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Third-World Sweatshops Producing Virtual Goods

prostoalex writes "MSNBC points to the court cases spawned by virtual worlds. Recently, Tom Loftus notes, a virtual island in one of the MMORPGs sold for $30,000, enough to attract commercial attention. Apparently, some businesses create third-world sweatshops, where low-wage laborers are being paid to play and accumulate enough virtual merchandise, so that an eBay sale of it makes the operation profitable. 'One such business, Blacksnow Interactive, actually sued a virtual world's creator in 2002 for attempting to crack down on the practice. The first of its kind to center on virtual goods, the case was eventually dropped,' MSNBC says." Update: 02/06 18:59 GMT by Z : We ran a story about the sale of the virtual island, and Terra Nova has a lot of commentary on the sale of virtual goods. For comparison, the economic impact of this phenomenon is roughly equal to that of Namibia or Macedonia.

24 of 348 comments (clear)

  1. Sweatshop? by bigtallmofo · · Score: 4, Interesting

    Considering relatively affluent people in the US pay money to play these games for hours on end, I don't think you could describe paying third-world citizens money to play the games as a "sweatshop" work environment.

    Where's the signup sheet for this "sweatshop"? I'm sure there's plenty of Slashdot readers that would gleefully sign up.

    --
    I'm a big tall mofo.
    1. Re:Sweatshop? by Photon+Ghoul · · Score: 5, Interesting

      Yeah so all the comments here are "oh wow being paid to play games is considered bad"?

      Slashdot or the submitter shouldn't have used the word "sweatshop" because it focuses attention on the working conditions away from the fact that there are companies who really game the system in MMO's for profit. It gets to the point that their actions ruin the in-game economy and playability.

      Consider Everquest2. There supposedly exists a group of people who work for one "Boss" (that's actually his in-game name). These people run teams of bot-driven characters who farm items, drive up prices, intrude in other's playing space etc. Supposedly a lot of their items end up being sold on online auctions.

    2. Re:Sweatshop? by hanssprudel · · Score: 4, Interesting

      However, if they can't leave it IS slavery.

      Of course they can leave, but the "fair trade" people always conveniently forget that in their quest to justify protectionism. The fact is that the people who work in these "sweatshops" (whether they are making sneakers or RPG characters) are there by choice because they decided the alternatives they had were worse. And if the "sweatshop" was to dissapear, what would happen? They would be left with exactly those alternatives.

      Of course it sucks that their are people in world who are so poor that working under awful conditions is a step up for them. But denying them this step up does not help their poverty - instead it locks out their societies from the prospect of economic development.

      You can point this out to the left as many times as you want, though, and they won't listen. The reason is that their motives for wanting protectionism have nothing to do with concern for foreign workers. Like all other protectionism, it has to with protecting ourselves from the possibility that others are able to do our jobs better and cheaper.

    3. Re:Sweatshop? by rhsanborn · · Score: 3, Interesting

      Have you ever seen the EverQuest economy? It cut the 'normal' or casual player out. Prices were so inflated it was darn near impossible to get anything without killing the mob yourself. Not much for a player economy.

    4. Re:Sweatshop? by PsiPsiStar · · Score: 2, Interesting

      (provided most of the siphoned money stays there and isn't funneled back into our pockets)

      Yes and no. I'll take China because that's one economy that I understand. The workers there work for subsitinance wages. The money goes to

      1. The foreign firms.
      2. The local factory owners.

      The local factory owners use this money to buy more industrial equipment. It creates a stronger China, industrially and millitarily and creates a few fantastically wealthy and powerful individuals like Robber Barons from early 20th century US capitalism, but it helps the factory worker only slightly.

      The 'worse alternatives' in China exist in part because the Chinese government forces agricultural workers to sell their crops at below market prices in order to fund this industrial growth and the growth of Chinese cities, (not to mention getting foreign currency in order to buy weapons.)

      --

      ___
      It's the end of my comment as I know it and I feel fine.
    5. Re:Sweatshop? by Anonymous Coward · · Score: 1, Interesting

      And we pull out Ludlow, and watch your argument fall apart. Might as well argue "he who has the gold makes the rules" and wait for another civil war.

      I suppose you subscribe to the "bleed them dry" system of law where the rich can wait out any legitimate claim until the other side goes broke? The labor market is very much the same.

      There is a fine line between government labor laws (to which, by certain degree, I oppose), and the government stipulating when business has violated a person's rights (and to be clear, those protections must apply in all cases, or you can kiss any coherent system of law goodbye).

      If no one owes you a job, no one owes you a business either. Labor laws seem to be an obvious manifestation of that (abide by the law, or you are out of business).

      While I agree with your original statement, it avoids the bigger question as to why people are in such poor conditions in the first place. Greed and corruption usually are at the heart of the matter, and you seem to be advocating for more of the same.

      No one choose to work in a sweatshop unless the gold that makes the rules forces them to. This is not left, this is not protectionism; this is genuine concern and a sense of fair play, which you seem to be incapable of.

    6. Re:Sweatshop? by DerWulf · · Score: 2, Interesting

      No one choose to work in a sweatshop unless the gold that makes the rules forces them to. This is not left, this is not protectionism; this is genuine concern and a sense of fair play, which you seem to be incapable of.

      It is left. It also is quite ignorant. Your vantage point is looking back at 150 years of industry and, comparativly, liberty. Some wealth has been produced over that time and manifests itself everywhere: machinery improving productivity, infrasturcture, education. The third world on the other hand, starts out with very little of this. At this stage, your occupation is one out of those:

      - Chief or misc. government buerocrat
      well, those are often doing quite well, even if the country is bad shape. I wonder why.

      - Soldier
      Up to a point they are mostly well fed and well off. If conditions change for the worse, often a 'revolution' happens and they switch place with the group above

      - Merchant or craftsman
      Very risky business that can go either way. Basically those are one-man style firms that bear all the risks of their endevours themselves.

      -Farmers
      The biggest portion of the populance farms for subsidence. As I pointed out above, this is no fun at all. Besides the fact that this is the hardest work we could imagine, the farmer bears all the risk. If the harvest goes bad, no food on the table. Productivity is so low that one farmer can hardly produce enough to keep himself and the family fed. Even if something is left, trading that won't buy him much in an economy that is not mass producing. The implications are clear: all tools and commodities like clothes (or funiture) must be crafted by the farmer or his family members, adding additional work to his already busy schedule.

      Now, imagine you where that farmer and one of those terrible sweatshops opened near by. Would you go on working your farm on the verge of starvation or would you rather have a reliable, risk free income (and more of it). Would you take the job and work fewer hours and not have to bother with making your own tools? I do think so. And this is the reality in those countries: people fight over those jobs, precisely because they are better off taking them. Labour is not forced by the 'rule of gold', it comes about because of necessity. It's not nikes fault that people need food and clothes and education and health care to survive. Neither does 'nature' provide those for free. This is the true point that the left tends to forget: living is not free. The delta, the difference between living and starving must be provided and ultimatly can only be provided by work. The question comes down to wether you want to be your own employer without any capital (machinery ie.) and work your ass off without any gurantee that your work will pay or labour (be employed by someone else) and profit from the producivity that division of labour brings, have the company take all the risk (they don't know if their shoes will sell) and use their tools?

      --

      ___
      No power in the 'verse can stop me
  2. this is like something out of an SF novel by Cryofan · · Score: 2, Interesting

    first, paying for something like this is just strange, in my opinion.

    But then the whole thing of having 3rd world sweatshops to produce virtual real estate is like something out of a science fiction novel. But I doubt any SF novel has ever dealt with that subject. SF is really not all that original or truly predictive of our real world, in my opinion.

    --
    eat shiat and bark at the moon
  3. ... what? by tomstdenis · · Score: 2, Interesting

    So let me get this right.

    1. Create virtual world
    2. Buy virtual island with REAL money
    3. Pay REAL people REAL money to play in virtual world ...

    4. Sell accumulated virtual wealth for REAL cash money on ebay... ... what? Who the fuck would buy with REAL money something in a video game that they could just sign up for and get themselves?

    I mean I bought minish cap for 40$ [cdn]. I wouldn't pay someone money for a savegame so I could beat the game quicker. That kinda defeats the purpose doesn't it?

    As a side note I see the REAL accumulation of things as kinda pointless as well. I mean I do have cool shit [e.g. 500W 5.1 stereo, 17" LCD, amd64, etc...] but you won't find a shirt in my room worth more than 10$ nor diamond encrusted watches, etc...e.g. I buy practical stuff I can actually use and benefit from...

    I hope they sell it for a lot of cash money and I hope whoever buys it gets exposed for the dork they are. ;-)

    Tom

    --
    Someday, I'll have a real sig.
  4. Virtual Goods? by ceeam · · Score: 4, Interesting

    Let's think about it. What makes these goods more "virtual" (ie not-real) than MP3 music or videos? No, really?

  5. Doctorow wrote about this by Dark+Paladin · · Score: 4, Interesting

    Here's a link (think there might be a commercial to go through, but there it is:)

    http://www.salon.com/tech/feature/2004/11/15/andas _game/index.html

    A story about what MMRPG's might be like in the future, and the repercussions of that in our lives, including the "sweat shop" idea. The first half made me go "Eh, another story about MMRPG's and the evils of playing all the time", but then when the meat of the story came in it had me thinking.

    Seems the future is now.

  6. Re:almost jobless by Anonymous Coward · · Score: 1, Interesting

    Time is money.
    It's no different then sitting around playing the stock market.

    Or sitting around doing ANY activity that has value to someone else and is willing to pay for.

    This, in essence, is what capitalism is all about.

  7. So, why bother playing this shit? by RLiegh · · Score: 2, Interesting

    I know this is going to come off as flame-bait; so I'll apologize in advance. But given the cheating, the internet fucktard factor and every other shitty factor (people who are working irl will take over your area according to one post here? wtf is that all about?) ... why bother playing online?

    Between that, and the people who are out in the FPS games who deliberately spoil people's games ... there are not anywhere close to enough measures in place to be able to insure a fair and pleasent gaming experience for the casual gamer (read: someone who actually has to work for a living)... ...is online gaming just some jackass "omg we're so hardcore" avocation or am I missing something that makes the cheaters and invaders and general assholes worth paying cash money to put up with? Because from where I sit (outside, looking in) it looks really, really crappy -- and i certainly wouldn't be willing to pony up any cash to join the crapfest which is online gaming, that's for sure.

  8. Re:meanwhile... - prophetic SciFi by aacool · · Score: 4, Interesting
    Cory Doctorow wrote a short story, Anda's Game about this not too long ago - this is quite interesting.

    Since Salon is quite restrictive in access, I put a DRM-free txt/html version on my blog along with a review.

    The story itself is here(txt) and here(html).

    A review of the story is also on my blog

    As is par for Cory's work, the topics are cutting edge - dealing with ebay-driven in-game economics, dietary restrictions on kids,anti-globalization criticism, puns on the Bradbury/Moore controversy and female rights a la SuicideGirls(?). In another time, a little girl might play with a golliwog, a Barbie or a teaset. In this post-modern age, she is a skilled character in a game that borrows from Everquest, Ray Bradbury, Quake and Tolkien - more a killer than a wayfarer. Her participation in, and then disavowal of, an in-game conspiracy to terminate characters who produce in-game gold to be sold for real money on ebay, is bracketed with the onset of youthful diabetes, induced perhaps by the sweetshops just outside the 500 m sugar-free zone at her school.
  9. Sega got it right with PSO by Stormwatch · · Score: 3, Interesting

    On Phantasy Star Online, Sega got it right - better than everyone else, actually. Money abounds and item storage is limited. What do players do then? After getting more powerful weapons, they give away their older, less powerful ones to newbies, who put them to good use. And everyone has fun together doing what is actually fun: killing monsters.

    No, it is not a MMORPG; it is a multiplayer (not massive) online action RPG. It actually demands skill, not just tons of levels and clicking on the monsters. And it is actually fun to play solo. It is not a virtual fantasy world; it is just a damn good game - and it is good for not trying to be anything else.

  10. Cultural imperialism by michaelmalak · · Score: 2, Interesting
    We're so generous. We destroy indigenous cultures with Hollywood and advertising, luring them to the more "advanced" Western lifestyle. Then we say that it costs money, and, oh, here's a way to earn that money.

    Selling technology-laden products is not liberating, but technology training would be.

  11. The main problem with these ? the economy. by LullySing · · Score: 3, Interesting

    The main problem with those "sweatshops" is that over time, they eventually increase the chance for the in-game economy to go comepletely FUBAR.

    By flooding the market for certain items, or controling drops on certain monsters , a small group of Farmers like these can effectively deny the rest of the online world's population of something that they need ( for they character's job) or simply monopolise the market on some items ( after all, they can organise shifts easely so they can camp for 24 hours at a time).

    Add to the mix the fact that there is a good percentage of these people botting ( aka, having automated scripting tools that will autoattack/target rare monsters, or farm items without human action) and Eventually over time you get to the point that MONEY BECOMES WORTHLESS in the online game.

    And the problem is that it keeps on getting worse and worse. The Final Fantasy XI Online economy was showing the signs of this about 5-6 months ago, and now, since then there has been about a 100% inflation on all costs in-game ( for player-sold items). It's getting so bad, the developpers are putting a tax on ALL ITEMS being bought ( so they could reduce the crazy amonts of money lying around).

    Developpers don't realise how badly their economy might go down unless they start to actually monitor the online world's economy. Usually by the time they start doing that, they are already getting to the point that things are getting too crazy to be fixed.

    --
    Peace and happyness to you, by LullySing ;)
  12. Ok I've Bought virtual goods by Grimster · · Score: 4, Interesting

    I like to play games, I have a group of friends I've played online games with since the infancy of online MMORPGS (DarkSun Online nearly 10 years ago now) and unlike the olden days, I can no longer play as many hours as I used to. I have a kid, wife, a company to run, etc, so my play time isn't that "much".

    So I'm left with staying a "newbie" forever, for example in WoW it takes "roughly" 300+ hours of real play time to get a character "maxxed" out, playing 3 maybe 4 hours a day, I'm looking at 3-4 months to get maxxed out so I can join in the "high level" fun stuff. By then most of my friends will be on their 3rd or 4th maxxed char and hell by then most of them will be quitting for the next game and I'm sitting there going "damnit".

    So what do I do? $300 for a maxxed char off Ebay, $300 for enough gold from one of those gold selling services that I can afford to buy enough "good stuff" to be able to join in those high level shenanigans, and I'm set. Obviously if I were working for $8 an hour this would be stupid, but $600 is maybe 2 days income for me, call it 15 hours of work to make that cash, 15 hours of "real world labor" to save myslef 300+ hours of "game time grinding"? I'll pay it. Now I'm able to join in all the reindeer games.

    As for the "sweatshops" are these people supposedly being forced to work for these companies? What is these peoples' alternatives? Where would they be working if they weren't doing this? As I understand it there isn't just a glut of "good jobs" in many of these locales so is playing an online game all day for a boss 'that' bad of a job or is it a pretty decent setup for these folks? I think fast food restaurants are HORRIBLE sweat shops and any time I see some teenager being browbeaten by a 20 something manager I just thank the gods I no longer work in fast food (I did during high school and some of my college times).

    --
    --- www.f-theocean.com
    1. Re:Ok I've Bought virtual goods by Anonymous Coward · · Score: 1, Interesting

      I hope that you don't play on my server.

      I will report anyone who tells me they bought game money/items/accounts for RL currency to the GMs. I report anyone who admits to selling as well. No joke. I don't care who you are, you get reported, and I hope that the GMs ban you from the game.

      Selling "virtual property" hurts the game in the following ways:

      #1. It screws over the game economy for legit players.

      I used to think it was OK to sell items/money on eBay, etc. in these games. After all, I thought, you spent the time to earn those in game. Perhaps if it were just a few normal players on eBay earning some extra cash, it'd be okay. But it isn't. There is now an entire sub-industry deticated to this practice. Companies employ thousands of players in China and elsewhere to grind nearly nonstop. These guys are impossible for a normal player to compete with. On high population PvP servers, they apparently have teams of both Horde and Alliance farming areas and if a legit player decides to grind in their territory, the legit player can expect to be zerg rushed by them and forced out.

      Legit players should not be forced to form a raid group just to grind for some gold, but if these farmers continue with their practices, the legit players on PvP servers will have to.

      $300 will buy you about 800 gold on my server, from what I can surmise. You buy this indirectly from farmers who spend all their time grinding out high level areas in teams and in effect get far more rares and epics than an average player would have. These farmers never drop their prices on these items despite supply, so we're talking 300g for an epic. And this is a low price compared to other servers, apparently.

      Now, you log on with your character who has 800g, and buy that 300g epic from the gold farmers who just sold you the money since you have it. They get their money back to sell to another chump, and the price of epics never drops for legit players, forcing us to grind even longer to afford the best items.

      #2. Players who buy high level characters generally suck at the game.

      I have spent 3 months learning how to play my class effectively, and learning how to handle various situations and various types of groups.

      Player skills are more important than character stats or leet gear. If you think that you can buy a level 60 character and instantly be effective in an Onyxia raid or own everyone in PvP, you're sorely mistaken.

      #3. You have missed out on 1-60 content.

      There is a hell of a lot of fun content on the way from level 1 to level 60, and you missed it. You will never experience the thrill of taking on the your first instance as a level 20 character. You will never get the "rush" of exploring a new, unknown area where the mobs are actually dangerous to you, or from encountering a player of the other side who is 20 levels higher than you for the first time.

      Not to mention, WoW gives you a "rested bonus." The longer you rest, the longer your bonus lasts. While you have your rested bonus, you will earn double XP. Thus, people who play the game half us much as me can catch up much easier than any other game.

  13. Difference is in creativity by Sycraft-fu · · Score: 3, Interesting

    Normal IP, as it's defined under the law (at least as it is supposed to be defined, these days it seems anything goes) has to do with a creative process. Wether it's music or a book, or a brilliant new manufacturing process, someone expends effort to create something new. Doesn't mean it's 100%, from nowhere with no insparation from prior works, but it's still creative.

    That's not the case with money in MMORPGs. All you are doing is incrimenting a value in a database. If the company that ran it wanted, they could change that value arbitrarly. There's no creative process, and there's no new creation as a result. The number just goes up.

    I'll pay for a video game or for music or for a book because of the creative value. Someone has a talent and used that talent to create something I like. Even though it's non-tangible, they still deserve compensation, so they'll hopefully keep doing it.

    Money in a game lacks that, a person sat there going through the process the game has to incriment a number in the database. No creativity. The other thing is the whole reason I play these games is to have fun. It's an enjoyable way to spend my free time. Paying someone else to play, therefore, seems really stupid. If the game isn't fun, I shouldn't be playing it in the first place.

    That's all aside from how this can screw up a game's economy. Final Fantasy 11 apparantly really suffers form this. You cannot get some of the best items in the game by playing it. They are continously camped by these "sweatshops". The only way to get them is to pay real money for them, a lot of it. Well talk about a way to screw up the game for those that play it for fun. What if you happen to LIKE the really hard quests and battles that take a long time? Maybe that is fun to you, I know a lot of people for who it is. However oh, no, can't do that, because there are people locking you out to attempt to get money out of you.

    Basically, I don't mind paying the company who made and runs the game a fee to play. As far as I'm concerned, it's a service fee for entertianment, just like my cable bill. I give them money, they give me entertainment. It's also necessary, because there's real costs associated with running these games (bandwidth, support, hardware, etc). I am not willing to pay to have someone else play the game for me, or for their permission to do something I want to, and should be able to, do in the game.

  14. Pitfalls of Virtual Property by cannon+fodder+0109 · · Score: 2, Interesting

    For a more thorough discussion of virtual property "ownership" than the links given in TFA try:

    "Pitfalls of Virtual Property" by Dr Richard Bartle

    Links:

    Original PDF

    HTML version from google's cache

    --
    Pick up the bread knife and carve your way into forensic history
  15. Economic Impact of ? by gordguide · · Score: 2, Interesting

    " ... For comparison, the economic impact of this phenomenon is roughly equal to that of Namibia or Macedonia. ..."

    Okay, I'll bite (didn't see anyone else post it yet).

    These are virtual goods that, in about two years, have transformed themselves into a real economy (the things sell for hard currency) already as big as whole countries?

    Sure, they're small countries. But, they have lots of real people eating, working, making stuff. Probably a few rich ones, fattening the offshore bank account in the usual ways. Trust me, my own personal economy isn't that big, by a long shot.

    Put another way, are we seeing a phenomena that would have doubled these economies, while making "goods" that didn't even exist a couple of years ago?

    If I were the "Benign Dictator" of Nambia, I'd be getting right on it. Pronto.

  16. Re:online shopping sucks by Doc+Ruby · · Score: 2, Interesting

    There is a huge cultural imperative to be "modern" - own a TV, wear a suit, etc. So many people have been made consumers, and therefore dependent on foreign trade, therefore requiring jobs. But there is little choice for people whose society used to feed people through a division of labor based on their own local conditions. And assign status, including political decisions, mating preferences, hereditary knowledge, by one's fitness in the "grand scheme", which used to be limited to one's 10 mile radius at birth. The industrial consumption machine has created insatiable desires and unsustainable disparities. And a job, however cruel, looks like the only way out. Even enlightenment beyond desire has been crushed by the Christian hunger for eternal reward, and its apparent fulfillment on Earth. Wage slaves worldwide have very real chains, though their slavery is mental.

    --

    --
    make install -not war

  17. Selling items and characters has many detrimental by samdu · · Score: 3, Interesting

    effects.

    I played Final Fantasy XI for a total of 79 RL days. I recently quit the game because it was taking up too much mindshare and RL time. The Chinese "sweat shops" were also a factor in my quitting.

    The selling of accounts in and of itself causes certain issues in-game. While other posts have noted that it's a time-saving measure for some, that is a problem. Those of us who managed to build up a character to a high level through the tedious level grind and crafting learned the nuances of our jobs. Someone that buys a level 50 character, on the other hand, has saved all that time but doesn't know those finer points of playing the job. Thus, you get parties with schmucks that don't know what the hell they're doing. No one gains from this. The new player gets embarassed, the seasoned players get killed and lose experience, causing them to spend even MORE time in game.

    There's also the problem of the sellers that rush through levels trying to build up a saleable character. They also don't know their jobs and really don't care that they don't know how to play. So, yet again, you get seasoned players that get killed due to the ineptness of the sellers.

    Even more of a problem were the Chinese gil sellers. These people would lock down an area and "steal" as many mobs as they could that dropped certain, high gil items. They would corner the market on these items and raise the prices to astronomical levels. One example for a piece of equipment that was highly prized for my main class (Monk) was the Ochiudo's Kote. They went for nearly a million gil on the auction house. Try selling them to an NPC and the going rate was three thousand gil. Sure, they would be more than the NPC price naturally, but they wouldn't have been nearly as much if it weren't for the gil sellers. The gil sellers, and most players eventually came to know who they were, they used similar names and were on 24 hours a day, seven days a week, became a serious problem and contributed to my quitting the game.

    Another side effect of the gil sellers were the steps taken by Squenix to try to thwart them. They instituted game changes like the likelihood of catching certain fish going down considerably after being in a particular zone for a certain length of time. Sure, this had an effect on the fish botting players and gil sellers, but it also became a pain in the ass for the honest players. And after the fishing nerf, they did the same thing to logging, mining, and excavating. I can't blame Squenix for trying to slow down the gil sellers, but the steps they took ended up screwing everyone, not just the people they were going after.

    Of course, there are soultions to a lot of these problems. But Squenix was never all that receptive to the obvious solutions.

    Near the end of my play time I tried to organize some things to cause the gil sellers some grief. I could never get enough people together to make an impact. Partly because a lot of the people that I recruited considered what I proposed griefing, which would have put their accounts in jeopardy. I didn't think it was, but that was the perception. In essence, the people that I was playing with were FAR more moral and decent than the gil sellers and that was a stumbling block in getting the players involved in an effort to take a stand against the gil sellers.

    At any rate, this IS a problem and it's one that won't go away until people quit supplying the gil selling companies with cash by buying accounts or in-game money. And just for shits and grins, I decided to see what my account would bring in when I decided to quit the game. Based on other accounts with similar or lower stats/equipment, one could expect to spend a couple of hundred dollars for my account. The amount I was offered was a whopping $47.00. So, when you're thinking of how much these guys must be paying the "sweat shop" workers, take that huge profit margin into account.