Curse

Fril Estelin · Jan 04, 2008, 06:38 PM // 18:38

Hi,

I read a few days ago articles that aroused my interest on a subject that now seems very much in the hot news in the GW World, Commerce in MMOs and Virtual Economies (I understand that commerce concerns transaction from a group of people to another group while economy looks at the whole population and how money and goods flow):

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Big-shot economist to advise teen virtual world 'Gaia Online'

Quote:

In recent years, the economies of virtual worlds have become increasingly complex and varied and have attracted significant amounts of popular and media attention. Economies like those of Second Life regularly see more than $1 million day in user-to-user transactions. Anshe Chung, who became a millionaire by developing and selling real estate in Second Life, was even featured on the cover of Business Week.

Despite the growing importance of these economies, it surprises some to see a heavy-hitter like Boskin taking on such an important advisory role for a virtual world catering to teens. After all, this is a man who, in addition to his academic positions, serves on the boards of companies like Exxon Mobil, Oracle and Vodafone. According to his Hoover Institution biography, he also serves "as an adviser to presidents and prime ministers, finance ministries, and central banks around the world, from the United States to China."

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Interview with a game economist and ex-RMT-manager: Jeff Lyndon on the history of gold farmers in China

(RMT=Real-Money Trading where real money is paid for virtual one)

Quote:

There was this one day I manage to get hold of a "Invisible Cloak" of Linage, and I yelled at the public channel just to show off a bit. Yet right away tons of players private messaged me for a price. I kept ignoring them since I was not sure how much should I sell it for. Yet after a while a player messaged me with approximately 4000 USD offer. I had never heard of anything that could sell that much so I decided to reply him and checked whether he was joking or serious. Which turned out he was serious and he was just 14 yrs old.

...

If my theory is correct. The motives for people who buy virtual golds are people who want to have the achievements but are not willing or able to spend the time that is required for the achievement.

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I'm sure that there are great "apprentices" (a reference to the tv show) which do virtual commerce in GW and could may be share their thoughts and experience on this thread. Any economist who wants to share is opinion is welcome of course. I guess a topic of discussion is also the recent introduction of the Mini Polar Bear, but with a max, say, 30 of them which may sell at 1000ectos+ it's probably not more than a few thousands items selling 30ectos right?

It's also very interesting to see how the real and virtual worlds meet at this point (because, for the rest, we don't carry swords to kill monsters

). I guess that MMORPGs are also fantastic playgrounds for economist to test their knowledge and theories. It's particularly interesting to look at how RMT is a threat, how to deal with it and how it relates to fairness of the economic model.

So: how do you think that the GW virtual economy works? What are its rules, its advantages and benefits? How does it compare to virtual commerce and economies of other MMORPGs you play? What trends do you see? How important do you think RMT is in GW? Is Anet able to influence the virtual economy and prevent RMT?

Please argument your position and do not hesitate to bring articles to this discussion table.

Cheers!

P.S.: for fun and memories, an article about Taxing MMORPGs in 2006.

Coridan · Jan 04, 2008, 07:21 PM // 19:21

i personally don't see GW's ingame items having much real world cash value in and of themselves... I know that people have bought ectos and gold etc...and i would imagine that is about all that i would think would sale for real world cash...at least in large numbers.. the reason for this is that the items in GW do not affect game play. Now if they were to drop a AnetWhomping Stick of Domination....that did +50 unconditional damage...at the rate that the Polar bear dropped...and for the same amount of time...then i can see people paying large sums of money to own one. But to pay large sums of money to buy an actual minipet or weapon i don't see that happening...hence me saying that only gold/ectos are worth RL moneys... I am no expert etc...just a normal 30 something Married with Children....

Fril Estelin · Jan 04, 2008, 07:31 PM // 19:31

Quote:

Originally Posted by Coridan

iI am no expert etc...just a normal 30 something Married with Children....

Neither am I. Thanks for sharing. Why do you think then than there's been so many bots in GW and Anet has to ban a lot of them all the time?

I stumbled about another piece of news related to the topic:
Blizzard won't support 'legit' RMT service

Quote:

The Next Generation site has commentary from individuals at Blizzard Entertainment, reacting to the announcement of the Live Gamer service. The company is standing firm on its current terms of use for World of Warcraft, flatly denying the possibility that it will work with the service to allow the purchase of Azeroth's in-game currency.

"The game's Terms of Use clearly states that all World of Warcraft content is the property of Blizzard Entertainment, and Blizzard does not allow 'in-game' items to be sold for real money. Not only do we believe that doing so would be illegal, but it also has the potential to damage the game economy and overall experience for the many thousands of others who play World of Warcraft for fun ... While we can understand the temptation to purchase items for real money, we feel that players can find ample equipment and money for their characters within the game through their own adventuring and questing."

Coridan · Jan 04, 2008, 07:39 PM // 19:39

IMO the reason there are bots is because of the gold/ecto real world value...as long as players will go out and spend $50 plus dollars for in game gold..there will be someone trying to take advantage of it. But again i think the only thing that is worth "real" money is the golds/ectos.

Unfortunately...i think GW economy is dying/dead I truly enjoyed my journey through GW... I didn't start till Mar/Apr 06 so i missed alot of the big exploits...and didn't make a farming char till well after that ... probably Apr/May of 07. But i did enjoy earning money...collecting crafting material and selling to others because there was not enough storage....at lvl 12 in Pikens Square i had well over 20k in gold in storage..on my first character. Then i graduated to selling mods...because you never knew what youw as going to get from an expert salvage...so mods had some sort of value to them...then i started in on "almost" perfect weapons...buying/selling those...because not EVERY SINGLE weapon that dropped could be made perfect for 10k or less. Finally started trading in perfect weapons...made some cash...switch to trading minis...sold those..made some more cash...now i have nothing to do in GW....as far as the economy goes..still play the game quite a bit...but the thrill of getting a gold drop is gone...because any gold drop is perfect with a few trades...now we have to wait for that uber rare item to drop...which in honesty only drop from the zashien/hoh chests... i missed out on the PVP stuff because my computer was too slow..and now that i have upgraded...i find no desire to sit and let some one yell at me because i am new to pvp...so i stick to RA/AB/ and bit of PVE

CE Devilman · Jan 04, 2008, 08:03 PM // 20:03

its good to see new players start getting a good sword and not spending
so much on it..

greed it not a game..

Fried Tech · Jan 04, 2008, 08:05 PM // 20:05

Before ebay and sites like it cracked down on virtual trades for real money people did sell mini and the like online. Now, yes, the only thing that people buy for real world money is ectos and platinum. And when these people buy in game gold what do you think they do with it? It is quickly distributed back into the game economy, in some way. Usually this is detrimental to the in game economy because these are high value trades. The money is going from one, now "rich" person, straight to another rich person. Not getting filtered down to the average player. And loot scaling made the problem worse, because the rich are still rich and the poor have a harder time making money.
These are the reasons that the ingame economy is so messed up, and personaly, I doubt it will get any better till GW2.

As for bots. The bot does the farming and then a real person sells the crap to merchant, and the good stuff is sold in trade channels. Then, the gold is put on a website and sold to someone.

Fril Estelin · Jan 04, 2008, 08:36 PM // 20:36

So you'd say Fried Tech that there are basically two economies, one between the rich ("high end") and the other one ("normal")? And they rarely communicate? But then it means that it would pretty to spot, so does this mean that there're money laundering techniques like in the real world?

Fried Tech · Jan 04, 2008, 08:46 PM // 20:46

I don't think that there is money laundering. More like.... the rich have the high end items, with a few exceptions (birthday present minis, lucky drops, etc.) and they know that they can sell these items for a rediculous amount of in game money because there are others just as rich as them in game. No casual player could ever hope to touch these items unless they go and buy some gold from a website. Unless, they work for the sole purpose of getting that one item, and then they will be broke again. I'd say its more like real life, where the gap between the rich and the poor just gets worse and worse as time goes on.

bout to get off work might not post again till monday

Fril Estelin · Jan 04, 2008, 08:58 PM // 20:58

Quote:

Originally Posted by Fried Tech

the rich have the high end items, with a few exceptions (birthday present minis, lucky drops, etc.)

By "the rich" you mean the ones that have always been trading and amassing huge amounts of money? Because I guess that everytime someone gets a rare mini (like the extremely lucky ones for the minibear) he almost gets his entrance ticket into the "rich" economy?

(actually I was thinking that someone, but not me, could buy a Factions collector edition that I saw a few weeks ago and sell the mini kuunavang for 100k+, but it would cost him £40/$80)

Quote:

No casual player could ever hope to touch these items unless they go and buy some gold from a website. Unless, they work for the sole purpose of getting that one item, and then they will be broke again.

Yeah, I know what you mean. But still it is perfectly possible to get tons of things that are not "high end" (I never farmed and bought a lot of minis, 1 or 2 greens and a few other things; so I guess that when I'll start farming, I;ll be able to get more), which may be equivalent to getting one that is "high end".

Quote:

I'd say its more like real life, where the gap between the rich and the poor just gets worse and worse as time goes on.

Yes very probably, but it's no so important because contrarily to the real-life, one can enjoy GW a lot while being in the "normal" (I would only call the "poors" the people that start and play with very limited knowledge about GW for a long while). Furthermore, anyone could possibly find a great item tomorrow in a chest or even that extra-uber-rare item that no one knew dropped? (honestly, I was thinking of the months I've spent without really knowing the stuff about GW, and I may have merch'd a few very nice golds ...)

Quote:

bout to get off work might not post again till monday

Have a nice day (or welcome back

)!

Fril Estelin · Jan 04, 2008, 09:11 PM // 21:11

I'm sometimes amazed at the amount of trading on GWG. And I know there's the auction website in addition to the Ventari subforum. May be I should have put my thread in the Ventari? Or shall I pay 50g for the traders to come and participate?

W T B thread participants with perfect mods

W T S gold thread 15^50 20/20 s/b 100k

CHannum · Jan 04, 2008, 10:30 PM // 22:30

Quote:

Originally Posted by Fried Tech

Usually this is detrimental to the in game economy because these are high value trades. The money is going from one, now "rich" person, straight to another rich person. Not getting filtered down to the average player. And loot scaling made the problem worse, because the rich are still rich and the poor have a harder time making money.

I dont' really see how it matters in GW. Max armor and weapons is a matter of simply playing a few weeks at most, even for a casual player. Whatever runes and mods you might want will be available in a few more weeks of beer and pretzels level gaming. After that, you're just chasing cosmetics, which will only ever matter enough to drive "an economy" for a small percentage of players. The economy is dead not so much because of anything ruining it, but because it never really existed. You don't need anything that money, real or virtual, is going to buy beyond what you achieve relatively easily in game. Nothing would stop the GW economy from failing because there's nothing to sustain it by design.

If you want a real economy you have to actually have something to sustain it. A game like WoW maintains its economy through utra rare items that actually affect the game and simultaneously includes constant money drains (repairs, respecs, crafting materials that require either lots of alt playing or purchase from other PCs) so that you don't accumulate stupid resources easily. It also has one thing GW actually fails majorly on: bragging rights - everybody can see your equipped gear in all it's gloriously enchanted detail. Compare that to something like GW which only allows other players to see your armor at low detail and your minis. No matter how cool your weapon skins and mods are, you and maybe a handful of friends are the only ones who will ever know just how "cool" the toon really is

strat_53711 · Jan 04, 2008, 10:42 PM // 22:42

IMHO, the Guild Wars economy evolved into a multi classed economy.

Old money players, player who played the game early, collected items that currently no longer drop, took advantage of profitable farming areas, sold high demand material items during increasing growth phases of the world (release of Faction, Nightfall, EotN).

Luck players, player who received a uber rare drop, knew its value, and sold it for the highest price.

Newer players, players just starting out with minimal resources. Are subjected to the world were elite weapon drops rarely occur. Farm less productive areas, sell lower demand material items during declining growth or the world (people are bored and are leaving the game)

It's not a class system where rich and poor don't interact. The game has been set where a 1,000,000 gold outfitted character has no in game advantage than a character who spends 20,000 gold on equivalent stats cheap armor and weapons. Its more like a status "look at my bling bling" thing.

strat_53711 · Jan 04, 2008, 10:44 PM // 22:44

Quote:

Originally Posted by CHannum

I dont' really see how it matters in GW. Max armor and weapons is a matter of simply playing a few weeks at most, even for a casual player. Whatever runes and mods you might want will be available in a few more weeks of beer and pretzels level gaming. After that, you're just chasing cosmetics, which will only ever matter enough to drive "an economy" for a small percentage of players. The economy is dead not so much because of anything ruining it, but because it never really existed. You don't need anything that money, real or virtual, is going to buy beyond what you achieve relatively easily in game. Nothing would stop the GW economy from failing because there's nothing to sustain it by design.

If you want a real economy you have to actually have something to sustain it. A game like WoW maintains its economy through utra rare items that actually affect the game and simultaneously includes constant money drains (repairs, respecs, crafting materials that require either lots of alt playing or purchase from other PCs) so that you don't accumulate stupid resources easily. It also has one thing GW actually fails majorly on: bragging rights - everybody can see your equipped gear in all it's gloriously enchanted detail. Compare that to something like GW which only allows other players to see your armor at low detail and your minis. No matter how cool your weapon skins and mods are, you and maybe a handful of friends are the only ones who will ever know just how "cool" the toon really is

Well said!!!

Bryant Again · Jan 04, 2008, 11:37 PM // 23:37

Quote:

Originally Posted by CHannum

I dont' really see how it matters in GW. Max armor and weapons is a matter of simply playing a few weeks at most, even for a casual player. Whatever runes and mods you might want will be available in a few more weeks of beer and pretzels level gaming. After that, you're just chasing cosmetics, which will only ever matter enough to drive "an economy" for a small percentage of players. The economy is dead not so much because of anything ruining it, but because it never really existed. You don't need anything that money, real or virtual, is going to buy beyond what you achieve relatively easily in game. Nothing would stop the GW economy from failing because there's nothing to sustain it by design.

If you want a real economy you have to actually have something to sustain it. A game like WoW maintains its economy through utra rare items that actually affect the game and simultaneously includes constant money drains (repairs, respecs, crafting materials that require either lots of alt playing or purchase from other PCs) so that you don't accumulate stupid resources easily. It also has one thing GW actually fails majorly on: bragging rights - everybody can see your equipped gear in all it's gloriously enchanted detail. Compare that to something like GW which only allows other players to see your armor at low detail and your minis. No matter how cool your weapon skins and mods are, you and maybe a handful of friends are the only ones who will ever know just how "cool" the toon really is

Very well said.

In Guild Wars, the most you'll get from 10000000k is a mini-pet that doesn't do anything besides walk around and look angry from time to time. You could use more K to buy more skills, but why buy gold when you can just buy the skill unlock packs? The only thing that gives you an "edge", per se, are the consumables. But if you need consumables, then you suck. If you suck, you ain't gonna get for.

Nonetheless, there's very little in Guild Wars that you need to buy with money. It's really why I could care less about bots, farming, gold sellers, etc.: It's all about dressing up your Barbie Doll. And if you wanna spend shit loads on it, then go right ahead, sir.

It's quite different with WoW. With a large amount of cash, you can get enough materials to craft weapons and armor that give you an edge in both PvE and PvP. Fortunately, a few items have a material requirement that can only be found in high-end dungeons. However, this still doesn't make up for the fact that the person doesn't have to even try for his gear and materials.

Basically, WoW has a lot of things that are actually worth buying. But I do believe that it's the overall popularity of the game that will give it a lot of gold sellers and eBaying.

(Now that I'm thinking about it, I wonder how much money I can make off of my own account?...)

pygar · Jan 05, 2008, 12:01 AM // 00:01

Second Life has the right idea when it comes to online economy. They have a built in money system that was meant to be there as part of the game from the start, and dont have to ban ppl for trading out of game or duping, you just put in ur CC# or paypal info in ur account info and buy what u like( and nobody even tries to make you feel dirty about it). GW should just follow suit with their online store somehow.The system set the way it is pretty much encourages people to hit 3rd party sites for gold and good stuff (or to run them and make cash)....and the ones that don' go 3rd party are so stressed out about the in-game economy it is not even funny. (or fun to be around)

pygar · Jan 05, 2008, 12:18 AM // 00:18

Quote:

Originally Posted by Fril Estelin

So you'd say Fried Tech that there are basically two economies, one between the rich ("high end") and the other one ("normal")? And they rarely communicate? But then it means that it would pretty to spot, so does this mean that there're money laundering techniques like in the real world?

No, but people do hoard stuff which drives up prices and this creates waht we would call "cornering the market" in RL. Things like Ecto are naturally going to be pricey because of demand as craft materials, but the fact that people use ectos as secondary currency drives the price up all that much more.(the traders price is based on supply and demand, but people never sell ecto back to the traders, so it never goes down) Another market cornering concept in GW is if you have a perfect stormbow say, and you want to sell it for 100K + whatever......there arent many people who have that kind of cash, except you know who....and if they dont like your price on your weapon, they just wait until you've spammed yourself blue with no result and then come in and try to lowball you.

An important thing to understand in the current GW economy is while people may talk about "values" of items, the only thing that is really worth one platinum, is one platinum- the "value" of everything else is highly subjective.Back to the stormbow example, the people you are trading with when trying to get paid for an item like that hold the real cards......they have the cash which you want and need, you have a weapon that they only might want if you are lucky, since they have the cash to buy anything they do not need your item like you need their money.

maraxusofk · Jan 05, 2008, 12:56 AM // 00:56

sigh time to whip out the economic theories.

the most basic economic rule is supply and demand. in any environment, there are goods that are desired and a currency with which to trade. take guild wars for example. you have items that u want (perfect 15>50 itmes) and a currency to trade (platnum). in the early days of guild wars, the economy was perfectly healthy b/c there were lots of items people wanted (affected supply) and drops sucked (affected demand). there was a stable balance between the two. hence it was easier for a new player to recieve a relatively good stat weapon and sell it for money.

come nightfall however, that balance was drastically tipped. b/c inscriptions meant that perfect itmes to be used would be MUCH more commonplace as people could simply obtain the mod and put it on the weapon of their choice, rather than have to look for a particular skin, then wait a while to find a seller with that certain mod, the supply of things people wanted went down greatly. greens were equally affected b/c stats were no longer the main factor in purchasing a weapon, so the perfect stats inherent in a geen became less of a incentive for buying said green. on the same note, the drops for special skins, such as colossal scimitar in its early days, that people wanted remained bad, so the demand for rare items remained high. however, such items dropped at a MUCH lower ratio than high req but good stat weapon or greens, but those weapons were also the main methods for people who had a low-mid supply of cash to make money, so those people lost out and could not earn as much as they used to. with less items that could actually be sold to earn money, the low-middle class cannot earn as much, cannot purchase as much, and will drive a floundering economy.

when theres a decrease in the supply of goods that people want to purchase, currency value goes up (inflation). hence ultra desirable goods such as rare minipets, req 7, and tyrian crystallines go up in terms of price. their rarity didnt change, but people with money have nothing else they want to buy, so they would be willing to pay for more for what they do want.

on the same note, a constant influx in new goods affects supply, so more new items would affect the economy by driving demand for them up. if those goods are too rare or too common, however, said goods will affect a small crowd as the item will either be not desirable or impossible to acquire, such as the hybrid vs ferrari.

wow has a stable economy b/c money cannot buy the most desirable items (those must be dropped) what money is used for is common goods that are a necessity, such as constant repairs on items and materials for things as common as a quest.

hahaha i might be forgetting 1 or 2 factors but hey, im only 18 and this is a pretty good analysis for someone of my age.

pygar · Jan 05, 2008, 01:03 AM // 01:03

@ maraxusofk

18 eh? That is a pretty good description of the economic "big picture" in GW right now.

GG

maraxusofk · Jan 05, 2008, 01:23 AM // 01:23

thks pygar

anyway at this point in the game nobody needs anything anymore so the benefits of new items will be ephemeral at best. but at least itll help somewhat.

**cosyfiep** · Jan 05, 2008, 01:32 AM // 01:32

sigh doesnt seem the causal player (even though some of us have been here for more than 2 years) fits into the above list from strat_53711.
Many of us have just enough money to get skills, a set of decent armor and that's about it...none of the ultra rare crapp--and for many of us it doesnt matter. We have a good weapon, so the skin isnt rare, it does the same job as the rare one (if they have the same mods etc).....so the economy doesnt mean much to us....15k armor costs.....15k. some of the costs of materials may change over time, though most dont fluctuate enough to worry about (and I am not talking about fow armor, its the ughhhhlist armor in game). Greens drop and with the free treasures in nightfall we might actually get a nice gold weapon in our lifetime. Many of us sell only to the merchant since he seems to buy almost everything we have in our inventory (or the material guys). So this economy that everyone talks about, well let the super uber rich people fight over some dumb sword....mine works just as well and only cost me....killing off a mob or two!