The developer behind Palworld is facing a crucial decision regarding the game's future: adopt a free-to-play live service model or stick with its current pay-to-play approach. This choice has significant implications for the game's longevity, profitability, and overall player experience.

Palworld, a multiplayer survival crafting game, has been dubbed "Pokemon with guns" due to its inclusion of creatures called Pals. The game launched on Steam priced $30 and quickly became available on Xbox and PC through Game Pass, breaking sales and concurrent player number records in the process. Japanese developer Pocketpair has revealed that Palworld's massive success has left it struggling to keep up with the profits generated.

Although Palworld's player numbers have declined slightly since its explosive launch, it remains one of the most-played games on Steam, comfortably sitting within the top 100. However, for Pocketpair CEO Takuro Mizobe, thoughts are now turning to the future and whether to make Palworld a free-to-play game with live service elements or stick with its current pay-to-play model.

In an interview with ASCII Japan, translated by Automaton, Mizobe emphasized the importance of making a decision between these two business models. "When you think about it from a business perspective, making (Palworld) a live-service game would extend its lifespan and make it more stable in terms of profitability," he said. However, Mizobe also highlighted the challenges involved in adopting a live-service approach, particularly when Palworld was not initially designed with this model in mind.

One significant challenge would be turning Palworld from a pay-to-play game into a free-to-play game, which would require significant changes to monetization strategies. "It is common for live-service games to be F2P with paid elements such as skins and battle passes, but Palworld is a B2P game, so it’s difficult to turn it into a live-service game from the ground up," Mizobe explained.

While there are examples of games that have successfully transitioned from premium to free (Fall Guys and PUBG), this process requires significant effort and carries inherent risks. "Both (games) took several years to make the shift," Mizobe added. "While I understand that the live-service model is good for business, it’s not that easy."

The decision has yet to be made, and Pocketpair is keenly aware of a potential backlash from players who have already paid $30 to play Palworld. However, it's worth noting that Palworld launched in early access form just over half a year ago, so it's still relatively early days for the game.

In related news, Pocketpair has formed a new business called Palworld Entertainment, which is tasked with expanding the IP beyond video games. This includes non-video game products such as merchandise and music, highlighting the huge popularity of Palworld across various mediums.

Rumors are swirling that Palworld will be announced for PlayStation at this month's Tokyo Game Show (TGS), after the game popped up on a schedule. Pocketpair had previously teased a PlayStation release back in June, so this would come as little surprise. TGS runs from September 26 to 29.

Palworld's success has also been accompanied by controversy, with claims that it ripped off Pokémon and even death threats sent to Pocketpair staff. Nintendo has removed an eye-catching Pokémon mod and issued a statement regarding intellectual property rights related to Pokémon.