5.4.2023 – 15:43z

Has the MSFS Marketplace Failed Developers and Consumers? Developers and Community Weigh In

Microsoft Flight Simulator launched on August 18, 2020, and with it came the MSFS Marketplace, an add-on store self-contained within the simulator itself. The Marketplace promised to facilitate the easy purchase and management of flight simulator add-ons, in service of MSFS’s vision to be the next-generation flight simulator. When the simulator launched on Xbox almost a year later, the Marketplace served another important purpose as the only place for console users to acquire any additional content not included in the base simulator.

For the entirety of its existence, the MSFS Marketplace has been controversial. For long-time flight simmers, its very inclusion represented a slide toward further “gamification” of the hobby. A wider gaming audience, not used to flight simulators, also groaned at the thought of another major title putting microtransactions first. Developers have decried the revenue-sharing agreements of the Marketplace as well as the process of releasing and updating their products.

But a storefront that doesn’t benefit sellers will have no products, and a storefront that doesn’t have demand will generate no sales. Almost three years into its life, the MSFS Marketplace has a healthy catalog and retains its prominent place in Microsoft’s strategy for the simulator, despite the continued controversy and complaints. FSNews spoke with members of the flight simulator community as well as a few prominent add-on developers to understand the community consensus on the Marketplace. While opinions on the matter are often black and white, the truth of the MSFS Marketplace is far more complex.

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A new community

To understand the Marketplace, we must try to understand the market, which means grasping the staggering impact and reach of Microsoft Flight Simulator. The simulator reached two million unique users just a few months after release, and by the end of 2022 had been tried by over 10 million pilots. MSFS’s all-time high player counts on Steam (The only platform where we can reliably track player numbers over time as a 3rd party) was just shy, on release, of that of Red Dead Redemption 2 – one of the most highly-regarded single-player games of all time. To this day, it maintains a healthy, steady daily player base. Among flight simulators, MSFS has held the top spot since its release by a significant margin, according to the Navigraph Community Survey.

MSFS’s impact extends far beyond Steam and the Windows store. It is included in Game Pass and Xbox Cloud gaming, making it extremely accessible for a wide range of players. Being available on PC, Xbox, and via cloud streaming is unprecedented reach for a flight simulator – historically a niche hobby. Many people either unearthed or rediscovered a passion for flight simulation when they tried it out “on a whim” or as included in their Game Pass subscription because it looked like fun. Like millions of other virtual pilots, they were immediately hooked.

This explosion of interest in flight simulation is summed up eloquently by Edson Soriano of Parallel 42 (//42): We are experiencing the ultra-niche market of Flight Simulation, attempting to go mainstream. Like an artist evolving through their career of albums, this is happening right now for us. […] [I]n the past, the entire category of flight sim would often have well under 1000 viewers distributed amongst ALL the streamers [on Twitch]. These days, a SINGLE streamer can hit over 1000.”

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Microsoft and Asobo are delighted to capitalize on this reach, of course. Asobo continues to provide free updates and content additions that help to maintain steady player counts. Of course, all those players across the myriad of platforms all have convenient access to the MSFS Marketplace – and are encouraged to purchase there thanks to its prominent placement on the main menu of the simulator.

Content quality and the impact of “casuals”

Although the majority of simulator pilots are naturally interested in aviation, according to the Navigraph Community Survey, 27% of pilots simply fly for casual entertainment. This “casual” audience is a significant portion of the overall user base, and therefore the users looking towards the Marketplace. This is especially true on platforms like Xbox where it is their only choice for additional content. This has led to community concern that the quality of add-on content will decline in order to “pander” to this growing market: people not looking to sink time learning high-fidelity add-ons.

Indeed, low-quality add-ons do seem to have become an issue. “I’m never going to hesitate to call a spade a spade. Lots of add-ons should have never been published,” says Edson. “[This content] does not match the development effort of quality content; therefore, it is much more easily produced. This faster pace of production leads to rapid-fire submissions that eventually bury quality titles in the Marketplace.”

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The MSFS Marketplace is not the only platform store struggling with content quality concerns. As this representative post on Reddit (One of many similar) indicates, the Nintendo Switch eShop has similar problems: an endless “landfill” of low-quality games makes it difficult to discover high-quality offerings. Like the eShop, the MSFS Marketplace generally lacks more than basic discovery and curation tools, especially when it comes to aircraft. Potential customers have little more than a basic search function when it comes to aircraft, and the only feedback mechanism available is a basic system of 1-5 stars. This leaves no room for nuance or detailed reviews – no one can tell by looking at the Marketplace ratings why a particular add-on is rated in the way that it is.

Sim pilots complain that they can’t trust the Marketplace ratings to discover a new product that fits their interests or level of experience. If a sim pilot is looking for a high-fidelity aircraft, for example, they have no way of knowing if a product is highly rated by others looking for the same level of detail. Perhaps the aircraft hits the spot for that audience looking for a casual experience and so is rated favorably, but someone looking for a higher-level add-on will be disappointed. After all, as Edson puts it, “Like art, quality is subjective, and that line isn’t drawn the same for everyone.” While it’s natural that a large marketplace would carry products for a wide range of pilots’ experiences and desires, the MSFS Marketplace clearly makes it difficult to meaningfully discover and separate those products when browsing the store.

A different story for sceneries

Most of the discussion directed at the Marketplace, and low-quality add-ons in general, revolves around aircraft, but the situation with sceneries and airports seems a lot more positive. For one, discovery is aided significantly by the World Scenery map. “It’s very easy” for customers to discover scenery products on the Marketplace, says Pedro (Gold787FlightSim) of scenery developer Vref Simulations. “It’s as easy as searching the ICAO or looking at the airports map.”

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Users echo Vref’s sentiment on the ease of use of the scenery map. Additionally, rarely are sceneries so divided in expectations as aircraft. While a casual audience might not notice the nuances that an experienced simmer or real pilot might, they will be immediately put off by glaring issues and low-quality modeling, and even the most laid-back simmer appreciates little touches like building interiors and custom jetways. This results in Marketplace ratings for sceneries more closely aligning with broader sentiment across all platforms, despite the lack of detailed reviews.

Not the fault of the casuals

The developers we spoke to all rejected the idea that any decline in add-on quality was related to the influx of the new, more casual simulator demographic. In fact, they agree that the more of these “casuals” enter the hobby, the more vibrant the community becomes. “There is no doubt that the market for simming products has grown significantly since MSFS was released,” stated Robert S. Randazzo of PMDG. “A portion of the casual simmers entering the simming community each month become increasingly interested in simming, and this leads to net growth in demand for the kinds of products that PMDG creates.  We are exceedingly happy with the overall trend in that regard.”

Indeed, Randazzo points out that for almost a decade, the market for add-ons had been continuously on the decline. For developers of flight sim products, the release of MSFS has both energized the hobby and kept their studios running. Even for developers like PMDG who have, in the past, only distributed through their channels, it makes sense to take advantage of the broad reach of the MSFS marketplace. And the influx of casual simmers, with new perspectives and expectations for their add-on products, is essential to the health of the market and the hobby – despite those who resist the change.

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“Punk just hit FM radio airwaves, and the gatekeepers are scared,” remarked Edson, referring to the sudden influx of new simmers. “With all the marketing behind this title, the flood of ‘casual’ audience is more significant than ever, so we have more flight sim noobs per day on any social media site, group, or forum. All of these folks [who decry the influx of ‘casuals’] were once ‘casual’ players too; they often forget that. Adapt, be kind, and never forget where you came from.”

The flight simulation community remains tight-knit and welcoming even as its popularity explodes, and individuals are quick to offer suggestions and opinions to new pilots when they come up against the lack of information available in the Marketplace. But there’s little question that Microsoft could do more to make the store a more inviting place to discover high-quality add-ons, especially when you lack the experience to know where else to look.

Two Different Products

The majority of add-ons that are available in the MSFS Marketplace are also available from other storefronts. Whether directly from the developer or through one of the many established storefronts serving flight simmers, customers often have the choice of where to purchase. However, often the experience a customer gets from a product purchased on the MSFS Marketplace can vary significantly from that from other channels – mostly to the customer’s detriment. Products purchased through the MSFS Marketplace often lag significantly behind other storefronts in terms of updates but can also lack features entirely compared to other storefronts.

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Lack of Updates

Behind product quality concerns, the largest complaint echoed in the MSFS community about the Marketplace seems to be the pace of releases and especially of updates. Like most software industries these days, developers of flight simulator add-ons often add features and fix issues at a rapid pace – but deploying those changes to Marketplace customers can take weeks or even months to arrive. As an example, Blackbird’s celebrated Cessna 310R add-on received a massive update on December 14, 2022 – that didn’t hit the Marketplace until January 12, 2023.

Delays like this are maddening not just for customers hungering for new features, but for developers eager to squash bugs that may have presented themselves after release, or after a new sim update. “We hold products back from Marketplace because it is important for us to be able to rapidly iterate updates to customers in order to ensure product stability post-release,” said Randazzo. Indeed, PMDG has deployed several updates since the release of their 737 series to MSFS in 2022, many of which have included timely hotfixes in response to severe issues discovered by forum users. “Keeping the product only to our channel allows us to do this, and once the product is stable it goes to Marketplace and our [other partners] for wider distribution.”

Notably, PMDG’s 737s have been absent from the Marketplace until recently, and according to Randazzo, concern over the pace of updates is partially to blame. Now that PMDG is confident in the stability of the 737, and largely happy with the direction of the MSFS Marketplace, they are finally beginning to list these highly-anticipated aircraft. Even for scenery developers like Vref Simulations, the process of submitting or updating a product to the Marketplace can take “well over a month to get anything moving.”

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Different Features and DRM

Products on the MSFS Marketplace sometimes lack concrete features compared to their releases on other storefronts. Sometimes, this is due to Marketplace policies. Other times, the encrypted nature of Marketplace files prevents the modification that flight sim users are used to having access to. Developers often put options into products that can be easily changed by modifying files – but not if they’re locked by Marketplace DRM. And there is rarely any indication that you’re getting a different version of the product on the Marketplace page.

MSFS Marketplace policies forbid the depiction of weapons, yet there are plentiful military aircraft available. Developers such as IndiaFoxtEcho and Milviz offer versions of their fighter aircraft both in the Marketplace and on their storefronts, and weapons hardpoints are available only in the versions bought directly from the developers. Astute observers will note that the omission of weapons hardpoints is clearly mentioned in the product descriptions, but customers are not told where they could get an armed version if they wanted it – likely due to more policies forbidding partners to direct customers off of the Marketplace.

The Walled Garden

Digital software distribution is historically a cutthroat field where the big players dictate the rules. Outside of flight simulation, companies such as Valve, Apple, and Epic Games have become embroiled in multibillion-dollar legal battles over control of the storefronts and platforms – each trying to be the gatekeeper and claim the pot for themselves. While Microsoft has shown no indication that they plan to hinder third-party storefronts in any way, the close integration of the MSFS Marketplace with the simulator itself (the “platform”) positions them to choke out the competition through marketing and sheer volume, forcing acceptance of their platform – whether it serves the developers and users or not.

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The volume of sales done through the MSFS Marketplace compared to other storefronts makes it an opportunity that most developers, especially smaller ones, can ill afford to ignore. For a small scenery developer like Vref Simulations, their products in the Marketplace sell at a far higher velocity than on other storefronts and comprise 40% of their total sales – despite having only 2 out of their 6 products available in the Marketplace. For a more well-known developer like //42, the ratio is 2:1 of Marketplace to other storefronts – with only 7 of their 22 total products available at the time of writing.

The ghost of monopolies past

As the platform holder, Microsoft positions its storefront for success. The Marketplace is front and center of the simulator’s main menu, and every new and updated product is announced in their weekly development updates. With payment processing built right into the Xbox, Windows, or Steam, the barrier to purchase for customers is lowered. For customers on Xbox, the Marketplace is their only choice – and while that audience might not be massive (Navigraph’s Community Survey puts console flight simmers at a small fraction of their respondents), it’s not insignificant.

While Microsoft might not move to forcibly corner the market with abusive policies (and indeed shows no indication of wanting to do so at this time), their marketplace is positioned to edge out other storefronts slowly but surely, and even unintentionally – forcing developers and users into their walled garden because it is too pervasive to leave. Microsoft is, of course, no stranger to monopolies. As an analogy, think of stores like Steam or the Google Play Store: sure, you can get your games and Android applications elsewhere, but these are your first, and often only, stop. Being listed on Steam is a make-or-break move for most game developers, and if your app is not on the Play store – well, it might as well not exist.

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The price of convenience

The convenience of the walled garden actually keeps many users choosing the MSFS Marketplace as their storefront of choice to obtain flight simulation add-ons. In fact, despite the complaints, the MSFS Marketplace was among the top two preferred stores for add-ons in 2022. While some simmers might lack knowledge about other storefronts, several community members asserted that the MSFS Marketplace remains their top pick – by choice.

“The dream of flight is universal,” said Jorg Neumann, head of Microsoft Flight Simulator. Microsoft and Asobo have made great strides with MSFS to make the flight simulation hobby more accessible and enjoyable for a wide range of people. Many of those, especially the newcomers, appreciate the convenience that the MSFS Marketplace provides in the management of their payware add-ons. Flight simming in 2023 can be far from a simple “launch and fly” affair if you have a significant number of add-ons installed – and all of those programs, aircraft, sceneries, and more need to be kept up-to-date.

This extends to portability as well – the process of “migrating” your sim installation when upgrading hardware (Or switching between console, Cloud streaming, and PC) is significantly less tedious and painful with a collection in the Marketplace. The MSFS Marketplace is central to Neumann’s vision of bringing the dream of flight to as many people as possible, enabling third parties to provide exciting flight sim experiences to anyone, whether they are able to play on a high-end PC or choose to stream via Xbox Cloud on public Wi-Fi.

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“Having an alternative where my add-ons are all updated with one process and as little click as possible is not only tempting but also more efficient,” explained PMDG forum user Jaques P. on this thread. This sentiment is echoed by users of all experience levels and keeps sim pilots drawn to the MSFS Marketplace. After all, the promise is clear: instead of launching each company’s individual updater before you start the sim, just go to your Content Manager and click “Update All.” The simplicity is enticing, and it is understandable that simmers would gravitate toward the solution that makes their add-on management as painless as possible. While the MSFS Marketplace is not the only storefront to offer central add-on management, it is the only one directly integrated into the sim in such a manner.

Regional pricing

The accessibility of the MSFS Marketplace extends beyond convenience and benefits users all over the world by providing regional pricing. For Vref Simulations, based in Brazil where the median wage averages around USD 500/mo, the regional pricing means that people like them can enjoy high-quality add-ons at price points that make sense for the demographics of their region. For Brazilians, add-ons like the H-Jet can cost approximately $19, and in other regions, the PMDG 737 is as low as the equivalent of $2.40.

Microsoft’s cut

Just like every major digital storefront that sells products from many developers, the platform holder – Microsoft – takes a percentage of every purchase made from the MSFS Marketplace. Microsoft retains 30% of the revenue of each purchase. This is in line with other major digital storefronts, such as Steam and Apple’s App Store. These platform holders claim the fee as the price paid for the services that the store provides, such as customer convenience, support assistance, hosting, distribution, marketing, and more.

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To some developers like PMDG, the MSFS Marketplace is living up to their expectations enough to command this cut. “We have not found any areas of Marketplace that we feel are concerning,” stated Randazzo. “The store delivers what we expect with minimum of [sic] hassle at a reasonably good return.” The popularity of PMDG’s add-ons has actually caused issues in the past: When the 737-700 first launched for MSFS in early 2022, DDOS attacks on their AWS-hosted servers caused major issues in the first days of sale. High-profile products such as these can benefit from diversifying into Microsoft’s hardened cloud infrastructure and payment processing, enabling them to support these launches that accompany flight simulation’s unprecedented audience.

But some feel that Microsoft does not go far enough to justify the revenue split. To developers like //42, it’s too much. “[Other stores have] significantly better rates for distribution and very reasonable release windows. Microsoft does not deserve the percentage they command for what is provided,” said Edson. The delays in releases and updates are very challenging to manage for developers. Microsoft has also cut more services they provided when they put the responsibility for functional testing back on the shoulders of developers. It’s also difficult to argue that Microsoft provides any meaningful assistance with support. Tales of poor service, refund hassles, and other challenges with the purchase process make some users wary of Marketplace purchases.

Visibility = volume

Microsoft does, however, provide marketing benefits to its Marketplace customers. The MSFS Marketplace is immediately front-and-center for every MSFS user, and new products and sales are the first things displayed when a pilot opens the sim. Microsoft also announces every new and updated product in its weekly Development Updates every Thursday. These Development Updates are directly announced to their Discord server with thousands of members and often are reposted to news sites serving all different communities of flight sim enthusiasts.

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This marketing results in a significantly increased volume of sales through the Marketplace compared to other storefronts for many, though not all, products. For some developers, the volume can often make up for the downsides of selling on the Marketplace. For Pedro, “Even with the cut, it’s still worth it to me. The marketplace equals or beats [another store’s] revenue, even if I receive 30% less.” And Brazil’s tax relationship with US companies like Microsoft requires that a significantly higher percentage of revenue is also paid in tax – which illustrates just how much the volume of eyes on the MSFS Marketplace can impact sales, despite lower margins.

Funding the future of flight simulation

It could be argued that the ongoing development and improvements to Microsoft Flight Simulator are an additional service provided by Microsoft that is directly funded by Marketplace revenue. While this might not be of immediate benefit to developers, it’s clear that Asobo and Microsoft have been committed to improving the simulator since its release.

Even Edson, typically critical of Microsoft’s Marketplace ambitions, thinks their heart might be in the right place – for now. “One thing that can be said is that the artist (Microsoft) is doing something they seem to be genuinely passionate about, and they spend big bucks on growing our industry and community,” he stated when describing the impact of the new simmers enticed by MSFS’s marketing.

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Beyond bug fixes and feature additions – all of which have come at no cost to customers – Microsoft/Asobo’s “Famous flyer” and “Local Legend” line of aircraft releases have brought a plethora of unique or underappreciated aircraft to life in the simulator. It is likely that some of these projects, made in collaboration with well-established add-on developers, were either enticed by or subsidized in part by the MSFS Marketplace revenue. Some superb releases such as the Airbus A310 and the De Havilland Beaver have come for free thanks to Microsoft/Asobo’s partnership with renowned third-party developers – partnerships underwritten by Marketplace money.

Microsoft responds to feedback

Microsoft has recently made significant changes to its submission approval process to greatly shorten the time a product or update spends in its approval queue. They have admitted that there is too much time lost in communication between Microsoft and their content partners and have passed the responsibility for functional testing of all content back to the developers. In theory, this will significantly ease the bottleneck for products and updates coming to the MSFS Marketplace: a backlog that Microsoft recently put at 1,050 new products or updates awaiting approval.

However, the response was mixed among flight sim users. While the community acknowledges Microsoft’s attempt to ease the process, many remain concerned about “opening the floodgates” for non-functional content on a storefront that rarely offers refunds. Microsoft has ensured simmers that developers trying to take advantage of this and submitting broken addons will face “consequences.” Some have also pointed out that a sudden release of this backlog could result in unintended consequences, such as a paradoxical overabundance of content. This could make it even more difficult for customers to find what they are looking for, without further investment from Microsoft into content curation and discovery.

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Developers are eager to see this change in motion. //42 has 8 products currently pending their Marketplace release, with some languishing since October of 2022. Only now, 6 months after ingestion, has their 42CM Cedar Mountain scenery finally been handed back to //42 for testing – a product that has been available on other storefronts since November. “The position that this delay puts us in is frustrating, and I’m excited that we created enough waves to be noticed. Microsoft has finally listened and adjusted the process,” stated Edson. But he’s still not sure that it will be all smooth sailing, also anticipating that the deluge of “unblocked” releases might overwhelm customers. “Something tells me [Microsoft] won’t want to announce 100s of partner products per email,” Edson said, “So now, we wait and see if these changes will bring relief, or present more grief.”

But that’s not the only change that Microsoft and Asobo have made to the MSFS Marketplace in recent weeks. In their March Live-Stream Q&A (Timestamp), Jorg Neumann acknowledged the feedback and outlined some concrete steps that Microsoft is taking to address it. In addition to adjusting its submission process, Neumann pledged to address the feedback that lower-quality content is released over higher-quality content. Microsoft will now “prioritize” the release of high-quality add-ons over lower-quality ones, ensuring that they come to the MSFS Marketplace faster.

“There is a line for quality, and there should be,” said Edson of this change, on one of his live streams. “And [Microsoft] has a right to enforce that.” //42 and other developers have hailed this change as an important step towards making the MSFS Marketplace a more equitable place for passionate developers to showcase their work. However, details are scant on exactly what the standard is to Microsoft for a “high-quality” add-on. Neumann stated that the process for determining this bar for content is iterative, and will take into account ratings and sales on the MSFS Marketplace, as well as community feedback on their forums.

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Neumann was also asked about the Marketplace’s lack of an equitable refund policy and promised to address it in a future Q&A. Additionally, Microsoft has just brought on a new manager for the Marketplace and is in the process of hiring several new team members focused on improving it as well. They are also easing some requirements on localization, removing this as a hard barrier to release. They have also started to crack down on developers that would submit empty or incomplete packages and then actively finish development while the approval and release process dragged on, draining Microsoft’s resources away from products that would play “fair.”

Finally, Microsoft has begun work on an expanded freeware category for the Marketplace, hopefully bringing the same vibrant freeware community directly into the sim and critically, onto consoles. While some details are still scant, Microsoft seems committed to improving the MSFS Marketplace. “The feedback has been heard, […] and we’re not perfect,” said Neumann in the stream. “But the goal is to have the best Marketplace that can possibly be.”

The free Marketplace

Whether it is a hobby, a professional tool, or casual entertainment, flight simulation brings all of us joy in the virtual skies above our planet Earth. It has sustained a cottage industry of supporting tinkerers, manufacturers, and developers for decades. This vibrant industry has always kept going thanks to the passion they maintain for aviation and flight simulation, and occasionally – it is a profitable endeavor.

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What the flight sim world is experiencing now is a disruption – a new and different way of approaching the industry of flight simulation add-on sales. Alongside a massive increase in newcomers, Microsoft has brought the weight of its infrastructure and market position to bear on a market comprised largely of home-grown enterprises. It is natural to be apprehensive of tectonic shifts, and it seems that Microsoft has not entered the flight simulation market on a fair footing with the prominent featuring of their store in the hobby’s dominant sim software. They have significant work to do to improve the experience of both buying and selling on the Marketplace

But while the MSFS Marketplace has its failings, it remains a useful tool for flight simmers and a decent revenue opportunity for some developers. Clearly, it isn’t perfect, but whether a customer values convenience, pricing, or something else the Marketplace still offers experiences not found on other storefronts. Microsoft and Asobo have been fairly transparent since the launch of MSFS, and clearly do listen to feedback. The recent changes are a welcome and laudable step towards easing some of the criticisms leveled at the MSFS Marketplace. While it might take some time to bear fruit the community and developers that we talked to are optimistic about the changes.

Despite the monopolistic specter of the MSFS Marketplace’s positioning, it is serving an important role in making high-quality add-ons accessible for a new and less-experienced audience, even if imperfectly. Ultimately it is the flood of new simmers – that the MSFS Marketplace can undoubtedly support – who sustain and grow the community and get excited about new aircraft, sceneries, and unique experiences that are only offered in this exciting world of flight simulation.

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FSNews would like to thank the following individuals for providing fascinating insight and comments directly for this article:

Pedro (Gold787FlightSim) – CEO, Vref Simulations
Edson Soriano – CEO, Parallel 42 (//42)
Robert S. Randazzo – CEO, PMDG

We would also like to thank everyone who contributed discussion directly to our Reddit forum inquiries here and here, and to every member of the flight simulation community who makes their voice heard!

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