Building a Sustainable Rec Room

[RecRoomJeff]

The team has been hard at work on updates to Rec Room Plus, and we’re excited to roll them out… SoonTM. We think RR+ is the best way for players to support the game - so we’re focusing on making RR+ an obvious choice for active players. This means in the near future you’ll see changes to how we talk about RR+ in the app and changes to how we develop features for RR+ members. We want to strike a balance between providing a great free experience and making RR+ a premium membership well worth joining.

We’ve been talking a lot internally about monetization. We want to share this internal post from our CEO Nick to give some important context on the topic as we move forward. Here it is in its entirety:

Building a Sustainable Rec Room

For the last nine years, we’ve made an illogical choice as a business: we’ve kept the doors open while operating at a loss.

Rec Room has never been profitable. We’ve consistently spent more than we earn, and we’ve depended on investor funding to keep going. That’s how most software companies get started, but it’s not sustainable, and it has to change if we want Rec Room to be around for a long time as an independent company.

It’s time for Rec Room to stand on its own. It’s time for us to rely on the people that play Rec Room, that love Rec Room - not our investors - to keep us in business.

The Monetization Challenge

Let’s be honest: Rec Room isn’t great at monetizing. The numbers are clear. Fewer than 2% of our players spend money each month. That means 98 out of 100 people play for free. This has always been true, but it can’t remain true.

Some games can make that kind of conversion rate work. Match-3 games that have extremely low operating costs can. No real-time multiplayer, minimal support needs, no trust & safety costs, no complex content storage. Or, in some cases, games where a small group of players spends huge amounts of money can make that work, like social casino titles.

That’s not who we are, and it’s not who we want to be. We want to build a sustainable business by offering a fair value to a broad base of players, not by depending on a small group to carry the load with outsized spending.

Rec Room is Expensive to Run

We’re a live multiplayer platform. That means we need servers, moderation, storage infrastructure, and customer support. We recently made the very difficult decision to reduce team size to lower costs. That was painful for everyone. Still, we have substantial operating costs - people and systems - where there’s not much more we can easily cut. So to keep running Rec Room for a long time, we need a broader base of paying players.

The Good News

We have the players. We have the engagement. There are games at our scale that generate the revenue needed to sustain a business like ours.

Millions of people play Rec Room each month. Millions of them are deeply engaged playing regularly for six months or more. But even among this group, very few spend money.

We don’t need everyone to pay. That’s not realistic. And we don’t need people to pay on day one. But if someone has been playing Rec Room for months, or even years, it’s a strong signal that they like what Rec Room has to offer and we shouldn’t be shy about asking them to contribute.

And they don’t need to contribute much. Just frappuccino money. A Rec Room+ subscription costs about the same as a venti frappuccino at Starbucks. If just 1 in 5 of our long-term players (6+ month tenure) subscribed, Rec Room would be sustainable.

Lean Into Rec Room+

We’re going to focus on growing Rec Room+ among our deeply engaged players. That starts with three steps:

1. Explain Our Subscription Better
A lot of players already have Rec Room+. It’s a good deal, and retention is strong. But the way we present it? A giant wall of text? It’s awful. Let’s fix the basics and clearly communicate why it’s worth it.

2. Be Deliberate About Our Subscription
As we build new features—and even look at some existing ones—we need to assess whether they should be fully free, free up to a point, or part of a subscription. Different features have different costs to operate and different value to our players. We need to strike the right balance so what we’re offering aligns with what it takes to keep Rec Room sustainable. Obviously, we’ll need to do a great job at communicating this to the community. This isn’t easy to explain. So let’s be transparent and help them understand what we’re optimizing towards.

3. Get Comfortable Asking
We need to get over the discomfort of asking our most dedicated users to support the service. Yes, every monetization change gets us roasted on Discord and Reddit. That sucks—I hate it too. But I want Rec Room to stick around. If we can’t ask the people who play for dozens or hundreds of hours to spend a little money, then we’re not going to make it as an independent company.

The Path Forward

Here’s the good news again: we don’t need to reinvent the wheel. The users are here. The engagement is here. The infrastructure is already in place.

What we need to do is simple: ask more clearly, more confidently, and more effectively for our long-term players to support the service they love.

We had a tough start to the year. You’ve all been working hard to make sure we can bounce back. We’ve got an amazing set of features coming up. Let’s make sure we’re using that momentum to get Rec Room on a sustainable footing, so we can be around for a long time.

[LemonsCupOfTea]

while i understand revenue is required to keep the game running, i don’t think asking people will exactly help the situation. most people have no drive to get rec room plus because of the fact most of the features don’t apply to the person who may be considering a subscription
i think it should be less about “how can we ask people to support the game?” and more on “what benefits or improvements can we make to make rec room plus worth the price?”

[chicken_vr]

I think rr+ needs to be more like Fortnite crew and the clear benefits you receive with it monthly, and not some side add-on that gives you some tokens.

[ThebaconGM]

Maybe make things that the players want then what the investors want and I might consider re-subscribing to RR+

[EyesDraws]

I understand the need for money/revenue to make RecRoom long lasting, I think most understand that. When your going to look at RecRoom plus, I think you should look at what it offers to players (Creators are inclined to pay for it but regular players are not) so you should look at what you can offer to the regular player (they are the majority) like for me the reason I have RR+ is for Custom Shirt making, Selling inventions, and the 200 outfit slots. If I was a regular player the only thing I would want RR+ for is the outfit slots if I’m honest. But paying for just that is ridiculous. I yhink something else you should consider is that people are loyal but even those loyal players are beginning to slow down there engagement. I’ve been playing RecRoom pretty much everyday since 2021 and only recently have I begin to move to other games. I thought about even removing my rr+ but Im hoping things get changed so Im holding out. Theres alot people are asking and I know you can’t do everything at once but maybe try to come up with a year long plan or 5 month plan may bring some peace among players. So we know where your headed, where y9ur th8nking, so we can help too.

[yeetsoulfox]

your begging for OUR money but you cant get a damn thing right that the community is actually asking for or taking any sort of advice without taking 2+ months to actually listen to it. I’ve been seeing this game tumble since 2021 (im a 2020 player) and now that you want MORE money is just baffling. Yea i get it you gotta pay the workers, server costs, whatever but spending any more on this game is just bad and most people that do normally only get RR+ for the tokens and outfit slots. If you dont focus on the game the players want you wont make money thats just basic logic. Especially if you push the community away like you’ve been doing since 2021. Anyway #removenewbean #keepoldbean thats a place you can start to get your community’s trust back without hugging tightly to the 5% of the creative community which gets all the attention for some reason.

[killer]

“rec room is expensive to run” then shut it down lol you guys don’t listen to anything the community says anyway, you guys just add useless additions to the already unstable unoptimized watch UI which no one asked for you guys to do.

[B4gell]

You want this game to last, and yet you are making the wrong decisions by bringing updates to the game that nobody asks for. The new bean body for example, you guys release new items only for those body types, add “adjustments” to the features for it that honestly don’t look good, and force some players to use it. Half of the rec room community wants to keep the classic bean body. Probably because it looks decent. The new bean body doesn’t really look that good at all. And its not just the bean body update thats ruining the game, theres a lot of other things too. Like, honestly ask your community what they want instead of just adding pointless things into the game.

[SuprisedFlamingo]

Rec Room be like: jump into a pit of venomous snakes or listen to ur community

THE ENTIRE STAFF TEAM: SNAKEY SNAKEY YAY!!!

[westtblaster]

To be honest, if you want people to join Rec Room Plus, like the more casual players, you should add more benefits, like how other companies, for example, Rockstar Games and Epic Games, have for their subscription services, because the more benefits there are, the more likely the regular casual player will be interested in getting Rec Room Plus. Then you can have equal creators and more casual players having Rec Room Plus, and that will actually make people want to get it, and it will be worth it for the casual players. Also, another problem is that the updates are not what a lot of the Rec Room community wants, and you can actually focus on stuff the community would want to have and see to improve the game. That’s honestly the best way to improve the game and make the game experience fun for everybody and ensure the game lasts for a long time.

[1tru]

yes im rec room YES i will do anything to not listen to my community YES we are on our knees for any amount of money YES 2025 is our last year being remotely alive YES we LOVE to release updates for things no one asked for and create more bugs

[potatoonskates]

wait, so the plan for getting more money is to… advertise rr+ better? anyone with basic reading skills and more than 10 hours on the game can decide for themselves whether or not they want it. the lack of subscribers that they talked about kinda proves that adding perks does nothing, this just makes me concerned that they’re gonna start taking things that were originally free and make them paid (like spotify has been doing).

[CrypticCreator]

But if someone has been playing Rec Room for months, or even years, it’s a strong signal that they like what Rec Room has to offer and we shouldn’t be shy about asking them to contribute.

I hate to break it to you guys, adding garbage like Maker AI, laying off beloved members of the staff team, and failing to listen to your community time and time again, all of those “Players that have enjoyed the game for months or years” have already left this community.

You have broken trust in the community time and time again and have failed to do anything to repair it. We don’t like you anymore, and we no longer want to be apart of a community for game that doesn’t care about us

Maybe try making amends before begging your older audience for money, or stick to your new target audience of slop creators and children

[Gamerr_VR]

Why should I pay for a game that is doing everything EXCEPT what the community wants?

[Tuna]

What are people asking for? The biggest ask I’ve seen was to lower clothing costs, they’ve done that! They brought back double shot, added Crescendo to the quest, improved security, became more transparent by communicating to us and more.

There’s A LOT they can do, and there’s A LOT we want, but right now they need to focus on being more sustainable, so be patient. Telling them to shut down the game won’t make any progress.

Also, i’ll admit, this new monetisation plan doesn’t seem like it’ll work. They should increase RR+ token payouts and decrease free token payouts through boxes. And I’ve seen many people agree with me on this.

[Tuna]

I appreciate the transparency. I highly doubt this monetisation plan will work.

[Xwet]

I disagree with reducing the tokens of free players because it would make it almost impossible to obtain anything without spending money. Reducing the tokens would drive away new players because it already takes a long time to get anything.

[PaandaCat]

I think most people typing here are just being plain rude. Remember this is Nick talking to the Recroom team. NOT us players.

So, Recroom Plus really needs work. I saw eyesdraw’s post and I agree with it very much. Players have almost no reason for Recroom Plus other than 200 outfit slots, tokens, and the discount on items. (Personally, I totally forgot I get a discount when buying items. ) Well, I definitely think adding more features is a MUST. A simple start right now is a graphic. This graphic should show what’s being used the most (outfit slots, tokens, and the discount) in an easy-to-read, interesting format. My suggestion for the format is the tile graphic they show in Apple events for updates and new phones. If you want to see what I mean, go over to Apple’s YouTube channel and look at the most recent live stream at the time 1:08:24.
I really like that graphic personally, and if you can do it right with nice images, cool colors as well as making the most noticeable features the most noticeable inside the graphic, it could help. As people probably are familiar with it… if they watch Apple events .

[GobbyTheGoblin]

holy yap!! someone sound the yap alarm because holy guacamole!!

[Nixxxxxx]

I discontinued my RR+ subscription due to Rec Room’s handling of feature implementation.

While I consistently provided feedback via Research Lab surveys about my need to have more accessability to socialization, the release of new and valuable features like individual player volume control, a standard in platforms/games like VRChat, R.E.P.O., and Valorant, was done on RecRoom through undisclosed split tests.

A split test I didn’t get to be able to participate in because some percentage of an algorithm said I don’t get to use this feature? Feels like absolute gatekeeping and a shot to the gut. I’m expected to ditch my Level 50, RR+ subscription account to hop onto alt accounts on RecRoom just to use a split test that I want and absolutly would improve my ability to socialize with my use of hearing impairment devices along with controlling how loud players are myself. RecRoom expects me to just ask my friends, add me on Nixxxxxx523 or Nixxxxxx721 and play with a character that looks nothing like me, spend no money on customization because what’s the point if I pay for something on one account and can’t use it on that account because a split test says so.

I ask about how soon this split test is going to evaporate and everyone will have it since it’s so well favored? Nobody knows.

The lack of transparency regarding the roadmap of RecRoom and these secrecy split tests, and the reliance on community-driven discovery on newly released RecRoom features, highlights a significant gap in communication and feature accessibility compared to other platforms. RecRoom keeps releasing new features without giving anyone and probably not even their own investors information on what they’re doing. Oh look, new Maker AI, oh look, new per user volume controls.

RecRoom wants my suggestions?

1. Split tests need to stop being forced.
   If RecRoom really wants to know how a community feels, why don’t they ask about how their split tests are or ways for users to opt in to every split test and let their split test users give juicy details about how they feel. Or let users opt out, they don’t want their hardware information collected and have the most reliable version of RecRoom currently available. They don’t want to be the next user added to a makerpen split test that makes an unexplainable bug that breaks their mood to create on RecRoom.

2. RR+ needs more value.
   As an example, if you subscribe to XBox Game Pass and link your XBox account to Valorant, you’re granted access to all the agents on Valorant as long as you stay subscribed to XBox Game Pass. Maybe some of the items that RecRoom doesn’t sell/offer to users on the store could be offered for RR+ users to rent? Be that you have to have RR+, can pay 200 tokens, and be able to wear on that item or items for a month. If you keep your RR+ subscription and join the game after renting that item(s) for a month, a watch pop-up can appear, ‘keep wearing these items? will be another 200 tokens, etc’. Then players can be able to equip unique original RecRoom assets that used to only be given to 20-600 people etc. RecRoom is already giving UGC, why not expand that UGC by their own in-house already made assets? I can see that users who were given special contest awarded items may feel let down that they’re not the ones exclusive to wearing that asset anymore, but I’m pretty sure the ones who won these exclusive items don’t want RecRoom to shutdown entirely with all their hard work on their rooms and may just let players wear what they want.

3. Break out of the NDA/confidentuality clauses
   It seems RecRoom has tons of NDA’s or confidentuality clauses that even users who fill out RecRoom’s own Research Labs are all binded into secrecy to keep RecRoom’s plans and ideas a secret as best as they can. With how many times I get asked while filling our a Research Lab survey that ‘yes, I’ll keep your secrets within my head’, makes me think that RecRoom’s own team and group of developers also can’t even talk to their own games community on what they’re working on in fear they’ll break the NDA, clause, or release something that supposed to be a secret, when really they shouldn’t need to keep it a secret like it’s some goverment document. It’s time to go back to the roots of what started RecRoom, show us what you’re working on as like it’s back to a college feeling landscape, give the energy of RecRoom’s moto publically instead of privately in RecRoom HQ, and Ready Fire Aim, for everyone to see. Break the glass and don’t be quiet! The one showcasing a feature they worked so hard on should be the developers who made it. Having everything funnel down to a inverted pyramid of luck to have some higher-up manager or staff talk to the public about something new is a bottleneck.

I’d hate for RecRoom to fade out of existance but with how many times I join in to play for a few or watch a YouTube video about RecRoom; It’s always either a new feature someone talks about and it’s a split test. Rooms 2 beta and it’s a closed group of creators. A bug with a tool, makerpen, or streamer cam that makes it completely unusable or garbage with no idea if it was a split test to change a configuration or ‘improve’ preformance. It’s a mess, there’s no roadmap, and it only feels like a roadmap to the landfill lately.