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Economics of Online Gaming
PGillingwater writes "The Walrus has a nice article up about the economics of on-line gaming communities. Starting with the original 2001 paper which shows that Everquest has a GNP greater than India, Bulgaria and China, and going on to the billionaires of Ultima Online and the Mafia takeover of The Sims.
"He began calculating frantically. He gathered data on 616 auctions, observing how much each item sold for in U.S. dollars. When he averaged the results, he was stunned to discover that the EverQuest platinum piece was worth about one cent U.S. -- higher than the Japanese yen or the Italian lira. With that information, he could figure out how fast the EverQuest economy was growing. Since players were killing monsters or skinning bunnies every day, they were, in effect, creating wealth. Crunching more numbers, Castronova found that the average player was generating 319 platinum pieces each hour he or she was in the game -- the equivalent of $3.42 (U.S.) per hour. "That's higher than the minimum wage in most countries," he marvelled.""
If each platinum piece on Everquest == 1 cent real life, then the programmers should create 1,000,000,000,000 platinum pieces in the game and give it to themselves. Then they would be rich!!!
Come play Heroes of Might and Magic Mini online.
Just what the EverCrackHeads need, another reason to stay glued to the computer. While I have never played the game myself, other then for a few minutes just to see what it was all about, I have had friends literally stay in the house for weeks so they could play the game. It is amazing what a hold it can have over some people. My friend honestly did not want to stop playing because he feared he would miss out on something going on within his "clan". How ironic that he missed out on so much that happened in the real world with his "friends" and "family".
Please do not let scientific accuracy interfere with the intended humourous/interesting/insightful value of this comment
The article fails to take into account that those EQ platinums aren't conversible. Meaning, you can auction them off in eBay, but only a minority will ever be. If they were a real currency, not necessarily the US dollar, then they would be convertible and these measurements and comparisions would make sense.
In that case, the value of the EQ platinum as a commodity would be much, much lower.
Leandro Guimarães Faria Corcete DUTRA
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I played EQ for a year and a half, averging 20 hours a week. (Quite a bit as I look back) When I "got out" I sold my character on a auction site and got 800 dollars for it! I couldn't believe it I thought that it was awesome money. Then I realized if I averaged out my time and what I got for my character, it was only like 50 cents an hour. That being said, my average was more like a "minimum" every week with some weeks being > 35 hours of game play. The other thing this study doesn't take in account for is that Sony ACTIVELY (when I played, things may have changed) fights out of game transactions, and selling in game money and items for real money. So your "PLAT" may be worth a cent each, but good luck cashing in!
1) Start playing these games when they first come out.
2) Build up a bunch up high level characters and items.
3) Sell them on ebay, or other RPG auction sites.
4) Profit!!!
like valuing every ticket in a theatre based on the price the touts are charging outside the event?
Not bad, however... You do need to pay for a constant internet connection, ( EQ here, so some light form of broadband ) a PC, electricity and one EQ account. I don't think that with these constant costs substracted, EQ will be a very good job...
Hate me!
Since I can't reach the page, I don't know why he only used 616 auctions (or however many he used). But you can use a tool obtained HERE for about $100 or so that will analyze Ebay listings for the past 2 weeks or so. Using this data you can get a MUCH more accurate reading that a measly 616 listings, which aren't even close to being correct since something around at least 80% of the business goes through IGE/Yantis these days. And don't forget Playerauctions which I can't access here at work due to the proxy but they don't get mentioned hardly at all nowadays despite the large amount of traffic going through them. If you want to read through more reliable reports you should instead roll around HERE (terra nova blogs) where doctors, lawyers and all sorts of other people that have been analyzing this stuff before you created your first level 1 female elven monk, lurk around.
Articles like this just make me want to get away from my computer and go enjoy the sunshine.
biopowered.co.uk - catalytically cracking triglycerides for home automotive use since 2008. Just say no to big oil!
The caculation of GNP assumes the fact that the 1st platinum piece sold (converted) to USD has the same worth as the 100 millionth, which is clearly an unsafe assumption for the report to make about a currency of an online game, even though this fact is usually taken for granted about real currencies.
In online games, people tend to not want to sell their in-game pieces just because they spent so much time earning them, inflating the real value of the platinum pieces. For example, if I were to value a ring I don't have so much that I would not sell it for a trillion dollars, that doesn't mean that if I were given the ring, my GNP would be greater than a few countries'.
Sounds like an urban legend to me. All their workers will be tied up clicking links
Sigs for Nerds. Sigs that Matter.
Mind giving a link or something? How is this "Informative"?
I'll bet not having to search for a party and playing for at least 72 hours a week would speed up the process.
this is all assuming that the grandparent wasn't full of shit, of course.
The World's Worst Webcomic!
You can't equate an EQ platinum piece with 1 US cent, for the simple reason that a cent is a symbol (having the backing of a nation and its mints) recognized worldwide as having a specific relative value.
Everquest equipment, plat, etc. are valuable to some people - a subset of the 300,000 people who play Everquest, an infinitesimal fraction of the world's population - but believe me, if you tried to exchange that '319 platinum' for a cheeseburger or video rental you'd get nowhere. If you took this guy's study, and a bonded note guaranteeing the user 319 Everquest Platinum, into a currency exchange... how much real currency do you think you could get for it? Does anyone really believe they could get anything close to $3, or even $0.01?
There is no stable rate of exchange for EQ platinum to real world money, except among a tiny, ultimately transient subset of EQ players. This is like quantifying the value of a sunday sermon based on analysis of the donations that week...
It's available on SSRN . Search 'castronova' and take your pick. Or go here. One thing: EverQuest's GDP PER CAPITA is bigger than India's. I don't why people keep reporting it as 'EverQuest's GDP is bigger than India's.' It isn't. That would be absurd. PER CAPITA. {sigh}.
That's what always drives me nuts about the likes of EQ & SWG. Basically, it's up to who reads up the most online to work out the mathematically best combination of skills and then just grinds for a month or two till they have those attributes, and change their skill sets as appropraite whenever the developers nerf/buff something.
Ah yes. I remember that. Getting the best equipment. Optimize your stats and skills. Following area level recommendations precisely.
Boy, those people made me laugh.
Everquest was definitely pretty heavy on optimizing your character and getting the best equipment, but it was hardly neccessary. Player skill was important too. Personally, I did sometimes read those sites but found their advice useless. For one thing, I wasn't good at getting the uberpowerful stuff. For about half the time I played, I typically ran around with store bought armor that I had used for the last 10 levels. I also had a tendency to be in areas that were too high of a level for me. By the measure most people used in the game, I was an absolutely sucky player.
Which was completely untrue. One thing I had that these people focused on optimization and efficieny didn't was skill and adaptability. Honestly I couldn't tell you what I was doing different from other people, but the way I used the character easily made up for my character's weaknesses. I had little trouble keeping up with people five levels above me in areas where I should, by all accounts, have been killed just trying to enter.
It was always hilarious when some uber-d00d complained that I wasn't playing right. I either healed too soon, or used "useless" spells, or didn't have my nose in the book when I should have. Of course, the whole time they were complaining I was ignoring them and just playing like I had learned to play. Despite all the times people complained, I can count the losses of a teammate due to my own failure on one hand.
The best times came when people left the group because of the "n00b" cleric (he doesn't have the Uber scepter of ultimate clericness! he must be a n00b!), or when they were the first to run away when the battle turned sour. In either case, the rest of us typically held our ground. Things got hectic, but I just picked up my pace too (stun lock is great), and we usually got through it. We'd be out of mana and perhaps have just pixels of health left, but we'd win. Without the d00d.
That was longer than I expected. Anyways, yes, although most people focused on optimizing their character, it was possible to optimize your own skills as a player too. In fact, there was a clear inverse correlation between skill and the outrageousness of the character's equipment. Unless it was their 4th or 5th character, people that had equipment that was impossible for a character of their level to get tended to be awful players.
This is hardly limited to EQ either. The same kind of thing has happened to me in Phantasy Star Online. "You're using a Yamato? Here??" Half an hour later; "Wow. You're pretty good."
(Free tip: Put down the sword. Use a partisan type weapon and learn to dodge after a combo. You'll take a lot less damage.)
So it would be nice if the mechanics of games were less important, but you can still put a lot of your own skill into the game, whatever it is.
I can't speak for any other games, but in Neverquest it doesn't take all that long if you have a group or someone there to power level you. As a former Neverquest player, I have two accounts. This saved me from having to look for a group, and made my time playing FAR more enjoyable. I got my second account a few years after my first, and as a result had no characters on the account who could actually group with my "main". So I set off to do some power leveling of my own characters. In 3-4 days I had the primary power leveled character well above level 50. I am not sure what the current level cap is, at the time this occured it was still level 60. After that point I no longer had to hunt for a group, I would log both accounts on and get to killing things. I was churning out massive amounts of EQ cash daily. If I were to start playing again I am fairly certain I could churn enough in my favorite spots to pull in at least 7-9K Plat Pieces per day per character. Assuming that those spots are still as unhunted as they were a year ago.
That having been said. I have no idea why people are so obsessed with these games that they will spend hard earned real life cash on them, aside from the monthly fee. The games aren't "hard" by any stretch of the imagination at least in my humble opinion.
Granted, I did have an advantage, though not one which many of the others playing don't also have. I didn't have to wait for a group for an hour when I logged on to get anything "accomplished" in the game.
So, yes, if you have a set group and lots of time, you can sure as hell get alot done in a current MMORPG. In fact the only thing you can't get done, really, is camping those long never appearing spawns that have a specific item. That can be solved by having a smaller team of people alternating characters at the spawn point, one logs off another takes over the camp.
You can't keep the value of currency higher than it would usually be. You also don't want it unfairly one way or the other.
Money is an abstraction for value, it is a unit that can account for goods, services, time, quality and any other factor.
Currencies only have relative values to each other. This is backed by the goods you can buy.
The million platinum pieces don't have a value themself, only that of the underlying good.
From TFA: "A few years ago, a company called Black Snow Interactive opened up a "levelling" service for the game Dark Age of Camelot. It had a digital sweatshop in Mexico; there, ultra-low-wage workers would click away at computers, playing the characters twenty-four hours a day to level them up."