Tobold's Blog
Thursday, March 11, 2010
Not a solution to RMT

Rohan from Blessing of Kings posted a reaction to a proposal that Blizzard should start selling gold to ruin third-party gold sellers, and thinks that this would be okay, if the money went to charity. Through the charity solution he wants to avoid Blizzard having incentives to tune the game that it can only be played smoothly when buying gold. Interesting thought, but I think Rohan missed a far more serious problem of Blizzard starting to sell gold: Blizzard would produce the gold out of nothing, while third party gold sellers only circulate gold around in the economy.

Gold farmers, in spite of their name, do not farm gold. They farm herbs, orbs, or various items dropped from monsters and sell those to players for gold, then sell back that gold to other players for real money. In macroeconomic terms gold farmers do not increase the overall supply of gold. This is why since the release of Wrath of the Lich King most prices for items on the auction house have either kept stable, or slowly decreased with more of those items becoming available. Remember Crusader Orbs for 1,000 gold? Well, they are 100 gold now.

If Blizzard would sell gold, that gold would be "freshly minted", created out of nothing by a keystroke. If enough players buy that sort of gold, overall money supply goes up, causing inflation. The price for a stack of herbs or ore or eternals would go up significantly. That is not only bad for people who want to buy things from the auction house and didn't buy gold. It also is counterproductive to the goal of eliminating third party gold sellers. Because as prices for herbs and ores go up, gold farmers can stay in business, because now with the same amount of work they make more gold, and can undercut Blizzard's official prices. And the more gold players have, the more profitable it becomes to hack their accounts and steal their gold. Of course then Blizzard could undercut them again, because it doesn't cost Blizzard anything to create gold, but that obviously leads to an undercutting death spiral in which the economy is flooded with cheap gold and inflation is rampant.

So, charity or not, Blizzard selling gold would not work to eliminate third party gold sellers, and would only cause harm to the virtual economy. Furthermore we would lose the argument that buying gold is bad because it is cheating, and not allowed by the rules of the game. A rule of "you can only buy gold from us" is morally a lot weaker than a rule of "you can't buy gold".
The only legitimate way Blizzard can introduce this without too much inflation is to allow the purchase of items (vanity items) for gold.

Thus, players can use real life currency to buy mammoths, jewelry, bags, etc.

And you're right, Blizzard selling gold out of thin air will be very very bad for it will cause rampant inflation. This is the same as countries printing money.
I totally believe that "gold farmers" increase the value of gold by devaluing the objects they farm (herbs, metals, and such).

I get the point that if Blizz sells gold created from nothing then the value of the gold will decrease (herbs, and metals will get more expensive).

However your example of crusader orb prices falling by a factor of 10 isn't a good one. When the were 1000 they were also the end game crafting object. At 100 gold they are not, and primal saranoite is the end game crafting object and worth over 1000 gold.

Frost lotus prices might be more useful example, but it is also problematic since drop rats were either recently adjusted, or an adjustment was announced (and market prices will reflect that).

So something more like frostweave cloth, or motorcycle parts or something might work better.

(also Blizz _could_ not only donate all the real world money to charity, but also only generate the in game gold by magically created items they sell in the AH...but that seems like an increasingly odd way to do things...also donating money to charity would actually generate a tax write off that is like getting real world dollars, and not doing it that way might be a SEC violation of maximizing shareholder value... 'tho they could try arguing that leaving this money on the table is in the long run maximizing shareholder value)
If you want to be a bit picky every player makes gold out of nothing in WoW. The only thing traded for that type of gold is time. What am I thinking of? Well, the value of a drop or farmed item doesn't exist until it is spawned and picked up. Whether that is from a herb or mob drop doesn't matter.

Remember that each and every gold piece that exists in the economy actually originates in one way or another from a spawned mob or gathered item. This in itself would means inflation, especially if there aren't money sinks in the game that equals the spawn rate.

That isn't to say that if Blizzard would introduce their own RMT it would hurt the balance. It would. But if they added money sinks of roughly equal value that would be at least somewhat worth spending on it probably wouldn't hurt it that much. Of course the problem would be balancing it.

But then I probably wouldn't like that solution anyway.
Oh, and what I forgot to say is that since the gold farmers add something to the system which wouldn't be there to begin with, more time which then equals more gold, it should logically mean more inflation. Of course the price of some items will go down since there will be more supply of them, but the amount of gold circulated in the system will increase.
The only legitimate way Blizzard can introduce this without too much inflation is to allow the purchase of items (vanity items) for gold.

I would like to correct myself. I meant to say the purchase of vanity items for real-life currency. Another option would be allowing trading of in-game BoE items for real-life currency.

Both of these forms already exist in some form. The Pandaren pet is an example. An in-game item (Spectral Tiger code) can also be traded for real-life currency.
EvE has a solution, it sells the monthly play passes and from what I have seen in the past month there are no RMTs, or at least not actively promoting.

The solution is that these monthly passes can be traded for in game currency and so does not cause inflation.

While my initial though was that Blizzard would not like this I forgot that the monthly passes still have to be brought and paid for so I see no downside.
Although we both know that there are ways to introduce RMT without causing inflation, I certainly agree that Blizzard earning money with RMT is the least of my concerns.
RMT connects the game world to the economic real world. A disastrous connection that eats up immersion really fast.
If only our politicians would understand (or NOT ignore) this simple economic principle of money supply.
The trouble is a lot of gold doesn't come from farming.

We dubbed the grinding some bots do as farming because it's going over the same area harvesting goods/money.

So what is termed as when you take control of another player's character, steal all of their gold, use their access to rob their guildbank, vendor all their items then delete them and use their account to spam goldseller messages?

Because - its a lot more efficient for the sellers to operate this way. No bought gold is without its victims.
Think what MagrothJ is true. The amount of gold and items in the game is not a fix number but wil incrase with more farmers. Personally I think RMT sux and I also believe that it would be a terrible Idea introducing goldselling from the developers. But wouldent it be nice if the big moneysinkers where taken out like flying mount and boe Batterd Hilt ? Think gold sellers would be very unhappy then.
Excellent post Tobold.

There are ways around the inflation issue as previous commenter have pointed out: allowing players to buy items for real money which could be sold for gold in game means that someone still has to earn the gold in game. Of course the items that are bought for real money must not impact on the main economy of the game. Vanity items or game-time cards would work.

This is not a way to eliminate illegal gold sellers however. Experience from EVE shows that here is still a healthy black market for those who undercut the official price.

Whether or not you think it is a good idea is another issue. Some argue that it removes the incentive to play the economic sub game because you can just use real cash to meet your gold needs. My experience is the opposite though, I think it actually makes the economic sub game even more relevant because you can now use your earnings to actually buy something (like pay your subscription).
Blizzard already sell in-game items for real money. The wave of virtual pets like the Panderan and the new Gryphon plushies are one example, while the "loot" trading cards for sale on eBay are another.

I'm hoping that Blizzard hold it at the "cool but not game affecting" level. While tier 9 gear is fairly easy to get these dyas, you still have to put the effort in running the heroics and collecting the badges. Cheapening that by allowing players to skip it all for a credit card number means that players end up playing the game less, not more.

From a player point of view, imagine you're forming an ICC pug. If Blizzard brought in the ability to buy in-game items for money or sold their own gold, how would you tell the difference between someone who's been through enough raids to get trained and gear up, or someone who's just maxed out their plastic?

People who have all the gear and no idea afflict other hobbies enough. WoW is one of those few that you "have" to be at a reasonable standard in order to get the gear. For that at least, I'm grateful.
how would you tell the difference between someone who's been through enough raids to get trained and gear up, or someone who's just maxed out their plastic?

To play devils advocate here for a moment: You owe this distinction you are looking for, to those who equate time with money in a game world.

Being able to pull out cash or plastic and bypass months of grind makes these people so much smarter than the poor sap who doesnt have the money to burn on such a shortcut. They refuse to play the game the way it was designed, and bemoan the fact that they are somehow "forced" to do so since they are unable to "buy" their way past these self contrived barriers. one is holding a pistol to these players heads and forcing them to resub month after month....
Jim hit the nail on the head. Just make the game time cards available to sell in game for gold.
Looking at the monthly pass setup:

Cash -> Game time card -> Gold

How is this different from:

Cash -> Gold
Let me answer that Gazimoff:

The difference is that the game time card should actually get used relatively quickly ingame and then it's value disappears from the economy. If you would buy gold from Blizzard it could actually stay in the economy for a very long time if you just spend it on the AH instead of money sinks like riding skills, repairs or flight routes. It will then lead to inflation.

I think it could actually work. mbp says that it doesn't prevent a black market in EVE. I would be interested to hear how that works since if it was introduced in WoW we would probably see something similar which we probably don't want.
I wonder if there are better ways to reward players for taking part in the economy (ie. not buying gold from outside).

I only say it because like you say, a more active economy improves the game for people who enjoy playing the auction house and trading.
@MagrothJ mbp is talking about the black market of gold sellers that pop up in every game. Eve's game time card system didn't eliminate gold sellers completely, but I don't think that's possible in any MMO. Also, GTC's do not effect how gold is spent, and gold acquired through them will be used in the AH as well as the other gold sinks. The market would probably fluctuate when the system is introduced, but this happens anytime the game is changed and severe inflation is unlikely.

@Gazimoff The GTC system equates time into gold instead of just money into gold. Thus four separate parties benefit from this system. Players that have more money than time can sell GTC's for gold, players that have more time than money can buy GTC's and avoid a subscription, Blizzard rakes in the cash from selling the GTC's to stores, and stores rake in the cash selling GTC's to consumers. It also places a soft limit on how much gold a player can effectively trade for since there is a theoretical limit to how many GTC's they can sell in a given time period.
There is a way for Blizzard to sell gold without the issue of inflation:
They can sell the gold from banned accounts.

This of course would create a whole different issue.
Players that have more money than time can sell GTC's for gold, players that have more time than money can buy GTC's and avoid a subscription,

The issue here is one that is often overlooked in this scenario: What about those players who have both an abundance of time AND money? They do exist, and in many cases these types of players -will- take advantage of any system that gives them an advantage in-game, whether it be in terms of amassing gold/currency, or play time in the case of EVE. Anytime a mechanism is introduced that allows the trading of items(time cards or otherwise) for in game currency, there are going to be ways to exploit their usage.

Just look at Sony with its Station Exchange system: even with sanctioned methods of player exchange, the gold farmers will always be able to undercut whatever the developer has implemented.
The EVE solution would work in WoW.

In short, allow people to sell pre-paid Game cards to other players for in-game gold on the Auction House.

Gold isn't created, simply shifted from one player to another. Also, Blizzard doesn't make additional profit -- it's just allowing someone else to pay for the gold sellers game time.

I'm not a fan of RMT, but if you are going to have it -- this is one of the better implementations.
It's quite easy really.

"EvE has a solution, it sells the monthly play passes and from what I have seen in the past month there are no RMTs, or at least not actively promoting.

The solution is that these monthly passes can be traded for in game currency and so does not cause inflation.

While my initial though was that Blizzard would not like this I forgot that the monthly passes still have to be brought and paid for so I see no downside."

Basically, to expand on this a bit further. A person can purchase a 60 day GTC from CCP or a third party re-seller. He/She can then either use this GTC or can securely sell this GTC to another play for in-game currency. The market is controlled via the forums in a supply/demand type nature. The handling of the transfer is done completely secure via a system implemented by CCP. I wish all MMO's used this model.
The current situation is not "you can't buy gold." Rather, it is against the rules. So the existing situation benefits gold buyers more than if it were decriminalized. At a certain level of law breaking, decriminalization may be better. Would RMT gold be better than a WoW where half the players were buying from gold farmers?

Inflation is not a complete rebuttal since WoW is founded on the idea of *massive* devauluation. The game revolves around incentives to delay doing something. Want to buy a Battered Hilt/Greatness Card/Frozen Orbs right when they come out, it could take >10k gold and many hours of grinding. But the price is continually dropping. How fun is it to do 100 dailies to buy some new pixels when and the people who inspect you know it would only take 40 dailies in a month?

Even for BoP items; it was disheartening to have pugged my way thru half of Ulduar, to then need to pug 50 LFDs to get much better gear.

If you take a 3 or 4 month break from WoW, you are essentially starting over, at least as far as raid/PvP season gear goes. Which means items/advantages purchased with RMT gold, would cease to have much benefit. It is the mounts and pets that retain value; BiS gear is designed to be worthless relatively quickly.

Blizzard selling gold does not guarantee inflation since it is not a closed system. It could be as unsubtle as increasing repair cost by a factor of 10. Or making a new "must have" flask require 20 enchanted vials. Reagents and skills are gold sinks and Blizzard controls those as well. Blizzard can have as much or as little inflation as it wants, whether it sells gold or not.

While there are many flaws to EVE, in a game I am going to play for over a year, I like that the equipment you bought a year ago may no longer be FOTM, but more often than not is still serviceable doing the tasks it was doing.
Re "
how would you tell the difference between someone who's been through enough raids to get trained and gear up, or someone who's just maxed out their plastic?

An ex-guildie ebayed his Algalon down, Firefighter, BoP BiS priest. So the current system does not mean that you can not use RMT, it just means you do it inefficiently, unregulated and with much higher risk of fraud and keyloggers.

Personally, I would find the arguments against RMT much more persuasive if RMT wasn't already going on.
If Blizzard wanted to stop gold farming they could simply replace gold with a non-tradeable currency. Most MMOs use token and faction systems already, and for almost all the really Good Stuff, which itself is then non-tradeable.

Since MMO designers choose to continue to use tradeable currencies, but largely limit them to the more routine items within the game, presumably they think they are gaining something by doing so the value of which outweighs the costs.

What might that be?

Crusader Orbs dropped in price because (1) farming the badges for them is easy (2) the crafted rewards aren't as powerful so their demand goes down.

farmers have nothing to do with the price of orbs....

and it's ridiculous to assert that farmers don't "create gold". Of course they do! If there was no market for gold, there would be no farming, and the money wouldn't be created. In WoW every user inflates the money supply by the rate they kill mobs and sell the leavings.

but yes, Blizzard selling gold would be more inflationary than the current inflation contributed by farmers; provided they could beat their prices.
There are 2 solutions to avert the "gold farmers" from making money.

A. Use the EVE model where players can buy game time with gold and the gold spent on game time can be sold on the Blizzard web site to other players. The problem is the prices would have to be competitive with the current gold selling market and that would cause an issue as to how gold to charge for play time cards to make the entire system balanced and thus work.

B. Make gold no drop. Just like emblems make everything used like that. The problem with this is it puts restrictions on the players. You couldn't help or "twink" friends.

Yes there are ways to limit the amount of problems with either system but the amount of work required isn't worth what Blizzard would gain.

Gold sellers don't destroy the economy. They are a factor, but no more than Gevlon is. Leave well enough alone and try a new method in your next MMO.
@Epiny I thnk you misundertand the Eve model. The time cards would be in the actual Auction House in game. Blizzard would just be selling the time cards, and providing a secure system to convert them into an in game item like the trading card items.
That's really not a good solution to stop gold farmers.

The gold sold by the company will be injected into the game from nowhere.

It's the same thing like a player creating items with bug/dupe and selling them for real money.
@Jesse no I understand the basics. The problem still comes down to being competitive against the current gold sellers while still coming up with a balanced price for a in game gold to game card ratio.
@ Jesse

The time cards would be in the actual Auction House in game.

Sure, let's say a player buys a 3 month gamecard for $40. The player then puts the gamecard on the AH for 10K gold. The gold farmers see this and start offering 10K gold for $35. You think this wont happen?

If anything, this will give the gold farmers even more reason to ramp up their hacking and phishing campaigns along with their in-game gold farming.
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