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.

Comments

Sweatshop?

[bigtallmofo]

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.

Re:Sweatshop?

[xami]

maybe the work itself doesn't seem hard (to you), but the conditions they have to suffer are really sweatshop-like
BBC had a report about it recently, a dozen workers stuffed into a small, dark room with computers and only a sleeping bag may sound LAN party style to us - but we can leave the party anytime, they can't

Re:Sweatshop?

[Photon Ghoul]

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.

Re:Sweatshop?

[hanssprudel]

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.

Re:Sweatshop?

[digitalchinky]

I actually live in Asia, a lot of these 'sweatshops' are bloody nice work environments! Just as nice as anything you'd find in Australia - the difference is the workers are paid a little higher than average wages most times. If the company is foreign owned or 'bankrolled' - then conditions have to be compliant with all health and safety regs. The exact same pair of jeans sold in america for $100 will cost around $5-$10 here, on the street (shopping centers)

Workers get breaks, medical, dental, nobody under 18, the law is enforced pretty well since failure to do so means big government fines.

It all works out in the end.

These offshore 'call centers' are staffed by college graduates mostly, just looking for a good income - problem is a few 'Americans' think they are 'stupid' in many instances, and hate talking to them. (I have a neice working in one, I hear the stories every day) Can really screw up ones day. These people are smart, they just don't speak english fluently.

Just my 2 cents. (Excluding China, I don't know anything about that place - so previous poster might be right)

Re:Sweatshop?

[Zorikin]

Yes, it is better for a person to have a shit job than no income, but sweatshop employers are, by definition, mistreating their employees. The goal of fair traders is not to shut down the (say) factory which has sweatshop conditions, but to pressure the employer to raise the factory's working conditions above sweatshop status.

"Sweatshop factory or no factory" is a false dichotomy.

Re:Sweatshop?

[Jameth]

If you truly meant everything you just said, then you also disagree with all labor laws in this country.

If you're outright against all labor laws, I'm sorry, but you are a horribly misguided individual who needs to study history and see how those labor laws changed life. And, if you aren't against labor laws, you really need to revise your position.

It doesn't work both ways.

Re:Sweatshop?

[asdfghjklqwertyuiop]

If they can't speak English fluently they have no business taking telephone support calls from English speaking countries, is that really so much to demand?

Is it so much to demand that if you want that kind of service, you pay for it? Everyone likes to bitch about crappy, incomprehsible foreign support and then they go off and buy more $500 Dell crap PCs and $60 routers and everything else from Wal-mart (which they incessantly bitch about too for other reasons).

If you want competent domestic support then either you convince them to work for a third-world wage or you pay their salary. Take your pick.

Re:Sweatshop?

[harlows_monkeys]

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

Are you serious? Plenty of relatively affluent people tend their own gardens, too...how many do you think would want to work as farm laborers in some third-world country? Lots of people sew as a hobby...you think many of them want to head off to work in a clothing factory?

When you play these games, you do fun things, like quests, and exploring the world, and figuring out how to take on tougher and tougher monsters (and players for PvP games).

The people farming items and money for sale are not doing that. They are just sitting in one spot, killing easy things over and over and over. That's tedium, no fun.

One of the biggest criticisms of Everquest, and one of the things that most games since EQ1 have tried to fix, was that sometimes you'd have to do just that when playing. For example, to get a rare high level monster to spawn, you might have to kill placeholdes, which were low level and no challenge, for hours or even days. or to get faction to go someplace, you might have to kill 2000 trivial monsters. People hated doing this.

Video game addiction is becoming an epidemic.

[Anonymous Coward]

OMG, I can't believe that. People are spending real-world money for virtual merchandise?

Video game addiction is becoming an epidemic. I swear my roommate's job is World of Warcraft... he plays it enough. I tell him that he should go eat or go to the bathroom, but he insists on leveling his wizard or something. I think its funny (perhaps because it's unfathomably pathetic).

Re:Video game addiction is becoming an epidemic.

[Odin's Raven]

I tell him that he should go eat or go to the bathroom, but he insists on leveling his wizard or something.

Is your roomie's entertainment score increasing, or is he still sitting at the computer even when he's maxed out? Do you see "bored" icons over his head? You may want to invest the simoleans to get some other entertainment options, such as a pinball machine or a hot tub, just so he has some variety to choose from.

Also, make sure the problem isn't something simpler. Have you ever seen your roomie leave his computer room? If not, double-check the placement of doors, furniture, etc and make sure there's a clear path between his computer room and the kitchen/bathroom. (I nearly lost a guy to starvation before I discovered that I'd placed the new refrigerator in front of the only door to the kitchen.) Oh, and make sure you've trained him up at least one point for cooking so he doesn't keep setting the stove on fire.

Remember that you might have to intervene multiple times to break your roomie of the computer habit. Just keep clicking on him and assigning another task, and watch closely to make sure he doesn't wander straight back to the computer. You might have to put up with some stormcloud icons for a bit, but with any luck he'll learn a new routine and end up happier in the long run.

If he's just impossible to retrain, you might have no choice but to stick him in the swimming pool and remove the ladder. It's a bit harsh, but in extreme cases it's sometimes better to just accept the loss and create a fresh roomie.

Re:this is like something out of an SF novel

[Anonymous Coward]

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

not a novel, but a short story from cory doctorow.

Virtual Goods?

[ceeam]

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

Doctorow wrote about this

[Dark Paladin]

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.

Re:I feel soooo sorry for them

[Dark Paladin]

I think it would depend on the labor conditions.

If it's "Work 8-10 hours a day with a couple of breaks and an hour off for lunch, and a wage that a person can afford to live on (assuming third world country costs, this might be $5/day or so)", then yes, your sarcasm is met.

If it's "work eighteen hours with no breaks, no air conditioning and if you get carpel tunnel that's your own damned fault, and if you miss a quote you miss pay for the day (which might be just enough to buy food at $0.25/day) , and we employ the twelve year olds who's other choice is prostitution so the constant threat of 'perform or die' is hanging over their head 24/7" - then your sarcasm might not be met.

It's all in the scale.

Re:... what?

[DreadCthulhu]

Well, in a MMORPG, a good item (like say, the Sword of Pwning) might be really useful for your character, when your clan is fighting someone else. However, it might take a 10 hr quest to get the Sword of Pwning, and this busy first-worlder has a high paying job, so that can't skip that. So you buy the sword for real cash, because you get enjoyment out of the sword, just like you benefit from your 500Watt sterio that was probably built by some other third-worlder.

BTW

[ceeam]

Anybody around here selling mod-points? Karma? 4-digit accounts? What is the going price? : )

And how is this different from the real world?

[nysus]

My bank account is represented by a bunch of 1s and 0s in some database in the sky. There's no real paper behind it. It's virtual. Now, if someone wiped out the 1s to 0s, I'd have grounds to sue.

Value and money doesn't exist in the physical world. It's a contrived social concept that we humans have created. It's an illusion. So if it's "virtual" in the real world, seems perfectly logical that it can be virtual in the virtual world, too.

Re:meanwhile... - prophetic SciFi

[aacool]

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.

online shopping sucks

[Doc Ruby]

It's a "sweatshop" because the working conditions are really bad, and the pay is really low. The work itself is not as arduous as, say, sewing raincoats for 30 hours at a stretch, or soldering 5 thousand LEDs into Christmas light cables before being allowed to clock out. And they can quit, with many people dying to take their jobs when they do. But the physically demanding nature of traditional sweatshops isn't their defining characteristic, or steelmills would all be sweatshops in more than just a colorful description of their atmosphere.

Sweatshop labor is more of a commentary on the rest of the local economy. People don't quit, though they are "free" to, because there's no alternative labor available. That's almost always because there's no capital available to entrepreneurs, no competition among labor buyers, no real value applied to their labor. All of which is usually due to some political repression, a command economy, company towns - all the conditions we had in the US before labor organized in the 20th Century do protect our rights to work in human conditions. Which is why it sounds familiar to Slashdotters slaving away in cubefarms, wishing we could get paid to play games instead of write Java DB reporting systems.

Re:So, why bother playing this shit?

[BenjyD]

I really just can't understand the morons in online FPSs who go around TKing etc. I've tried talking to them sometimes, asking "why do you do this?" in as nice a way as possible, but of course never got an answer. The idea of playing an MMORPG, where the potential number of morons available to piss me off is so much higher, doesn't appeal to me much.

I have sat and watched someone spend half an hour stacking planes on an aircraft carrier deck so no one could take off (Coral sea,BF1942) before an admin joined and kicked him. What kind of mentality must a person have to waste half an hour doing something incredibly dull and repetitive (enter plane, taxi forwards, exit plane, wait for new plane to spawn, repeat) purely to piss off people he doesn't know who are trying to have fun?

It basically means only servers with admins are worth playing on. I have about five servers in my favourites list that I know have good admins and decent auto-kick settings. I occasionally play on other servers, but I always regret it.

Time has a value

[ThousandStars]

To those of you who have posted "OMGWTFBBQ why would people pay for virtual goods?", I can only say that time has a value that varies from person to person. So a network admin, for example, who makes $50 per hour, and wants an item that would take him four hours to pop, might put a $200 value on that item. Even $200 seems a bit excessive, but that admin might say "fuck it" and spring for the $20, especially if that item allows him to access content that he would rather spend his time enjoying. In the same way, people who like MMORPGs but have limited time to play them might pay real money for in-game money because that money will help them get through the "clear the rat den levels." If their time is worth $50 per hour, and they spend $30 on gold that saves them 10 in-game hours of leveling boredom, that's a cost effective purchase. As long as this remains true, a market for MMORPG items will exist.

Let me also pre-empt the replies that will say playing a game should be about enjoying the experience and the ride, not a power-trip toward getting an uber character and the ultimate foozle power: I agree. I'd never buy something in an MMORPG. That doesn't mean time doesn't have value and that buyers are necessarily evil.

Some MMORPGs recognize that this is bad for their game and take steps to prevent it. World of Warcraft, as far as I know, will "bind" some items to whoever picks them up. Technical solutions do exist, but as long as the economic conditions described in my first paragraph exist, I expect people will have a power incentive to get around the restrictions.

Virtual Currency Rates...

[GearheadX]

This is more than JUST a Chinese thing, there are people in the States who do this sort of thing... and it spreads across far, far more than just one or two games. Companies like IGE have been trying to set up systems across all MMOs to generate currency they can sell.

The end result of all this is inflation.

On most FF11 servers, for example, the Archer Ring is dropped by a single monster in the game, and there are people who work shifts camping that thing. To sell at an inflated rate to generate income. To sell by their company. To players. The result is a feedback loop that creates out of control inflation.

Some games make it harder for botters to play. Others become a bit more up front. World of Warcraft PvP server players have started compiling lists of known farmers working in shifts and are going around pounding them flat whenever they can (more power to em).

Meanwhile, IGE's mouthpiece can sit back in an interview and smugly say that his business is the wave of the future and has no ill effect on any game it's involved in, all the while watching his bank account climb.

Certainly, mashing farmers is cathartic... but the real solution is to NOT patronize these people.

Ok I've Bought virtual goods

[Grimster]

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).

I Live in China...

[ddewey]

I work in Hangzhou on behalf of a small manufacturing outsourcing company. Conditions for workers here in China are much better now than in the past, but there are still problems. Perhaps one of the biggest hardships for them is that most buildings in Hangzhou are not heated in winter, and it gets fairly cold here, dropping below freezing outside several times per month. Often even areas where the white collar workers are located have no heat, and sometimes I think they have it the worst, because at least the unskilled laborers are constantly moving instead of sitting motionless at a computer.

The point is, in a developing country some hardships can not be avoided. Unfortunately China's thirst for electricity is much more than can be supplied, thus it is not feasible to heat most buildings here in the south during winter. As it is, there are frequent scheduled blackouts in many areas to solve the problem that there is not enough electricity to go around. But they can't just all stop work and wait for spring. Sometimes I think people don't realize this when they get mad about working conditions in developing countries. Yes conditions are less than ideal in China, but they are improving, and it isn't possible for everyone to just quit working and wait for conditions to become like they are in the West. Change has to happen gradually and economic growth is the only way that it is going to happen at all.

Not Exactly Fun

[Chimp_On_Stilts]

A lot of people in this topic seem to be thinking that these people are being paid to have fun in a videogame like so many Americans do on a nightly basis.

That is not true.

These people are being paid to, in videogame speek, "pharm" items and money. To "pharm" something is to mindlessly acquire the item(s) at the expense of any other activity (IE: fun). For example, in World of Warcraft to "pharm" gold (currency) at level 60 for most of these workers means staying in one zone and killing the same type of enemy ("mob") for hours upon hours. Imagine killing the exact same bird in a game for literally 8 hours.

Find bird.
Kill bird.
Loot bird.
Repeat for six hours.

These people are not grouping, questing, raiding, interacting with other players, or doing any of the other activities that make these games fun. They are doing the digital equivalent of screwing bolt #3572 into a car chassis on an assembly line.

Also, beyond that, I have so far seen no mention of the damage these currency sellers do to in-game economies. These companies obliterate game economies with their actions.

For example, Bob wants Super-Item-of-Monster-Slaying, but Super-Item-of-Monster-Slaying costs 5000 gold, and Bob only has 10 gold. So, Bob buys 10,000 gold online. Now Bob is super-rich by in-game standards and decides that he wants Super-Item-of-Monster-Slaying *right now*. So, what does bob do? He offers 10,000 gold to the first person he sees with the item just because he can. The seller, along with every else, realizes he can start selling Super-Item-of-Monster-Slaying for twice the previous price and people will still pay for it.

This begins a downward spiral for the server's economy. People cannot pay the newly doubled price, so some of them pay real money for game money and pay even MORE. The price for goods rapidly increases, and the value of the currency plummets. In the end, players who want to buy anything in-game are forced to pay for fake cash or spend their own hours pharming the money for the horrifically overpriced goods.

Think this is too extreme and won't happen? Check out the Bazaar in Everquest 1; it already has happened.