The developer of Palworld has revealed a conundrum it faces as it looks to the future: take the game free-to-play and live service, or stick with its current pay-to-play model.

Palworld is the phenomenally successful multiplayer survival crafting game that's been dubbed ‘Pokemon with guns’ for its inclusion of creatures called Pals. It launched on Steam priced $30 and straight into Game Pass on Xbox and PC earlier this year, breaking sales and concurrent player number records in the process. Japanese developer Pocketpair has said the game was so popular, it couldn’t handle the massive profits the game generated.

While player numbers have declined somewhat since Palworld’s explosive launch, it remains one of the most-played games on Steam (Microsoft does not make Windows PC and Xbox player numbers public), sitting comfortably in the top 100. But for Pocketpair CEO Takuro Mizobe, thoughts are now turning to the future, and whether to make Palworld free-to-play and embrace the live service model so many other games have adopted.

In an interview with ASCII Japan, translated by Automaton, Mizobe said Pocketpair needs to make a decision between the 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,” Mizobe said. “However, the game was not initially designed with that approach in mind, so there would be many challenges involved in taking it down the live-service path.”

One of those challenges would be turning Palworld from a pay-to-play game into a free-to-play game, which would in turn crank up the monetization. “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 made the switch from premium to free (Fall Guys and PUBG are two), doing so requires a great deal of effort and much risk. “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.”

It sounds like a 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. But it’s worth keeping in mind that Palworld launched in early access form just over half a year ago, so it’s early days yet.

Still, Pocketpair acted swiftly to capitalize on Palworld’s breakout success, signing a deal with Sony to form a new business called Palworld Entertainment that’s tasked with expanding the IP.

This is not a publishing deal for Palworld the video game, or an acquisition by Sony, rather an attempt to make the most of the game’s huge popularity with non-video game products, such as merchandise and music. The newly formed business, headed up by Pocketpair CEO Takuro Mizobe, is responsible for global licensing and merchandising activities associated with Palworld.

Speaking of Sony, Palworld is heavily rumored to be set for a PlayStation launch announcement at this month’s Tokyo Game Show, after the game popped up on a schedule. Pocketpair had teased a PlayStation release back in June, so this would come as little surprise. TGS runs from September 26 to 29.

While Palworld is one of the biggest game launches ever, it’s also one of the most controversial. Pocketpair has said its staff has received death threats amid Pokémon "rip-off" claims, which it has denied. Soon after launch, Nintendo moved quickly to remove an eye-catching Pokémon mod, then The Pokemon Company issued a statement, saying: "We intend to investigate and take appropriate measures to address any acts that infringe on intellectual property rights related to Pokémon." IGN asked lawyers whether Nintendo could successfully sue.

If you're playing, be sure to check out IGN's interactive Palworld map, or how you can create a dedicated Palworld server with your friends.

Wesley is the UK News Editor for IGN. Find him on Twitter at @wyp100. You can reach Wesley at wesley_yinpoole@ign.com or confidentially at wyp100@proton.me.