God Bless John Smedley
Feb 14, 2008 20:02:50

John Smedley, CEO of SOEOkay - time to wake up and smell the coffee or roses or whatever you smell in the morning as grandmother used to say. It's not illegal, it's not immoral, and it's not unethical. It doesn't destroy economies, virtual or otherwise. What is it? It's real money trading or RMT for short. You won't go to hell for engaging in it - and thank God for that. I would be in hell myself if that were the case, for I have engaged in a bit of RMT myself in the past before I saw the light.

But there one thing RMT does, and that is damage, and one HECK of a lot of it. But none of the damage is "virtual". What do I mean by that? Don't take my word for it - here is what John Smedley had to say not long ago.
"Farmers are the bane of our existence at SOE. They cause us endless amounts of grief and do real financial damage in a meaningful way. What do I mean by that?

Many of them use stolen credit cards, obtained by unsuspecting users who give them credit card #'s to purchase in-game gold. I'm not saying all of the RMT shops out there use stolen credit cards, but a LOT of them do. Your credit card is absolutely not safe in their hands.

In addition we receive large scale (over $500k so far) fines for chargebacks that these scumbag farmers routinely do. They purchase a new account.. use it for a month and then call the credit card company to say "I never paid for this". Over time, as the # of these incidents rise we get fined by the credit card companies. And it's not just us, other large MMO companies are seeing exactly the same problem.

In any event, I wanted to stop in and at least set the record straight - you aren't going to be seeing RMT allowed on the non-exchange enabled servers."
- John Smedley on EQ2 Flames

Let's face it, even if the name on your corporate letterhead is Activision/Blizzard and you regularly ban enough accounts for gold buying and selling that it equals the population of a small town - even so, that will NOT stop gold sellers. There is only ONE way to stop gold sellers and that is beat them at their own game. God Bless John Smedley - someone has it right. Bring in Live gamer and beat the gold sellers at their own game. That is a first step.

What is the next step? The answer is micro-transactions and once again God Bless John Smedley who is moving SOE in that direction as well. Why would I give somebody I have never heard of my credit card number who may turn around and use that same credit card number to pay for his BMW. Why buy gold when I can give SOE my credit card number and get the best virtual goods. Don't think it doesn't work? If not, now you REALLY need to wake up and smell the coffee. Much of the MMO market on the other side of the Pacific already operates that way. Been there, done that.

There is one thing that RMT won't do if the game developer's handle it right - ruin virtual economies. Have I changed my mind on this? You bet. Back in the day when UO was the big thing on the market housing was not instanced. It created a megalopolis that all but destroyed the game. By and large all the player housing was paid for with RMT and it created runaway virtual inflation.

But that was then and this is now. Housing in games like EQ2 and Lotro is instanced. The best goods virtual gold can buy are labeled "no trade" so you couldn't see them or buy them for virtual cash is your life depended on it.

So where does the attitude that RMT will destroy virtual economies come from? Reports that are little more than garbage meant to sensationalize the issue...

Last year National Public Radio broadcast a report entitled "China's gold farmer's play a grim game". For such a short report (just under six minutes long) at the time it caused a bit of a stir in gaming communities. The announcer explains what gold farming is, then leads in with this: "controversy over gold farming has lead to virtual violence and on line murder."

Slow news day was it? Give it a rest. Virtual murder? Please - never played a video game at all have we? Just like the proverbial girl who "when she was good was very, very good, but when she was bad she was horrid" those people who deal in RMT that cause charge backs and steal credit cards (and as Mr. Smedley said, not all of them do) are the poop in the virtual punch bowl we all drink out of.

But thank God people like John Smedley are taking us all in the right direction.

See you online,
- Julie Whitefeather

Submitted by Brent on Feb 14, 2008 20:02:50 CST (comments: 14)


'RMT.....Really....I don't get why you think this would work' by Kasil
Submitted on 2008-02-15 18:38:18 CST
I am not getting it. Why are you applauding SOE for wanting to take us down the RMT/Micro-transaction path? RMT and Micro-transactions are nothing more then a business model that has open ended revenue, which benefits the game development companies. What is the benefit for players?

Anyway I am a firm believer in the following which I believe explains why I think both RMT and micro-transactions are doomed to fail in any large (i.e. top 10) MMORPG in the US if implemented by the game development company.

1) Level Playing Field: Everyday in the real world we deal with money, class, education, etc as advantages or disadvantages to work, school, life etc. Allowing RMT into these environments makes the games less immersive and brings us back to the real world which we are making an active choice to leave for a few hours.

2) Collecting and Displaying: These games are about collecting and showing off your accomplishments and what does that better then anything else in game? Loot, big fat swords that glow red and drip blood, shoulder armor with large spikes and glowie skulls, etc. If this loot is purchasable with real world money it does not mean anything. Just looking at WoW you can get various epic’s off the auction house which are bind of equip but these items are inherently less impressive because you did not have to earn them. Additionally there is a reason they call arena gear, welfare epic’s in WoW and why they have now put personal arena rating’s on certain pieces of gear.

3) Fairness: More then anything else MMO players go on and on about fairness, in EQ2 there was a guild which got moved from a test server to a live server and the community whined like SOE stuck a hot poker in their eye until they where moved back, why? because it was not fair. (Characters on the test servers level twice as fast which gave them an unfair advantage). In WoW the forums are overflowing with posts about X class being over powered and how it’s not fair. I am not saying these games are fair as many factors play into this, what I am saying is that we seek games which inherently are premised as being fair.

4) Competition is part of the Game: In WoW and every other MMO I have ever played there are certain items which are just a pain in the ass to get. In WoW primal fires come to mind, do you think this is by accident? I personally really doubt it. The developers want to create scare resources and conflict to some degree in acquiring them. Why does this matter to RMT? Because if you incorporate RTM and micro transactions into your game you then de-value everyone else’s accomplishments.

5) Lastly the MMORPG business model is built on people playing their game for a long time. It is very difficult to write and test this content so you need players replaying content over and over. Thus it makes no sense to allow RMT for items which contribute to game play because it quickens the pace to which players reach the end of their characters life cycle (which shortens the time a player will subscribe).

Anyway if you want to praise someone for doing something about RMT I suggest you look towards Blizzard. The only real way I see game developers affecting this is by getting judgments in court where the terms of service are enforceable and then closing the various gold sellers as they have done recently.


'I hate filling out these re: lines every time we post hehe' by Beauturkey
Submitted on 2008-02-15 22:36:58 CST
Anyway, I think RMT is coming, and in a few years we will all laugh at the fact that we paid for games monthly like some kind of bill.
I don't MIND that it's coming. Not at all. I have paid plenty of money in RMT's. Asian market games, and a few over here like Second Life and There.
BUT, I will admit my own weaknesses. Me and my wife have both admitted it. When she played the Sims (1 and 2) I would always try to play the game normally, no cheat codes..you know, going out and getting a job and paying my bills. BUt I would always break down and put in a cheat to give me a million dollars. While for me it ruined my enjoyment, I mean once I had my mansion and all the toys, I would get bored with it...well, Leala would still be playing for hours, decorating that mansion, making lil movies, all that.
So it depends on the person.
And I would TOTALLY pay 20 bucks for a cool unique mount. I'm weak like that.

'And about fairness..' by Beauturkey
Submitted on 2008-02-15 22:43:28 CST
I do not agree in any way that it was unfair that those players from the test server got moved over onto a real realm. They helped the game out by testing the game, and by doing ALOT of it. The test server is open to anyone, equally. And I will bet you anything that if any of the whiners were on the receiving end of the "unfairness", in other words the guilds that got moved, they would not be complaining.
MMO's are not competition. How does someone else effect your game-play? OK so that guy over there has the same sword that you do, but while you "worked hard" and got it after 20 hours,he only paid 5 bucks for it. How does effect your gameplay? It might effect your EGO, but not your game-play.
I do agree though, that a "cashshop" or something does help bring down the immersion level a bit.
But here's an example I always use...if it is a discussion about players with money and players without...then would someone that can have 2 account's be considered being unfair? It happens all the time. Hell, I know players that have 3 accounts. So what? If he wants to spend his money that way, go for it.

'these comment titles' by Brent
Submitted on 2008-02-16 00:42:57 CST
are really getting hate lately... should I remove them? unknown.

'wellllll...' by Beauturkey
Submitted on 2008-02-16 01:52:59 CST
You KNOW Brent that me and Leala think da WORLD of you, and your site, and the podcasts...but yeh, the comment titles should go.
BUT I can forsee some time when they WOULD be handy...to refer to a certain post or something.
Can you make em a choice? :)

'why not' by Sente
Submitted on 2008-02-16 14:49:05 CST
Kasil, I must say I do not quite agree with your comments

1) Immersion, not thinking about money:
In most of these games the in-game virtual currency is of some concern, so in a sense people will think of money in some way anyway. Just because some kind of micro transaction or trade real money for virtual money system is in place it does not mean that it necessarily will make a significant difference. If the game company pisses off people because only real life rich would get by properly, then they will not likely retain the rest as customers.

2) Showing off
That may be your view what these games are about, personally I could not care less about showing off stuff or what other people may have. Again, if the game company would piss off the majority of their customer base by allowing people to buy that kind of stuff (assuming people care), then they might loose a bunch of customers. So they might be careful about that.

3) Fairness
What is unfair about a shorter leveling time? The people did not get any items transferred only their characters in the nude. They do not have any added capabilities or anything another player would not have. If shorter leveling time is an advantage you are selling the game short I think, implicating that it is so boring that one has to speed up the leveling time to endure it.
Those people likely spent a lot of time helping with improving the game for everyone else. I really do not see what is unfair there. But this is a subject that does not really have much to do with the RMT topic.

4) Competition
Competition with who? Again, that is one kind of playstyle. I am not competing with any other players, other may perhaps do that in some way. Again, it is up to the game company how they implement an RMT scheme how that affect different play styles.

5) Business model
There is not one business model for MMORPGs. There is one model that has been applied to many of the titles in the Western hemisphere, the subscription-based model with a fixed fee and no variations or options (other than how many months you pay at once).

I do not think MMORPGs will grow that much if they retain that business model as is - there is a limited amount of people that will put up with playing 1-2 games for hours per day and pay a fixed fee for a number of accounts each regardless of how much they play - in particular if most of the family plays. There is a huge amount of people there that could potentially be playing multiplayer online games for which this type of gameplay and business model puts an effective stop in place.

Game companies need to think of different ways to attract more customers and at the same time be profitable - what would be the point for them to do this otherwise?
You may or may not like what they end up with, if not - simply don't play it. If many other people like it though and it becomes profitable they will likely continue with it.

'Topical reaction' by Syrinx
Submitted on 2008-02-18 14:56:59 CST

Long time reader, first time responder. While I do not like the availability of RMT on the local EQ2 server for fear of lack of control on my part (3AM Infomercial for George Foreman grill comes to mind), I shrug and agree that it may be the way of the future. I do feel that there is a RMT element already going on within the gaming community that currently the producers of the content don’t get a share of . In EQ2, one can buy ‘loot rights’ for a particular item. If said item drops for mega uber raid guild, I just have to fork over what the going rate is or be the top bidder. Someone drops from the raid, I get invited and the loot is assigned to me. No muss, no fuss, I now own the cowl of amazingness for the low price of 100 plat or so. If you follow the cycle, I either farmed for the plat or bought it off a gold seller. On the other side of the equation, mega uber guild has plat pouring in and really has no place to spend it since they already own all the top gear. Guess what they can do. Yep, sell it to the gold farmer and get REAL cash in their paypal account. This is a closed loop cycle that I (the one who has an itch they can’t scratch) started and ended. The shorter version would be to just paypal the money to the uber raiding guild to start with. The key thing being that Sony doesn’t get a red cent of it beyond my monthly subscription.

Off topic a bit, the element of time=money could be explored. RMT sounds like a way that I (adult gamer, limited in game time available) could potentially compete with the individual that has 6-10+hrs per day to spend farming, working the market, etc. As was mentioned, it will come down to what percentage of the loot table in the game can be bought. If 100%, then the balance has shifted to who’s bank account in RL is bigger. If it is 10% or lower, the status quo is maintained. The challenge is to find the middle ground.

'business model' by Kasil
Submitted on 2008-02-19 19:23:10 CST

Good post. First off just let me say in my above post I was not saying each and everyone of these elements are important to me but rather my observations over the last 6+ years while I have played MMO's. Additionally I think most people that frequent virginworlds.com are to some degree more interested in the broader virtual world/game design topics then the average player community for WoW, EQII, TR, LotRO, EvE etc.

As to your point on the current business model restricting the market, I agree. I don't think RMT is the answer but I would totally agree that if MMO's are going to continue to expand they will need to find more flexible pricing models which allow things like family accounts, plans for occassional users, etc.

'I think there is a failure to see the economic solution' by killertim
Submitted on 2008-02-21 09:19:15 CST
If the issue for gold farming is that it is profitable for people in some countries to pay for workers in game and sell to players in other countries would it not be easier to separate the servers geographically. That would eliminate a lot of the “cheap gold” spam I see in game.

While I don’t want to make anyone feel bad the issue seems to be Chinese companies selling to European and North American players.

'Why RMT Works on a small scale.' by AdamT
Submitted on 2008-03-10 02:17:23 CST
In the course of rummaging around for an EVE Online developer quote I am sure would serve as a witness for the defense, so to speak, I found myself developing a very strong opinion on RMT. More on that later, because I did eventually find the quote, which was buried in the middle of a Fanfest 2007 taped question-and-answer session. [Fn1] After being asked how great an effect the timecode-for-ISK system was having on the economy, CCP’s resident PhD. in Economics Dr. Eyjólfur Guðmundsson answered:

"[After establishing that a number of the audience had indeed bought ISK] …It really comes down to curbing the demand, and the demand has been relatively low. So it’s not impacting the game as such."

equity or uprightness of such a system, the good doctor did make clear that the developers weren’t sacrificing the integrity of the market to make a quick króna [Fn2]. Besides that, there exist two key mechanics in EVE’s basic design that mitigate the tremendous fallout one normally associates with large-scale illegal (or sanctioned) RMT.

First is the market system’s realism; there is a real population – 200,000 players – whose players are separated by vast distances that goods cannot instantly traverse. Any sudden influx of currency from an unnatural source is quite naturally absorbed. The free market, which sees hundreds of billions of ISK in transactions across the galaxy on a slow day, simply will not be fazed by the few stray billion changing hands occasionally.

The skill system also represents a mechanic that mitigates the effect of RMT on EVE. No matter how much money a given player has in his wallet, he will still take four years or longer to get to where, in terms of progression, the oldest players are now. Even then the veterans will maintain their lead.

The price of a veteran character, which is only payable with ISK, is prohibitively high to the point where only people who have been playing the game for months or years could afford one anyway; because of the nature of 0.0 space, veteran players can actually make far more money than a slant eye farmer over any given time period. The only way around this is to pay huge sums of Real Life money for the ISK charged for a veteran character. That it is so time-consuming to create powerful characters in the first place also severely limits their supply compared to level- and gear-based MMOs.

At last I arrive at the point, hoping that I have followed a logical progression of reasoning up until now. EVE is uniquely capable among MMOs of having Real Money Transfer and traditional advancement/gain coexist peacefully. A level-based game, or a sharded into small servers, or even one with instantaneous transfer of goods across a large world, could not come close to accomplishing the same thing. So Blizzard, SOE, Funcom, EA/Mythic – keep your greedy paws out of the money pot.

Fn1. http://link.brightcove.com/services/link/bcpid1274008831/bclid1301134687/bctid1308023119

Fn2. The Icelandic króna is abbreviated “ISK,” but it in this context it could easily be confused with EVE’s Interstellar Kredit.

'Goldselling..' by Beauturkey
Submitted on 2008-03-10 10:33:56 CST
I had just commented on this in other places, but would like to comment here as well. I'll try to keep it short.
While the real life economist claims that the isk-buying has had little effect on the game, I say that it doesn't matter. There are still huge corps and huge players getting more and more ISK in exchange for VERY LITTLE real life money. A Raven battle ship, insure and with 18 million left over for outfitting (and yes, that can still buy you some good stuff) cost about 15 dollars. That's it. Do we think that some hardcore players isn't going to throw down 500 dollars and own a fleet? Of course he is.
And this service is very unknown, at least to the players I have met. It will get out. Give this another year, and people will be crying that this RMT ruined their game. Of course all game mechanics will be the same, but players will still cry foul.
It's just funny, the more I think about it. So many of the gaming community talks about the purity of Eve. Eve has got RMT! There is now ways around it. You can buy yourself your fortune in Eve.

'Re: 'Goldselling..'' by AdamT
Submitted on 2008-03-10 13:42:29 CST
The character skills required to pilot a BS effectively take a long time to acquire. And because your ship is destroyed permanently when you die, the unskilled players will end up pouring wads of cash into something that really isn't worth much to them anyway. The players with the skill (reflexes and knowledge, not skill points) to pilot a BS will already have enough ISK to buy it without RMT.

'True dat...' by Beauturkey
Submitted on 2008-03-10 15:27:57 CST
Good point Adam. But like I have said elsewhere, it just feels strange, to have the ability to just buy a Raven for 15 bucks. lol
I like RMT, but I can be lazy and tempted easy. So I have no issues with RMT other than my own personal weaknesses.
Also, you can play the entire time in Eve without ever PvP'ing..and it's otherwise pretty darn easy to survive in the PVE. Eve is like any other MMO, easy to play, hard to master.
Also, 100 bucks for a fleet is soooo cheap! :)

'I've got no problem...' by Grimjakk
Submitted on 2008-05-06 23:53:00 CST
... with solid games that use micro-transaction on a small scale.

But I just read an article titled "Gambling Your Life Away" on www.danwei.org. It's about one of the larger Chinese MMORPG's - ZT Online - a game seemingly designed from the ground up to be a virtual extortion racket.

I don't know how to check the article's accuracy, as my Chinese stops after "Nihao"... =P

But apparently, a few years back, the newspaper that published it exposed an earlier "snake-oil" (phony vitamin-tonic) racket by the creator of the game.

... anyway, I thought it was a pretty chilling depiction of the RMT model taken to an extreme.

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