Last June, I had the opportunity talk to theater full of high school Science Fair attendees. At the lunch before hand, the adult sponsors and teachers asked me what I did.

Conversations about Zynga and making money online moved to their complete shock and surprise that anyone would ever buy a virtual good online, especially any virtual good for a game.

As surprised as the adults were, the high school students at the table thought nothing of purchasing a song from iTunes, or buying a really cool sword for their favorite game.

It’s a crazy feeling to be sitting at a lunch table, staring straight into a Grand Canyon of a generation gap like that.

Also tells me that it’s all about context.

Without the context of a “record”, “cassette tape” or even a “CD”, buying a bunch of “bits” that turn into music when you play them on your MP3 player is the natural thing to do.

Without the context of knowing how much better it is to play “World of Warcraft” with the “Uber Sword of Doom”,  it doesn’t make sense to spend real money on a virtual good for a game.

I’ll remember this conversation and the context of this lunch the next time I wonder “why would anyone want to buy that?”.

Magid Associates confirmed through a study that when a gamer rents a video game, it’s unlikely they’ll buy it afterwards.

Their data shows that less than 1 in 10 gamers buy a game after they rent it and then those people only buy 1 game for every 10 they rent.

Some might say this is a reason enough to shut down game renting or even make companies who rent games pay more to game publishers for each rental. What if instead, we turned the situation around and asked game publishers(and developers) to build better games?

The reasons sited for “not” buying included the games being too short and the quality being too low.

Imagine that…gamers are tired of paying full price for games they don’t think are worth the money. Then again, maybe they only have $50 to spend and would rather rent 10 games and play them a few days each instead of buying one game they can keep (and beat) forever?

As the installed base of game machines continues to grow in the US and worldwide, it seems logical that there will be more console players with less money they want to devote to spending on games.

The economic model of online games like “World of Warcraft” solves the rent vs buy issues by having the triple win of great content, a huge amount of content (can’t finish it in a weekend) and only being available with a monthly subscription or prepaid game card. With all the money they are making, it only makes sense that some of those features and benefits will start migrating their way to console products as well.

Link to the article at PC World.