critics of Roblox argue that the platform is exploiting young creators who develop the games. Donato said the company had paid out over $500 million to creators. However, only 1,000 Roblox games earned more than $30,000 in revenue for 2021.

Compared to other game development payouts, Roblox comes up short, only offering 24.5% of the game’s revenue. Steam, a popular PC gaming software, offers its developers 70% of the revenue, while Epic Games Store pays out a whopping 88%. 

Roblox also fields rumors about its potential shutdown on a regular basis, as well as contraction concerns that may correct the pandemic boom. If you ask the kids though, Roblox doesn’t seem to be going anywhere anytime soon. 

The Future of Roblox and UGC Content 

Roblox’s growth was accelerated by the pandemic, but the trend towards UGC is what has truly driven its success. In-game purchases are a well-proven model, and more industries are poised to offer their own currencies as increased financialization takes place. Questions surrounding the compensation of creators are likely to continue to arise but one thing is clear: Although the attention spans of younger people may be slightly lower, it is user-generated content, not shorter videos, that is defining their media consumption habits.  

Danny Avershal
Danny Avershal
Contributor

Opinion Contributor, Strixus

Danny Avershal is a freelance writer and video producer based in Los Angeles. He often writes about e-commerce, entertainment, and entrepreneurship. view profile

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