6 ms·

I find the "WoW token" -- where, supposedly, people can buy game-time tokens from Blizzard for cash and then resell them to other players for virtual currency -

I find the "WoW token" -- where, supposedly, people can buy game-time tokens from Blizzard for cash and then resell them to other players for virtual currency -- to be a brilliant scheme. (Note: I first noticed the concept in Eve Online, not WoW -- where did it originate?) MMO operators have long struggled with secondary markets for virtual currency. They often have trouble trying to sell virtual currency directly to players because then it has the feel of "pay-to-win." And so third parties have captured the lion's share of this market for years -- by some accounts capturing billions of dollars annually in revenues. But with WoW tokens (and similar concepts in other MMOs), they can market virtual currency to players, and because other players can feel like they benefit, too by getting their subscription for free, they don't complain as much of it being a "pay-to-win" model. In reality, though, remember that Blizzard controls the market for both buying and selling WoW tokens, and they can peg prices (in cash and in in-game currency) at whatever they feel is appropriate, by either providing or reducing supply artificially. Yet it is the artifice of "exchanging WoW tokens with other players" that gives the whole practice an air of fairness. This brain-dead-simple scheme will make them tens or hundreds of millions of dollars per year in increased profits that for years has been instead going to IGE and a cadre of third-party gold sellers.

forgetsusername 11y ago
Do you happen to have a source for any of your figures regarding these markets? I have a hard time understanding how a small scheme like this will result in hundreds of millions in annual profit. At the end of the day, each monthly player results in one monthly fee, whether they are paying for themselves, or buying a token which another player's paid for. Hundreds of millions in increased profits would require tens of millions of active accounts. I am I think at last count Wow had about 6 million active monthly accounts.
- spdionis 11y ago
  I think Blizzard can buy the tokens themselves with gold they generate.
  - rcxdude 11y ago
    BTW, this is something which CCP (who have a similar system for EVE online) very explicitly do not do. They make sure that purchased tokens are either destroyed by players, converted into gametime, or the associated profits are donated to charity.
    - mfoy_ 11y ago
      The fact that the EVE tokens even can be destroyed is always a source of amusement. Just google "eve killmail plex" and you'll find quite a few examples of players getting blown up while carrying thousands of dollars worth of tokens.
      - rcxdude 11y ago
        It's especially amusing considering there's literally no reason whatsoever to put them in a ship's corgohold, let alone undock with them.
        manicdee 11y ago
        Price differences between regions mean you can make tens of millions of ISK profit in a few trips. I have variously used a shuttle, covert ops frigate and interceptor to ferry billions of ISK worth at a time, and I am one of the smallest players in the market. To get caught you have to do something foolish like buy heaps of PLEX, then undock with the character that bought them in Jita, during a wardec, and not have an instant undock bookmark.
- dantillberg 11y ago
  Aha, but you're using the assumption that there are an equal number of WoW tokens bought by players and sold by players. Blizzard could sell 20 million WoW tokens each month to players for cash even if only 2 million tokens are bought by players for virtual currency. Blizzard needs only buy the remaining 18 million tokens on their own auction house in exchange for virtual currency (which, conveniently, they can create out of thin air). The question here, then, is not about the number of active accounts, but: how much extra cash are players willing to put into the game in order to get gear / avoid grinding / gain a competitive edge, etc. The size of this market could be very different; Wikipedia links to [0] (2008), which on page 10 examines some possible lower ($200m) and upper ($1.4bn) bounds for the annual size of the market. Of course, not all of that is WoW, and not all of it would necessarily be captured by Blizzard, but that's where I'm pulling the "tens to hundreds of millions in additional annual revenue" from. [0]: http://www.sed.manchester.ac.uk/idpm/research/publications/wp/di/documents/di_wp32.pdf http://www.sed.manchester.ac.uk/idpm/research/publications/w...
  - forgetsusername 11y ago
    >Blizzard needs only buy the remaining 18 million tokens on their own auction house in exchange for virtual currency (which, conveniently, they can create out of thin air). Hmm, you're right. I assumed it had to be a player to player transfer of the token. I guess under said system they are walking the pay-to-win line, as you say. They've been slowly making the game more and more accessible to casual gamers. I'd bet these decisions are driven by the fact that the games user base is dwindling.
  - mentos 11y ago
    >Blizzard needs only buy the remaining 18 million tokens on their own auction house in exchange for virtual currency (which, conveniently, they can create out of thin air). Interesting, so the final effect is as if players had just bought virtual currency with real world dollars but they 'launder the guilt' through this token scheme..? But wouldn't players be able to see through only 1 degree of indirection and make the connection that they are buying virtual currency with real?
  - VLM 11y ago
mikekchar 11y ago
It's a bit different than this scheme, but I actually read a short story in Dragon magazine about 35 years ago (very likely 1980 or 1981) about an MMO where most people paid a subscription fee to play, but you could exchange in game currency for play time (and could even cash out into real currency -- leading to pro players who would compete for collecting the most in game gold). It is an interesting twist to have the players front the real world cash. As an aside, I always dreamed of playing the game I read about. One of the cool things about the game was that your character continued in the game as an NPC when you were offline. I always thought this would be very interesting way to have player generated content, where they would have to build defences to protect their player/gold while offline. Other players could launch raids to try to steal it. No one has ever built a similar kind of PK system that doesn't piss everyone off, but for me it's a kind of holy grail of MMO functionality. I hope I see it before I die :-)
- pavel_lishin 11y ago
  > * an MMO where most people paid a subscription fee to play, but you could exchange in game currency for play time (and could even cash out into real currency -- leading to pro players who would compete for collecting the most in game gold).* Reminds me of Stephenson's REAMDE.
  - amyjess 11y ago
    Reading OP's article reminded me of REAMDE. I've never really played MMOs outside of a little bit of UO and EQ in the '90s, and everything I'm reading about WoW's gold economy is something that I thought Stephenson just came up with for REAMDE. I'm actually a little bit shocked that all this is real.
- jghn 11y ago
  "(very likely 1980 or 1981) about an MMO" There was no such thing at the time. There were MU* games around but MMO as a genre was viewed as something greater than that. Games like M59 and UO were where that differentiation really started being made.
VikingCoder 11y ago
I'd love to run a contest, but I'm pretty sure it'd be illegal. Picture leaving the Amulet of Yendor somewhere hidden in a new WoW shard. First player to pick it up wins $10,000. $0.25 to play the contest - PER LIFE. PVP. MASS HYSTERIA.
deleted 11y ago
[deleted]

forgetsusername 11y ago

Do you happen to have a source for any of your figures regarding these markets? I have a hard time understanding how a small scheme like this will result in hundreds of millions in annual profit. At the end of the day, each monthly player results in one monthly fee, whether they are paying for themselves, or buying a token which another player's paid for. Hundreds of millions in increased profits would require tens of millions of active accounts. I am I think at last count Wow had about 6 million active monthly accounts.

spdionis 11y ago
I think Blizzard can buy the tokens themselves with gold they generate.
- rcxdude 11y ago
  BTW, this is something which CCP (who have a similar system for EVE online) very explicitly do not do. They make sure that purchased tokens are either destroyed by players, converted into gametime, or the associated profits are donated to charity.
  - mfoy_ 11y ago
    The fact that the EVE tokens even can be destroyed is always a source of amusement. Just google "eve killmail plex" and you'll find quite a few examples of players getting blown up while carrying thousands of dollars worth of tokens.
    - rcxdude 11y ago
      It's especially amusing considering there's literally no reason whatsoever to put them in a ship's corgohold, let alone undock with them.
      - manicdee 11y ago
        Price differences between regions mean you can make tens of millions of ISK profit in a few trips. I have variously used a shuttle, covert ops frigate and interceptor to ferry billions of ISK worth at a time, and I am one of the smallest players in the market. To get caught you have to do something foolish like buy heaps of PLEX, then undock with the character that bought them in Jita, during a wardec, and not have an instant undock bookmark.
dantillberg 11y ago
Aha, but you're using the assumption that there are an equal number of WoW tokens bought by players and sold by players. Blizzard could sell 20 million WoW tokens each month to players for cash even if only 2 million tokens are bought by players for virtual currency. Blizzard needs only buy the remaining 18 million tokens on their own auction house in exchange for virtual currency (which, conveniently, they can create out of thin air). The question here, then, is not about the number of active accounts, but: how much extra cash are players willing to put into the game in order to get gear / avoid grinding / gain a competitive edge, etc. The size of this market could be very different; Wikipedia links to [0] (2008), which on page 10 examines some possible lower ($200m) and upper ($1.4bn) bounds for the annual size of the market. Of course, not all of that is WoW, and not all of it would necessarily be captured by Blizzard, but that's where I'm pulling the "tens to hundreds of millions in additional annual revenue" from. [0]: http://www.sed.manchester.ac.uk/idpm/research/publications/wp/di/documents/di_wp32.pdf http://www.sed.manchester.ac.uk/idpm/research/publications/w...
- forgetsusername 11y ago
  >Blizzard needs only buy the remaining 18 million tokens on their own auction house in exchange for virtual currency (which, conveniently, they can create out of thin air). Hmm, you're right. I assumed it had to be a player to player transfer of the token. I guess under said system they are walking the pay-to-win line, as you say. They've been slowly making the game more and more accessible to casual gamers. I'd bet these decisions are driven by the fact that the games user base is dwindling.
- mentos 11y ago
  >Blizzard needs only buy the remaining 18 million tokens on their own auction house in exchange for virtual currency (which, conveniently, they can create out of thin air). Interesting, so the final effect is as if players had just bought virtual currency with real world dollars but they 'launder the guilt' through this token scheme..? But wouldn't players be able to see through only 1 degree of indirection and make the connection that they are buying virtual currency with real?
- VLM 11y ago

mikekchar 11y ago

It's a bit different than this scheme, but I actually read a short story in Dragon magazine about 35 years ago (very likely 1980 or 1981) about an MMO where most people paid a subscription fee to play, but you could exchange in game currency for play time (and could even cash out into real currency -- leading to pro players who would compete for collecting the most in game gold). It is an interesting twist to have the players front the real world cash. As an aside, I always dreamed of playing the game I read about. One of the cool things about the game was that your character continued in the game as an NPC when you were offline. I always thought this would be very interesting way to have player generated content, where they would have to build defences to protect their player/gold while offline. Other players could launch raids to try to steal it. No one has ever built a similar kind of PK system that doesn't piss everyone off, but for me it's a kind of holy grail of MMO functionality. I hope I see it before I die :-)

pavel_lishin 11y ago
> * an MMO where most people paid a subscription fee to play, but you could exchange in game currency for play time (and could even cash out into real currency -- leading to pro players who would compete for collecting the most in game gold).* Reminds me of Stephenson's REAMDE.
- amyjess 11y ago
  Reading OP's article reminded me of REAMDE. I've never really played MMOs outside of a little bit of UO and EQ in the '90s, and everything I'm reading about WoW's gold economy is something that I thought Stephenson just came up with for REAMDE. I'm actually a little bit shocked that all this is real.
jghn 11y ago
"(very likely 1980 or 1981) about an MMO" There was no such thing at the time. There were MU* games around but MMO as a genre was viewed as something greater than that. Games like M59 and UO were where that differentiation really started being made.

VikingCoder 11y ago

I'd love to run a contest, but I'm pretty sure it'd be illegal. Picture leaving the Amulet of Yendor somewhere hidden in a new WoW shard. First player to pick it up wins $10,000. $0.25 to play the contest - PER LIFE. PVP. MASS HYSTERIA.

deleted 11y ago

[deleted]