I've been hearing that people have been having problems commenting. I've changed from embedded comments to full page, relaxed moderation for comments for older posts and allowed anonymous commenting.
Please let me know if you have any issues. cvorn@live.co.uk
That's my spam collecting email addy so I don't check it very often but I do usually skim the titles. Title your email BLOGGER COMMENT PROBLEM if you need to use it.
Tuesday, 30 August 2011
Monday, 29 August 2011
Diablo 3: The economy in numbers
It may perhaps come as no surprise to regular readers of this blog that I've been thinking about numbers.
In particular I've been thinking about this comment of Loque's:
"Now... for what concerns the "making money in D3" I don't really think it will happen for 99.9% of the players."
Why 99.9? Why not 80% or 99.99999% Can we attempt to figure it out?
Here goes
The virtual currency market is currently estimated at over $2 billion dollars annually and predicted grow to $5 billion by 2011. (Source)
Older but more trustworthy data states:
In 2005 The New York Times stated that there were over 100,000 professional, full-time gold farmers in China alone.[5] And in 2006 sales of such virtual goods were thought to amount to somewhere between 200[12] and 900 million USD.[4]
Another estimate, drawn from 2005/2006 data, valued the market at not less than USD200 million per year[13] and suggested that over 150,000 people were employed as gold farmers with average monthly earnings of USD145.[13] This same report estimated that 80% of all gold farmers were from China;[11] a fact which has led to prejudice towards Chinese players.[14] 2008 figures from the Chinese State valued the Chinese trade in virtual currency at over several billion yuan, or nearly USD300 million.[15]"
An academic analysis by Richard Heeks includes mention of speculation that as early as 2006 the market might be larger than $1b. And this is a market that has seen and is seeing non-stop growth.
Updating his figures in 2009 Hecks mentions that Nick Ryan put the Chinese RMT industry alone at $10b:
"Estimates of 400,000 people working in China on gold farming/trading are seen as very realistic, and the number could be 500,000 up to 1,000,000 (the latter figure is also estimated in Nick Ryan's recent articles on RMT, which claims total turnover for Chinese RMT operations of US$10bn per year). There are many brokerages in all major cities in China (Ryan's article estimates 60,000 in total)."
So in Diablo 3's first year is it fair to suggest that at a conservative estimate the global RMT market might be somewhere between $2b to $5b?
What's Diablo 3's cut?
I think there are a lot of reasons why D3 players will be more inclined to buy items than players of other games. First it's legal. Second there's the allure of believing that if you make yourself just that bit more awesome you'll be able to recoup your investment. Third it's the successor to WoW, Blizzard's first new avatar-based game since 2004 so it will inherit a lot of players who bought gold items and characters in World of Warcraft. Fourth the game provides significant blocks (difficulty level changes, pvp) that many people will only overcome by buying items.
So let's guess $5b gets spent and D3 players spend a fifth of it.
Diablo 2 sold 4 million copies. I strongly suspect that Diablo 3, launching on the back of WoW will sell more than that. There are simply more gamers around these days as well as a much higher number of older gamers. Also Blizzard has done really well with opening up new markets for WoW in places like Brazil, Russia and particularly China. Add in the allure of being able to get paid for playing, whether it's naive or not, which will draw in many more customers and I think it's not a stretch to say a big chunk of PC gamers will be playing D3. I'd guess about 10 million. I think at least 5 million is almost certain.
So if D3's real money auction house is going to turn over $1b in its first year and it has 10 million players that's $100 per player each year.
It won't distribute like that.
Hardcore mode (permadeath) players will get nothing through the legal AH. There will of course be a secondary market. (I suspect the existence of this black market will eventually push Blizzard into authorising RMT in D3 Hardcore).
The majority of players will never reach endgame.
Not all farmers are equal. Roughly a farmer's income = monsters killed * magic find bonus worth of magic items plus monsters killed * gold find bonus worth of gold.
Luck plays quite a big part, causing profits to deviate from the average that any particular playstyle might suggest.
Game knowledge can also play a big part, for instance a better method of killing fast (such as Javazons in the Cow Level in D2) or a better farming route.
Cheating (duping etc) can play a spectacularly big part but overall diminishes the game as there's less point being so interested in a game where people are able to cheat and hack and dupe. Hopefully Blizzard will keep cheating under control.
Game difficulty will play a big part. If the game can be farmed by under-geared characters in a relatively brain-dead way then uneducated Chinese labourers are perfectly effective. If the game is more difficult then players will need more grounding and understanding of the game. I'm speculating it may be hard for the typical Chinese gold farmer we saw in WoW to do this, ie it will change from a blue collar job to a white collar job. I'm sure they'll get up to speed in time but gold farming businesses that are not prepared may have a very rough first year. The current system of sharing characters in shifts with the guy on the next shift selling anything that isn't nailed down will be completely useless for farming Inferno.
All forms of arbitrage aren't actually significant in relation to the turnover figures. Arbitrage moves profit from one economic agent to another, it does not actually increase turnover itself.
Conclusion: if you're a skilled player who farms Inferno a lot with magic find gear on I think you'll earn over $1000 per year playing Diablo 3. If you also arbitrage effectively you will earn more. It won't support any but a few as full-time professionals but it's a financially significant hobby.
Or to put it another way if you're a reasonably competent gamer you will pay back the cost of the box at least if you do some magic finding in Inferno.
In particular I've been thinking about this comment of Loque's:
"Now... for what concerns the "making money in D3" I don't really think it will happen for 99.9% of the players."
Why 99.9? Why not 80% or 99.99999% Can we attempt to figure it out?
Here goes
The virtual currency market is currently estimated at over $2 billion dollars annually and predicted grow to $5 billion by 2011. (Source)
Older but more trustworthy data states:
" Figures
While reliable figures for gold farming are hard to come by,[11] there are some estimates of the market for in-game currency.In 2005 The New York Times stated that there were over 100,000 professional, full-time gold farmers in China alone.[5] And in 2006 sales of such virtual goods were thought to amount to somewhere between 200[12] and 900 million USD.[4]
Another estimate, drawn from 2005/2006 data, valued the market at not less than USD200 million per year[13] and suggested that over 150,000 people were employed as gold farmers with average monthly earnings of USD145.[13] This same report estimated that 80% of all gold farmers were from China;[11] a fact which has led to prejudice towards Chinese players.[14] 2008 figures from the Chinese State valued the Chinese trade in virtual currency at over several billion yuan, or nearly USD300 million.[15]"
An academic analysis by Richard Heeks includes mention of speculation that as early as 2006 the market might be larger than $1b. And this is a market that has seen and is seeing non-stop growth.
Updating his figures in 2009 Hecks mentions that Nick Ryan put the Chinese RMT industry alone at $10b:
"Estimates of 400,000 people working in China on gold farming/trading are seen as very realistic, and the number could be 500,000 up to 1,000,000 (the latter figure is also estimated in Nick Ryan's recent articles on RMT, which claims total turnover for Chinese RMT operations of US$10bn per year). There are many brokerages in all major cities in China (Ryan's article estimates 60,000 in total)."
So in Diablo 3's first year is it fair to suggest that at a conservative estimate the global RMT market might be somewhere between $2b to $5b?
What's Diablo 3's cut?
I think there are a lot of reasons why D3 players will be more inclined to buy items than players of other games. First it's legal. Second there's the allure of believing that if you make yourself just that bit more awesome you'll be able to recoup your investment. Third it's the successor to WoW, Blizzard's first new avatar-based game since 2004 so it will inherit a lot of players who bought gold items and characters in World of Warcraft. Fourth the game provides significant blocks (difficulty level changes, pvp) that many people will only overcome by buying items.
So let's guess $5b gets spent and D3 players spend a fifth of it.
Diablo 2 sold 4 million copies. I strongly suspect that Diablo 3, launching on the back of WoW will sell more than that. There are simply more gamers around these days as well as a much higher number of older gamers. Also Blizzard has done really well with opening up new markets for WoW in places like Brazil, Russia and particularly China. Add in the allure of being able to get paid for playing, whether it's naive or not, which will draw in many more customers and I think it's not a stretch to say a big chunk of PC gamers will be playing D3. I'd guess about 10 million. I think at least 5 million is almost certain.
So if D3's real money auction house is going to turn over $1b in its first year and it has 10 million players that's $100 per player each year.
It won't distribute like that.
Hardcore mode (permadeath) players will get nothing through the legal AH. There will of course be a secondary market. (I suspect the existence of this black market will eventually push Blizzard into authorising RMT in D3 Hardcore).
The majority of players will never reach endgame.
Not all farmers are equal. Roughly a farmer's income = monsters killed * magic find bonus worth of magic items plus monsters killed * gold find bonus worth of gold.
Luck plays quite a big part, causing profits to deviate from the average that any particular playstyle might suggest.
Game knowledge can also play a big part, for instance a better method of killing fast (such as Javazons in the Cow Level in D2) or a better farming route.
Cheating (duping etc) can play a spectacularly big part but overall diminishes the game as there's less point being so interested in a game where people are able to cheat and hack and dupe. Hopefully Blizzard will keep cheating under control.
Game difficulty will play a big part. If the game can be farmed by under-geared characters in a relatively brain-dead way then uneducated Chinese labourers are perfectly effective. If the game is more difficult then players will need more grounding and understanding of the game. I'm speculating it may be hard for the typical Chinese gold farmer we saw in WoW to do this, ie it will change from a blue collar job to a white collar job. I'm sure they'll get up to speed in time but gold farming businesses that are not prepared may have a very rough first year. The current system of sharing characters in shifts with the guy on the next shift selling anything that isn't nailed down will be completely useless for farming Inferno.
All forms of arbitrage aren't actually significant in relation to the turnover figures. Arbitrage moves profit from one economic agent to another, it does not actually increase turnover itself.
Conclusion: if you're a skilled player who farms Inferno a lot with magic find gear on I think you'll earn over $1000 per year playing Diablo 3. If you also arbitrage effectively you will earn more. It won't support any but a few as full-time professionals but it's a financially significant hobby.
Or to put it another way if you're a reasonably competent gamer you will pay back the cost of the box at least if you do some magic finding in Inferno.
Diablo 3: my time is free
It seems to be my week for challenging MMO truisms. Anyone who's played the economic game in any MMO has almost certainly heard the expression "my time is free" usually applied with scorn to people who are selling for lower than production cost. In Eve for example someone might take 150k isk worth of mats, build a ship and sell the ship for 125k - that's obvious not very smart. But a second player might mine the mats, build the ship and sell it for 125k - all it cost him is time. At this point people rather unkindly call him an idiot and point out he could have skipped the shipbuilding and got more for his time spent mining and point to it as an example of the "my time is free" fallacy, of a lack of understanding of opportunity cost. And they could be right but they're only right if isk-making is the be all and end all of the game.
In Diablo 3 I'll be playing to have fun trying out all the moves and mass murdering monsters while playing with my friends. That's the objective. That is, as I define it, leisure as opposed to work which I do for pay.
So what does that mean? That means, my friends, my time is free.
Beating the market is for me an additional part of the game, an additional entertainment, as fun as figuring out how to beat Diablo or how to make a class kick arse. I won't be playing Diablo 3 for money, I won't aim to be a professional gamer, I will play for fun.
Any revenue I get on top of that is a bonus. So if a Brutality Blade should sell for £3.50 but I sell one for £2 I haven't lost £1.50 I've gained £2. My time is free, any income I get is extra to the fun which is the reason I play.
I've seen many commentators giving dire warnings about no one will make any money on the game because we can't compete with Chinese gold farmers. They have it backwards. Chinese gold farmers can't compete with me nor with the 10 million others just like me. Our time is free, those RMT businesses have operating costs to pay and cheap labour is still more expensive than free labour.
I do expect to make money in the game but it's not why I'm playing the game and it doesn't matter. Viewed as a commercial concern my Diablo 3 looks like this:
Money spent = zero (I own a computer anyway, I would have bought the game anyway)
Money earned = 100% profit
That's a dream business, an I can't lose business. And I'm not worried at all about auction house manipulators or Chinese gold farmers because no one attempting to be professional in this game can match my overwhelming economic advantage:
My time is free.
In Diablo 3 I'll be playing to have fun trying out all the moves and mass murdering monsters while playing with my friends. That's the objective. That is, as I define it, leisure as opposed to work which I do for pay.
So what does that mean? That means, my friends, my time is free.
Beating the market is for me an additional part of the game, an additional entertainment, as fun as figuring out how to beat Diablo or how to make a class kick arse. I won't be playing Diablo 3 for money, I won't aim to be a professional gamer, I will play for fun.
Any revenue I get on top of that is a bonus. So if a Brutality Blade should sell for £3.50 but I sell one for £2 I haven't lost £1.50 I've gained £2. My time is free, any income I get is extra to the fun which is the reason I play.
I've seen many commentators giving dire warnings about no one will make any money on the game because we can't compete with Chinese gold farmers. They have it backwards. Chinese gold farmers can't compete with me nor with the 10 million others just like me. Our time is free, those RMT businesses have operating costs to pay and cheap labour is still more expensive than free labour.
I do expect to make money in the game but it's not why I'm playing the game and it doesn't matter. Viewed as a commercial concern my Diablo 3 looks like this:
Money spent = zero (I own a computer anyway, I would have bought the game anyway)
Money earned = 100% profit
That's a dream business, an I can't lose business. And I'm not worried at all about auction house manipulators or Chinese gold farmers because no one attempting to be professional in this game can match my overwhelming economic advantage:
My time is free.
Saturday, 27 August 2011
Optimising the fun into gaming
I was intrigued by a comment Nils made here yesterday suggesting that by optimising I'm removing the fun from playing Diablo 3. (Not offended by the way Nils, I'm glad to have the discussion).
You see if I had picked any of a number of alternative ways of playing no one would have the temerity to suggest that my way isn't the One True Fun Way. If I roved the world looking for photogenic screenshot opportunities or concentrated on collecting minipets or made mosaic art by dropping items on the ground in tasteful arrangements I don't think anyone would come here and say "That's not fun."
So what is it about the optimisation process that draws this reaction?
I think there's a number of elements.
It's about maths. Lots of people really don't like maths. I do. When I'm bored with nothing to do I sometimes work out long division or squares or other mathematical puzzles in my head just to keep my mind busy. I appreciate this isn't usual. But it's clear from reading gaming theorycraft sites that many of us enjoy the maths of a game just for the sake of it. It's another aspect, enjoyable to some, that is actually a lost opportunity to those who never appreciate it. It's as if someone plays but never talks to another player or never takes a screenshot or never stops to appreciate how their character looks or never reads the lore. None of that is mandatory but none of those things are mutually exclusive and I would argue there's a richer experience if you appreciate all of them.
It's about immersion. When if an awesome legendary axe drops you find yourself thinking "shall I make an Axe Barb?" I can see it's disconcerting to see other players are looking at the drop thinking "woot! £3.50!" I think though there's a level beyond living off the land gameplay and that's the trading game. Let's suppose Player A finds an awesome Axe and makes an Axe Barb. Player B finds an awesome axe, knows that the market is over-pricing axes right now, sells the Axe on the gold market for 10,000 gold, turns the gold into £6, uses the £6 to buy an awesome mace and uses the mace to make a better Barb than player A. Who is having more fun? And I don't just mean because the character is more powerful but the process itself seems more fun to me. I do see that it's less immersive but I think in this case immersion is not the same as fun. Besides is twinking a hand-me-down to an alt really immersive? When did Conan's big brother ever turn up and hand him an uber sword that he had spare? Surely all trading is not immersive including trading to yourself via the shared bank.
And lastly and perhaps most importantly it's about competition. When some of us theorycraft it forces other players into one out of three positions all of which are detrimental to them if they don't like theorycrafting. 1) they can ignore the theorycrafters and the cookie cutters and just be less effective than us. That's probably going to be rather an unpleasant option in D3 because D3 will inherit a huge amount of its players from WoW and WoW players are very suspicious of people not pulling their weight. Anyone who seems underpowered is going to find people being rude to them in public groups. 2) They can follow the theorycraft but in the early stages of a game theorycraft to the non-mathematician is gruellingly horrible. When a game ages you get short pithy synopses that show you all the maths you need to know in a page. Early on however the theorycrafters aren't sure yet so you get 20 page discussions of the attack speed formulae. Generally people won't summarise anything until the facts are established by extensive time-consuming testing and peer review. 3) they can figure out the best way to play by themselves while ignoring other theorycrafters. There's a couple of problems with this. Peer review is immensely important. Theorycrafting is very time-consuming, I remember hitting a zombie outside Hell Rogue Camp 1000 times and writing down each result back when I was helping figure out D2. It took me about 6 hours to conduct and write up my experiment and it was for something rather obscure (I forget what). Even the best theorycrafter in the world doesn't solve every problem. Plus if you make a mistake it gets incorporated into your dataset and is very hard to find for yourself.
Few things we've seen in gaming before will be quite as competitive as D3 money-making. We're going head to head with sophisticated corporations and huge businesses - perhaps even the Russian mafia - that want to make fortunes doing this and what's more almost everyone will be doing it. I realise there are a few purists out there but most regular players if they get a Bow worth £25 and their character does not use bows will sell it. Some will even sell it if their character does use bows. So the supply of goods in general is close to infinite because players will find more decent loot than the AH system can possibly sell which will drive the price of a bow which is good but not the best down and down. So ambitious achiever players like me plotting to maximise income are taking money out of the pockets of other players.
And are we also taking fun away?
I think so. Clearly if a fairly casual inferno player finds a mid range legendary he's going to get a lot less for it because of intense farming players. He's going to be less effective at selling it because of auction house manipulators. And it's going to be less exciting to say "Wow, omg, I found a Windforce!" if people like me are finding 10 Windforces a day and they're worth 30p.
But I'm not optimising the fun out of gaming. I'm optimising the fun into my gaming and out of yours. That's competition, baby.
You see if I had picked any of a number of alternative ways of playing no one would have the temerity to suggest that my way isn't the One True Fun Way. If I roved the world looking for photogenic screenshot opportunities or concentrated on collecting minipets or made mosaic art by dropping items on the ground in tasteful arrangements I don't think anyone would come here and say "That's not fun."
So what is it about the optimisation process that draws this reaction?
I think there's a number of elements.
It's about maths. Lots of people really don't like maths. I do. When I'm bored with nothing to do I sometimes work out long division or squares or other mathematical puzzles in my head just to keep my mind busy. I appreciate this isn't usual. But it's clear from reading gaming theorycraft sites that many of us enjoy the maths of a game just for the sake of it. It's another aspect, enjoyable to some, that is actually a lost opportunity to those who never appreciate it. It's as if someone plays but never talks to another player or never takes a screenshot or never stops to appreciate how their character looks or never reads the lore. None of that is mandatory but none of those things are mutually exclusive and I would argue there's a richer experience if you appreciate all of them.
It's about immersion. When if an awesome legendary axe drops you find yourself thinking "shall I make an Axe Barb?" I can see it's disconcerting to see other players are looking at the drop thinking "woot! £3.50!" I think though there's a level beyond living off the land gameplay and that's the trading game. Let's suppose Player A finds an awesome Axe and makes an Axe Barb. Player B finds an awesome axe, knows that the market is over-pricing axes right now, sells the Axe on the gold market for 10,000 gold, turns the gold into £6, uses the £6 to buy an awesome mace and uses the mace to make a better Barb than player A. Who is having more fun? And I don't just mean because the character is more powerful but the process itself seems more fun to me. I do see that it's less immersive but I think in this case immersion is not the same as fun. Besides is twinking a hand-me-down to an alt really immersive? When did Conan's big brother ever turn up and hand him an uber sword that he had spare? Surely all trading is not immersive including trading to yourself via the shared bank.
And lastly and perhaps most importantly it's about competition. When some of us theorycraft it forces other players into one out of three positions all of which are detrimental to them if they don't like theorycrafting. 1) they can ignore the theorycrafters and the cookie cutters and just be less effective than us. That's probably going to be rather an unpleasant option in D3 because D3 will inherit a huge amount of its players from WoW and WoW players are very suspicious of people not pulling their weight. Anyone who seems underpowered is going to find people being rude to them in public groups. 2) They can follow the theorycraft but in the early stages of a game theorycraft to the non-mathematician is gruellingly horrible. When a game ages you get short pithy synopses that show you all the maths you need to know in a page. Early on however the theorycrafters aren't sure yet so you get 20 page discussions of the attack speed formulae. Generally people won't summarise anything until the facts are established by extensive time-consuming testing and peer review. 3) they can figure out the best way to play by themselves while ignoring other theorycrafters. There's a couple of problems with this. Peer review is immensely important. Theorycrafting is very time-consuming, I remember hitting a zombie outside Hell Rogue Camp 1000 times and writing down each result back when I was helping figure out D2. It took me about 6 hours to conduct and write up my experiment and it was for something rather obscure (I forget what). Even the best theorycrafter in the world doesn't solve every problem. Plus if you make a mistake it gets incorporated into your dataset and is very hard to find for yourself.
Few things we've seen in gaming before will be quite as competitive as D3 money-making. We're going head to head with sophisticated corporations and huge businesses - perhaps even the Russian mafia - that want to make fortunes doing this and what's more almost everyone will be doing it. I realise there are a few purists out there but most regular players if they get a Bow worth £25 and their character does not use bows will sell it. Some will even sell it if their character does use bows. So the supply of goods in general is close to infinite because players will find more decent loot than the AH system can possibly sell which will drive the price of a bow which is good but not the best down and down. So ambitious achiever players like me plotting to maximise income are taking money out of the pockets of other players.
And are we also taking fun away?
I think so. Clearly if a fairly casual inferno player finds a mid range legendary he's going to get a lot less for it because of intense farming players. He's going to be less effective at selling it because of auction house manipulators. And it's going to be less exciting to say "Wow, omg, I found a Windforce!" if people like me are finding 10 Windforces a day and they're worth 30p.
But I'm not optimising the fun out of gaming. I'm optimising the fun into my gaming and out of yours. That's competition, baby.
Friday, 26 August 2011
Diablo 3: Treasure finding
Treasure hunting Bah!.. Treasure finding...
(The Necromancer on defeating the Countess in Act 1 of Diablo 2)
I've been thinking about item farming in Diablo 3 and I've come to realise that a lot of the stereotypical gold farmer traits are quite the opposite of how it's best to go about this.
In games like WoW gold farmers work in shifts. They have a quota of gold to make each shift so they will often strip the character of any decent items or stored wealth during their shift and tend to be a bit desperate towards the end of the shift. They farm specific areas thought to be high yield for this sort of activity. (At one stage it was the owlbears in Winterspring). They tend to be loners although they did sometimes cooperate in self defence when we were persecuting them on a pvp server.
I've realised this is pretty much the diametrical opposite of how we will need to play in D3 to be successful item farmers. (for as PC Gamer's delightfully witty podcast said in Diablo 3 Blizzard has solved the problem of gold farmers by making everyone a gold farmer).
First off that kind of shared account is really unsuitable because items are not bound. You can't progress to the most challenging content if people who share your account sell your items and gold. Next farming high yield areas is likely to be less effective. And lastly lone wolf seems significantly inferior to group play.
Let's address these in turn.
Gear
Diablo 3 is at least as much a gear progression as a level game and once you hit 60 it's wholly a gear progression. And Inferno difficulty, which is where virtually all of the decent loot will be is intended to be challenging.
So if you sell too early you're trading progress for quick cash. In a game where almost all the money is made deep in end game. That's not smart.
So if you sell too early you're trading progress for quick cash. In a game where almost all the money is made deep in end game. That's not smart.
Challenge in D3 is up in the air at the moment because we don't know how hard players will struggle with the difficulty. Diablo has a tradition of insane challenges. Just reaching max level was an epic story in itself in D2, with a team of players from Germany racing a team of Russians for the honour that many at the time believed not humanly possible. Drop rates on some items were insanely low, I played pretty solidly for 4 years without seeing one of the top 5 runes drop. Even if we look to WoW to see how current Blizzard philosophy is a lot of WoW is brutally hard. Hard mode raids especially, very few people have completed the content. As for the Starcraft series, it's an e-sport to “maximise” your SC2 status you have to be the best player in the world.
I think many people will hit a wall at Inferno difficulty where they just can't get started.
And that will be great for anyone who can cope because how are those players going to get past that wall? - they're going to buy gear.
In fact I'm planning to buy gear too.
Now that may seem odd for someone who wants to turn a profit playing Diablo 3 but my reasoning is this. 1) The real money items are in Inferno. 2) They will sell particularly well while most of the player base is struggling to get to grips with Inferno. 3) It's worth investing some gold and cash to get to Inferno farmer status as quickly as possible because that's an investment that will pay for itself.
I aim to have two sets of gear, both of which I'm prepared to spend some gold and/or pounds on. One is my most effective killing gear, a balance of damage and survival. The second set is my magic find set. I'm reasonably confident Blizzard won't let the economy collapse, either because of duping or because they've made it too easy so I really do think a little early investment will amply pay for itself once I'm zerging through hundreds of Inferno level monsters. And it's possible that I'll make enough gold and money through arbitrage that I won't need to put any additional real world funds in but I don't mind either way.
Farming areas
Blizzard recently announced the Inferno difficulty levels and explained that every monster would be level 61 and drop more or less the same loot so as to discourage path of least resistance farming. Of course it won't do that, it will just channel players to areas with high density of easy monsters. Certain monsters are quite tricky for many builds. In D2 there are imps in act 5 that teleport to safety when you damage them. They can be tedious to hunt down and kill if you're melee. Conversely the Bloody Foothills is an insanely easy area of high density mobs. It became the most farmed area for a while just after D2's expansion came out.
One twist though – Blizzard also explained that they would be monitoring playing patterns and if areas are being heavily farmed they would tweak the loot tables. We don't know at this time whether this will be announced or done via undocumented hotfixes. If they do clandestinely fix over-farmed areas then you could spend days or weeks farming sub-optimally without realising it. For this reason I'd recommend farming areas that still meet the desired criteria of high monster density and easy monsters but aren't the focus of public games. There were lots of areas of Act 5 that suited – at a time when most people were doing foothills runs I was running Nilathak's temple for example.
Grouping
We don't quite know how grouping affects drop rate. For example if I'm playing with 3 afk leeches and I kill 10 mobs do I get 10 drops like I was soloing? Or do I get 10/4?
Other than that grouping has everything to recommend it. If you're high level early on pugs generally are really good. I've been a fast leveler in a number of games including WoW and Rift and the early pugs are awesome, brilliant fun, very competent and determined. A lot of abilities are group abilities so if the Barb buffs defence for the group that's pretty useful. Why solo when you can have a Barb buffing you and a Monk healing you?
Tactically groups handle difficult content much better. 4 of you can do things against one boss that one soloer couldn't like have 3 people in a safe spot nuking while one tanks and so on. Or swapping tanking/kiting duty.
Another aspect that's up in the air is the role of magic find in groups. There's speculation that playing a magic find leech will be possible, it's hard to see quite how Blizzard could design around it at this stage. Personally I'll go for some compromise between magic find and being able to cut the mustard, no point running zones while being completely useless and just leeching, people will not want to play with you. Also generosity, although counter-intuitive to a magic item farmer, serves you very well. Hand a Windforce to a Demon Hunter and she might become a lot more open to you coming along on runs decked out in magic find gear.
Thursday, 25 August 2011
RIFT: play for free - but there's a catch
I've had an email from Trion inviting me to play Rift for free from August 25-31. Very nice of them and I'll certainly take them up on the offer.
Bizarrely though the small print includes this detail:
If user subscribes to RIFT during free gameplay time, user’s credit card or pre-paid game time card will be charged immediately, and any remaining free gameplay time will be forfeited.
Heaven forfend anyone pay them money!
Bizarrely though the small print includes this detail:
If user subscribes to RIFT during free gameplay time, user’s credit card or pre-paid game time card will be charged immediately, and any remaining free gameplay time will be forfeited.
Heaven forfend anyone pay them money!
Thursday, 18 August 2011
Wednesday, 17 August 2011
Diablo 3 grouping vs WoW's LFD
As WoW attempts to solve its issue of horrible pugs by making the tanking role as brain dead as the dps role Diablo 3 is poised to take over as the default method of having a fun group experience in an online game.
In Diablo games everyone is dps. If you want to pull just shoot something, no need to wait for someone else. If you're taking too much damage just run back behind your team for a few seconds. Mobs in Diablo games have an in-built hesitation mechanic so if you move they hesitate very slightly, allowing you to reduce the damage you take. Friends can help by ping-ponging aggro, by overthreating your threat value so monsters stop chasing you. It's a more agile more immersive playstyle.
Diablo 3 will take a lot from what Blizzard has learned over the years in WoW. Instead of the freeform games of Diablo 2 (for example Baalrun95) D3 players will set up games by choosing where they want to quest and how many people they want to quest with and the system will build a party for you to suit that. Which is quite similar to how LFD works in WoW, just without the queues.
Does it lose tactical depth? Yes, but WoW is withdrawing from the style of tactical depth as fast as it can. Who would want to play a game for the tactical depth of trinity gamestyle where it's impossible to rip aggro off the tank? That's not tactical depth.
In other ways D3 is simply streets ahead of WoW. Let's look at loot.
- in WoW you will see nice things drop and someone else will get it. In D3 if you see it, it's yours.
- Diablo games drop more loot that WoW-type games. Monsters are individually much weaker, you can kill a swarm in the time a WoW player would kill one mob.
- some WoW loot drops as currency which you then need to save up until you gradually save enough to buy an item. It's loot by installments. In D3 if it drops it's an item and you can use it immediately if you like.
- WoW loot is usually Bind on Pickup. In Diablo games if it drops any of your characters can use it. In D2 I quite often had the experience of finding an awesome item and thinking, "Wow, I've got to go make a Sword Barb now!"
- in D3 if you don't want it you can cash it in for real money or game money or crafting materials.
In Diablo games everyone is dps. If you want to pull just shoot something, no need to wait for someone else. If you're taking too much damage just run back behind your team for a few seconds. Mobs in Diablo games have an in-built hesitation mechanic so if you move they hesitate very slightly, allowing you to reduce the damage you take. Friends can help by ping-ponging aggro, by overthreating your threat value so monsters stop chasing you. It's a more agile more immersive playstyle.
Diablo 3 will take a lot from what Blizzard has learned over the years in WoW. Instead of the freeform games of Diablo 2 (for example Baalrun95) D3 players will set up games by choosing where they want to quest and how many people they want to quest with and the system will build a party for you to suit that. Which is quite similar to how LFD works in WoW, just without the queues.
Does it lose tactical depth? Yes, but WoW is withdrawing from the style of tactical depth as fast as it can. Who would want to play a game for the tactical depth of trinity gamestyle where it's impossible to rip aggro off the tank? That's not tactical depth.
In other ways D3 is simply streets ahead of WoW. Let's look at loot.
- in WoW you will see nice things drop and someone else will get it. In D3 if you see it, it's yours.
- Diablo games drop more loot that WoW-type games. Monsters are individually much weaker, you can kill a swarm in the time a WoW player would kill one mob.
- some WoW loot drops as currency which you then need to save up until you gradually save enough to buy an item. It's loot by installments. In D3 if it drops it's an item and you can use it immediately if you like.
- WoW loot is usually Bind on Pickup. In Diablo games if it drops any of your characters can use it. In D2 I quite often had the experience of finding an awesome item and thinking, "Wow, I've got to go make a Sword Barb now!"
- in D3 if you don't want it you can cash it in for real money or game money or crafting materials.
Tuesday, 16 August 2011
The unbearable darkness of online communities
Spinks has written a thoughtful post today about the end of a golden age in online gaming, an age of cooperation and consideration for others which she sees as being replaced by a more individualistic culture, perhaps for good.
I'd like to examine her points then move on to a prediction about the way group play is going.
Competition and Cooperation
Let's start by looking at competition and cooperation. Both are I think fundamental forms of play. Both, I suspect, pre-date the human species. If you throw a stick for a dog that's cooperative play, if you play tug-of-war with the stick when he brings it back that's competitive play. Animals combine both forms in their play - there are even scientific studies about the proportion of each type. As humans we've had both for a long time and we'll always have both, at least for the rest of our lifetimes.
In MMOs the balance between them has not been quite so straightforward. The ancestors of MMOs, MUDs, tended to be more freeform more sandbox. So what happens if you let players do what they want? Well in MUDs you got the Bartle types, that is, you got 4 distinct types of play: Killer, Socialiser, Explorer, and Achiever. Let's look at the two social ones - killers which is interacting with people by trying to make their game experience worse and socialiser which is interacting with people by trying to make their game experience better.
Many people who aren't killers simply can't understand the motivation. Why follow another player around killstealing their mobs or nicking their drops until they log out in frustration? My answer would be that some people are intensely competitive and want the feeling of beating someone else. In a game where pvp is limited or non-existent some people may derive more satisfaction in making another person log out in frustration than in killing them within the normal expectations of the game. Killing someone in a WoW battleground for instance is fairly meaningless as killing someone doesn't do any damage to them, it just moves them and imposes a very brief time-out.
Some people regard competitiveness as extremely unhealthy. An article from a writer on this states:
"Competition is to self-esteem as sugar is to teeth. Most people lose in most competitive encounters, and it's obvious why that causes self-doubt. But even winning doesn't build character; it just lets a child gloat temporarily."
In addition to damaging participants the competitive instincts of players can be very damaging to the businesses of the companies running games. If someone's personal playstyle is to get people to log out and never log back in that's clearly an uneconomic player.
One player describes an event in WoW that unexpectedly turned out to be a great time for griefers:
"Yesterday, I spent some of my limited game time to log into WoW, and work on a new Dwarf character I started about a week ago, so he’s still hanging around Ironforge for the moment. So I run up to Ironforge to check out a couple of vendors, and I discover a scene of griefer ecstasy in front of the auction house. Hundreds of player corpses littered the ground from high level zombies killing anything that moved, especially low level people which they seem to get a perverse joy in ganking repeatedly. They chose the auction house because that area is by far the most crowded area of the city. One of their favorite tactics is also to kill off the flightmaster NPC, so that no one can get a griffin out of the area, causing additional people to bottleneck."
Cooperation on the other hand in addition to being a playstyle a lot of people find fun is intrinisically beneficial for the people running online games. Raph Koster says:
"Community ties are the single biggest predictor of retention. And in the subscription game (really, in the microtransaction game too, though the effect is more complicated), retention = money. Therefore, community ties = money."
The direction of the last decade
So if community = extra money and griefing = less money then one would expect designers to design for community and against griefing. But they don't always and the reasons are complex. I'll try to give a brief overview.
One of the big strengths of massive online games is emergent gameplay. Players do unexpected things that turn out to be better and more fun than what the designers had originally foreseen. This happens quite a lot and many designers deliberately encourage it. In Eve while people have achieved spectacular acts of in-game criminality people have also done amazing and benign things. One player circumnavigated the universe over a period of years, one player founded a graveyard. In fact the company has created a site specifically to archive and document the amazing and emergent stories the players have - if you have a look you'll quickly see it's not all corp theft and can flipping.
The next element is personal progression. I'll let you into a secret that many players either never knew or forget. The numbers on your character sheet, on your gear, they mean nothing. A weapon that does 200 damage is neither intrinsically good nor bad. A 10 damage weapon hits a 100 hit point monster every bit as hard as a 1,000 damage weapon hits a 10,000 hit point monster. Numbers are relational and only relational. And since they are relational, it doesn't matter how much damage your weapon says it does, what matters is if it does more than your friend's weapon. The only meaningful metrics are "Am I better than him?" and "can I kill stuff easily?"
And players have become very attracted to personal progression. WoW beat EQ, SWG and UO for market share because it was more fun. Fun mainly being a matter of my character feels cooler. It did this by much faster gear upgrades than earlier games.
Personal progression is always competitive rather than cooperative. The only way to tell if you have a good sword is to see if it kills things faster than the guys with you. So the shift from the earlier model of highly challenging encounters where you cared more about doing everything you could to help the group win to relatively easy encounters where people care more about topping the meter is a shift from cooperation to competition.
What does the future hold?
I think two things are going to happen in the MMO gaming space. In fact they already are happening, in the future they will just get more obvious.
Firstly we have been getting and will get more types of games. Case in point, SWTOR is a highly directed theme park space PvE MMO. Launching in the same quarter against it is Prime BFD, a sandbox old school PvP MMO developed mainly by guys who loved Dark Age of Camelot and wish to re-create that experience in the modern market. Years ago you simply didn't see that diversity - a MMO was what it was and if the style didn't suit you then tough. You need to liberate yourself from being swept up by whatever is the most hyped game but if you can do so then you can play just about any type of game you like.
Second, there's a rubber banding effect. Games are very often a reaction to what was bad about the games before them. WoW was an immensely liberating experience after the forced grouping of EQ and the sandboxy aimlessness of SWG and UO. The horrible aspects of WoW are going to drive game development over the next decade. Expect to see games designed to address the problems of tank shortages, horrible rude pugs, gearscore epeen measurers and people who always stand in fires.
I'd like to examine her points then move on to a prediction about the way group play is going.
Competition and Cooperation
Let's start by looking at competition and cooperation. Both are I think fundamental forms of play. Both, I suspect, pre-date the human species. If you throw a stick for a dog that's cooperative play, if you play tug-of-war with the stick when he brings it back that's competitive play. Animals combine both forms in their play - there are even scientific studies about the proportion of each type. As humans we've had both for a long time and we'll always have both, at least for the rest of our lifetimes.
In MMOs the balance between them has not been quite so straightforward. The ancestors of MMOs, MUDs, tended to be more freeform more sandbox. So what happens if you let players do what they want? Well in MUDs you got the Bartle types, that is, you got 4 distinct types of play: Killer, Socialiser, Explorer, and Achiever. Let's look at the two social ones - killers which is interacting with people by trying to make their game experience worse and socialiser which is interacting with people by trying to make their game experience better.
Many people who aren't killers simply can't understand the motivation. Why follow another player around killstealing their mobs or nicking their drops until they log out in frustration? My answer would be that some people are intensely competitive and want the feeling of beating someone else. In a game where pvp is limited or non-existent some people may derive more satisfaction in making another person log out in frustration than in killing them within the normal expectations of the game. Killing someone in a WoW battleground for instance is fairly meaningless as killing someone doesn't do any damage to them, it just moves them and imposes a very brief time-out.
Some people regard competitiveness as extremely unhealthy. An article from a writer on this states:
"Competition is to self-esteem as sugar is to teeth. Most people lose in most competitive encounters, and it's obvious why that causes self-doubt. But even winning doesn't build character; it just lets a child gloat temporarily."
In addition to damaging participants the competitive instincts of players can be very damaging to the businesses of the companies running games. If someone's personal playstyle is to get people to log out and never log back in that's clearly an uneconomic player.
One player describes an event in WoW that unexpectedly turned out to be a great time for griefers:
"Yesterday, I spent some of my limited game time to log into WoW, and work on a new Dwarf character I started about a week ago, so he’s still hanging around Ironforge for the moment. So I run up to Ironforge to check out a couple of vendors, and I discover a scene of griefer ecstasy in front of the auction house. Hundreds of player corpses littered the ground from high level zombies killing anything that moved, especially low level people which they seem to get a perverse joy in ganking repeatedly. They chose the auction house because that area is by far the most crowded area of the city. One of their favorite tactics is also to kill off the flightmaster NPC, so that no one can get a griffin out of the area, causing additional people to bottleneck."
Cooperation on the other hand in addition to being a playstyle a lot of people find fun is intrinisically beneficial for the people running online games. Raph Koster says:
"Community ties are the single biggest predictor of retention. And in the subscription game (really, in the microtransaction game too, though the effect is more complicated), retention = money. Therefore, community ties = money."
The direction of the last decade
So if community = extra money and griefing = less money then one would expect designers to design for community and against griefing. But they don't always and the reasons are complex. I'll try to give a brief overview.
One of the big strengths of massive online games is emergent gameplay. Players do unexpected things that turn out to be better and more fun than what the designers had originally foreseen. This happens quite a lot and many designers deliberately encourage it. In Eve while people have achieved spectacular acts of in-game criminality people have also done amazing and benign things. One player circumnavigated the universe over a period of years, one player founded a graveyard. In fact the company has created a site specifically to archive and document the amazing and emergent stories the players have - if you have a look you'll quickly see it's not all corp theft and can flipping.
The next element is personal progression. I'll let you into a secret that many players either never knew or forget. The numbers on your character sheet, on your gear, they mean nothing. A weapon that does 200 damage is neither intrinsically good nor bad. A 10 damage weapon hits a 100 hit point monster every bit as hard as a 1,000 damage weapon hits a 10,000 hit point monster. Numbers are relational and only relational. And since they are relational, it doesn't matter how much damage your weapon says it does, what matters is if it does more than your friend's weapon. The only meaningful metrics are "Am I better than him?" and "can I kill stuff easily?"
And players have become very attracted to personal progression. WoW beat EQ, SWG and UO for market share because it was more fun. Fun mainly being a matter of my character feels cooler. It did this by much faster gear upgrades than earlier games.
Personal progression is always competitive rather than cooperative. The only way to tell if you have a good sword is to see if it kills things faster than the guys with you. So the shift from the earlier model of highly challenging encounters where you cared more about doing everything you could to help the group win to relatively easy encounters where people care more about topping the meter is a shift from cooperation to competition.
What does the future hold?
I think two things are going to happen in the MMO gaming space. In fact they already are happening, in the future they will just get more obvious.
Firstly we have been getting and will get more types of games. Case in point, SWTOR is a highly directed theme park space PvE MMO. Launching in the same quarter against it is Prime BFD, a sandbox old school PvP MMO developed mainly by guys who loved Dark Age of Camelot and wish to re-create that experience in the modern market. Years ago you simply didn't see that diversity - a MMO was what it was and if the style didn't suit you then tough. You need to liberate yourself from being swept up by whatever is the most hyped game but if you can do so then you can play just about any type of game you like.
Second, there's a rubber banding effect. Games are very often a reaction to what was bad about the games before them. WoW was an immensely liberating experience after the forced grouping of EQ and the sandboxy aimlessness of SWG and UO. The horrible aspects of WoW are going to drive game development over the next decade. Expect to see games designed to address the problems of tank shortages, horrible rude pugs, gearscore epeen measurers and people who always stand in fires.
Thursday, 11 August 2011
Prime BFD: Everybody wins...
... if you entered the bug report contest that is.
Sanya Weathers said:
I've blown a stupid amount of time trying to decide between awesome and awesomer.
So, as with the haiku, EVERYONE WINS.
This is not going to be a habit with us. My next contest, I'm going to make sure an actual winner will stand out.
But congratulations, bug reporters!
http://forums.primeonline.com/index.php?/topic/711-bug-report-contest-i-give-up/page__pid__20387#entry20387
Our prize is a place in phase 2 of the Beta
Phase 2 invites will go out, we hope, next week. If not next then definitely the week after.
I probably won't be able to say much (this information is public however so I'm pretty sure I'm safe to tell you this).
It's a really interesting game and I'm really looking forward to helping develop it. If you're interested then do get involved on their forums, Sanya said there will be more contests in the future.
Original post, and my rather poetic entry here:
http://forums.primeonline.com/index.php?/topic/572-contest-bug-reports/
Sanya Weathers said:
I've blown a stupid amount of time trying to decide between awesome and awesomer.
So, as with the haiku, EVERYONE WINS.
This is not going to be a habit with us. My next contest, I'm going to make sure an actual winner will stand out.
But congratulations, bug reporters!
http://forums.primeonline.com/index.php?/topic/711-bug-report-contest-i-give-up/page__pid__20387#entry20387
Our prize is a place in phase 2 of the Beta
Phase 2 invites will go out, we hope, next week. If not next then definitely the week after.
I probably won't be able to say much (this information is public however so I'm pretty sure I'm safe to tell you this).
It's a really interesting game and I'm really looking forward to helping develop it. If you're interested then do get involved on their forums, Sanya said there will be more contests in the future.
Original post, and my rather poetic entry here:
http://forums.primeonline.com/index.php?/topic/572-contest-bug-reports/
Wednesday, 10 August 2011
Diablo 3 to be localised for chavs
Following personal intervention by UK Prime Minister David Cameron, Irvine CA-based video games developer Activision-Blizzard will create a special localised version of its forthcoming title Diablo 3 with Britain's fractious underclass in mind.
Players will see a living room rather that the usual paper doll and will have to outfit their living room from loot drops of TV sets, Xboxs and Nikes. The Caravan will include a bling merchant who makes jewelry and a Man With a Hat who provides potions and elixirs. Loot can be sold in a special area called the Back of the Pub.
Act Bosses are replaced with crowbar wielding shopkeepers and zones will contain special burnable vehicles.
We spoke to Mark, a representative of the Peckham chavs and he had this to say:
"Gotta beta key?"
Players will see a living room rather that the usual paper doll and will have to outfit their living room from loot drops of TV sets, Xboxs and Nikes. The Caravan will include a bling merchant who makes jewelry and a Man With a Hat who provides potions and elixirs. Loot can be sold in a special area called the Back of the Pub.
Act Bosses are replaced with crowbar wielding shopkeepers and zones will contain special burnable vehicles.
We spoke to Mark, a representative of the Peckham chavs and he had this to say:
"Gotta beta key?"
Sunday, 7 August 2011
Diablo 2: it's cool to go back in time
It had been a long time since I played Diablo 2 so I fired it up and rolled three characters. I'll freely admit the D3 real money AH news has got me thinking about strategies.
There have been quite a few changes since I last played in 1.11. We're up to 1.13 now and some new end game content has been added that sounds very interesting.
Having played hardcore D2 for quite a long time last time I played I had forgotten how tough softcore is in this game. I died a few times on my barb. My stuff was on the ground (please don't fall over BNet), as was almost all my gold, I was naked and couldn't afford the price of a merc ress.
I've made a Barbarian, at first with polearms then I respecced him to swords. It's nice that you can do that now.
I made a Werewolf Druid.
I made a summoner Necromancer.
I quickly realised that the game is far more comfortable with more advanced gear and that one of the first things I want to do in D3 and want to do on this revisit is magic find. I started remembering how that's done.
With an untwinked character you can hardly do better than a summoner nec. They can play pretty effectively regardless of gear which means I can concentrate on magic find and gold find gear. They can spend fights kicking pots and opening chests and gathering up loot. And they're very powerful.
This has got me thinking for D3 - most of this will probably remain more or less true, a summoner should be able to kill safely while wearing magic find and gold find even untwinked.
Public battlenet games are horrible because of all the level 1 bots that come into your game and spam advertising. I am getting around this in two ways - playing in passworded games or making a game with level restrictions. My first one I was level 12 and set the level restriction to within 11 but that proved too wide, level 1s could still get in. Next game I set it to 10, game was blissfully peaceful and several people wandered in to bump up my monsters and give me better exp.
BNet also proved very easy to access. I thought I was going to have some awful time of proving I was the person who legally owned my copy because the email I used 11 years ago is now defunct but you don't need any email at all, it's just optional and you can give the current one.
I had a look around the wikis etc for the game and was pleased in one case to see that theory I'd researched 10 years ago is still being used. However I don't think this time round I'll be so active in the theorycrafting. I'd rather keep most of my research private. Sometimes it can help to go public to get peer review of stuff you're not sure about but if I discover something awesome I'd rather sit on it.
Diablo 2 in general has held up really well. It looks fine. The animations, the little winces, grimaces and one-liners the characters come up with are superb. I think this is one of Blizzard's key strengths - the characters act in interesting ways. The Barbarian's Leap looks good and has an engaging grunt. Most games that aren't Blizzard games don't quite have such engaging mannerisms.
Another strength is the item system. Very early on I found an rare axe that was ethereal (+50% extra damage, but can't be repaired) and self-repairing. That's a really good item. And it's not unusual to find pretty exciting loot. I'm a big opponent of the Best In Slot philosophy that's arisen in games like WoW and Rift. BiS philosophy is figuring out from a site like EJ or Rawr what gear you should use in each slot for maximum mathematical efficacy, getting it and then.... what? WoW without the gear chase or the leveling is just meh. D2 and D3 are and will be different because there's no upper limit on gear quality. You can always get something better. This is also true of Prime BFD another game in development I'm looking forward to.
D2 gives you very significant quest rewards. After the kill ten rats quests of MMOs it's nice to do a quest that gives you a permanent skill point for killing all the monsters in The Den. In fact the reward's been upgraded since I last played - it additionally grants you a skill and stat respec now.
So yup, playing D2 has reminded me what made Blizzard a great games company and now I'm even more interested in Diablo 3.
There have been quite a few changes since I last played in 1.11. We're up to 1.13 now and some new end game content has been added that sounds very interesting.
Having played hardcore D2 for quite a long time last time I played I had forgotten how tough softcore is in this game. I died a few times on my barb. My stuff was on the ground (please don't fall over BNet), as was almost all my gold, I was naked and couldn't afford the price of a merc ress.
I've made a Barbarian, at first with polearms then I respecced him to swords. It's nice that you can do that now.
I made a Werewolf Druid.
I made a summoner Necromancer.
I quickly realised that the game is far more comfortable with more advanced gear and that one of the first things I want to do in D3 and want to do on this revisit is magic find. I started remembering how that's done.
With an untwinked character you can hardly do better than a summoner nec. They can play pretty effectively regardless of gear which means I can concentrate on magic find and gold find gear. They can spend fights kicking pots and opening chests and gathering up loot. And they're very powerful.
This has got me thinking for D3 - most of this will probably remain more or less true, a summoner should be able to kill safely while wearing magic find and gold find even untwinked.
Public battlenet games are horrible because of all the level 1 bots that come into your game and spam advertising. I am getting around this in two ways - playing in passworded games or making a game with level restrictions. My first one I was level 12 and set the level restriction to within 11 but that proved too wide, level 1s could still get in. Next game I set it to 10, game was blissfully peaceful and several people wandered in to bump up my monsters and give me better exp.
BNet also proved very easy to access. I thought I was going to have some awful time of proving I was the person who legally owned my copy because the email I used 11 years ago is now defunct but you don't need any email at all, it's just optional and you can give the current one.
I had a look around the wikis etc for the game and was pleased in one case to see that theory I'd researched 10 years ago is still being used. However I don't think this time round I'll be so active in the theorycrafting. I'd rather keep most of my research private. Sometimes it can help to go public to get peer review of stuff you're not sure about but if I discover something awesome I'd rather sit on it.
Diablo 2 in general has held up really well. It looks fine. The animations, the little winces, grimaces and one-liners the characters come up with are superb. I think this is one of Blizzard's key strengths - the characters act in interesting ways. The Barbarian's Leap looks good and has an engaging grunt. Most games that aren't Blizzard games don't quite have such engaging mannerisms.
Another strength is the item system. Very early on I found an rare axe that was ethereal (+50% extra damage, but can't be repaired) and self-repairing. That's a really good item. And it's not unusual to find pretty exciting loot. I'm a big opponent of the Best In Slot philosophy that's arisen in games like WoW and Rift. BiS philosophy is figuring out from a site like EJ or Rawr what gear you should use in each slot for maximum mathematical efficacy, getting it and then.... what? WoW without the gear chase or the leveling is just meh. D2 and D3 are and will be different because there's no upper limit on gear quality. You can always get something better. This is also true of Prime BFD another game in development I'm looking forward to.
D2 gives you very significant quest rewards. After the kill ten rats quests of MMOs it's nice to do a quest that gives you a permanent skill point for killing all the monsters in The Den. In fact the reward's been upgraded since I last played - it additionally grants you a skill and stat respec now.
So yup, playing D2 has reminded me what made Blizzard a great games company and now I'm even more interested in Diablo 3.
Friday, 5 August 2011
Diablo 3: there's far too much nonsense being talked about tax
Reading the comments and forum posts of people I'm realising there's an astonishing amount of ignorance about how tax works.
For the full picture check the website of your local tax office. But here's a short summary of how it works in most Western countries.
- you are liable to pay tax on your income. All income, certainly including AH profits. If you find a penny in the street you are liable to pay income tax on it.
- you cannot retroactively decide you're a business and your expenses (buying the game, your computer etc) are tax deductible. If you want to do this you will usually have to let them know you're a business.
- you cannot hide this income or stay under the radar. It's online run by companies who are obliged to give details of your transactions to the tax authorities.
- it's your responsibility. Not Blizzard's, not Paypal's not your tax authority's.
- in some countries (for example the USA and the UK) you may be able to avoid having to pay if they accept that this income is from a hobby. D3 item selling is likely to be a very borderline case and they may decide either way. They may even analyse game logs to see if you did magic finding runs. If you did and then sold the items for real money you may be deemed to be a trader.
OK those are facts, now I'll move to speculation.
- I think most tax authorities will realise a huge untaxed trade is occuring. If a million people sell items worth $20 over the course of a year and they pay 25% tax as their highest marginal that's $5 million lost government revenue. In an era where every country is desperate to balance its economy all of our governments are going to want high to perfect tax collection efficiency.
- I think the most likely first starting point for the tax authority will be a public awareness campaign. It's kinda absurd to jail people for selling a Sigon's Boots for $2. This is the point at which you should make sure you're compliant if you haven't done so before.
- they will probably then move to a targeted phase. You might get a letter or an email stating that they think you have undeclared income. DO NOT IGNORE THIS. Sort it out and pay what they ask.
- the last step is enforcement. They will take some people to court. This could be really expensive and damage your credit rating and employment prospects if you let it get to court. Don't, ask to settle with them out of court. If you fight it you will lose anyway and get a judgment recorded against you on your credit score.
Advice
- trade in gold not money. In particular don't regularly cash out money. Someone who takes £20 every month looks much more like a trader than someone who plays the game for a year then cashes £240 out. Be aware though that gold will deflate much faster than normal currency so keep your wealth fluid (for example buying cheap gems then selling them on all the time).
- consider buying stuff from the Blizzard store. This may help prove that your earnings are part of a hobby.
- don't ignore any official communication.
- don't expect any of your dealings to be kept secret from your tax authority.
- do accept that it is your personal responsibility to pay tax. I'm not suggesting you phone them every time you sell a rare but you should be aware that if you sell a lot you need to sort it out with your tax office.
- stop posting these stupid BLIZZ GONNA BE IN TROUBLE WITH THE IRS posts. They won't, you might be.
For the full picture check the website of your local tax office. But here's a short summary of how it works in most Western countries.
- you are liable to pay tax on your income. All income, certainly including AH profits. If you find a penny in the street you are liable to pay income tax on it.
- you cannot retroactively decide you're a business and your expenses (buying the game, your computer etc) are tax deductible. If you want to do this you will usually have to let them know you're a business.
- you cannot hide this income or stay under the radar. It's online run by companies who are obliged to give details of your transactions to the tax authorities.
- it's your responsibility. Not Blizzard's, not Paypal's not your tax authority's.
- in some countries (for example the USA and the UK) you may be able to avoid having to pay if they accept that this income is from a hobby. D3 item selling is likely to be a very borderline case and they may decide either way. They may even analyse game logs to see if you did magic finding runs. If you did and then sold the items for real money you may be deemed to be a trader.
 |
| If Al Capone played Diablo 3 he'd avoid paying tax. |
OK those are facts, now I'll move to speculation.
- I think most tax authorities will realise a huge untaxed trade is occuring. If a million people sell items worth $20 over the course of a year and they pay 25% tax as their highest marginal that's $5 million lost government revenue. In an era where every country is desperate to balance its economy all of our governments are going to want high to perfect tax collection efficiency.
- I think the most likely first starting point for the tax authority will be a public awareness campaign. It's kinda absurd to jail people for selling a Sigon's Boots for $2. This is the point at which you should make sure you're compliant if you haven't done so before.
- they will probably then move to a targeted phase. You might get a letter or an email stating that they think you have undeclared income. DO NOT IGNORE THIS. Sort it out and pay what they ask.
- the last step is enforcement. They will take some people to court. This could be really expensive and damage your credit rating and employment prospects if you let it get to court. Don't, ask to settle with them out of court. If you fight it you will lose anyway and get a judgment recorded against you on your credit score.
Advice
- trade in gold not money. In particular don't regularly cash out money. Someone who takes £20 every month looks much more like a trader than someone who plays the game for a year then cashes £240 out. Be aware though that gold will deflate much faster than normal currency so keep your wealth fluid (for example buying cheap gems then selling them on all the time).
- consider buying stuff from the Blizzard store. This may help prove that your earnings are part of a hobby.
- don't ignore any official communication.
- don't expect any of your dealings to be kept secret from your tax authority.
- do accept that it is your personal responsibility to pay tax. I'm not suggesting you phone them every time you sell a rare but you should be aware that if you sell a lot you need to sort it out with your tax office.
- stop posting these stupid BLIZZ GONNA BE IN TROUBLE WITH THE IRS posts. They won't, you might be.
Diablo 3: initial thoughts on how the economy will play out
Early adopter bonus
The Diablo 3 economy is, as Tobold explains, likely to be front-loaded. If you find the best bow in the game and are the first one you will be able to sell it for a lot of money. If you find it but you're the 1000th one you'll receive pennies or perhaps a few quid at most.
This translates into an early adopter bonus. If you get in on the headstart if there is one you'll make a lot of money. Beta keys are going to ilicitly trade hands for a lot of money as although the items won't survive you will have the opportunity to learn how to item farm. Power leveling of various types will be a sought after service.
If you work but are thinking you'd like to be a D3 financial magnate you might want to book a week or two of leave.
The regions are going to vary considerably.
The game will be divided into markets by its regionalisation.
When asked about the regional breakdown of the shop, Pardo said, "The primary reason why we're doing the Auction House per [real world] currency is for usability, and in some cases, with legality -- it's the easiest way to do it... There are going to be so many items in each auction house in every currency that there shouldn't even be need to shopping around in different currency houses."
Source
So that sounds like for UK there will be a pound-based national server network. This may mean it's the first ever online game here to be national, it almost doesn't make sense or at least it hasn't before to be both national and online.
What I don't know is whether we'll be able to play in other countries' regions. Here's a list of countries by GDP, if you want to play abroad for a better market the highest GDP at the moment belongs to Qatar and the highest English-speaking country is the United States of America. Both have things to recommend them for the professional D3 player - Qatar's wealth is concentrated in the hands of the superrich so we may see extremely high prices paid, USA of course has both a cultural and a constitutional commitment to hedonism.
I have no idea whether we'll be able to choose our region. I think I'm inclined to play in my real region rather than roll on a more lucrative one but if I find myself making decent money I would be tempted to get extra copies of the game to expand the business multinationally.
Taxation
Tax (for UK residents) is explained here if you receive a salary. It's "income from casual earnings, for example, tips or commission" If you're an employee or receive a company or personal pension you can receive up to £2,500 extra income in a year and still pay tax on it through your tax code. For amounts greater than £2,500 you'll have to complete a tax return and pay tax through Self Assessment. You receive a PAYE coding notice before the start of each tax year and let them know on that how much you expect to earn or you can contact them to let them know you earned over £2500 and need to pay through self assessment. It works just like income so if your work pays you £20,000 and Diablo 3 pays you £1500 you'll be taxed on an income of £21,500. (This is not professional tax advice and if you want to be completely sure contact HMRC).
It's entirely possible you may pay less tax if you register as a business because you will then be able to defray expenses (the cost of the box, a proportion of the cost of the computer equal to the extent to which the computer is used in pursuit of the business, banking costs, electricity etc). It's discussed here.(In the United States from a brief look I took it seems to be the other way around, it's better if they think your game items sales are proceeds from a hobby than from a business).
Most people will simply not report it anywhere and not pay any taxes. If you're seriously into item selling this could be a very bad idea if you're successful and they catch up with you. As it's all online and as this is the very game that's likely to make the Revenue wake up and start chasing trade in virtual items that's quite risky. In fact we're right in the middle of a special Inland Revenue campaign to detect online trading that doesn't match tax returns. With robots :-)
Item value
Value is going to concentrate on a few high end items and particular bonuses. The nature of Diablo is that you can only wear a finite amount of items while finding lots of them. Except for a rush at the start when any decent item will have a fair amount of value there are going to be just a few items that are worth significant money. In D2 people tended to value percentage-based damage reduction over almost anything so that is an example of a stat that would fetch a premium - if D3's mechanics play out the same way then the new equivalent of a Vampire Gaze will sell steadily. For a trader understanding the game is a key element in understanding the economy. And both play into each other, if you see a market spike in an item with an unusual bonus type there may be more to that bonus type than appears at first glance.
Value will be shaped by end game activity as follows:
- Magic find runs. Lots of people will do this with their high level characters and will see magic find and gold find as investments. It will certainly be worth spending a little to add a few percentage to either find percentage early on if the market is vibrant.
- Gold farming.
- Leveling. It's possible D3 will be a lot easier to hit max level in than D2 but it's unlikely to be as easy as WoW. We do know the level cap is lower but that doesn't necessarily mean the last ten levels won't take ages.
- PvP. PvP in this sort of game is only really viable with the best gear. If you're serious about trading you should learn the pvp game just so that you can understand the market. Every serious pvper will obtain full best in slot if possible.
- Arena. A specialised type of pvp. Blizzard has the opportunity to make insane money if they can make this successful. You see, it's all very well having a game where people can sell each other stuff but if that game were also a Magic: The Gathering type game where people are passionate about tournament play to the point they will spend thousands the two elements synergise extremely well.
- Elite encounters. While many boss level encounters will be fairly random it's likely that players will farm certain bosses in preference to others. And if there's an advantage doing that boss with a certain item people will maximise that. So if most people like to run King Leoric, and say he does a lot of cold damage, people might place a premium on cold resist gear. Wyatt Cheng explains boss encounters here.
- Crafting. Crafting sounds like a huge resource sink and what's more produces variable loot. This makes it a kind of lottery - there might be thousands of people in your region crafting rare rings but you could still get THAT RING, the one with perfect bonuses and the right bonus types. Top end crafted stuff will always sell for a decent amount as long as the game stays popular. And some people will buy up cheap junk by the tons just to level their artisans and obtain crafting mats.
- Crafting mats. Some crafting mats apparently are rare drop.
- Gems and Runestones. These will always sell as they can be converted to higher types. There may even be arbitrage opportunities where you can buy 3 gems, cube them, and put the higher one back on the market for three times what you paid. It takes 19,600 of the lowest level gem to make one of the highest level.
- Achievements. People will want to complete their list of achievements so items may sell based on their usefulness to this. For example if there is some jump you have to do people might buy items with a stat that boosts jumping distance. This will be a short term market as most people will buy the item, do the achievement, then sell it.
- Followers. Your persistent followers can wear gear. In D2 there was a trick where you burned down a boss like Mephisto with your 500% magic find then let your merc with his 200% magic find get the final blow for a 700% magic find kill. People will want to buy decent stuff for their followers.
- Other end game pursuits. Blizzard have been muttering about awesome end game activities. The gear needed for these will certainly sell.
What won't factor
- Ladder resets. There will be none.
- Hardcore mode. May as well call it "I went through all this and I didn't even get paid" mode. I'm put off from hardcore mode although I loved it in D2. What if I find an item that would be worth £10,000 but I found it in hardcore mode? Too annoying. I think eventually Blizzard may cave in and allow real money trading in hardcore mode but for now it's the last haven of the amateur.
Playing the market
First this market won't be like any previous markets and will more ressemble real world markets. In WoW if you kept track of the market fluctuations and downloaded some useful addons you were playing a different game to most people and what's more you might be one out of only a handful of people on your server playing it. In D3 there will be tons of people playing the market, there's quite possibly going to be phone apps so people who can't log in to the game while at work or traveling will still be playing the market. Just as in real life it's quite hard to play the commodities market because people really do know where surplus value appears so too will it be hard to play the D3 market because so many very smart people will be competing against you.
That said experience of playing the market in games like WoW and Eve will certainly be useful. One of the most expert players of the WoW market is Marcko, owner of Just My Two Copper. He's already put up his D3 gold site. I think he'll make a lot of money just selling gold guides and from internet advertising revenue, never mind his actual in-game profits.
He's pretty good even if he has been outed for being somewhat unethical once or twice. He's worth a look imo although I wouldn't recommend buying his gold guide or anyone's. You can get just about all of the information for free from websites including Marcko's blog and forums. I guess think of the guide you pay for as being at best an executive summary. If you don't want to read around you can get a short version for money.
Regarding the market let me explain some broad MMO economic principles.
- buyers have an amount of interest in buying that peaks around their most intensive playtimes. Since most buyers will be people with jobs this means that peak buying interest will occur in the evenings, on weekends, on holidays and at times when people usually take annual leave. A buyer who plays a lot, say taking two weeks off at Christmas is very likely to buy during that period because he or she becomes so immersed in the game (and because of a cultural tradition of spoiling ourselves at Christmas).
- sellers have a different schedule, it's more or less constant. Sure some sellers will be at school or at college but even there people will sell from their phone because sellers tend to see themselves as players of the market.
- information about the market has tended to be poor which means people have no clue what to sell things for. This will remain true for a lot of players in D3. They generally will look at the auction house to see what to price stuff for. This means if an item spikes low most suppliers will continue to undercut by a small margin.
- value will degrade very quickly early on. However a lot of people won't know this and will think their Windforce is worth £2,000 just because the first one sold for that.
- casual players will not cross-reference the gold AH with the real money AH creating opportunities for arbitrage both ways. You may be able to buy something for £5, sell it for £10 worth of gold, use the gold to buy an item on the gold auction house that sells for £15.
- learning the auction house and keeping detailed records will be extremely useful. It's possible third party apps may emerge to help track ah details but be very careful about downloading anything that isn't official. One of the best ways for other people to make gold is to steal yours.
- new opportunities emerge every time the game is changed. If the devs says the next patch will improve fire damage then buy up fire damage items to sell on patch day.
- people will manipulate the markets, possibly to the extent of spending thousands of pounds. The basic example of this is the monopoly. Say I buy all the Lemon Fist Axes available then list one or two at a very high price. Ideally I supplement it with a post on the forums about my amazing Lemon Barb. As demand grows I release my stock, ideally at the high point of demand and the low point of supply. A word of caution - this is not a beginner tactic. I've tried it a few times in Eve without any real success, you need to really know the market. What tended to happen to me is I would buy something that didn't have many sell orders and people would just replace it at the same price. In a market like this there will be a lot of stockpiling, a monopolist's day can easily be ruined by someone spotting the price rising and having a big stockpile of the commodity.
- undercutting. The 1p undercut (1 cent, 0.01 isk, 1 copper) is the default method of selling for most players. Max revenue for least amount of thought. You can manipulate this by listing low then buying out the people who undercut you. I suspect though that in D3 if you try that you will just see your item sell immediately. Deep undercutting, a strategy Gevlon popularised for WoW, is unlikely to work well. He used it to intimidate other crafters out of the glyph market. He was dealing with one or two suppliers. In a game with thousands of suppliers, many of them very sophisticated you won't be able to do this so easily.
- information is power. Revealing specifics, or even a general post like this one, reduces profit.
For all that if anyone makes a fortune in Diablo 3 it will be those playing the market. The game is effectively creating a new unregulated stock market, it is going to be a financial Wild West.
The Diablo 3 economy is, as Tobold explains, likely to be front-loaded. If you find the best bow in the game and are the first one you will be able to sell it for a lot of money. If you find it but you're the 1000th one you'll receive pennies or perhaps a few quid at most.
This translates into an early adopter bonus. If you get in on the headstart if there is one you'll make a lot of money. Beta keys are going to ilicitly trade hands for a lot of money as although the items won't survive you will have the opportunity to learn how to item farm. Power leveling of various types will be a sought after service.
If you work but are thinking you'd like to be a D3 financial magnate you might want to book a week or two of leave.
The regions are going to vary considerably.
The game will be divided into markets by its regionalisation.
When asked about the regional breakdown of the shop, Pardo said, "The primary reason why we're doing the Auction House per [real world] currency is for usability, and in some cases, with legality -- it's the easiest way to do it... There are going to be so many items in each auction house in every currency that there shouldn't even be need to shopping around in different currency houses."
Source
So that sounds like for UK there will be a pound-based national server network. This may mean it's the first ever online game here to be national, it almost doesn't make sense or at least it hasn't before to be both national and online.
What I don't know is whether we'll be able to play in other countries' regions. Here's a list of countries by GDP, if you want to play abroad for a better market the highest GDP at the moment belongs to Qatar and the highest English-speaking country is the United States of America. Both have things to recommend them for the professional D3 player - Qatar's wealth is concentrated in the hands of the superrich so we may see extremely high prices paid, USA of course has both a cultural and a constitutional commitment to hedonism.
I have no idea whether we'll be able to choose our region. I think I'm inclined to play in my real region rather than roll on a more lucrative one but if I find myself making decent money I would be tempted to get extra copies of the game to expand the business multinationally.
Taxation
Tax (for UK residents) is explained here if you receive a salary. It's "income from casual earnings, for example, tips or commission" If you're an employee or receive a company or personal pension you can receive up to £2,500 extra income in a year and still pay tax on it through your tax code. For amounts greater than £2,500 you'll have to complete a tax return and pay tax through Self Assessment. You receive a PAYE coding notice before the start of each tax year and let them know on that how much you expect to earn or you can contact them to let them know you earned over £2500 and need to pay through self assessment. It works just like income so if your work pays you £20,000 and Diablo 3 pays you £1500 you'll be taxed on an income of £21,500. (This is not professional tax advice and if you want to be completely sure contact HMRC).
It's entirely possible you may pay less tax if you register as a business because you will then be able to defray expenses (the cost of the box, a proportion of the cost of the computer equal to the extent to which the computer is used in pursuit of the business, banking costs, electricity etc). It's discussed here.(In the United States from a brief look I took it seems to be the other way around, it's better if they think your game items sales are proceeds from a hobby than from a business).
Most people will simply not report it anywhere and not pay any taxes. If you're seriously into item selling this could be a very bad idea if you're successful and they catch up with you. As it's all online and as this is the very game that's likely to make the Revenue wake up and start chasing trade in virtual items that's quite risky. In fact we're right in the middle of a special Inland Revenue campaign to detect online trading that doesn't match tax returns. With robots :-)
Item value
Value is going to concentrate on a few high end items and particular bonuses. The nature of Diablo is that you can only wear a finite amount of items while finding lots of them. Except for a rush at the start when any decent item will have a fair amount of value there are going to be just a few items that are worth significant money. In D2 people tended to value percentage-based damage reduction over almost anything so that is an example of a stat that would fetch a premium - if D3's mechanics play out the same way then the new equivalent of a Vampire Gaze will sell steadily. For a trader understanding the game is a key element in understanding the economy. And both play into each other, if you see a market spike in an item with an unusual bonus type there may be more to that bonus type than appears at first glance.
Value will be shaped by end game activity as follows:
- Magic find runs. Lots of people will do this with their high level characters and will see magic find and gold find as investments. It will certainly be worth spending a little to add a few percentage to either find percentage early on if the market is vibrant.
- Gold farming.
- Leveling. It's possible D3 will be a lot easier to hit max level in than D2 but it's unlikely to be as easy as WoW. We do know the level cap is lower but that doesn't necessarily mean the last ten levels won't take ages.
- PvP. PvP in this sort of game is only really viable with the best gear. If you're serious about trading you should learn the pvp game just so that you can understand the market. Every serious pvper will obtain full best in slot if possible.
- Arena. A specialised type of pvp. Blizzard has the opportunity to make insane money if they can make this successful. You see, it's all very well having a game where people can sell each other stuff but if that game were also a Magic: The Gathering type game where people are passionate about tournament play to the point they will spend thousands the two elements synergise extremely well.
- Elite encounters. While many boss level encounters will be fairly random it's likely that players will farm certain bosses in preference to others. And if there's an advantage doing that boss with a certain item people will maximise that. So if most people like to run King Leoric, and say he does a lot of cold damage, people might place a premium on cold resist gear. Wyatt Cheng explains boss encounters here.
- Crafting. Crafting sounds like a huge resource sink and what's more produces variable loot. This makes it a kind of lottery - there might be thousands of people in your region crafting rare rings but you could still get THAT RING, the one with perfect bonuses and the right bonus types. Top end crafted stuff will always sell for a decent amount as long as the game stays popular. And some people will buy up cheap junk by the tons just to level their artisans and obtain crafting mats.
- Crafting mats. Some crafting mats apparently are rare drop.
- Gems and Runestones. These will always sell as they can be converted to higher types. There may even be arbitrage opportunities where you can buy 3 gems, cube them, and put the higher one back on the market for three times what you paid. It takes 19,600 of the lowest level gem to make one of the highest level.
- Achievements. People will want to complete their list of achievements so items may sell based on their usefulness to this. For example if there is some jump you have to do people might buy items with a stat that boosts jumping distance. This will be a short term market as most people will buy the item, do the achievement, then sell it.
- Followers. Your persistent followers can wear gear. In D2 there was a trick where you burned down a boss like Mephisto with your 500% magic find then let your merc with his 200% magic find get the final blow for a 700% magic find kill. People will want to buy decent stuff for their followers.
- Other end game pursuits. Blizzard have been muttering about awesome end game activities. The gear needed for these will certainly sell.
What won't factor
- Ladder resets. There will be none.
- Hardcore mode. May as well call it "I went through all this and I didn't even get paid" mode. I'm put off from hardcore mode although I loved it in D2. What if I find an item that would be worth £10,000 but I found it in hardcore mode? Too annoying. I think eventually Blizzard may cave in and allow real money trading in hardcore mode but for now it's the last haven of the amateur.
Playing the market
First this market won't be like any previous markets and will more ressemble real world markets. In WoW if you kept track of the market fluctuations and downloaded some useful addons you were playing a different game to most people and what's more you might be one out of only a handful of people on your server playing it. In D3 there will be tons of people playing the market, there's quite possibly going to be phone apps so people who can't log in to the game while at work or traveling will still be playing the market. Just as in real life it's quite hard to play the commodities market because people really do know where surplus value appears so too will it be hard to play the D3 market because so many very smart people will be competing against you.
That said experience of playing the market in games like WoW and Eve will certainly be useful. One of the most expert players of the WoW market is Marcko, owner of Just My Two Copper. He's already put up his D3 gold site. I think he'll make a lot of money just selling gold guides and from internet advertising revenue, never mind his actual in-game profits.
He's pretty good even if he has been outed for being somewhat unethical once or twice. He's worth a look imo although I wouldn't recommend buying his gold guide or anyone's. You can get just about all of the information for free from websites including Marcko's blog and forums. I guess think of the guide you pay for as being at best an executive summary. If you don't want to read around you can get a short version for money.
Regarding the market let me explain some broad MMO economic principles.
- buyers have an amount of interest in buying that peaks around their most intensive playtimes. Since most buyers will be people with jobs this means that peak buying interest will occur in the evenings, on weekends, on holidays and at times when people usually take annual leave. A buyer who plays a lot, say taking two weeks off at Christmas is very likely to buy during that period because he or she becomes so immersed in the game (and because of a cultural tradition of spoiling ourselves at Christmas).
- sellers have a different schedule, it's more or less constant. Sure some sellers will be at school or at college but even there people will sell from their phone because sellers tend to see themselves as players of the market.
- information about the market has tended to be poor which means people have no clue what to sell things for. This will remain true for a lot of players in D3. They generally will look at the auction house to see what to price stuff for. This means if an item spikes low most suppliers will continue to undercut by a small margin.
- value will degrade very quickly early on. However a lot of people won't know this and will think their Windforce is worth £2,000 just because the first one sold for that.
- casual players will not cross-reference the gold AH with the real money AH creating opportunities for arbitrage both ways. You may be able to buy something for £5, sell it for £10 worth of gold, use the gold to buy an item on the gold auction house that sells for £15.
- learning the auction house and keeping detailed records will be extremely useful. It's possible third party apps may emerge to help track ah details but be very careful about downloading anything that isn't official. One of the best ways for other people to make gold is to steal yours.
- new opportunities emerge every time the game is changed. If the devs says the next patch will improve fire damage then buy up fire damage items to sell on patch day.
- people will manipulate the markets, possibly to the extent of spending thousands of pounds. The basic example of this is the monopoly. Say I buy all the Lemon Fist Axes available then list one or two at a very high price. Ideally I supplement it with a post on the forums about my amazing Lemon Barb. As demand grows I release my stock, ideally at the high point of demand and the low point of supply. A word of caution - this is not a beginner tactic. I've tried it a few times in Eve without any real success, you need to really know the market. What tended to happen to me is I would buy something that didn't have many sell orders and people would just replace it at the same price. In a market like this there will be a lot of stockpiling, a monopolist's day can easily be ruined by someone spotting the price rising and having a big stockpile of the commodity.
- undercutting. The 1p undercut (1 cent, 0.01 isk, 1 copper) is the default method of selling for most players. Max revenue for least amount of thought. You can manipulate this by listing low then buying out the people who undercut you. I suspect though that in D3 if you try that you will just see your item sell immediately. Deep undercutting, a strategy Gevlon popularised for WoW, is unlikely to work well. He used it to intimidate other crafters out of the glyph market. He was dealing with one or two suppliers. In a game with thousands of suppliers, many of them very sophisticated you won't be able to do this so easily.
- information is power. Revealing specifics, or even a general post like this one, reduces profit.
For all that if anyone makes a fortune in Diablo 3 it will be those playing the market. The game is effectively creating a new unregulated stock market, it is going to be a financial Wild West.
Wednesday, 3 August 2011
Monday, 1 August 2011
Diablo 3: who wants to be a professional gamer?
And the heavens shall tremble reads Blizzard's Diablo 3 website. Well the games press is certainly trembling today as Blizzard announces that players will be able to sell each other in-game items for real world money in forthcoming title Diablo 3.
The Washington Post covered this story in their business section, presumably they consider this news may affect Activision Blizzard's share price.
Gamasutra heard it straight from the horse's mouth, Mr Rob Pardo explaining the details in a press conference at Blizzard's Irvine CA office.
Then for the big news. Pardo began by discussing the importance of trading items in Diablo, how it had been done online in Diablo II: via manual exchanges, forum posts, or IRC, and "shady third party sites full of gray market stuff." He said, "We can make it better."
With the Diablo III Auction House, players will have a fully-integrated marketplace that allows them to buy and sell items, gold, and components with real-world currency (tentatively divided into U.S. dollars and euros, among others) in their respective territories. According to him, it's based on the World of Warcraft Auction House, but with refinements. Diablo III's iteration allows for auto-bidding and instant buyouts, smart searches based on class, a shared stash, and secure item transfers.
Pardo was swift to mention that it's not an official "Blizzard Store," but a clearinghouse for players to have an open market to facilitate the trading of in-game items with each other. Players will be anonymous during trades, and there will be restrictions on the buying and selling of goods with real-world currency for those who choose to play in Hardcore mode.
He then outlined initial details of transactions. There will be a fee for both item listings and sales. Should players accept in-game currency, their payment will go toward their Battle.net e-balance, which covers auction items, WoW subscriptions, and pets. Should players decide to cash out their items, a currently-unannounced third-party payment provider will handle the transaction and take a percentage of the sale. There won't be any limits on item trading, but there will be a 24-hour cooling period before players can resell a purchased item.
Pardo intimated that if Blizzard didn't take the steps to bring e-commerce in-house, someone else would step in and profit from it. "Players want this... We could take a harder stance, but with Diablo, we think [the Auction House] will end up being a good thing," he said. The fact that in-game bartering and selling had "become a metagame of its own," in his words, was another motivator for launching the new feature.
This move incurs a number of legal risks which I believe Blizzard is prepared for and wants to tackle head on.
This article on Eve Online covers some of the implications that follow virtual money becoming real money.
In particular I would draw your attention to the part where the author discusses the games developer becoming effectively a bank.
Under Blizzard's proposed system a player would send them real money, that they would keep in escrow in an account assigned to the player until s/he found items that s/he wished to purchase whereupon they would transfer money from his/her account to the seller.
If it's a real account with real money in that rather sounds like a bank, doesn't it? Sure it's a bank with rather unusual restrictions but I can put money in, take money out and authorise payments to third parties.
There's also the gambling issue. If I do a Pindleskin run knowing I will probably get nothing but I have a 1 in a million chance of a Windforce worth $2000 then isn't that essentially just a reskinned online fruit machine? Do gambling laws apply?
I think that Blizzard is trying to push back the legal restrictions on what is acceptable. This may result in no one really complaining in which case practices considered somewhat shocking now will become commonplace and can later be defended on the grounds that they are usual practice. They may be bitterly contested by lobby groups or class actions in which case Blizzard is likely to throw an army of lawyers into the arena (and they'll be able to afford to from their cut of all the transactions). Blizzard may lose in court in which case they may try to lobby the legislature for law reform.
It's even possible that Blizzard may establish this as normal practice by buying off court actions by settling them. If what they are doing is enforcably wrong but no cases ever get to court because they always settle then after a while what they are doing becomes standard industry practice, is adopted by their competitors and is suddenly much harder to root out.
It makes sense for games companies to take over the third party market. It wouldn't surprise me if more money has been made on World Of Warcraft by people who are not Blizzard than the company itself. It's worth a lot of money to take control of this business.
Whatever happens the MMO hobby will change. I do think the rest of the industry should let Blizzard be an early adopter in this and let them take the risks. But imagine if in a few years this is a battle Blizzard has won for the developers. Imagine crafting in Prime knowing each master crafted epic is worth $5 real cash that will clear a few days after you sell the item. Very interesting eh?
 |
| And Lo! Lord Pardo decreed that their bank balances shall tremble! |
The Washington Post covered this story in their business section, presumably they consider this news may affect Activision Blizzard's share price.
Gamasutra heard it straight from the horse's mouth, Mr Rob Pardo explaining the details in a press conference at Blizzard's Irvine CA office.
Then for the big news. Pardo began by discussing the importance of trading items in Diablo, how it had been done online in Diablo II: via manual exchanges, forum posts, or IRC, and "shady third party sites full of gray market stuff." He said, "We can make it better."
With the Diablo III Auction House, players will have a fully-integrated marketplace that allows them to buy and sell items, gold, and components with real-world currency (tentatively divided into U.S. dollars and euros, among others) in their respective territories. According to him, it's based on the World of Warcraft Auction House, but with refinements. Diablo III's iteration allows for auto-bidding and instant buyouts, smart searches based on class, a shared stash, and secure item transfers.
Pardo was swift to mention that it's not an official "Blizzard Store," but a clearinghouse for players to have an open market to facilitate the trading of in-game items with each other. Players will be anonymous during trades, and there will be restrictions on the buying and selling of goods with real-world currency for those who choose to play in Hardcore mode.
He then outlined initial details of transactions. There will be a fee for both item listings and sales. Should players accept in-game currency, their payment will go toward their Battle.net e-balance, which covers auction items, WoW subscriptions, and pets. Should players decide to cash out their items, a currently-unannounced third-party payment provider will handle the transaction and take a percentage of the sale. There won't be any limits on item trading, but there will be a 24-hour cooling period before players can resell a purchased item.
Pardo intimated that if Blizzard didn't take the steps to bring e-commerce in-house, someone else would step in and profit from it. "Players want this... We could take a harder stance, but with Diablo, we think [the Auction House] will end up being a good thing," he said. The fact that in-game bartering and selling had "become a metagame of its own," in his words, was another motivator for launching the new feature.
 |
| This post was brought to you by the Activision CEO and the Powers of Darkness. |
This move incurs a number of legal risks which I believe Blizzard is prepared for and wants to tackle head on.
This article on Eve Online covers some of the implications that follow virtual money becoming real money.
In particular I would draw your attention to the part where the author discusses the games developer becoming effectively a bank.
Under Blizzard's proposed system a player would send them real money, that they would keep in escrow in an account assigned to the player until s/he found items that s/he wished to purchase whereupon they would transfer money from his/her account to the seller.
If it's a real account with real money in that rather sounds like a bank, doesn't it? Sure it's a bank with rather unusual restrictions but I can put money in, take money out and authorise payments to third parties.
There's also the gambling issue. If I do a Pindleskin run knowing I will probably get nothing but I have a 1 in a million chance of a Windforce worth $2000 then isn't that essentially just a reskinned online fruit machine? Do gambling laws apply?
I think that Blizzard is trying to push back the legal restrictions on what is acceptable. This may result in no one really complaining in which case practices considered somewhat shocking now will become commonplace and can later be defended on the grounds that they are usual practice. They may be bitterly contested by lobby groups or class actions in which case Blizzard is likely to throw an army of lawyers into the arena (and they'll be able to afford to from their cut of all the transactions). Blizzard may lose in court in which case they may try to lobby the legislature for law reform.
It's even possible that Blizzard may establish this as normal practice by buying off court actions by settling them. If what they are doing is enforcably wrong but no cases ever get to court because they always settle then after a while what they are doing becomes standard industry practice, is adopted by their competitors and is suddenly much harder to root out.
It makes sense for games companies to take over the third party market. It wouldn't surprise me if more money has been made on World Of Warcraft by people who are not Blizzard than the company itself. It's worth a lot of money to take control of this business.
Whatever happens the MMO hobby will change. I do think the rest of the industry should let Blizzard be an early adopter in this and let them take the risks. But imagine if in a few years this is a battle Blizzard has won for the developers. Imagine crafting in Prime knowing each master crafted epic is worth $5 real cash that will clear a few days after you sell the item. Very interesting eh?
Subscribe to:
Posts (Atom)