Love It Or Leave It? Player-To-Player Virtual Item Sales Go Legit (GDC 2008)

everquest2_money.jpgSan Francisco -- If you're an MMO gamer who buys his/her virtual in-game goods on the black market, your days of shady dealings may be numbered.

A panel I attended earlier this week at the Game Developers Conference's "World in Motions" series suggests that player-to-player item selling is going to be increasingly legit -- whether many MMO players like it or not.

The session was called "Learning to Love Virtual Item Sales." The half-hour presentation was led by Andy Schneider, president and co-founder of Live Gamer, "a legitimate market for virtual trading," and Steve Goldstein, co-founder and president of Ping0, a Live Gamer partner and distributor of Flagship Studios' "Hellgate: London."

Legitimate virtual item sales are common, particularly in free-to-play games, and especially in Korea, where micro-transactions -- the buying and selling of in-game assets and content -- are rampant. But for games that don't offer real-money transactions, like "World of Warcraft" for example, websites like IGE and ItemBay have transformed illicit virtual item sales into a billion-dollar business -- over $1.8 billion according to analysts' estimates given in the session -- and game publishers aren't getting a cent.

Schneider and Goldstein want to change that.

The pair listed a number of reasons why players are resorting to black market goods -- acquiring a sense achievement, being social with friends and maintaining an immersive, fantasy experience. To boot, often due to lack of time, gamers want to advance through the games faster to keep up with friends and get new content as rapidly as they can. "I have to outsource my gameplay now because I don't have the time," Goldstein admitted. "There was a point in time where I could spend 16 hours a day playing a game. Now I'm lucky to get two or three songs in with 'Guitar Hero.'"

"And what is that really saying about MMOs in general?" he pondered. He thinks it's a persistent problem that "ostracize[s] people that just don't have the time to spend that they used to."

While convenient for some, black market sales hurt the publishers and developers as well as gamers. "Publishers and developers are getting none of [the black market revenue], and in fact, they're incurring costs from customer support," Schneider said. So not only do the publishers and developers not make money from the black market sales, the game companies are also responsible for the costs from gamers needing customer support as a result of their illicit purchases.

stationexchange.jpgTheir suggested solution? Services like Sony Online Entertainment's Station Exchange, which launched in June 2005 as a place for "EverQuest II" players to securely trade virtual game items for real money to avoid fraud and fight farming practices. Before the launch of the Station Exchange, 40 percent of the game's customer service was spent on "virtual item sales resolution." Since the service's rollout, it's dropped by 30 percent, according to the presentation.

Although the service is nearly three years old, earlier this month, Live Gamer announced an agreement to utilize SOE's Station Exchange technology to form Live Gamer Exchange. It promises to be a new, independent service that "combines the Web-based accessibility of Station Exchange with Live Gamer's proprietary Wall-Street-developed in-game application" while offering players "a flexible and convenient way to access the virtual marketplace anytime, anywhere." In a press release from February 7, John Smedley, president of Sony Online Entertainment said the new Live Gamer service "will be supporting other publisher's games."

As "World of Warcraft" player myself, I have never bought in-game goods -- characters, currency, weapons, mounts or anything of the sort. Though I think that the game publishers and developers deserve a cut from these virtual sales when they inevitably occur (it is their game after all), do services like the Station Exchange condone the type of behavior -- easily buying items that are normally earned through dedicated gameplay -- that many MMO gamers find unfair to begin with? What if a behemoth like Blizzard teamed up with the Live Gamer Exchange or implemented a similar service? Would you learn to love it?