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Role Playing (Games) The Almighty Buck Entertainment Games

Economics of Online Gaming 285

PGillingwater writes "The Walrus has a nice article up about the economics of on-line gaming communities. Starting with the original 2001 paper which shows that Everquest has a GNP greater than India, Bulgaria and China, and going on to the billionaires of Ultima Online and the Mafia takeover of The Sims. "He began calculating frantically. He gathered data on 616 auctions, observing how much each item sold for in U.S. dollars. When he averaged the results, he was stunned to discover that the EverQuest platinum piece was worth about one cent U.S. -- higher than the Japanese yen or the Italian lira. With that information, he could figure out how fast the EverQuest economy was growing. Since players were killing monsters or skinning bunnies every day, they were, in effect, creating wealth. Crunching more numbers, Castronova found that the average player was generating 319 platinum pieces each hour he or she was in the game -- the equivalent of $3.42 (U.S.) per hour. "That's higher than the minimum wage in most countries," he marvelled.""
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Economics of Online Gaming

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  • by moberry ( 756963 ) on Tuesday May 18, 2004 @07:22AM (#9181909)
    Think you could cut me a check?
    • by Anonymous Coward on Tuesday May 18, 2004 @07:25AM (#9181933)
      No, but we can put it in your PayPal account.
    • You laugh... (Score:5, Interesting)

      by autechre ( 121980 ) on Tuesday May 18, 2004 @07:41AM (#9182061) Homepage
      But there are sites that specialize in trading real-life dollars for in-game currency and vice-versa. I've recently started playing FFXI, and this has become a bit of a sore spot with fans, as gil (money) is in rather short supply in the game, and you need to spend a lot of it to have up-to-date equipment and be a good asset to a team (the game is weighted HEAVILY against solo play after about level 10 for all but one job class).

      Some people with the Windows version are using "bots" to mainly do two things: fishing and camping for Notorius Monsters. Fishing is pretty straightforward: you sell the fish. Notorius Monsters are one-of-a-kind monsters that only appear sometimes, and often drop excellent items (Leaping Boots go for at least 250,000 gil at the auction house). Even without bots, players would have to "camp" these monsters for hours for the possibility of getting the item. But now they have even less of a chance, as people grab these items, sell them for gil, and sell the gil for dollars.

      • Re:You laugh... (Score:3, Interesting)

        by chrish ( 4714 )
        Gee that sounds like fabulous fun, so totally worth paying $15 US per month to fish and camp monster spawns.

        These games have certainly come a long way from, say, Rogue, haven't they? That innovation of paying $15/month is brilliant.

        No wonder I don't play MMORPGs. Someone call me when there's actually a point to playing them...
  • by Anonymous Coward on Tuesday May 18, 2004 @07:22AM (#9181912)
    But it doesn't affect my economic situation at all. Should I use more lotion?
  • by AtariAmarok ( 451306 ) on Tuesday May 18, 2004 @07:23AM (#9181916)
    " that Everquest has a GNP greater than India, Bulgaria and China"

    Has there been any outsourcing to Everquest yet?

    • Re:Outsourcing. (Score:4, Informative)

      by GodHead ( 101109 ) on Tuesday May 18, 2004 @07:36AM (#9182019) Homepage
      You joke, but yes.

      Several companies hire people in low-wage countries like mexico and have them produce EQ platnium. This in-game money is sold for real money on auction sites.

      • Comment removed based on user account deletion
        • Re:Outsourcing. (Score:5, Informative)

          by Phekko ( 619272 ) on Tuesday May 18, 2004 @07:52AM (#9182151)
          Just in case you're even remotely serious: It takes a few months of serious gaming before you get to the point where you can earn several hundred platinum in an hour. I should know, I was hooked on the game for like 5 months. So before you get to earning it will cost you the monthly fee and a lot of time. If you'd play anyway is another story, but I can imagine a few more lucrative businesses than playing EverCrack
          • not to say you don't know what you're talking about or anything, but I'm wondering if it would really take that long if it was your job to play and you could and in fact, had to play with a guaranteed group of ~10 people for 12 hours a day or more.

            I'll bet not having to search for a party and playing for at least 72 hours a week would speed up the process.

            this is all assuming that the grandparent wasn't full of shit, of course.

            • Yes, it most definitely would speed things up. I powerleveled a friend to level 13 or 14 in a relatively short time. The problem is that it gets slower as you progress. But at a guess you can progress quite fast with a lot of help, yes, but I don't think there's any way of not wasting at least a few weeks on just building the character and not making any money. It used to be possible to make some money with secondary skills such as brewing and smithing and I don't even remember what the sewing was called. B
      • Re:Outsourcing. (Score:3, Insightful)

        by Phekko ( 619272 )
        Sounds like an urban legend to me. All their workers will be tied up clicking links [slashdot.org]
      • Re:Outsourcing. (Score:4, Insightful)

        by anpe ( 217106 ) on Tuesday May 18, 2004 @07:52AM (#9182152)
        Mind giving a link or something? How is this "Informative"?
        • Re:Outsourcing. (Score:3, Insightful)

          by Ashjam ( 715839 )
          From TFA: "A few years ago, a company called Black Snow Interactive opened up a "levelling" service for the game Dark Age of Camelot. It had a digital sweatshop in Mexico; there, ultra-low-wage workers would click away at computers, playing the characters twenty-four hours a day to level them up."
      • Several companies hire people in low-wage countries like mexico and have them produce EQ platnium. This in-game money is sold for real money on auction sites.
        Reading the article blurb, I was wondering how long that would take, but I guess we already have virtual gladiators.
      • by RLW ( 662014 ) on Tuesday May 18, 2004 @09:32AM (#9183307)
        ...we hear the Fed. Chairman Greeenspan talking about the upward pressure on inflation because of the EQIPEC (EQ Item Producing and Exporting Countries) are restricting demand and therefore driving up the value of the Platnium. Then pressing on he states that we should start 'mining' the American lunch hour reserves and use this otherwise down time to produce more domestic EQ Items.
    • by Tangurena ( 576827 ) on Tuesday May 18, 2004 @07:36AM (#9182021)
      There are quite a few characters who spend 24 hours a day at certain spots that drop above average amounts of platinum. Those teams/contractors sell their plat to IGE/Yantis who then sell it to the other players. The people playing the toons are getting paid a couple dollars per day.

      The guides in the game (who are unpaid volunteers) are starting to get replaced, along with most of the GMs (who are employees of Sony, and used to be located in San Diego and UK) with GMs working in India.

    • Well, sometimes, when talking to some companies'tech support on the phone, I do get the feeling that tech support has been outsourced to some kind of magical realm where my questions are answered by weird dwarves, fairies and dragons who will only help me if I say the right magical words and will vow to slay the evil CEOrceror :)
  • Creating Wealth (Score:5, Insightful)

    by ajakk ( 29927 ) on Tuesday May 18, 2004 @07:27AM (#9181952) Homepage
    <inflation impaired> If each platinum piece on Everquest == 1 cent real life, then the programmers should create 1,000,000,000,000 platinum pieces in the game and give it to themselves. Then they would be rich!!! </inflation impaired>

    • That and the worth would be constantly fluctuating... like other currency, actually. Now, I only wish that I could actually read the article...
    • Re:Creating Wealth (Score:5, Interesting)

      by Shalda ( 560388 ) on Tuesday May 18, 2004 @08:25AM (#9182559) Homepage Journal
      This takes me back to the heyday of Magic: the Gathering. Comic book and gaming store owners discovered they could make more money on cards by opening the booster packs and selling the cards individually. The less scrupulous owners would put the less desireable rares back in the packs and reseal them. However, eventually, supply caught up with demand and only out of print cards (Black Lotus, Ancestral Recall) were still selling at a premium. And while kids still play, the market for cards is not nearly what it once was.

      My point in telling this little parable is that the economics of online gamming are very dependant on the sustained interest level in the game. A small drop in people playing the game could cause staggering changes in exchange rates between Everquest and Real Life. As well as the fact that in order to maintain the economy as it stands, Sony has to either force users to purchase large amounts of consumables or create ever more powerful and expensive items for people to invest in. Stay tuned for my next segment where I discuss the pros and cons of Guns vs. Butter.
      • Hey! (Score:3, Informative)

        by pjt33 ( 739471 )

        And while kids still play, the market for cards is not nearly what it once was.

        Who you calling a kid?

        I didn't play M:tG back in the days of the Power Nine, but I estimate it's still the case that you can make more by selling the cards individually - most sets have one or two rares which sell for four times the cost of a booster, and the last couple have uncommons which sell for twice the cost of a booster. Sell the commons in chunks of 100 cards on E-bay, and you've probably got a viable business model. (I

  • by WordODD ( 706788 ) on Tuesday May 18, 2004 @07:28AM (#9181960)
    Just what the EverCrackHeads need, another reason to stay glued to the computer. While I have never played the game myself, other then for a few minutes just to see what it was all about, I have had friends literally stay in the house for weeks so they could play the game. It is amazing what a hold it can have over some people. My friend honestly did not want to stop playing because he feared he would miss out on something going on within his "clan". How ironic that he missed out on so much that happened in the real world with his "friends" and "family".
    • So true. The amount of time involved to create this so called wealth surely makes it a classic case of false economy.
      • by Impy the Impiuos Imp ( 442658 ) on Tuesday May 18, 2004 @08:54AM (#9182872) Journal
        Actually, it's an excellent example of truly free market economies.

        Look at all the hours people are willing to put in to gain advantage. No "government" there stealing it's mafia-like cut. No "voting" to take some of your wealth and give it to people who don't wanna work as hard, or to some doofus who can't figure out the interface controls. No "minimum wage law" that tells the monsters to drop a lot more cash OR ELSE!

        • And, for those of you in Europe (and thank god the US hasn't fallen this far, yet...) no laws restricting your "working" hours to 37.5 or 35 or some such per week. You wanna buy that 100k supersword, "work" 80 hours per week if you wanna. No politician riding to the "rescue, for your own good."
          • by tiled_rainbows ( 686195 ) on Tuesday May 18, 2004 @12:02PM (#9185189) Homepage Journal
            Actually, there's nothing in European Law that forces you to work less than 35 hours a week or whatever. The law only states that your employers cannot stipulate that you do, as part of your contract. Meaning that if your boss asks you to work overtime, you have the choice between working the overtime and giving him the finger.

            Now, I guess the standard Libertarian response to this would be "That's exactly the choice you have in a free market: either work the overtime or take a different job with a better boss".
            Which is fine in theory, but when there aren't that many jobs about, and the bosses know it, and they all take advantage of the fact, what kind of a choice are you, the average worker, going to have?

            While I sympathise with the Libertarian position as far as I don't think the gub'mint should be poking its nose in where it's not necessary, a few laws protecting the individual from the rapacious greed of their employers doesn't seem like such a bad thing.
        • Don't you have to pay monthly fees for server upkeep and other infrastructure costs? That could be perceived as a tax. Granted, it is flat and regressive, but it's still a tax. I guess it could be perceived as a tax for existing in the system.

          And the idea that poor people don't want to work hard ignores the fact that quite a few working poor bust their asses at two jobs just to get by at the minimum wage, which has lost its meaning when it can't support someone working full time in most parts of the country

    • There's been tragedy [slashdot.org] with EverCrackHeads forgetting about real life.
    • by ajs ( 35943 ) <[ajs] [at] [ajs.com]> on Tuesday May 18, 2004 @09:10AM (#9183042) Homepage Journal
      While I have never played the game myself, other then for a few minutes just to see what it was all about, I have had friends literally stay in the house for weeks so they could play the game. It is amazing what a hold it can have over some people.

      Let's turn that around to something a bit more apropos of Slashdot....

      While I have never had sex myself, other than a few minutes looking at a magazine just to see what it was all about, I have had friends literally stay in the house for weeks so they could play with each other. It is amazing what a hold it can have over some people.

      Ok, so you get the rather obvious point, here. Folks get involved in activities or communities and become engrosed. This is human nature. EverQuest is NOT a video game (a fact which Sony continues to this day to fail to understand). EverQuest is a community, much like Slashdot or the local coffee house. Just as people enjoy those activities and get more involved, they do so with EQ.

      When I was a teenager I spent weeks in my room working on a rubick's cube.... which is worse, that or chatting with an old friend from college while whacking on an evil dragon?

      At least there's some social contact in the EQ option, which is more than many people in my field get on a regular basis.
      • by Anonymous Coward
        Dead on. People just can't *understand* how one could enjoy being social online. In some cases it's quite helpful for those who could never be social in today's society.

        This is no different than playing a sport, drinking, drugs, being a hooker, watching movies, etc. It's a way to *waste* time. Now some people do have excessive compulsive disorder and they need to control their time but they would probably have the same problem with any other activity they did.
  • Too much time... (Score:5, Insightful)

    by leandrod ( 17766 ) <l.dutras@org> on Tuesday May 18, 2004 @07:28AM (#9181961) Homepage Journal
    >
    Perhaps I am taking this too seriously, but some people sure do have too much time in their hands.

    The article fails to take into account that those EQ platinums aren't conversible. Meaning, you can auction them off in eBay, but only a minority will ever be. If they were a real currency, not necessarily the US dollar, then they would be convertible and these measurements and comparisions would make sense.

    In that case, the value of the EQ platinum as a commodity would be much, much lower.

    • by Little Hamster ( 586231 ) on Tuesday May 18, 2004 @07:35AM (#9182015)
      > The article fails to take into account that those EQ platinums aren't conversible. Meaning, you can auction them off in eBay, but only a minority will ever be.

      How is that not conversible? How many people holding the US dollar or the Japanese yen are selling their money on the foreign currency market?

      >If they were a real currency, not necessarily the US dollar, then they would be convertible and these measurements and comparisions would make sense.

      The exchange rate depends on the supply and demand of a currency, not on some arbitrary conversion factor (well unless you are talking about non-floating currency such as China's RMB). If there are a lot of a particular currency on the market (eg if some big finicial inventment company decides to sell due to falling interest rates), its price will fall against other currencies in the market.

      • Re:Too much time... (Score:2, Interesting)

        by leandrod ( 17766 )
        >
        How is that not conversible?

        Try to buy any other currency or commodity with it. You can't. The only way is first selling it.

        >
        unless you are talking about non-floating currency such as China's RMB

        Conversibility is a non-intuitive Economics concept. China's RMB is exactly a non-convertible currency: you have to go to a currency board set by China's government to be able to exchange it.

        • > How is that not conversible?
          Try to buy any other currency or commodity with it. You can't. The only way is first selling it.

          I fail to see the distinction you're making between "converting" currency and "selling" it. The way I see it, they're the same thing. Yeah, you can't walk into the tourist currency exchange and swap USD for EQP, but there are other currencies that have the same problem.

          It seems from your post that you do know of a real distinction, but I don't, and I was hoping you'd share.
          • >
            you can't walk into the tourist currency exchange and swap USD for EQP, but there are other currencies that have the same problem.

            That's exactly the problem. Currency boards exist to try to keep the valuation of a currency higher than it would usually be.

            • by nuggz ( 69912 )
              You can't keep the value of currency higher than it would usually be. You also don't want it unfairly one way or the other.

              Money is an abstraction for value, it is a unit that can account for goods, services, time, quality and any other factor.

              Currencies only have relative values to each other. This is backed by the goods you can buy.
              The million platinum pieces don't have a value themself, only that of the underlying good.
    • Re:Too much time... (Score:3, Informative)

      by jafuser ( 112236 )
      If they were a real currency, not necessarily the US dollar, then they would be convertible and these measurements and comparisions would make sense.

      This site is still new, but it's basically a virtual currency "commodities" market which makes the comparision measurable...

      http://www.gamingopenmarket.com [gamingopenmarket.com]
  • by MandoSKippy ( 708601 ) on Tuesday May 18, 2004 @07:28AM (#9181964)
    I played EQ for a year and a half, averging 20 hours a week. (Quite a bit as I look back) When I "got out" I sold my character on a auction site and got 800 dollars for it! I couldn't believe it I thought that it was awesome money. Then I realized if I averaged out my time and what I got for my character, it was only like 50 cents an hour. That being said, my average was more like a "minimum" every week with some weeks being > 35 hours of game play. The other thing this study doesn't take in account for is that Sony ACTIVELY (when I played, things may have changed) fights out of game transactions, and selling in game money and items for real money. So your "PLAT" may be worth a cent each, but good luck cashing in!
    • Obviously you can't make a career out of that. ($0.50 an hour) but on the other hand, most don't get paid for their game playing at all. :)
    • This is, IMHO, the wrong way to look at it. While it's true that your time was technically worth $.50/hr., you really can't calculate how much enjoyment you got out of it and how much that was worth. It's like my buddy who will pay, on average, $4/hr. for any entertainment...be it video games, sporting events, bars, etc, because he figures that the price of a movie is ~$8/2 hrs., and that's worth it to him. Did that video game you just bought for $50 give you ~12 hours of enjoyment? Then it was worth it
      • It's pure profit until you start losing money because you are playing it too much. Or missing out on other opportunities; better job, better education, better credentials, etc.
      • True, the "fun" aspect is not included in my post. I stopped playing because of the effect it was having on my real life. I was engaged,(the game ironically paid a large portion of the engaement ring), I was graduating, I was ready to enter the real world. My wife's thoughts (and mine) were that it's hard to enter the real world and succeed if you are spending a good portion of your life in a fantasy world. The point I was trying to make is you can't make money on the game. Play a game for the enjoyment,
    • SOE has taken a much less active role in preventing off-line transactions recently. In-game they have made some steps to stop obvious abuses, but they don't spend any time or effort to actually stop folks like IGE (the largest platinum seller).

      EQ goes on. Most of what SOE has done in recent years revolves around high-end content that simply isn't tradable. You do it yourself, or you're out of luck.

      Mind you, accounts can still be sold (against the EULA, of course, but that doesn't stop people), but that ta
  • 1) Start playing these games when they first come out.

    2) Build up a bunch up high level characters and items.

    3) Sell them on ebay, or other RPG auction sites.

    4) Profit!!!
  • isnt this (Score:5, Insightful)

    by Dr.Knackerator ( 755466 ) on Tuesday May 18, 2004 @07:31AM (#9181980) Journal
    like valuing every ticket in a theatre based on the price the touts are charging outside the event?
    • Re:isnt this (Score:3, Insightful)

      by zardor ( 452852 )
      Or like valuing every house in a street based on the price of the one sold last week?
      Or the price of a stock based on the market value of the 'few' that were sold on a particular day?
      What would the houses or the shares be worth if everybody tried to sell at once?
      Most of the wealth (and growth) in a ecomony is based on the fact that only a very small few individuals want to realise the profit at the same time. The rest of us just think we are rich.

    • Re:isnt this (Score:3, Interesting)

      by awol ( 98751 )

      "isn't this like valuing every ticket in a theatre based on the price the touts are charging outside the event?"

      Er, perhaps but how is that inaccurate. If the resource is scarce, a tout's price is the true price. Indeed there is a very interesting study to be made of the prices charged for tickets to events. This is particularly true when the audience are from different identifiable groups who have very different socioeconomic means. But that is a question for another time.

      It is certainly true

  • Uh huh (Score:5, Insightful)

    by Dark Lord Seth ( 584963 ) on Tuesday May 18, 2004 @07:31AM (#9181981) Journal
    Castronova found that the average player was generating 319 platinum pieces each hour he or she was in the game -- the equivalent of $3.42 (U.S.) per hour. "That's higher than the minimum wage in most countries," he marvelled.

    Not bad, however... You do need to pay for a constant internet connection, ( EQ here, so some light form of broadband ) a PC, electricity and one EQ account. I don't think that with these constant costs substracted, EQ will be a very good job...

    • Re:Uh huh (Score:2, Interesting)

      by daniel_mcl ( 77919 )
      I know that a lot of people at school here play poker on the internet and make something like $1000 a night (real money), so it seems like Everquest is not exactly the big money here.
  • Outsourcing... (Score:5, Interesting)

    by Lostie ( 772712 ) on Tuesday May 18, 2004 @07:31AM (#9181985)
    http://www.juliandibbell.com/texts/blacksnow.html [juliandibbell.com] It's already been tried - see link above. Some enterprising guy ran a China Everquest sweatshop where the employees played Everquest all day, and whatever they collected was sold for profit.
    • American company with money opens a production facility in Tijuana. The article says the workers were "unskilled Mexican laborers," which would presume two things: 1) their time isn't worth much to begin with (unskilled), and 2) they are "laborers," so they are going to be earning a wage somewhere (hopefully), regardless. If they were school-aged children, that would be another matter, but the article doesn't say that.

      If the rates they were paid were too low compared to what other companies in Tijuana were
  • Would someone care to give us non-gamers an overview of Everquest so I can understand the article more. Thus far, it sounds like an RPG like the Sims but with broadswords?

    Please don't mod this down until someone responds with a good description of Everquest.
    • by Lodragandraoidh ( 639696 ) on Tuesday May 18, 2004 @08:02AM (#9182276) Journal
      Its all about leveling your character(s). It is really one giant level treadmill (think of a hamster in a cage running furiously on his little cylinder).

      As you kill more creatures (or build your tradeskills) you gain level points. As you increase in level you can more easily kill the lower level creatures; however, you also do not get as much benefit from these creatures, and thus must move on to an area with higher level creatures to allow you to level faster again.

      This process continues indefinitely. There are certain levels that are called 'Hell Levels' - mainly due to the fact that your particular character is at a point where there are no monsters that fit the level of your character, or the skills available to your character make it difficult to make headway - so leveling slows to a crawl.

      Tradeskills follows a similar pattern, at each level you can build more interesting and/or useful items - that you then sell to other players, which finances further development of your tradeskills.

      I found this process to be very boring after awhile. So I migrated to a PVP server (player versus player) - where the players could fight each other, in addition to the monsters. This made it much more interesting. I tried all of the different PVP servers (one allowed free for all, and the other three were team servers of various makeups). This was my downfall...I was glued to the game after that.

      Finally, the fact that my peers were able to level faster (I have a family after all, and couldn't spend the same hours my single friends did in game), stripped me of my leveling party, and it became a boring slog...at which point I was able to extract myself, and go cold turkey...

      Been clean and EverCrack free for 3 years now (knock on wood). Of course I am now involved in World War II Online - but I can stop playing at any time and step away - that is the key. A game is just that - A GAME. It shouldn't take your concentration for every waking moment - which EverQuest requires, particularly at higher levels (if you camp out deep in a dungeon, for example, that required your whole group to fight into - when you come back and login again, you will have to fight your way out alone, which might be impossible depending on the monsters in the dungeon - so you can't just stop playing until you are at a relatively 'safe' location).

      Hope that helps you get an idea about what the game is about.
      • So it *is* sort of liketeh Sims in that you have a character who has a 'career' as a monster slayer, etc. But now I have three more questions:
        (1) How do you 'start' - what I mean is, are you some person at a tavern with $10? Do you have to sleep or eat?
        (2) So what's with the whole article's statements about Platinums? And the 616 auctions? like on eBay?
        (3) What happens to your character when you leave the game...or don't pay the monthly bill?
        • 1. You start off as a 'newbie' at the city of your race with a rusty sword (or similar weapon appropriate for your race and class - magicians, for example, have a wooden staff - my main character was a magician, and I leveled several magicians over time). You are near the newbie area - a monster area near the city with the lowest level creatures in the game - you fight these creatures to level up.

          2. The money comes in as a result of 'looting' the creatures you kill. Sometimes they drop money. Most tim
      • >>There are certain levels that are called 'Hell Levels' - mainly due to the fact that your particular character is at a point where there are no monsters that fit the level of your character, or the skills available to your character make it difficult to make headway - so leveling slows to a crawl.

        Hell levels were removed years ago. The level transitions are all fairly smooth now. And there is plenty of content for anyone at any level these days, with 200+ zones to play in.
        • Additionally, I was explaining what 'appeared' to be happening when you played the game - not the specifics of the mathematic calculations behind the hell level.

          It seemed to take longer to kill the creatures and what you did kill gave less experience. Additionally, there were levels where your spells were ineffective against higher level MOBs - due to the fact that you really needed the next higher version of a particular spell to be effective - not available until you reached that higher level (catch-22?
  • Deepanalysis (Score:5, Insightful)

    by Moo Moo Cow of Death ( 778623 ) on Tuesday May 18, 2004 @07:33AM (#9182002) Journal
    Since I can't reach the page, I don't know why he only used 616 auctions (or however many he used). But you can use a tool obtained HERE [hammertap.com] for about $100 or so that will analyze Ebay listings for the past 2 weeks or so. Using this data you can get a MUCH more accurate reading that a measly 616 listings, which aren't even close to being correct since something around at least 80% of the business goes through IGE [ige.com]/Yantis [mysupersales.com] these days. And don't forget Playerauctions [playerauctions.com] which I can't access here at work due to the proxy but they don't get mentioned hardly at all nowadays despite the large amount of traffic going through them. If you want to read through more reliable reports you should instead roll around HERE [blogs.com] (terra nova blogs) where doctors, lawyers and all sorts of other people that have been analyzing this stuff before you created your first level 1 female elven monk, lurk around.
    • Firstly, the paper was written (and all data collected) in 2001. 616 auctions was about the entire breadth of the EBaying scene for EQ at the time, and IGE/Yantis weren't around. Certainly if you amassed new numbers you'd get a slightly different result.

      Next, it's amusing that you mention TerraNova, since the author of the original paper (Edward Castronova) is a moderator and heavy contributor there. Amusing that you pooh-pooh the source of the (3 year old) data, and then refer people directly back to t
    • And did you read the list of moderators on the alternative site you recommended? First on the list: Castronova, Edward
  • Which would have been a fantastic article. As it is this one is interesting on its own.
  • Virtual currency (Score:2, Insightful)

    by tttonyyy ( 726776 )
    Backed by what? Bunnies? It's not like you can use this stuff to buy oil, either.

    Articles like this just make me want to get away from my computer and go enjoy the sunshine.

  • I have recently picked up the game of Texas Holdem. I figured out that it was costing me around $8.00 to play online.

    So I can make $3.00/hour in one online game to fund an $8.00/hour in another online game.

    Heroineware anyone?

    hmmmm. If I could only reverse the two then I would be in the money. Sounds like a plan

    If if was a fifth then we would all be drunk--Words to live by
  • Evercrack (Score:5, Informative)

    by Lodragandraoidh ( 639696 ) on Tuesday May 18, 2004 @07:36AM (#9182018) Journal
    These games are so one dimensional (I am a recovering Evercrack addict - so I know what I speak of). Working on an assembly line would be more stimulating than building tradeskills in the game; and the damage model for combat is a points based system - so if you get the math right, you can consistently win (or conversely, get it wrong and lose).

    That being said, there was an addictive quality - particularly when playing with the same group of people you know in the real world (many of my coworkers played at the time). I don't know if it was the color scheme, or some subliminal message they strobed in the background between frames; whatever it was, it made it very hard to stop.

    Sadly, most online games are built for the least common denominator - for folks who want instant action, and little thought put into the gameplay, with few exceptions.

    I have recovered from my addiction - and I warn everyone who considers buying the game: don't do it!
    • Re:Evercrack (Score:4, Interesting)

      by @madeus ( 24818 ) <slashdot_24818@mac.com> on Tuesday May 18, 2004 @08:28AM (#9182588)
      I can identify with that completely...

      and the damage model for combat is a points based system - so if you get the math right, you can consistently win (or conversely, get it wrong and lose).

      To go off topic a little bit:

      That's what always drives me nuts about the likes of EQ & SWG. Basically, it's up to who reads up the most online to work out the mathematically best combination of skills and then just grinds for a month or two till they have those attributes, and change their skill sets as appropraite whenever the developers nerf/buff something.

      It runins the creativity and fun aspect for me. It's about as much fun as seeing who can optimise their MySQL database the most, or write the fastest XML parser. I DO think that sort of thing can be fun, just not what I want to do in a *game* most of the time (or I'd be playing Robocode or something ;-). I have an open source project I can play with when I feel I want to do that. I love reading fan sites for advice and tips (beats working! ;-), I just don't like having to read them as part of in depth research because the game system is unbalanced or unituative to the extent that if I don't read them I'm just wasting my time and effort doing the wrong thing.

      I know it's hard to make a game that relies on a little more action (like say PlanetSide) due to lag, and the fact that the games engine would actually have to perform half well. I realise not every one wants an MMOG to play like version of Planet Side (think Unreal 2004 with vehicles, but larger scale - with hundreds of players and levels up to 8 kilometers square and persistant character growth), and I'm not sure I do, but a comprise is needed I think.

      The best game I've seeen for this is City Of Heroes, it's still basically stats based underneath but thanks to a very fluid engine (decent netcode and fast rendering) it's able to rely more of knowing when to use a power and what power to use, as well as building up a character. The tedious specific details are hidden while not being oversimplified. There is still room for creativity because you can choose from a wide variety of skills to mix and match, or simply build a character that is uber at one specific type of thing.

      Unfortunately the 'missing incredient' that shows if this approach can really work is PvP, which isn't coming till later (via an expansion pack, City of Villans). Given the system though, I imagine could create an uber PvP character, but you could equally create a character who would be perfect at counter acting that character.

      EVE online combat is like that - you have such a wide variety of attibutes to choose from, a few things become standard (e.g. warp core stabilisers are virtualy a must, so you have a better chance at warpping out if you are in danger even if your opponent tries to scramble your warp) but much of it is entirely open to personal preference and so far more creative.

      Having given up SWG a couple of months ago, I play PlanetSide, EVE and CoH (in that order) these days. I will likely get bored of CoH - dispite how well polished and solid underneath it is - I'm starting to feel the lack of depth (lagely due to no PvP or wider ongoing story arc, whcih I'm sure will be addressed as they say). PlanetSide and EVE both have great futures though, I think I'll be keeping them reguardless of what else I pick up.
  • More economics (Score:2, Informative)

    http://terranova.blogs.com/terra_nova/2004/05/econ omics_of_ff.html#more provides more analysis of the economics of Final Fantasy.
  • by CaptainAlbert ( 162776 ) on Tuesday May 18, 2004 @07:38AM (#9182033) Homepage
    Now I don't know enough about Everquest et al. to make this thought coherent, but I'll try. Presumably there are organisations (guilds?) made up of co-operating players. These have assets, generate revenue, trade, etc.

    So, they should be able to issue stock! Seriously, why not?

    In fact, I expect it would be easier and more natural for a derivatives market to emerge (e.g. players trading futures contracts for in-game commodities, etc).

    I wouldn't be surprised if that sort of thing doesn't already happen informally, of course. But if one could buy into an investment fund / unit trust which dealt in virtual equities... definitely at the "high-risk" end of the spectrum though!

    If you think about some of the business models of public companies whose shares you can invest in via the conventional stock market (ahem SCO ahem), might you actually be better off putting your money into Everquest equities?

    Just a thought. :)
  • by brxndxn ( 461473 ) on Tuesday May 18, 2004 @07:39AM (#9182045)
    I never did play Everquest. But, I played Shadowbane, an Everquest-like game - where players completely controlled the economy, built cities, and created nations and guilds and fought among one another..

    The first two months the game was out. One million gold pieces went for ~$100 on Ebay. It took my brother's farming character about 5 hours to earn $100. He made about $500 on Ebay when I decided to get the game. Twenty bucks an hour isn't bad for playing a video game..

    Soon after I got it, gold quickly lowered in price. After about six months, 100 million gold went for $100 on Ebay. The economy was completely flooded. Any remotely valuable in-game item sold for millions of gold - or an impossibly-long farming time for a new player.

    I read that some new MMORPGS that are coming out are actually going to try to take advantage of the players' willingness to pay for an advantage. Supposedly, people will be able to buy uber items that are impossible to get in-game.

    • by Durzel ( 137902 ) on Tuesday May 18, 2004 @07:54AM (#9182177) Homepage
      Reminds me of SWG.

      I had never put much faith in MMORPGs being a meaningful source of income (I believed I could earn more doing more traditional things like IT consultancy), but this changed when I sold my Jedi character (one of the early ones) for just under $1500.

      For the amount of grinding work that it involved (approx. 1 month fairly hardcore play - i.e. most/all of the weekend and 7pm-early AM most weekdays) it would've been roughly equivalent to a 17,000 GBP per annum job over here, which is pretty scary.
    • Interesting. It would appear that the economies in online games are in a state of hyperinflation. Which is leading to a rampant devaluation in the purchasing power of the in game commodity. This is a state in which real world economies have found (and continue to find) themselves from time to time. Mostly these are tin pot economies, but almost always the econmy cannot work its way out of this state and there is a schism that takes place beofre the conomy is fixed. In on-line gaming speak this schism i
      • by @madeus ( 24818 ) <slashdot_24818@mac.com> on Tuesday May 18, 2004 @08:56AM (#9182893)
        Interesting. It would appear that the economies in online games are in a state of hyperinflation

        I find it intersting too, but it's deeper than that, not all games have the same condition...

        EQ and SWG have similar (not the same, SWG has more depth/complexity, but untilmately similar) economic models. MOST games do seem to suffer from the trading of in game credits off line, or of powergamers setting prices, making items more and more expensive, thus presenting a barrier to entry.

        One shining example of a game that *doesn't* have this problem, and that has slow *deflation* (but kept up by a fixed level of the worth of raw materials and the time/effort/risk required to gather them) is EVE Online. It's got slow deflation at all times on the very expensive items, e.g. the cost of an uberbattleship was 100 Mil ISK last month, it's now 90 Mil ISK (and you can view trading results via the in built stock market, so it's great for having a stable market, though of course rip offs and bargins are still to be had). The difference isn't as noticeable with lower cost items (where the potential profit margin is smaller) but overall this is great news for players, as it means they can afford to spend more time blowing each other up and having fun with PvP, and not worrying about how much it will cost them.

        Partly I think this is down to the unquie and superior skill system, where there is no limit to the skills you can learn (unlike other games such as SWG, which force you to be a fighter OR a crafter - you can't be good at both as the number of skill points are fininte, meaning crafters are rare and so can charge high prices). It's also down to how you learn skills - you pay for the appropriate skills (from another player, or from an institution like a space academy) and you devote time to racking up skills in that area, the training continues while you are off line.

        Level I takes typically 20-60 min, while Level II skill in something might take around 2 hours or more and Level III a day or more and Levels IV and V days and weeks. You don't actually have to 'grind', just devote the time to learning it. From there you need to buy the blue print (single use, or unlimited reproductions), get the raw materials (easily enough done via mining or even more simply, on the open market) and rent some time in a station to begin some construction.

        I know it may sound a bit complex, but honestly in reality it's all very simple and straight forward (thanks to a pretty clear interface), and the low barrier to entry keeps prices down. :)

        They also introduce new technologies, such as new ships or the next generation of a given technology (so that items can be created that drain less power, use less ship CPU time, etc) which are rare and so the 'expensive new toys' for those with the cash to spend, while the older technology gets cheaper (but not cheaper than the raw materials).

        It's the only game I've played with a wide and stable economy though, most MMOG do have hyper inflation, I put this down to bad gameplay design (though to be fair, while some of the problems are obvious, others are more subtle and harder to spot for non-economics majors, so it's understandable that as MMOG's are new there will be bad economic models initially). It may take a few iterations for developers (especially the likes of SOE) to start seriously thinking about them though. :(
    • I'll give $5000 for a BFG that doesn't need to charge and has unlimited ammo!
    • Atitd (A Tale in the Desert) has only player made currencies (you learn to make paper and print money).

      Two currencies now survive what was a 'battle' of sorts between different currencies. The main one, TN, is maintained by players who post prices of their goods online, and the value of TN slowly shifts over time.

      Another currency, Goodscrip, is tied in value with a notion they call First Good, where the tradehouse maintains a supply, giving 1 First Good (10,000 Goodscrip) value to the first good of a typ
  • Comment removed based on user account deletion
  • Pay Me! (Score:4, Funny)

    by Silicon Mike ( 611992 ) on Tuesday May 18, 2004 @07:43AM (#9182077)
    Then I realized if I averaged out my time and what I got for my character, it was only like 50 cents an hour Yeah, but you're PLAYING A GAME. If anyone wants to pay me 50 cents an hour for playing games, email me. I'll give it to my girlfriend so she can go shopping, which in turn will give me more game time.
  • by Anonymous Coward on Tuesday May 18, 2004 @07:43AM (#9182081)
    I think you guys totally missed what this guy meant. He's not saying you as the player are making $3.42 and hour, he's saying that the character in everquest is making the equivlent of $3.42 an hour. Of course this has a much less value in the real world, mentioned earlier.

    Virtually, and this is why it is interesting, all those toons in EQ, are doing quite well for themselves.

    It would be interesting to do a study like this on a newer MMORPG, like SWG, because their economy is far more intergrated into the gameplay.
  • Won't Work (Score:2, Insightful)

    The caculation of GNP assumes the fact that the 1st platinum piece sold (converted) to USD has the same worth as the 100 millionth, which is clearly an unsafe assumption for the report to make about a currency of an online game, even though this fact is usually taken for granted about real currencies.

    In online games, people tend to not want to sell their in-game pieces just because they spent so much time earning them, inflating the real value of the platinum pieces. For example, if I were to value a ring
  • by 91degrees ( 207121 ) on Tuesday May 18, 2004 @08:09AM (#9182352) Journal
    Of course,m the problem here is you have to play the game to make money. One guy tried a scheme in Star Wars galaxies to automate this. Here's how well he did. [gamespy.com]
  • by eap ( 91469 ) on Tuesday May 18, 2004 @08:09AM (#9182353) Journal
    I'm hatching a plan to steal Unreal Tournament 2004 vehicles from the other team and then sell them back on Ebay. You want that tank back, blue? It'll cost you!
  • Context Dropping (Score:2, Insightful)

    by Anonymous Coward
    You can't equate an EQ platinum piece with 1 US cent, for the simple reason that a cent is a symbol (having the backing of a nation and its mints) recognized worldwide as having a specific relative value.

    Everquest equipment, plat, etc. are valuable to some people - a subset of the 300,000 people who play Everquest, an infinitesimal fraction of the world's population - but believe me, if you tried to exchange that '319 platinum' for a cheeseburger or video rental you'd get nowhere. If you took this guy's s
  • That's a problem (Score:4, Interesting)

    by mseeger ( 40923 ) * on Tuesday May 18, 2004 @08:28AM (#9182594)
    Crunching more numbers, Castronova found that the average player was generating 319 platinum pieces each hour he or she was in the game -- the equivalent of $3.42 (U.S.) per hour. "That's higher than the minimum wage in most countries," he marvelled.

    This marvel leads to a big problem:

    • People start living on virtual income.
    • They optimize their behaviour towards income, not fun.
    • They disrupt the experience of the "normal" user.

    I started playing Lineage II [lineage2.com] lately. There are complete areas inhabited only by Bots and Farmers. Bots are Programs which gather gold (scripted characters with hacked clients). Farmers are users which make a living from the virtual income. Both sell their gold/items through auctions [searchmarketing.com] and other eCommerce [ige.com] to (some) users. All three clases are not highly regarded by other players.

    Regards, Martin

    P.S. Please do not missunderstand me: If i had no income and could earn some living by playing a MMORPG, i would probably do it too. The problem is a direct consequence of the social gradient. I have no real solution for this... Banning [slashdot.org] the sales in the real world is only a measure of limited use.

  • Please remind that some european countries have introduced the euro a couple of years ago.
  • by Minwee ( 522556 ) <dcr@neverwhen.org> on Tuesday May 18, 2004 @09:19AM (#9183165) Homepage
    The North American version of Cleavage II has been flooded with professional farmers since before it was released. Want a character leveled for you? Don't have enough money in the game? Just cough up the cash [gmhelper.com]. (Link contains images of Dark Elves. May not be work safe.) Want a job? They're hiring [sina.com.cn]. (That last one may be an ad for a porn version of Gilligan's Island instead. I don't read Chinese as well as I could.) Want something to whine about? No problem. [lineage2.com] There are reports about organizations like Adena Farming Inc. [lineage2.com] all over the official boards.

    Any time there is profit to be made by ruining an online economy, there will always be people lining up to make it.

  • In Everquest, there is virtually no control of the money supply. And since very little of the things EQ money is spent on are consumable, there is nothing to take money out of the economy.

    So it's really irrelevant to compare EQ's economy to real economies. The only point of interest is how the trading market works in EQ.

    Ignorance, greed, and desire are all prevalent in the trading of items, and those who see and take advantage of it can make lots of money as brokers.
  • by StefanJ ( 88986 ) on Tuesday May 18, 2004 @11:05AM (#9184387) Homepage Journal
    Almost forgotten in the of the MMPORG: multi-player play-by-mail games.

    Most of these were fairly simple strategic tournaments. Flying Buffalo Inc. was the big wheel of this industry. It's still in business, running games like Starweb for afficianados.

    A few companies ran open-ended society games which were similar to Civilization or Masters of Orion.

    The biggy was "Tribes of Crane" by Schubel & Son. It was entirely paper based. You led a tribe of nomads on a barbarian world. If your tribe found something neat, or your shamans learned a new spell or whatnot, you got a paper chit explaining it. Money was in the form of paper slips too. You spent money by mailing it to the game master or another player.

    I played another S&S game, "Star Master." You designed an alien species, picked out a homeworld, and did standard Masters of Orion type stuff ("Explore, Expand, Exploit, and Eliminate" or something like that). If you engaged in trade, you could earn EUs, and trade them in for tech advances.

    There was a vigorous out-of-channel trade in artifacts, money, and even entire species. People leaving the game would sell their empire to the highest bidder. That's what I did.

    Some of the trading was illegal. After the "Central Galaxy" filled up, S&S opened up the "North East Galaxy." It was many, many months away by fast spaceship. Essentially a different universe.

    Central Galaxy and NE Galaxy had different-colored EU chits. Not exchangeable in-game. However, a few players had species in both galaxies. They acted as middlemen.

    Small scale and under the radar compared to the economic sideshow of Everquest, but still interesting.

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