So, the Diablo III Auction House will allow us to pay real-world cash for in-game items – any in-game items.
I’ve seen people saying it will be awful. I’ve seen people saying it will be pay-to-win. I’ve seen people saying it will be genius.
But I’ve yet to see anyone commenting from an… “exploit-focussed” perspective. (As opposed to, say, “cynical and untrusting”.) Now, for better or for worse, I tend to think in that direction. And so, a few things have occurred to me as likely unintended consequences of the real-money Auction House in Diablo III.
A note, before I begin. This stuff will probably not happen to you. It might not happen to anyone you know. But if Diablo III ends up with millions of players, it will happen to someone.
And the Legendary Sword goes to the gentleman from the Rosthchild Foundation
Tobold has commented that he thinks items will be far, far cheaper than expected. He’s absolutely right – mostly. The per-hour rate for “work” in Diablo III will stabilise at far below minimum wage for the average person, thanks to 3 factors – people cashing in items they aquired for “free” (“Woo! I was playing Diablo and I got this awesome sword! Free cash!”), farmers in developing countries (it’d be very easy to set up a Diablo III content farm in the Phillipines paying about $1-2 per hour), and people who are desperate to make money who fail to understand basic economics.
The latter will probably be the biggest problem – on every other “easy” money-making opportunity (Ebay, for example) there tend to be hordes of people trying to make money who are satisfied with insanely low profit margins, or make basic commercial mistakes. In WoW, this would be the classic “I farmed the mats, so they’re free!” error.
On the other hand, some items will go for insanely high amounts of real world money. Let’s do a quick thought experiment. Assume the legendary for your WoW class (or equivalent in another game) is coming in Patch 4.3. Assume it takes the usual amount of work to aquire – ie insane amounts with the full support of a large guild.
How much real-world money would you pay to get your hands on one of them, completely legitimately? What’s the maximum one of your guildies would pay?
Right. Now imagine you earn $30,000 per month in the real world.
How much would you pay for the legendary now?
There will be Diablo players out there who earn that much. There will probably be Diablo players out there who earn a lot more. I seem to recall one of the major EVE players is actually a Russian millionaire if not billionaire. These people will have no problem dropping sums that most of us would consider insane, just to outfit a new alt.
Of course, this very much depends on how large the market for Diablo III is. But if it gets anywhere close to WoW, very, very rare items are going to go for art-world level prices. Tens if not hundreds of thousands of dollars.
But not all items are going to go for that much, of course. You might not ever see an item worth $1000 in years of playing Diablo.
That doesn’t mean RMT won’t affect your gaming.
AWKWARD
Here’s another thought experiment. You’re off playing Diablo with your friend, who happens to be going through a rough time – she’s broke, she’s unemployed, maybe her health insurance is running out. Maybe she’s got debts.
And a very rare world drop randomly drops. Something that won’t sell for a fortune, but will sell for $50 or so. It also happens to be a massive upgrade for you.
What do you do?
As far as I can tell, there’s no good social outcome here. You Need, you feel like a bastard. She might well be legitimately upset – that’s $50 she just lost, and she really needs that $50. You give it to her, you probably feel a bit resentful, she feels like she’s had charity given to her, she also feels bad because she got an item you needed. You both roll, whichever one wins feels bad.
Now, you might be saying that of course you’d see past that. She’s your friend.
Now imagine she’s in your regular group. And you’re pretty good. Every night you see 3 or 4 drops, worth about $10 each. Every night she’s down, and talking about how her mum’s medical bills are hurting her, or how she’s getting sued by creditors. And every night, you have to make the decision above three or four times.
That’s going to start to suck.
TL:DR – gaming groups with major income disparities – and there are a lot of them – are not going to find Diablo III much fun sometimes.
But what happens if you DO see something valuable drop?
Someone’s going to emergency, someone’s going to jail.
Gamers, I think it’s safe to say, are not universally well-heeled, highly intelligent people with a great deal of sense and impulse control. All sorts of people play games. Some of them are not very nice people.
Sometimes, you don’t know that much about your guildies.
Now, I’m sure all your guildies are lovely people. But I think you’ll probably in the past have had the experience of being in a guild – perhaps even a raid group – with someone suddenly turned very nasty. If not, you’ll have heard of it, perhaps on WoW Insider’s Drama Mamas column.
Some guilds are going to have that problem in Diablo – but a lot worse.
We’ve all seen some pretty major loot drama from WoW. I know of plenty of friendships breaking up, threats being made, torrents of verbal abuse, sometimes even physical violence.
Now imagine that each of those fights were backed by anyone involved having either won or lost some fairly serious cash.
Go Google “Poker murder”. A lot of people get killed over poker – a game involving real-world money – every year. Enough that it doesnt show up in the national news – because it’s sufficiently common.
Think of the worst loot argument you ever got involved in. Now imagine if there had been hundreds of real-world dollars at stake there.
Think anyone could have gotten hurt?
If Diablo III’s a WoW-level success, someone’s going to get their legs broken over a Diablo III item, and probably sooner rather than later. Someone’s going to go to jail.
Someone’s going to get killed.
What’s a serious Diablo III group going to feel like? Think dark glasses, smoky rooms, and quiet voices
Now, don’t get me wrong. None of this stuff is a good reason that Blizzard shouldn’t institute RMT in Diablo. I’m not against poker, either – indeed, a friend of mine is a semi-professional poker player.
But if you want a good idea of what a serious Diablo III gaming environment is going to look like, you probably want to look at the equivalents currently existing.
The closest equivalent I can think of is poker.
We’re talking very intense expressions. We’re talking a lot of very controlled people – after the first few Nasty Incidents happen, people on Diablo III are going to start prizing calm, reasonable, grounded guildies with stable income streams a lot higher than anyone who might go mad with an axe. We’re talking very, very dedicatedly polite gaming.
(Oh, and just like you get professional poker cheats, you’re going to get professional ninjas. See “This Is Not A Game” by Walter Jon Williams. Lovely.)
Of course, all of that only applies if there’s some way people can track you down in RL. (Don’t use the same username you use ANYWHERE else on the Internet – I personally have tracked one person to his RL identity from their WoW handles. It’s easier than you think.)
Which brings us to…
Forget “Dirty cop”. Think “dirty GM”
The biggest, fastest money in Diablo – assuming you’re not a very nice man or woman – will be made by compromising account security in one way or another.
The AH is going to be anonymous. That’s a very sensible move – as previously mentioned, tracking most peoples’ online identities through their WoW handles isn’t too hard, and you do NOT want any yahoo on the Internet being able to track you if you’re currently selling a $75,000 Legendary. Or undercutting someone else’s.
However, just how good will that anonymity be? For starters, will GMs have access to the account details of people who are trading on the AH? It’s quite likely that some of them will – after all, Blizzard will want to be able to monitor and police activity. If Blizzard’s development team don’t think too hard about Bad People (a very common mistake), all GMs will be able to break AH anonymity at least to the character name level.
Being a GM is not a very highly-paid profession. Being a GM who passes on contact details for people selling high-priced items, however, could well be a very lucrative profession indeed. Even if nothing nasty subsequently happens, if you can directly get in contact with the guy who is selling the Legendary Staff of Awesum, you may well be able to negotiate 10% off his asking price – that’s serious cash.
And Nasty could well happen. Getting the account details of someone with said Staff of Awesum is worth $75k, after all. That’s good money for a wide variety of criminal types, from hackers to legbreakers. There will be people out there intending to make money from Diablo, and not all of them will be doing it in legitimate ways.
Most of the time, it’s perfectly safe to sell a valuable painting, too. But not always.
Even if Blizzard are more clever than that with their security, exactly how good will it be? True anonymity is hard to do. And as the Sony debacle proves, games companies ain’t always at the top of the security game. Once serious RMT starts happening – on a huge scale – a lot of very serious computer cracker types are going to be interested in breaking that security. I hope Blizzard is prepared.
(They might want to start by reading “Halting State” by Charles Stross.)
Oh, and as a final point – if you manage to get your hands on the Super-Rare Staff of Massive Awesum, may I heartily recommend you don’t Tweet or blog about it?
It’s not all bad
Now, you might be thinking I’m saying that Diablo III’s going to be a total disaster, and that people are going to be getting killed like they were in a civil war.
That’s not the case. There are plenty of games out there where a lot larger volume of money changes hands than will do in Diablo III, and for the most part, they’re perfectly safe and fun to play. Poker, backgammon, horse racing – these are major and legitimate sports and games that add fun and relaxation to the lives of millions of people worldwide.
But what I’m saying is that the environment of Diablo III is going to look a lot less like WoW, and a lot more like one of those games. And the various unintended consequences of the RMT in Diablo III will be much more wide-reaching than anyone realises – even more far-reaching than EVE, a game without much in the way of random drops and an overall gameplay that’s not terribly mass-market appeal.
That might be a good thing. It might be a bad thing. It might depend on who you are.
A lot of this will depend on how the loot system in Diablo works.
If it’s very non-random, and the most valuable items are only accessible to people who put in the hardest work, then you’ll end up with a poker-type situation. Very low-limit poker is basically completely risk-free. Very high-stakes poker, on the other hand – well, let’s just say I wouldn’t expect to get into the Diablo equivalent of Paragon without a criminal background check.
(Of course, in the future, the hoped-for result from that criminal check for some top groups might end up being “right, you’re part of the Mob too, let’s get on with exploiting the hell out of Heroic Diablo for the $65 grand loot payoff”. With the amounts of money that might be at stake, cybercriminal groups could be extremely interested in getting early access to top loot. Imagine the current exploit dramas around top guilds, and add in six-figure payoffs. I look forward to the official Russian Business Network raid group. )
On the other hand, if there are random, ultra-rare item drops which are very useful or otherwise sought-after – you’re going to have more the equivalent of a lottery, or roulette.
Very nasty things happen to lottery winners sometimes.
We don’t know which way it will go. But, regardless, when you think Diablo, you might want to add to the usual jokey Vent conversations, Twitter flamewars and loot arguments the image of smoke-filled rooms, desperate lucky-break hopes and large guys with lumpy suits and shaved heads.
Just sayin’.
Update – Diablo III has individual, not group loot. That solves the problem of loot drama to some extent – however, I’d expect groups to rapidly come up with informal trading rules anyway (“Hey, Bob needs that healing mace more than you”). Blizzard wants RMT, so they have a vested interest to make sure many items that drop are more useful to other people than to you.
Do you think Diablo III will be carefree and fun times? Or shady and a bit scary? And which would you actually prefer?
{ 8 comments… read them below or add one }
The role of foreign commercial farmers is going to be a lot less than people think. The commercial-farmer business model is a mix of account theft and the use of unskilled labor that does drudge-work for miniscule wages.
Chinese farmers don’t have gladiator players who will carry you to high arena ratings. Chinese farmers can’t rent you a pro tank to help you beat Ragnaros. Chinese farmers haven’t even been farming the Firelands trash.
Instead, what you see is people using stolen accounts or druids with 95k health to grind gathering professions. There is no demonstrated game sophistication on the part of these organizations. These organizations have also developed absolutely zero sophistication about the game economy. They dump huge quantities of raw trade goods onto the auction house, undercut each other until the prices are ludicrously low for the amount of times the resources take to gather, and that’s it.
There’s a small community of WoW players that makes a minigame out of the auction house. They have a sophisticated base of information about which obscure items are valuable (i.e. certain items “twink” players covet), and they have game mods that crawl the auction house looking for these items at cheap prices. These are the players who are hitting the gold cap. I have not heard of gold-sellers adopting their methods, even though their methods likely represent the most favorable time-to-gold ratio of any gold-making strategy. By utilizing sophsiticated auction strategies, players have hit the gold cap in WoW, an accumulation of wealth that is almost impossible to obtain through conventional means.
Other players utilize the market for finished trade-goods to make gold. Even where a huge profit is available simply for turning herbs into flasks, these people will sell the herbs.
If getting good Diablo items requires any skill at playing Diablo, or if any degree of sophistication about Diablo is necessary to know which items are valuable, then the foreign farmers are likely out of the game. These are gangsters, not gamers.
However, the community of auction gurus is likely to seize on the cash auction house. It’s a basic rule of economics that markets are only efficient when information is uniformly available. That’s why financial regulators won’t let people with nonpublic information about companies to trade those equities on stock markets.
WoW’s auction house is rife with information disparities, and it’s a gold-mine for the guy who knows that the green level 19 belt you just listed for 45s is worth 600g to a twink. Diablo’s auction house will be the same way. You probably won’t be able to earn more than a couple of bucks an hour by playing Diablo, but somebody will be able to do better playing the Diablo auction house. Expect to see a story in the WSJ about some guy who made $25k in a month doing this.
Daniel Friedman recently posted..World of Poorcraft
@Daniel Friedman – That’s a very long and detailed response – thanks! I’m particularly interested to hear that gold farmers aren’t using sophisticated tactics yet. I’m really surprised by that – since I know a fair bit about outsourcing, it looks comparatively easy to set up a reasonably sophisticated operation. I wonder why no-one has?
In Diablo, I’d expect people to get a bit more sophisticated – but maybe not quickly. It’ll be interesting to see.
Personally, as a reasonably experienced AH player (both in WoW and real life) I’m watching the Diablo AH idea with interest. I made a fair bit of money off Magic the Gathering back in the day – I wonder how over-subscribed the market will be?
As a previous Diablo and WoW player acutely sensitive to anything that affects my gameplay, i thought i would chime in here. whether fortunate or not, i believe all i offer is more murkiness to our perspective.
The entire premise of the loot and co-op gaming system is what will, nay MUST, differentiate Diablo from WoW. this means that the loot system will most likely adhere very closely to the original system, mainly random. this also means that the bulk of the gameplay is meant to be experienced either solo, or in small groups. also very unlike WoW.
you are very correct that RMT will change the gameplay for everyone, but to most it will only be the idea that causes any change. I am very optimistic that Blizzard will create a gameplay environment which will serve an advanced feeling of purpose to ALL, whether or not they utliize all available functionality.
I hope to god no one gets hurt because of this game. i know if i was president of blizzard, this would be my number 1 priority, just ahead of providing the best gaming experience available today.
This was a good read. The ideas and information brought forward were well thought out and I enjoyed myself following your thought process. That being said, a few questions spring to mind.
Firstly, what leads you to believe that Diablo III’s loot disparity will be so close to World of Warcraft’s rather than Diablo II’s? If we go by Diablo II’s model, we’ll have fairly rare items (like Stones of Jordan or Windfury) that ARE very valuable, but will still likely never come to the point where they’re worth tens of thousands of dollars. (I think ONCE I saw an unidentified Windfury sold for $500, back right after Blizzard finished mass deleting duped items and the entire community was terrified of duped items)
Diablo III, if anything like Diablo II will have the same ability for a well geared, intelligent player to be able to complete the game on hell mode on their own. That being said, the Asian farmers and bots and the like will be able to pervade the market that in World of Warcraft is restricted to the elite few whom band together to form a guild and take down end game content on a month by month basis. In addition bosses will have no restrictions on how often you can kill them, save reaching them, unlike in World of Warcraft where you must wait a week between kills. This fact will make avaliability of items in Diablo III MUCH MUCH higher than in World of Warcraft, drastically reducing even the most rare or legendary items prices. The rarest item in Diablo III will also not be close to as rare as obtaining one of the legendary items in World of Warcraft (all of this is assuming of course Diablo III is anything even remotely reminiscent of Diablo II.) Prices will likely not be anything close to what you use as an example.
Second question, what leads you to believe that even if items ARE that rare that these people who command salaries as you suggest will be both abundant enough to support such figures for an extended period of time beyond a few of them buying them in the first months, (at which point THEY HAVE THE ITEM,) and also are enough enamored with the game to lose their senses and snatch up the items for ridiculous prices such as those? Anyone who makes money like that, one would ASSUME has a lick of common sense, in that if they wait for a bit the prices will drop, especially on a market as volatile as one that is run by gamers (who for the most part have no special aptitude for pricing, other than undercutting each other by 1 cent, and if that doesn’t work, dropping 80% of the price for a quick sale!)
You see behavior like this on the WoW markets often enough. For example, the recent valentines day event was proof enough of this concept that gamers have an obscene ability to destabilize an economy. The Truesilver Shafted Arrow which allows the player to learn the ability to summon Q Kwee Peddlefeet as a non combat pet, started being placed on the auction house for 2000 Gold almost immediately, with each subsequent player pricing 10 gold or so below the last. The same auctions posted by the original few were in the auction house nearing their last legs two days later as prices had dropped to 400 Gold, and even those auctions were undercut by upwards of 40% later on. People aren’t as stupid as you may think, not everybody with a wad of cash they don’t know what to do with throws their money around. People with 75 grand to spend on an item that see one for 75 grand are likely to pass it up and see if they can get a better deal. It’s the very nature of humans and greed. Millionaires don’t get and keep their fortune by blowing it when they know a FAR better deal is merely a game of biding your time.
The events you describe seem spot on if the market and item rarities you describe exist, but that’s only if those conditions actually exist. The question of if they exist will only be told by time. My gut and hopes for Diablo III tell me no, and I’d be all too happy if you were wrong, simply so I don’t have to spend $50 on a Shako or Buriza-Do Kyanon!
Great response, and very interesting stuff!
I agree, my thesis is entirely dependant on items being just *that* rare, and it may not be the case that they are. However, even in WoW there are items that are rare and valuable, even given the usual destabilising tendancies of gamers. The Spectral Tiger mount, for example, is extremely expensive even now, as are Mechanohogs, Vials of the Sands, and several extremely low drop-rate pets.
Maybe Blizzard will have deliberately avoided such things in Diablo III, but there are too many good game design reasons to include ultra-rare “aspirational” items for me to be confident that’s the case.
I understand exactly what reasons you are talking about when you say that. The idea that those elusive items could be just one more boss kill away, or just one more mob for that matter is one of the driving forces behind a random loot system like the one that Diablo has. It’s what drove Diablo II’s community to the near Zealotry that was seen.
Mephisto runs for example. Chain running Mephisto and the Council for hours on end hoping that the game would deign to reward you with a Shako for your efforts was FUN, (Seeking treasure has been a hobby/dream of human beings for far longer than game developers have been around to see it happen for us.) Hell, hunting for that Shako was ADDICTIVE, and game developers seek one thing more than your love or your enjoyment of their product, it’s your addiction. Game players and Drug abusers share one very important thing in common: both are referred to by their suppliers as USERS. The vast majority of industry seeks to sell to the consumer, but in the gaming industry, we have World of Warcraft USERS!
Whew that was a tangent but I felt it contributed to the discussion anyways.
Let’s get back to the actual impact of these super rare items, or their existance on what would be a real money auction house. Spectral Tiger is probably a bad example, it’s the strongest point for a single item being worth a vast sum of money, but there’s a damned good reason for it. For one, they don’t exist in game per-say. The only way to obtain one is the WoW trading card game. For another, they are limited print, and their avaliability is subject to the printing of their TCG booster pack series. The items themselves have an average value already assigned to them due to the cost of obtaining the average number of booster packs for their accrual manually.
http://www.wowhead.com/item=33225/reins-of-the-swift-spectral-tiger#comments
First comment.
Vial of the sands is probably the best example for being an extremely rare in game item. The rareity of even being able to make the vial of the sands is INSANE. Analysis of the chances/work involved in being able to make the item are in the wowhead comments.
http://www.wowhead.com/item=67538#comments
The item however, is still only “worth it’s weight in gold,” so to speak. To obtain one you just need to know someone who can make the item and offer them a fair sum above it’s material costs. Perhaps even as low as 1000G since it’s a guaranteed buyer for them. If you don’t have the gold it’s as simple as knowing somebody who does, especially IRL and paying them for their gold safely (i.e. you can give them a cuff on the back of the head if they try to cheat you!) without dealing with scam sites. Either way the ~30,000 Gold you’d need to purchase for the mount in it’s entirety can be done so at a relatively low real life cost. I myself have traded gold with a friend for real money in a way. While abusing the recruit a friend service for fast leveling with a friend, I agreed to purchase a month and get him his Rocket Mount and a free month of World of Warcraft for 10,000G and he EXCITEDLY accepted my offer. For a token sum of $34.97 (plus holiday purchased copies of world of warcraft at $5) I could have my very own vial of the sands.
I have a hope that an in game item that players are able to find in relative abundance but that are valuable in their own right (like stones of jordan/Shakos were, or runes after them) will make their way to the spotlight and set a sort of “Standard” price, which everything else’s value is based off of, depending on it’s comparative rarity.
Hopefully no item in Diablo III ever manages to entice people into paying into the thousands of dollars (for those of us who don’t think they could ever actually make money or more imprtantly real money purchase on D3.) I’d like to see the RMAH devolve into a huge micro-transaction shop of 20cents-$3 purchases. Mainly because I might be able to thrive in that environment! Hah!
*Final Note* One fact that MUST be drawn to attention!
Perhaps at the time of the posting of this article the details of the RMAH were not hammered out, or perhaps like me until just this moment, the fact was overlooked that money made from the real money auction house will be applied to your BLIZZARD ACCOUNT BALANCE, not to some bank account you may posess. The drive for players to attempt to make vast sums of money will likely be much lower than either of us initially expected. There are only so many world of warcraft accounts, months of wow, plushies and steins that a person can use. After market sales of real life items such as the mugs/action figures avaliable from the Blizzard site will be the only way to make money off of the RMAH, which vastly reduces the probability of people leveraging this system for vast personal gains. That being said, perhaps we can all expect to own a wind rider plushie for much lower than Blizzard’s face value order price!
Scratch that thing at the bottom, I just reread the RMAH FAQ and noticed Blizzard is allowing a cash out feature to transfer your funds to other sources.
Fun read.
Interesting point about Blizzard employees policing auctions. Will they have access to the ‘anonymous’ posters information? What is in place to prevent extortion or even retaliation in the event that they’re reported for extortion?
At first I had hope that they’d have access to who’s posting, to regulate for exploits/hacks/etc. Now it might be better if they don’t. Perhaps two or three randomly assigned GM’s from different locations should be assigned an issue before anonymity is broken to protect against this sort of thing.
My first thoughts when hearing of the RMAH were reminiscent of all the forced items Diablo 1 and 2 both had. Hackers actually created items. Rings that were of normal quality (not magic/unique/etc.; usable at level 1) and had 107% ias, fcr, frw, etc.
If hackers have such an ability and only release it once they’re done having fun then now that there’s a RMAH there’s no longer an incentive for them to release the hacks; therefore the RMAH probably is and shall remain compromised.
So what will we see? Everytime a rare unique goes down, another one suspiciously shows up? On day one an otherwise unobtainable item is instantly available (doubtful as it would alert Blizzard to the exploit, but it just shows the depth of possibilities)?
I, however, doubt a prevalence of guilds, as the most players in a game that you can have is four. Even if you’re with friends, I don’t think they see your drops, so if you’re fairly secretive (nice point about tweets and such) both before and after you attain your profits, you should be fine there.
Either way I trust in God. I gotta point out that you’re being a little … what’s that word they always say to pot smokers? Oh yeah, paranoid (I really couldn’t think of it).
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