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Role Playing (Games) Entertainment Games

When Play Money Becomes Real 35

Thanks to Wired News for its article analyzing the commercial potential of the trade in MMO virtual items, focusing on Internet Gaming Entertainment (IGE), of which CEO Brock Pierce claims "has more than 100 full-time employees in Hong Kong and the United States... [and] is hiring about five new people a week." Pierce also makes claims that: "In this industry, it's eBay and us... we're the major players", and elsewhere, a Sony Online spokesperson "is aware of IGE and has spoken with the company" with regard to their EverQuest item sales, concluding: "At this point, we're still sort of trying to decide what direction the company's going to move in on this topic." We've previously covered the financial dealings of IGE.
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When Play Money Becomes Real

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  • or maybe a few days back. I have no idea if the two are related, I can't remember any of the guest names. But for us online gamers, this is pretty familiar to us... I play UO, and items there have been sold for real world cash for a long time.
    • I play Final Fantasy XI, and so far I have yet to see any real advantage to spending cash money to buy gil or other items in the game. To my understanding, the game's economies are structured to not take this sort of thing into account. Besides, in FFXI, gil is abundant if you just work a little for it (selling crystals, farming items at the AH, heck, even making some good deals at the AH/Bazaar).

      I'm not saying people shouldn't be allowed to do it-- hey, it's their money-- but to me, at least, it defeats the purpose of playing the game. "I spent $500 on the best sword evar and now I'm a L1 Warrior with the Atma Weapon +5", which he can't use until level 70 anyway. It's far more impressive to either a) kill the monster guarding the sword or b) save up enough gil to buy it from another player. Either way, someone gets the fun intended-- and maybe you do too; maybe you like fishing better than fighting, and sell your catches at the AH for ungodly sums. That works too.

      The point of all this rambling is that in older games, like UO (which I did play for about a week before I realized it was populated mostly by elitists who'd sooner give me a quick and messy death than the time of day), money was hard to come by and the methods for getting it were somewhat tedious. In newer games there are plenty of occupations that can earn a player money, and they're very diverse. Thus, buying money outside the game in these games could be seen as cheating by those who spend a weekend building up their skills in the hopes of becoming the next virtual millionaire.

      Oh yeah, and this of course ignores the subset of MMO games where a primary way to get money is to buy it from the developers. Gunbound [gunbound.net] comes to mind as a big example.
      • by Austerity Empowers ( 669817 ) on Thursday April 08, 2004 @10:18AM (#8803783)
        I played FFXI for just the free trial month, and given the level limits etc. I guess I tend to agree that there isn't much value in auctioned money etc.

        In EverQuest however most of the "old world" items have no level limits, so you can give your level 1 character what was, in the old days, the absolute best gear. Thus buying plat online is of great value. HOWEVER, you never get THE BEST. The BEST items currently are in the "Plane of Time" (ignoring recent expansion which I don't understand), and you have to play seriously just to get in there, or eBay a character that can.

        Buying plat has ups and downs. The upside is that if you are a working stiff with a wife and kids, you can get your character decent enough equipment such that you can be useful to other people playing the game. Without such equipment many people will snob you out of their groups/raids/guilds/etc. I see it happen every day " can't tank for shit, her AC is 1000 and she can't hold agro", so they find someone else or make do with other strategies.

        The downside is that buying plat makes this elitism problem WORSE because in some peoples minds there is no excuse for not having 1400 AC by level 52. Sucky equipment? Give yantis some money, he'll give you some plat. Secondly, the flood of plat coming in to the game drives prices sky high. Decent items right now sell for 100ks worth of platinum (100k plat is about $70 US). If you play legit, and do not buy plat online, that amount of money is essentially unattainable without spending a lot of time doing very boring things. Finally, I'm not sure how IGE gets the plat, but I can't help but shake the belief that Sony isn't getting a peice of the action, and that makes me mad.

        This is the online equivalent of the mary sue problem, except that since EQ is largely a strategy/combat based game, if you're NOT a mary sue you are at a disadvantage.

        • This is kind of the problems with these games. If I'm spending money just to play, I want it to be fun and worth playing even at the lowers levels. Sure, you can't do the same stuff the higher level people would, but there's no reason newbies shouldn't be able to enjoy the game until they level their characters up to a sufficient point.
      • Its a matter of time. I enjoy playing MMOs, but I have a job and other interests. I don't want to spend 30 hours farming for cash. So I occasionally buy a bit, so I can do the things in game I do enjoy.

        Really, at the base of it, its a flaw in the game. I shouldn't HAVE to put dozens or hundreds of hours into something boring and repetative in order to get what I need to do something fun. Time sinks like that only because the devs weren't able to add enough real content to the game.
    • by b0r0din ( 304712 ) on Thursday April 08, 2004 @08:17AM (#8802518)
      Yeah I heard that. It was on yesterday afternoon. Really interesting to hear people talk about the games they play, they had some President from the Sims Online as well as some people who called in who played DaOC and stuff. Nice to see there is at least a little media attention being paid to it.

      I think it's an acceptable practice to sell the items you work for. You do work for them, even if you don't realize it. There is a lot of time spent gathering items in a virtual world, and while it may be entertainment, there's nothing that says you can't enjoy being paid for those hundreds of hours you spent playing EQ or whatnot.

      One thing NPR brought up, and it's a good point, is about how this will all play out, the buying and selling of virtual items, and how it has an effect on content control. They talked about media censorship in a game environment such as the Sims Online, so you've not only got economies being created virtually, you've got the idea of control developing. Who controls the items you obtain online? Who controls what you can say online? My guess would be that a self-regulated body controlled by a corporation has the right to censor any material, but who owns game-earned content?

      Also, does this currency truly require its own place among currency tables? Probably not, because the games don't last long enough, they aren't stable currency. And it's doubtful there will ever be a currency transferrable between other economies. Maybe two companies could collaborate and use the same currency and have methods to transfer that currency. When we start seeing environments like this, that's when it'll really start to get interesting.
    • I thought I had read an article in Wired about this topic. Edward Castronova (an associate professor of economics at California State University at Fullerton) wrote a study about online economics and its possible effects.

      Wired Article [wired.com]

      The biggest issue of debate was wether or not the ability to get real money off of assets from these games could possibly grant your avatar certain Government protected rights. Silly, I know but what if you made your living off of online brothels and then your character g
  • Taxes... (Score:3, Funny)

    by lynx_user_abroad ( 323975 ) on Thursday April 08, 2004 @07:47AM (#8802282) Homepage Journal
    One wonders how long it will be before game players are required to claim online income (or allowed to claim on-line losses) on their taxes.

    I for one wouldn't want to have to cough up 6.5% VAT when I sell my +5 Vorpal. (But I'd rather do that than try to explain how I came into posession of it in the first place...)

    • Re:Taxes... (Score:5, Insightful)

      by shadowcabbit ( 466253 ) <<ten.enoyrrufeht> <ta> <xc>> on Thursday April 08, 2004 @08:05AM (#8802421) Journal
      This doesn't really seem to apply since you're not using actual real-world currency. I'm not an accountant or tax lawyer, but I don't think a government can tax trade not being done in its native currency (i.e. the U.S. can't charge tax at time of sale if I were to go to Toronto and buy a bottle of soda; on larger purchases, like a computer, they might be able to at the border/Customs, but I'm not sure).
      • I'm not an accountant or tax lawyer, but I don't think a government can tax trade not being done in its native currency

        A government can tax any transfer of goods that it desires, even if the exchange involves only goods rather than actual currency.

        For example, the LETS system does not directly use a currency but is still taxable [u-net.com]. (Of course, I wouldn't recommend its implementation - it assumes the local area is a zero-sum economy, which doesn't work when it relies on importing supplies. The villages in

      • I was quite supprised this year to see a section on my California state taxes for items purchased outside the state.
      • This doesn't really seem to apply since you're not using actual real-world currency.

        It's called bartering. Contrary to popular belief, it's taxed.

        As for foreign trade, why wouldn't you have to pay duties or whatever? You would in real life.

    • Re:Taxes... (Score:3, Interesting)

      by b0r0din ( 304712 )
      The tax system is pretty much a joke [slashdot.org] anyway. If you want to read a good book about how bad our tax system is, I highly recommend a book called Perfectly Legal. It basically points out how bad it's really gotten. I doubt the IRS is going to audit your EQ account, let alone audit you. They pretty much can't afford to audit most people anymore. Which is probably one reason we have a deficit.
      • Re:Taxes... (Score:2, Interesting)

        I doubt the IRS is going to audit your EQ account

        That's the point I was slyly trying to make. If a person ever got to the point where they were making enough money off of EverQuest trading to actually pay the bills, the IRS would want to tax that as income.

        But doesn't that mean that if I dump a load of money into trying to build an on-line EverQuest venture which can produce enough money to live on, I can claim those expenses <losses> as a tax deduction?

        I'm pretty sure I can claim those losses f

  • There's no problem with me when it comes to people trying to find a new way to make money. However, this really cheapens the game, competing against a company who's not out to have fun. That just puts a damper on things.

    The MMORPG developers just need to close this loophole by stopping games from becoming a clickfest and to quit allowing characters to become near immortal. In fact, it might be an option to add some penalties for death. Regardless, it's up to the developers to make a game actually require s
    • Umm, every MMO has deth penalties. The current trend in North American MMOs (not asians) is to reduce the death penalty because its annoying, and just not fun. It tends to be the #1 gameplay related complaint of MMO players.
  • ... just a couple days ago. (Our previous high sale was $800 for someone not quite in the top 10.) I think that's probably a record for a game without fancy 3D graphics. I should spend less time coding and more time playing. :)

    (And then there's the players who think any mixing of RL with the game world is grounds for lynching. Heh.)
  • by mkraft ( 200694 ) on Thursday April 08, 2004 @08:33AM (#8802638)
    Online trading/selling of items has been occuring since the first account was sold on Ebay [ea.com] (Ultima Online) up to the formation of the Open Gaming Market [gamingopenmarket.com] (a currency exchange place for online game currency).

    There have been people who have quit their normal jobs and took the "job" of play Diablo to make money [infoceptor.com]. There's even been a court case for return of stolen in-game items [securitynewsportal.com].

    It is a crazy world where currency in online games actually have more worth than the currency of some countries [msn.com]. I've personally sold virtual items for real life cash and I think people are crazy for paying what they do for these things, but then again I also can't understand why people pay large amounts of money for junk on E-Bay. I guess what they say is true, "one man's trash is another man's treasure", whether the trash is virtual or real. The online market just makes it easier to get those two people together.
    • Most games should support places like the Gaming Open Market. The website lets the buyers and sellers set their prices, or accept an existing posted transaction, much like a commodity market.

      The problem I see with all the games that don't support a place like GOM is that keeping currency exchange against the rules, just makes it so that the cheaters win, while those who stick to the rules lose.

      I spend most of my time in Second Life these days, and basically GOM makes it so that you can get paid RL money f
    • by JavaLord ( 680960 ) on Thursday April 08, 2004 @09:54AM (#8803509) Journal
      I've personally sold virtual items for real life cash and I think people are crazy for paying what they do for these things

      why not? Say for example you have someone that has a Jedi Account in SWG that took them 200 hours of gameplay to get. (I'm just making these figures up...) if I turn around and buy that account from them for $400 I'm buying their time in place of taking my own time to grind stuff out. And at about $2 and hour, it's a steal. For someone who is a casual gamer because they work long hours, buying an account may be the best way to go.

      The only problem with buying and selling anything that exists in a virtual world is that the economies aren't well regulated. One bad patch, bug or hack could screw up the economy pretty badly. Take the above example. Say you buy the Jedi account for $400. Then a week later a patch comes out making it easier to become a Jedi. Now people can do it easly in 30 hours....You just got screwed hardcore.
      • It all comes down to people having more money than you could realize, and they can't really take it with them when they die. When people can making upwards of $5,000 a day, they become shrewd in the fact that it would take them 7 days of playtime to obtain an item worth $400. It just doesn't make sense to them, and as people approach middle age, they still want to feel as they accomplished something in game and they can do that through thier 'real world power'. It may sound crappy and might ruin the game fo
      • why not? Say for example you have someone that has a Jedi Account in SWG that took them 200 hours of gameplay to get. (I'm just making these figures up...) if I turn around and buy that account from them for $400 I'm buying their time in place of taking my own time to grind stuff out.

        I thought the entire point of playing a game was to have fun actually playing it. If you think that an integral part of a game is a waste of time, then why are you playing it?

        Rob
        • Because it isn't an integral part. Or shouldn't be. Being able to buy an account and skip the leveling is like being able to fast forward through the boring parts in a movie. You get to just do the parts you like, and avoid the things put in just as time sinks.
    • by Anonymous Coward on Thursday April 08, 2004 @10:52AM (#8804193)
      Online trading/selling of items predates Ultima Online by quite a bit.

      I remember playing a MUD around 1994-ish.

      The administrators would sell "uber" items (you'd just send them a check) and when players got tired of their characters they would try to auction them off to others.

      I'm sure this sort of thing was done on BBS door games and the like as well, so finding the "first" would probably take a while.
  • by Jetifi ( 188285 ) on Thursday April 08, 2004 @11:50AM (#8804891) Homepage

    This was brought up on a K5 article by Rusty at some point, think about it:

    1. Buy goods and/or currency with dirty money
    2. Once in the game, give the goods and/or currency to your 'clean' character, OR do this through a coupla layers of intermediaries or sock puppets.
    3. Sell the goods at a place like this for clean money.

    The only problem is that your ''dirty'' money has to be in a bank account to start with. Normally it's in cash, unless you have a serious sum that needs washing, in which case you'd risk distorting the online markets you washed your money through.

    <disclaimer>I haven't tried this myself, and I don't suggest other people do either. But if anyone does, let me know how it goes :-)</disclaimer>

  • by gringo_john ( 680811 ) on Thursday April 08, 2004 @01:12PM (#8805935) Journal
    Though I haven't played any of the big MMOG games like Everquest or Ultima Online. I wonder if this whole notion of selling virtual items for real world money can be converted to a real business.

    First, you would have to determine if play time online can be quantified into an exact amount of real world money. Does playing 10 hours of Everquest yield enough virtual loot to justify paying someone 10 hours of game playing wages and have profit remaining?

    If so, what about the notion of creating an offshore gaming "sweatshop" where you would pay 100s of *children* to play Everquest and then selling their online loot? Does having a group of 100s of online players focusing together cooperatively increase the yield of loot? If so, you could have supervisors/strategists who could coordinate the gaming efforts just so that the profits increase...

  • With a rather limited storage system, Sega's PHANTASY STAR ONLINE does it right. Veteran players don't benefit from keeping all the shzit they amass; healing items are cheap, but the best items can not be bought, they are obtained by defeating enemies, so money is worth little.

    What to do? They just give their shzit away to the n00bs. This way, players concentrate on the fun part of the game: killing monsters - which PSO also did better than any other online RPG.

    Game economics? Screw it! Do you play to amm
  • by newsdee ( 629448 ) on Friday April 09, 2004 @09:06AM (#8814837) Homepage Journal
    I've played some games in Asian servers (e.g. Lineage II) and I made a few local friends who explained me several 'social dynamics' of the game.

    The most noteworthy thing was that there were these clans of players who completely monopolized a dungeon or a given area (to get all the respawns monsters). And it was weird because usually clans left room for other people. I asked my virtual friends about it and they told me those were Chinese gangs, out there to make real money by reselling their items/characters on auction sites.

    A lot of people were complaining because they couldn't get to the "good" monsters - if you tried to get too close you got PK'ed by one of them on sight.

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