There are a couple of game producers out there which have implemented quite an interesting model to boost funding of their further development. For example Paradox Interactive, developer and publisher of so-called grand strategy games. Simply speaking- once the game is released, it remains in continuous development. Each patch brings a number of free features which comes accompanied by a paid expansion. Said expansion contains extra features and- in some cases- enhancements of the features included in the free patch. As the expansions are optional, the features are "modular" and integrate smoothly with the core game. This allows both the players who have and the ones who haven't bought one or more expansions to play the same version of the product, and hence receive necessary support and bug fixes.
Pros and cons that come to my mind:
Pros:
- Continuous source of income for the company
- Players who want extra (paid) features can get it, players who don't/can't afford it, can still enjoy the game and get the support
- Everyone gets extra free feature as a "thank you" from the company
- The product is developed and improved more actively
- The model encourages more feedback from the players and makes it easier to implement desired features
- Company may fail to balance between free and paid features, leaving players who haven't bought the expansion disadvantaged (example from Europa Universalis 4- new development and building model left players without the expansion with limitations on how they can (indirectly) unlock the building slots, as they couldn't manually change the development level)
- The "full version" of the game, i.e. the core game + many expansions released later, results in a high overall cost (EU4 costs hundreds $ as of today). This makes it a harder entry point for new players, as they may be less likely to buy the game without all the expansions.
- Badly managed development model leads to "feature bloat", where most focus is put on releasing many features relatively often (i.e. focus on income rather than quality) without careful consideration of the features being introduced
- Harder mods integration- modders need to decide whether their mode requires certain expansions, handle the integration with other versions (without other expansions) of the game etc.