When Play Money Becomes Real

Thanks to Wired News for its article analyzing the commercial potential of the trade in MMO virtual items, focusing on Internet Gaming Entertainment (IGE), of which CEO Brock Pierce claims "has more than 100 full-time employees in Hong Kong and the United States... [and] is hiring about five new people a week." Pierce also makes claims that: "In this industry, it's eBay and us... we're the major players", and elsewhere, a Sony Online spokesperson "is aware of IGE and has spoken with the company" with regard to their EverQuest item sales, concluding: "At this point, we're still sort of trying to decide what direction the company's going to move in on this topic." We've previously covered the financial dealings of IGE.

Comments

Re:Taxes...

[shadowcabbit]

This doesn't really seem to apply since you're not using actual real-world currency. I'm not an accountant or tax lawyer, but I don't think a government can tax trade not being done in its native currency (i.e. the U.S. can't charge tax at time of sale if I were to go to Toronto and buy a bottle of soda; on larger purchases, like a computer, they might be able to at the border/Customs, but I'm not sure).

Re:This is really nothing new.

[JavaLord]

I've personally sold virtual items for real life cash and I think people are crazy for paying what they do for these things

why not? Say for example you have someone that has a Jedi Account in SWG that took them 200 hours of gameplay to get. (I'm just making these figures up...) if I turn around and buy that account from them for $400 I'm buying their time in place of taking my own time to grind stuff out. And at about $2 and hour, it's a steal. For someone who is a casual gamer because they work long hours, buying an account may be the best way to go.

The only problem with buying and selling anything that exists in a virtual world is that the economies aren't well regulated. One bad patch, bug or hack could screw up the economy pretty badly. Take the above example. Say you buy the Jedi account for $400. Then a week later a patch comes out making it easier to become a Jedi. Now people can do it easly in 30 hours....You just got screwed hardcore.

Can this become a business?

[gringo_john]

Though I haven't played any of the big MMOG games like Everquest or Ultima Online. I wonder if this whole notion of selling virtual items for real world money can be converted to a real business.

First, you would have to determine if play time online can be quantified into an exact amount of real world money. Does playing 10 hours of Everquest yield enough virtual loot to justify paying someone 10 hours of game playing wages and have profit remaining?

If so, what about the notion of creating an offshore gaming "sweatshop" where you would pay 100s of *children* to play Everquest and then selling their online loot? Does having a group of 100s of online players focusing together cooperatively increase the yield of loot? If so, you could have supervisors/strategists who could coordinate the gaming efforts just so that the profits increase...