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Thursday, January 18, 2007
Europe vs. US RMT difference
Thank you to the reader who brought this to my attention: Apparently there is a huge difference in prices between World of Warcraft gold on an US server and the same amount of gold on an European server. There is an article about that named "Is Europe the 'Third World' of Warcraft?", but if you want to read it, you'll have to google it. Because the site that posts it is a price comparison site for WoW gold sellers, and I'm not linking to such sites.
But I checked a gold seller, and yet, WoW gold in the US is about 10 times more expensive than in Europe. 1000 gold in the US cost $300 to $400, while you can get 1000 gold in Europe for $30 to $40. A striking difference.
Quote: "The cost involved in producing (farming) gold on Europe must simply be lower than the cost involved in producing the same gold on World of Warcraft USA. What this means is that Blizzard is policing its American realms far, far more rigorously than it is policing its European realms."
Can't argue with that. If the cost of farming gold was the same in Europe and in the US, and the farmers are Chinese who play whereever they earn most, prices on the two continents should be the same. Because otherwise the farmers would just move to where they can sell the gold for more money. Only Blizzard wielding a heavy ban stick on the US realms, but leaving the European realms alone can explain the huge price difference.
I'm just not so sure which continent is worse off by that. If you think RMT is a very bad thing, you'd agree with the article that Europe was treated less well by Blizzard. But if you want to buy 1000 gold, you'd probably prefer to live in Europe. Makes you wonder if Blizzard is running a huge socio-economic experiment on a test sample of 3.5 million players to find out how bad RMT really is for a game.
- posted by Tobold @ 8:50 PM Permanent Link
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I didn't read the article.
But from the price jump I'd have to assume that the demand for gold would play a greater role in determining price than the cost to farm it.
It looks to me like European players just aren't buying the gold as much.
But from the price jump I'd have to assume that the demand for gold would play a greater role in determining price than the cost to farm it.
It looks to me like European players just aren't buying the gold as much.
# posted by 
: 18/1/07 22:15
: 18/1/07 22:15
Yes, if this was anything other than simple supply and demand, I'd be very surprised. It's the same reason there are vast differences within US servers and even Horde/Alliance within a server.
# posted by : 18/1/07 22:41
: 18/1/07 22:41
Tobold,
I got the same email over at KTR. Real casual and it had me for a moment. It you read it carefully, and take his included link up one level, you'll see it's for a gold-shopping site and it's really just a commercial he's bulk emailing out to try and get some business. Thus, I didn't post it.
I got the same email over at KTR. Real casual and it had me for a moment. It you read it carefully, and take his included link up one level, you'll see it's for a gold-shopping site and it's really just a commercial he's bulk emailing out to try and get some business. Thus, I didn't post it.
# posted by : 18/1/07 23:08
: 18/1/07 23:08
This is the one that alludes to some work done with University of Sheffield students to try and validate it's claims?
There seemed to be a huge leap in logic between the "EU servers have cheaper gold" findings and the "Blizzard must police them less" conclusion.
There seemed to be a huge leap in logic between the "EU servers have cheaper gold" findings and the "Blizzard must police them less" conclusion.
I'm a habitual European myself - if a game has a EU server at all, I'll be on it (mostly for ping times rather than any inter-atlantic sociopolitical snobbery) and must admit to seeing very few of those speculative gold-selling tells in my time on Runetotem.
Makes me wonder if in Europe, the demand for it just isn't there in the same was as the US - we're always something of a marginal offshoot set of servers, in most games.
Makes me wonder if in Europe, the demand for it just isn't there in the same was as the US - we're always something of a marginal offshoot set of servers, in most games.
# posted by : 19/1/07 11:17
: 19/1/07 11:17
I think Tobold is on to something here. The situation cannot be explained by lower European demand because even though players cannot easily switch regions gold farmers can farm in any region they want. One would expect lower demand be matched by a lower number of famers leading to a rise in price until the European price matches the US price more closely. Such a dramatic difference can only be explained by a factor which makes it much easier to farm gold in Europe. Perhaps thsi is deliberate Blizzard policy or perhaps it is accidental. I know that one of the ways of catching farming to to identify players whose IP addresses are from countries outside the region that they are playing in. Is he European market being flooded by Gold Farms in Eastern Eurpe who cannot be caught by this measure?
I once reported 6 Gold Farmers in the Burning Steppes. They were effectively killing every mob between them as soon as the mobs spawned, and trying to get my Oxyxia quest chain done was a real drag.
About a month later a GM replied to a ticket on a separate issue, whilst I happened to be in the Burning Steppes.
Once he had sorted my problem out, he asked me if I had any other issues, so I said there were a number of farming bots operating in the Burning Steppes. He then asked for their names, and I replied they were the same bots I had reported a month ago, and nothing had been done about it, so I didn't really see the point of giving him their names again.
If Blizzard Europe were serious about getting rid of bots on European servers, it would be a simple task for a GM to wander round Azeroth and find them.
About a month later a GM replied to a ticket on a separate issue, whilst I happened to be in the Burning Steppes.
Once he had sorted my problem out, he asked me if I had any other issues, so I said there were a number of farming bots operating in the Burning Steppes. He then asked for their names, and I replied they were the same bots I had reported a month ago, and nothing had been done about it, so I didn't really see the point of giving him their names again.
If Blizzard Europe were serious about getting rid of bots on European servers, it would be a simple task for a GM to wander round Azeroth and find them.
# posted by : 19/1/07 12:03
: 19/1/07 12:03
Although in Europe the gold farming is a real problem (I experienced the same reaction of GMs as the poster before me) I do not see that it is as simple as suggested by Tobolds quotation. The "supply and demand" argument is equally correct as the assumption, that gold in the US may be harder to farm. But one cannot conclude that gold farmers spread equally over US and EU until the gold prices are equal. They might find that farming in the US is harder BUT the gain is higher due to more demand. This would then result in the same amount of gold farmers but having different 'farming conditions'.
Therefore I agree with dragon, that there is a huge leap between the fact that gold is more expensive in the US and the assumption that it is because Blizzard is enforcing their policies more strictly there. Thus a mixture of arguments is what seems most convincing to me.
In my opinion, thorough analysis would require to know the actual size of the 'gold market' (offer, sales) and compare that. If the market and the sales differ significantly (calculated per player) between the US and EU THAN one might have prove for 'harder gold farming' in the US. If they are the same, the price difference is due to higher/lower demand.
Therefore I agree with dragon, that there is a huge leap between the fact that gold is more expensive in the US and the assumption that it is because Blizzard is enforcing their policies more strictly there. Thus a mixture of arguments is what seems most convincing to me.
In my opinion, thorough analysis would require to know the actual size of the 'gold market' (offer, sales) and compare that. If the market and the sales differ significantly (calculated per player) between the US and EU THAN one might have prove for 'harder gold farming' in the US. If they are the same, the price difference is due to higher/lower demand.
# posted by : 19/1/07 13:37
: 19/1/07 13:37
Actually, that would be a very interesting experiment to conduct... And potentially very useful.
# posted by : 19/1/07 19:34
: 19/1/07 19:34
Tend to agree that this is hugely simplistic.
What about "propensity to buy" ? Does traditional Keynesian economics work in the grey economy ?
This is like saying that if rates for prositutes were reduced, we would see a rise in usage. Perhaps there might be a rise in usage from people who already DO, but is price really the barrier to entry ? Or is it a moral one ?
I suspect the latter. And I also suspect that if you need 1000G for you epic flying mount, then if you have made the decision to purchase anyway, then price is probably not an issue.
Why does gold cost more/less between Horde and Alliance on the same server ?
I just don't buy the supply/demand idea. The players don't control the demand side, we don't spam goldsellers with our "buy" price.
My guess would be this is simply time cost based. Decide no the G-per-hour you want from your people, and set accordingly.
So it really comes down to how easy it is to make gold on your server. I have no idea how gold sellers make their money, but I make a bit of mine through herb collecting.
From Tobolds descriptions of HIS server, and with it being PVP, I would guess that my server's gold is cheaper than his. We have less people, and far less grinding of resource, and we are non PVP. I can wander round Winterfall for 20 mins, and collect a decent amount of IceCap. There will be nobody else doing this, usually.
What about "propensity to buy" ? Does traditional Keynesian economics work in the grey economy ?
This is like saying that if rates for prositutes were reduced, we would see a rise in usage. Perhaps there might be a rise in usage from people who already DO, but is price really the barrier to entry ? Or is it a moral one ?
I suspect the latter. And I also suspect that if you need 1000G for you epic flying mount, then if you have made the decision to purchase anyway, then price is probably not an issue.
Why does gold cost more/less between Horde and Alliance on the same server ?
I just don't buy the supply/demand idea. The players don't control the demand side, we don't spam goldsellers with our "buy" price.
My guess would be this is simply time cost based. Decide no the G-per-hour you want from your people, and set accordingly.
So it really comes down to how easy it is to make gold on your server. I have no idea how gold sellers make their money, but I make a bit of mine through herb collecting.
From Tobolds descriptions of HIS server, and with it being PVP, I would guess that my server's gold is cheaper than his. We have less people, and far less grinding of resource, and we are non PVP. I can wander round Winterfall for 20 mins, and collect a decent amount of IceCap. There will be nobody else doing this, usually.
# posted by : 22/1/07 10:39
: 22/1/07 10:39
What about "propensity to buy" ?
What about arbitrage? A share doesn't need to be bought equally often in the US and Europe to have the same share price.
We can assume that the same hour of work of a gold farmer would net him the same amount of gold on either server, unless Blizzard intervenes and bans him. So if he could earn 10 times more by playing on a US server, he would do so. If it was just US players buying more gold than Euro players, the supply would move until it balanced the demand.
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What about arbitrage? A share doesn't need to be bought equally often in the US and Europe to have the same share price.
We can assume that the same hour of work of a gold farmer would net him the same amount of gold on either server, unless Blizzard intervenes and bans him. So if he could earn 10 times more by playing on a US server, he would do so. If it was just US players buying more gold than Euro players, the supply would move until it balanced the demand.
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