"It's the economy, stupid!" - Issue 3: Back from the grave and Blizzard's gift to themselves
There is fashionably late, and then there is just plain late. After a forced two week hiatus, Stefan "Devt" Kreutz is back to write about the economy of Diablo 3. This week, he wonders why Blizzard introduced the Real Money Auction House in the first place.
Money is a wonderful thing. As the wise philosopher Homer Simpson once said, "money can be exchanged for goods and services". Whether or not you consider items in an online game a good or a service (as most sellers will be quick to claim they only sell the "time it took to collect these items" in order to avoid a copyright lawsuit), money can get you far in a lot of games. What changes when this money goes into the pocket of the players themselves?
The usual way of buying services on MMOs relies heavily on (aptly-named) third parties. The game company doesn't offer the service and while sales from player to player happen, the lion's share of the cash flows into the pockets of companies operating in a gray market. An unideal situation but, as we have already established, an integral part of online gaming. There simply is no MMO without this sort of black market attached to it.
Blizzard's decision to introduce the RMAH tends to be seen as a method for them to benefit off their own game even more than they already do, in the spirit of the scarily popular freemium games. And while it is true that they take a cut in the form of auction fees, the biggest chunk of paper stays with the players, who are free to cash it out. There is no third party anymore, no legal issues, no fear of being scammed. Everyone is free to purchase the gear, gold or characters they want, players can sell their stuff freely and attempt to make a living off of pixels. A proper Utopian fantasy, isn't it? People like me can try and (ab)use the game to earn some dough while the purists can choose to only buy gear with gold and ignore the cash market altogether.
Unfortunately, there is no Utopia; there is no perfect world. Every Utopia is a Dystopia in and off itself, and what we have here is no exception. I don't want to keep repeating myself but the mere fact that cash is now part of the game means that is is part of the game. The only way to truly avert it is playing hardcore (although once again, third party websites will offer cash trades for hardcore as well), for everyone else, money will always be an issue, whether they touch it or not. There is a high probability that the best items will simply never be put up for sale for mere ingame gold; players who choose not to partake in cash trades will have no chance of trading for such items.
If we accept this as a major flaw of the game, the question remains why Blizzard would willingly add such a thing. The concept of the RMAH strikes me as extremely pragmatic. It seems that Blizzard has long realized there is no way around the cash market and chose to embrace the concept rather then condemn it, in an attempt to drive competition out of the market. A bold step to take, surely, but an understandable one. Keeping the money in the players' (and, to an extend, Blizzard's) hands is a sensible idea but assuming that farmers won't play a big role in the market would be naive at best. Even with duping being practically impossible due to the server structure, legitimizing ingame sales will lead to scores of companies dedicating manpower to Diablo 3 and throwing their product onto the RMAH. Regular players, while not being completely driven out of the market, will have a hard time competing with such services for "fair" prices. To answer my introductory question, the money might never reach the players in the first place.
In the end, Blizzard's decision can only be explained as chosing the lesser of two evils. Taking away the market from the third parties and placing it in a controlled environment is a positive aspect but it comes at the cost of alienating a part of their player base as well as knowingly inviting those same third parties to kick it up a notch and become quasi-brokers on their own service. I am starting to sound like a broken record here but I can't help but feel like this is a giant social experiment we are all partaking in. If anyone can provide some precedent to this all, be my guest; as far as I am concerned, there has been no game, and certainly no game this big, that openly invites its player base to trade its commodity for real cash.
So what is "Blizzard's gift to themselves"? Do they really come out a winner in all this? Sure, they take a minor cut of the transaction fees, but that money, if anything, goes a short way towards paying the bandwidth for the free battle.net service so we can discount it as profit altogether. It also can't be keeping third parties from earning money through their game, as they can use the RMAH just as easily. Some claim to see the writing on the wall and say the RMAH is just the first step towards a proper, Blizzard-run cash shop, as evidenced by the (cosmetic) items sold in World of Warcraft; making the dollar a part of the game would lower the player's inhibition towards spending cash and guarantee them profits in the future. All of these are keen observations but I don't think either of them fits.
Remember when I said that this feels like a social experiment to me? The RMAH provides Blizzard with knowledge. Every trade, every character, every item sold is recorded; demands can be logged, spikes in cost of certain items can be noticed. If a certain class sells a lot more often than the others, there might be something to this class worth exploring as a developer. If certain items fetch a higher price we might see them altered or droprates changed to bring them back in line. Speculation, yes, but who is to say that Blizzard aren't at least toying with this idea? Feel free to report your thoughts on this in the comments.
And on that note, we end "It's the economy, stupid!" for this week. As I am back on my regular schedule now, look forward to next Friday, when I will reader questions. If you'd like to get your voice in, post a comment or shoot me a question on Twitter!
Links
Twitter - Follow Devt on Twitter!
Money is a wonderful thing. As the wise philosopher Homer Simpson once said, "money can be exchanged for goods and services". Whether or not you consider items in an online game a good or a service (as most sellers will be quick to claim they only sell the "time it took to collect these items" in order to avoid a copyright lawsuit), money can get you far in a lot of games. What changes when this money goes into the pocket of the players themselves?
The usual way of buying services on MMOs relies heavily on (aptly-named) third parties. The game company doesn't offer the service and while sales from player to player happen, the lion's share of the cash flows into the pockets of companies operating in a gray market. An unideal situation but, as we have already established, an integral part of online gaming. There simply is no MMO without this sort of black market attached to it.
Blizzard's decision to introduce the RMAH tends to be seen as a method for them to benefit off their own game even more than they already do, in the spirit of the scarily popular freemium games. And while it is true that they take a cut in the form of auction fees, the biggest chunk of paper stays with the players, who are free to cash it out. There is no third party anymore, no legal issues, no fear of being scammed. Everyone is free to purchase the gear, gold or characters they want, players can sell their stuff freely and attempt to make a living off of pixels. A proper Utopian fantasy, isn't it? People like me can try and (ab)use the game to earn some dough while the purists can choose to only buy gear with gold and ignore the cash market altogether.
Unfortunately, there is no Utopia; there is no perfect world. Every Utopia is a Dystopia in and off itself, and what we have here is no exception. I don't want to keep repeating myself but the mere fact that cash is now part of the game means that is is part of the game. The only way to truly avert it is playing hardcore (although once again, third party websites will offer cash trades for hardcore as well), for everyone else, money will always be an issue, whether they touch it or not. There is a high probability that the best items will simply never be put up for sale for mere ingame gold; players who choose not to partake in cash trades will have no chance of trading for such items.
If we accept this as a major flaw of the game, the question remains why Blizzard would willingly add such a thing. The concept of the RMAH strikes me as extremely pragmatic. It seems that Blizzard has long realized there is no way around the cash market and chose to embrace the concept rather then condemn it, in an attempt to drive competition out of the market. A bold step to take, surely, but an understandable one. Keeping the money in the players' (and, to an extend, Blizzard's) hands is a sensible idea but assuming that farmers won't play a big role in the market would be naive at best. Even with duping being practically impossible due to the server structure, legitimizing ingame sales will lead to scores of companies dedicating manpower to Diablo 3 and throwing their product onto the RMAH. Regular players, while not being completely driven out of the market, will have a hard time competing with such services for "fair" prices. To answer my introductory question, the money might never reach the players in the first place.
In the end, Blizzard's decision can only be explained as chosing the lesser of two evils. Taking away the market from the third parties and placing it in a controlled environment is a positive aspect but it comes at the cost of alienating a part of their player base as well as knowingly inviting those same third parties to kick it up a notch and become quasi-brokers on their own service. I am starting to sound like a broken record here but I can't help but feel like this is a giant social experiment we are all partaking in. If anyone can provide some precedent to this all, be my guest; as far as I am concerned, there has been no game, and certainly no game this big, that openly invites its player base to trade its commodity for real cash.
So what is "Blizzard's gift to themselves"? Do they really come out a winner in all this? Sure, they take a minor cut of the transaction fees, but that money, if anything, goes a short way towards paying the bandwidth for the free battle.net service so we can discount it as profit altogether. It also can't be keeping third parties from earning money through their game, as they can use the RMAH just as easily. Some claim to see the writing on the wall and say the RMAH is just the first step towards a proper, Blizzard-run cash shop, as evidenced by the (cosmetic) items sold in World of Warcraft; making the dollar a part of the game would lower the player's inhibition towards spending cash and guarantee them profits in the future. All of these are keen observations but I don't think either of them fits.
Remember when I said that this feels like a social experiment to me? The RMAH provides Blizzard with knowledge. Every trade, every character, every item sold is recorded; demands can be logged, spikes in cost of certain items can be noticed. If a certain class sells a lot more often than the others, there might be something to this class worth exploring as a developer. If certain items fetch a higher price we might see them altered or droprates changed to bring them back in line. Speculation, yes, but who is to say that Blizzard aren't at least toying with this idea? Feel free to report your thoughts on this in the comments.
And on that note, we end "It's the economy, stupid!" for this week. As I am back on my regular schedule now, look forward to next Friday, when I will reader questions. If you'd like to get your voice in, post a comment or shoot me a question on Twitter!
Links
Twitter - Follow Devt on Twitter!
