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Quiet Speculation is excited to have Kyle Rusciano providing MTGO financial content! If you have questions, comments, or requests for topics to cover regarding MTGO, let him know in the comment section below. While this article was written before the release of Amonkhet, the content and data is still quite relevant today.  Enjoy!

A couple years ago, I wrote an article for MTGGoldfish discussing the impact that Play Points (PPs) might have on the MTGO economy.  Today, I want to take a look back and examine the way that this change – introduced during Origins – as well as other, more recent changes, have affected the Limited experience on MTGO.

In short, drafting has become a more costly experience.  While many of y’all undoubtedly have felt this to be the case (I certainly did before gathering the hard data), I wanted to show in more quantitative terms the impact that recent changes have had on Limited players.  About three months ago, Lee Sharpe announced new changes that have affected Limited and Constructed players alike.  Let's examine the direction that MTGO has taken towards Limited play over the past few years before the implementation of these changes.

I have analyzed every large set from Theros through Kaladesh; namely, Theros, Khans of Tarkir, Battle for Zendikar, Shadows over Innistrad, and Kaladesh.  For the sake of consistency, I’ve stuck to the first set of every block; all but Shadows over Innistrad were fall sets.  To get a good handle on the information I’m going to present, it is important to keep in mind that Theros and Khans go together (pre-PP changes), BFZ and SOI go together (post-PP changes), and KLD stands alone (post-PP changes plus the $2 reduction in Draft price plus no Masterpieces).

Boosters Cost More Yet Contain Less Value

The first new reality about our changed landscape is that you pay more for boosters and get less value out of them.  I’ve created a helpful chart that shows how much value is contained inside a booster as a percentage of the booster’s cost:

Prior to the introduction of PPs during Origins, the cards contained inside a booster were worth roughly 35 to 40 percent of the booster’s cost. Back in that era, the predominant determinant and guarantor of card and pack price was redemption. Once PPs were introduced with the explicit purpose of artificially making boosters more scarce, the booster prices rose without a corresponding increase in the value of the cards contained therein.

Thus, whereas in the past the cost of drafting decreased significantly and proportionally as card prices decreased, that simply was no longer true once BFZ was released. Just one month into BFZ’s release, the average booster contained cards worth only 96¢, yet the booster still cost a whopping $4.05.

Had the MTGO PP changes not yet been implemented, your typical triple-BFZ draft would have cost about $10.25. Instead, it cost the full $14. The new equilibrium for the card-value to booster-price ratio was now below 25 percent, whereas prior to the changes it was above 35 percent.

The reason for the slight improvement during Kaladesh was the hard cap placed upon the cost of a draft at $12.  This kept Kaladesh booster packs from rising above $3.33, which created a bit of protection against the very worst of the new lower equilibrium point.  This cap benefits the player most during the first few weeks of a fall set’s release, because that is when card prices in the post-PP world would otherwise dictate a booster price of $4 or more.

I had thought this effect would have been helpful for longer, but just one month after release (when this data was pulled), the EV percentage was still far closer to that during BFZ/SOI (24 percent) than during Theros/KTK (37 percent).  It proved even less helpful once Aether Revolt was released, as the individual booster prices themselves are not capped, only the draft as a whole.  This allowed Aether Revolt boosters to cost $4 for their first three weeks on the market, and in fact these boosters did not dip below $3.33 until MM3 went live.  We can expect the same sort of pattern to continue into the future.

The Increased Cost of Drafting – Higher Profits for Wizards

One conclusion you might draw from the above section is that drafting has become more expensive.  The data bears this out in important ways, but in other ways it is more mixed.  Per draft, Wizards makes more money now than it did a few years ago.

This chart shows the amount of money lost per player for any given draft.  I have accounted for all prizes, card values (including foils), and format.  I’ve chosen to display the “competitive” (8-4) drafts, but the story is the same among the “beginner” drafts (Swiss) and the “intermediate” drafts (4-3-2-2 to 6-2-2-2 to Intermediate League).  As you can see, there was a clear increase in losses after the Origins PP change.  The average real cost of a draft, once roughly $3 per person, now became $4.50 or even $5 per person.  Before, every person added about $3 to a draft that would disappear (or feed the MTGO Behemoth); afterwards, every person added $4.50 to $5.  That is quite an increase!

When we look at rakes (the amount of money that feeds the MTGO Behemoth as a percentage of the cost of a draft), things look better, albeit only for the competitive side.  This is one way to view the Competitive League structural changes positively, as it restored Wizards’s rake to the rakes of the 8-4 queues of Khans.

Although Wizards now makes more money per draft, at least the percentage they take in decreased back closer to pre-PP levels. The rake, 37 percent during BFZ and SOI, dropped back to 32 percent upon the arrival of KLD.

I'll note that this still feels high to me, but at least it was somewhat a return to before.  I say “somewhat” because few players benefit from the Limited order of Kaladesh in comparison to the pre-PP order of Theros and Khans.  Factoring in both variables we’ve been talking about – the sunk value lost per draft and the rake – the only players who have benefited from the changes are those who win more than about 63 percent of their matches (the break-even point has fluctuated between 62.5 and 64 percent during KLD-AER).  Those who win between 60 and 63 percent of their matches will not have seen much of a financial outcome difference between Khans and Kaladesh Drafts.  But those who win below 60 percent of their matches will have noticed a major difference.  As someone who tends to have a Draft win percentage between 55 and 60 percent, I have had to drastically cut down on the amount of drafting I’ve done, and I’m sure I’m not alone. Those who win 50 percent of their matches have lost, on average, the amount shown in the figure above each draft.

The tale of the non-competitive drafts is even more grim, more Shadowmoor than Lorwyn.

The rakes on non-competitive queues remain high, still hovering around 37 percent.  They dipped to 35 percent during Kaladesh because of the $12 draft hard-cap, but as I mentioned before, this cap matters less the longer a set is out, especially once the second set of the block releases. Aether Revolt restored the rake to 37 percent. For some added perspective, consider that Wizards’s rake for 4-3-2-2 events during Khans was 35.7 percent.

The conclusive TLDR of this section: the cost of drafting has gone up.  Whereas before the introduction of PPs all players put in about $3 per draft – value that would not come back out either as prizes or opened card value – that number has jumped to between $4 and $5 across all competitive and intermediate leagues/queues.  Wizards’s rake from competitive draft events is 32 percent, while its rake for intermediate draft events remains even higher at 37 percent.

Potential Solutions

The first and most important thing is that people have to care enough about this to make their voices heard and their displeasure known.  I hope that some of the data I have presented will make more of the MTGO community aware that there is a serious problem with the prize support for Limited, especially for Draft.

There are many ways to skin this cat, but here are a few that I find elegant and/or illuminating:

1) Bring the Draft payout levels up to those of Friendly Sealed

This is not my preferred solution, but I posit it predominantly to highlight the stark discrepancy in prize support offered across MTGO’s various Limited events.  Believe it or not, Friendly Sealed right now offers the best value of any Limited offering on the market. And that is true no matter how many booster packs you add to your pool. To illustrate this, I’ve generated a graph depicting the amount of prize support as a percentage of that event’s cost MTGO offers for its different Limited offerings today.  For example, if MTGO charges 25 tickets per person for an event and pays out 15 tickets per person in prize support, the event’s percentage would be 60 percent.  This graph was generated using AER-KLD data, and the percentages will remain roughly the same for Amonkhet.

This chart is illuminating because we see that MTGO "gives back" over 60 percent of what it takes in via Friendly Sealed, whereas it gives back about 50 percent in Competitive Draft and Sealed and 40 percent in Intermediate Draft. (Of course, saying that Wizards “gives back” this amount in prize support is inaccurate – they do not give real money out in prizes like a casino, they just generate boosters and PPs out of thin air.)

What would altering draft payouts look like?  Let’s consider the Competitive Draft League with the following improved payout structure:

• 1st: 150 PP + 6 Boosters
• 2nd: 150 PP + 3 Boosters
• 3rd/4th: 50 PP

Under this scenario, which adds $10 to the prize pool by giving the third- and fourth-place players the event ticket portion of their entry fees back in PPs, then Wizards would be giving back 59 percent - still not as good as the Sealed Friendly, but pretty close.  How about the Intermediate Draft League?  This one needs a more drastic improvement, perhaps something like:

• 1^st: 50 PP + 6 Boosters
• 2^nd-4^th: 50 PP + 2 Boosters

This prize payout structure would mean that Wizards was giving back 63 percent of the entry fee in prize support, identical to the prize support of the Friendly Sealed.

The major takeaway is that Wizards is charging a premium to draft.  Seventy-five percent of the Magic I’ve been playing for the past several months is Sealed Friendly, because there the payouts feel much more fair and I am therefore able to enjoy the game without stressing out about needing to win every single match.

2) Sell Boosters for $3.33 or $3.50 in the Online Store Instead of at Full Retail of $3.99

Once it was announced that Masterpieces would not be in MTGO booster packs and Wizards simultaneously reduced the cost to draft by a few dollars, I presumed that boosters would be sold at the new price of $3.33.  I didn’t even think about it until Aether Revolt rolled around and it then hit me that the cap was only really efficacious for the first month or two of the first set of every block’s release.  Aether Revolt was going for $4 because only the total draft was capped, not the individual booster prices themselves.  This problem could be mitigated by selling booster packs for $3.33 in the store (or by allowing Masterpieces to be found in boosters).  Either fix would help soften the increased financial burden of drafting.

3)  Allow for the “Dusting” of Draft Chafe

A beloved feature of Hearthstone and a much-needed way to maintain a manageable card collection online, allowing you to “dust” your cards into tickets or PPs or Treasure Chests or anything would be yet another way to lessen the financial burden of drafting.

This is my preferred solution, because it is most in keeping with what I sense is a goal of Wizards to reduce the amount of product that gets redeemed on MTGO.  The increase in the redemption fee from $5 to $25, coupled with the now-decreasing time frame within which to redeem cards, strongly suggests that Wizards believes that too much paper product is getting released into the wild.

Coupled with excessively high print runs since Theros block, Wizards might worry that an oversaturation of the market might reduce the need for future Masters sets, or they might worry that redemption reduces the amount Standard-legal product being bought. Whatever the motivation, the intention is clear, and so is this solution.  Dusting cards would put floors on the value of cards of all rarities, thereby increasing the cost of redeeming sets, and thereby reducing the number of sets redeemed.  This solution is much cleaner than the current model of cutting off redemption in the middle of a set’s Standard life.

I would propose allowing the dusting of Standard-legal common cards at a rate of 100 to 1 ticket or 10 PP, 50 uncommons to 1 ticket or 10 PP, 25 rares to 1 ticket or 10 PP, or 10 mythics to 1 ticket or 10 PP. On average, this would add a significant 60¢ to the EV of the cards you open in draft, amounting to a roughly 9-percent increase in prize payouts, which is about in the ballpark of what is needed.

Conclusion

Sometimes changes are hard to notice unless we quantify them or lay them out visually before our eyes.  I know I learned a lot doing research for this article, and I hope that the MTGO community will find this data helpful and will be inspired to press for change.  PPs have not been kind to the MTGO Limited player.

I look forward to reading the comments below, and don’t hesitate to get in touch.