Trading Virtual Goods

This blog is hosted by Blogger for free, but of course that means they put ads on the top of the page. The ads are powered by Google, which does a good job of seeing what the blog is about, and then showing ads that are relevant to the blogs content. So my MMORPG blog is usually headed by some advertising for some website selling virtual goods from a MMORPG game. As this is a highly controversial issue, I think its time to discuss it.

Many people buy and sell virtual goods from MMORPG games. The corresponding EBay category had 17,661 entries when I checked today, and that covers only the games where the game company doesn't object to this kind of sales. In some games, like Everquest, buying or selling characters, in-game items, or in-game money, is against the Terms of Service. You can get your account banned for it, and if you try to list something on EBay, your auction gets deleted. But the sellers usually just move to some less populated place, and you can still buy EQ platinum at many places, enter "Everquest Platinum" into Google and you get 166,000 hits. In other games this trade is perfectly legal, for example EBay lists 2,771 Ultima Online items for sale.

I never sold any virtual goods, but I bought a few virtual things on EBay. For some people, that makes me a "cheater". These people believe that MMORPG are competitive games, where your virtual belongings are status symbols, gained by in-game achievements. Being able to buy the same virtual belongings for money they consider "unfair". The argument overlooks the fact that MMORPG are inherently unfair. Your level and belongings in all MMORPG are going up more or less linearly with the time spent online. So somebody with a lot of free time on his hand will always achieve a higher level and better items than somebody who by having a job and a family is prevented from playing that much. Being of high level and having the greatest items is not proof of being a great player, but more likely of spending too much time online.

I'm not much of a fan of buying a complete character, I never did it. But really high level Everquest characters were sometimes traded for up to $1000. The buyer gets the status symbol power of having a high-level character. But obviously he doesn't really know how to play that high-level character well, which can lead to all sorts of trouble with his fellow players. And the bought character comes complete with a given name, and the original player might have made enemies with that name. But the main argument against buying characters is that leveling a character up is often the most fun part of a MMORPG, and the buyer misses out on that.

Buying items or money is a lot less problematic. My very first virtual purchase was a house in Ultima Online. My character did have the means to buy a deed for a house in game. But UO did not have enough flat surface for everybody to build his house. So after running around for 2 weeks in vain trying to find a spot where I could at least build a small house, I went to EBay and bought a medium sized house for $30.

All my other virtual purchases were for game money. My characters are usually low- to mid-level, as I don't have the time to play hundreds of hours every month. And for low- to mid-level characters, earning money in many MMORPG games consists of doing something boring for many hours. Like running from A to B repeatedly to do missions, or "farming" hundreds of low-level monsters that don't give xp any more. But often in the same game high-level characters can make more virtual money per hour. So if a high-level character sells me the money that only took him 1 hour to make, but would take me 10 hours to earn in game, it is a win-win situation.

This is particularly interesting because different people value time and money differently. A teenager might have lots of time, but very little cash, so playing a MMORPG for 2 hours and receiving $10 for it sounds like a dream job to him. Somebody a bit older with a well-paying job would maybe rather spend $10 instead of doing something repetitively boring for 2 hours, as those 2 hours might be all the play time he gets for one day, and he'd rather spend it doing something more fun.

Of course buying virtual goods in MMORPG is not totally unproblematic. Many people wouldn't do it for the simple reason that they don't think that virtual goods have value. Obviously when I stopped playing UO, the house I bought for $30 went up in smoke. But at the time I considered $30 for ending a huge frustration money well spent. And lots of people pay iTunes money for music, which is just a virtual good as well. So for me it is a matter of pricing: How does the price of the virtual game item compare with the time it would take me to achieve the same in game by myself? And would that in-game activity be interesting or boring?

But a bigger problem is the potential for fraud. If the buyer pays money via PayPal and should receive something in-game in exchange, neither PayPal nor the game company have any means of checking whether the other part of the deal took place. So both companies refuse any responsability. If the buyer pays his money and never receives his virtual good, he can not do anything. He can give a negative comment on EBay, if the deal took place there, but EBay ratings are easily manipulated and don't count all that much. The buyer could theoretically go to the police, but who would want to admit that he got defrauded while buying 1000 virtual platinum pieces? This possibility of fraud is why some games don't allow this trade, they don't want to get mixed up in customer complaints.

There are a select few companies that have a business model based on giving away their game for free or very little, and then making money by selling in-game items. But none of them is a classical MMORPG company. This business model exists for some social games, where you have an avatar living a virtual life in a 3D environement, and like in real life you can make your virtual life more comfortable by buying stuff. And of course the same business model is used in online trading card games like Magic Online. It is only a matter of time until somebody at least tries to launch a MMORPG without monthly fees, where you can buy virtual game items for real world money. GuildWars is already half way there, by opening up added content only for money.
- posted by Tobold @ 11:17 AM Permanent Link