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Jun 21, 2004

Comments

1.

Here is an e-mail which was sent out to all GOM members.

---------------------------------
Ok, here's what's going on.

Sunday afternoon, a new client purchased over $3000.00 worth of ISK and SWG credits. He nagged us for delivery, and then immediately after receiving the goods, reversed the charges claiming we never delivered. He was making use of a well-known loophole in PayPal's chargeback policy that favours the purchasers of "intangible goods" over the sellers. He explained this to us in an email he sent today. He claims the ISK and credits he stole are "payment" for the lesson he tought us.

This incident has been reported to the FBI Internet Fraud Department, and tomorrow to the RCMP. We have compiled as much information as possible on this person, including his name, address, phone number, email addresses and the IPs used to log into our site. All of this information will be turned over to the authorities.

Now, the complaints registered with the FBI were two-fold. The first was about this person who scammed us. The second was about PayPal. PayPal's policy rewarding the perpetrators of this type of fraud not only makes it easy, it actually *encourages* it. Please take this as a lesson learned the hard way. If you deal in any "intangible goods", be it downloaded software, music, documents and data, or game currencies or items, PayPal is *not* your friend.

We are currently providing as detailed information as possible to the PayPal fraud department, but we're not holding out hope for a favourable settlement. Our PayPal representative has made it very clear that we can provide any evidence we want, but that it doesn't matter - we deal in intangible goods and hence have no rights.

*** NOTE: Any employees of CCP or Sony Online Entertainment (or any other game publisher for that matter) are encouraged to contact us. We know we violate your user agreement - we just want this behaviour to stop! It hurts everyone, *including* your paying clients! I know you have detailed transaction records proving exactly when and where those transactions were made. This information could help get the ball rolling. Linden Lab has worked with this. So can you! ***

Now we have always called ourselves a "secure way to trade". By that we mean that we *actually* provide seller protection because *we* guaranty delivery. We are holding true to this policy, and absorbing this $3000.00 loss. This $3000.00 is approximately 70% of our profits since January. We didn't build GOM to make us rich. We built it as an experiment in digital world economies, and to provide people like you with a cheaper and more efficient alternative to eBay. We cannot afford to be tought another lesson.

Until further notice, all trading in *all* games except Second Life is halted. All currency you may have on deposit with us will be returned to you at a mutually convenient time. Please request a withdrawal and contact either Tom or myself to schedule it. PayPal withdrawals will also be made on our regular sporadic schedule.

Linden Lab (creators of Second Life) is the only publisher to support our efforts. Second Life business will continue as usual. Please accept my apologies for this delay. Linden Lab has worked with us before on this type of fraud, and we're confident that our future with them will be long, happy and prosperous for all. :)

Keep yer stick on the ice.

Jamie Hale
President - Gaming Open Market Corp.
jamie@gamingopenmarket.com

2.

Very interesting case. Note that the fraudster did not end up a single real world dollar richer, he only charged back what he paid. So effectively, what he "stole" was "only" virtual currency. And whether that is a crime or not depends totally on the question of whether virtual currency can be a real life property. At which point we all have to go back two threads and read Richard Bartle's paper on the pitfalls of virtual property.

I don't see how you can blame PayPal though. Either they allow chargebacks in trades of intangible goods, or they don't. As they do allow it, fraud is possible by chargebacks. If they wouldn't allow it, fraud would happen the other way round, with the seller never delivering the intangible goods. The current policy favors the buyer over the seller, which I would consider the better of the two options. Unless you involve some sort of clearing house, I don't see how they could implement a policy that would prevent fraud.

3.

Julian's blog entry is probably a fair example of the typical exchange between PayPal and every hapless virtual trader.

4.

Few things.

There's a new message up on GOM's home page to the same effect as the above-posted e-mail.

I love that exchange on Julian's blog. Besides illustrating the difficulties inherent in this whole mess it reminds me of every conversation I've had with customer service. (i.e. The time I called the credit card company trying to learn why I was being assessed a penalty for paying the amount their automated phone system said I owed. Or the time I sought Alienware's assistance in fixing the computer I bought from them.)

5.

tobold> I don't see how you can blame PayPal though. Either they allow chargebacks in trades of intangible goods, or they don't. As they do allow it, fraud is possible by chargebacks. If they wouldn't allow it, fraud would happen the other way round, with the seller never delivering the intangible goods. The current policy favors the buyer over the seller, which I would consider the better of the two options. Unless you involve some sort of clearing house, I don't see how they could implement a policy that would prevent fraud.

The digital world operators do know whether the delivery happened and a standard could easily be established to allow delivery reporting. Or, a digital world could decide to act like an issuing bank and say, for example, that the maximum liability in digital currency is L$50. In other words, if a chargeback happens, it is treated as fraud, the person who sold their digital currency gets most of their currency refunded and the user who made the chargeback is suspended or banned from the world.

Obviously, this would require cooperation between the digital world operators and the trading sites, which comes back to one of my core disagreement with Bartle et al. Since world creators can't stop commodification -- yes, they *may* be able to reduce it, but there is no evidence that they can stop it -- there is tremendous harm by pretending to block it and forcing it into black and gray markets. Black markets neither protect customers nor allow legitimate cooperation between digital worlds and 3rd party traders.

It's time to stop ignoring the elephant in the room and realize that commodification is a basic feature of digital worlds. Only then will fair and rational approaches be taken to address the problems that it raises.

6.

With all the rabid anti-commodifiaction players out there I'm surprised this hasn't happened before in a vigilante attempt to shut down these "criminal" (as they see it) organizations. I thought that PayPal's policy for intangible goods had received wide enough publicity, but maybe I'm skewed by reading TN and PlayMoney.

This case certainly does get to the heart of the "is virtual property owned" question. Obviously it would be huge if GOM's case was upheld, but if/when it isn't, does this mean the end to virtual middlemen, or does it mean the end of PayPal for virtual transactions, perhaps in favor of a yet unrealized competitor? The difficulties of protecting the seller's rights have been well documented here, but maybe demand is high enough that players would be willing to absorb the risk - most view virtual sales as inherently risky anyhow.

7.

With all the rabid anti-commodification players out there I'm surprised this hasn't happened before in a vigilante attempt to shut down these "criminal" (as they see it) organizations. I thought that PayPal's policy for intangible goods had received wide enough publicity, but maybe I'm skewed by reading TN and PlayMoney.

This case certainly does get to the heart of the "is virtual property owned" question. Obviously it would be huge if GOM's case was upheld, but if/when it isn't, does this mean the end to virtual middlemen, or does it mean the end of PayPal for virtual transactions, perhaps in favor of a yet unrealized competitor? The difficulties of protecting the seller's rights have been well documented here, but maybe demand is high enough that players would be willing to absorb the risk - most view virtual sales as inherently risky anyhow.

8.

Cory Ondrejka>one of my core disagreement with Bartle et al. Since world creators can't stop commodification -- yes, they *may* be able to reduce it, but there is no evidence that they can stop it -- there is tremendous harm by pretending to block it and forcing it into black and gray markets.

They can stop it in small virtual worlds very easily. There are some virtual worlds that have been running for over a decade and have no commodification whatsoever. Some of these are commercial virtual worlds, too.

>Black markets neither protect customers nor allow legitimate cooperation between digital worlds and 3rd party traders.

So using your argument we should allow competitors in the Olympics to take performance-enhancing drugs because we can’t stop them. Then we can thrill to the sight of athletes vying to win the 100m before the massive doses of steroids they have taken burst their hearts.

Just because you can’t stop something completely, that doesn’t mean you have to make it legitimate.

>It's time to stop ignoring the elephant in the room and realize that commodification is a basic feature of digital worlds. Only then will fair and rational approaches be taken to address the problems that it raises.

This is where you and I part company. I do not believe that commodification is a basic feature of virtual worlds, as evidenced by the fact that it doesn’t happen in, oh let’s be generous, 90% of the VWs listed on the MUDconnector. I am happy for virtual worlds to come in two flavours, commodified and uncommodified. You, however, feel that all virtual worlds should follow the same, pro-commodification rules, under the defeatist proposition that it’s impossible to stop. This would kill the smaller virtual worlds, which don’t have the problem you’re trying to fix. What’s more, it would screw up virtual worlds with different business models or solutions (technical or operational) yet to be invented.

Why do you keep on saying this? Why do you think that it’s impossible for commodified and uncommodified worlds to exist side-by-side? I’m basically in favour of having both – I really don’t see why you want one to be eliminated in favour of the other.

Richard

9.

Help, mod meh.

10.

Some people feel like someone saying "legalize VW trade" is saying "legalize satan for president".

There's almost nothing you can do to argue with these people, it's quite pointless trying to even talk to them when they're not only not going to come around to the simple facts supporting VW trade, they'll go as far as stretching the fabric of reality and pinpointing some urban legend friend that had such and such happen to them which is why it shouldn't be done.

Thank god for TN :)

11.

Jamie> *** NOTE: Any employees of CCP or Sony Online Entertainment (or any other game publisher for that matter) are encouraged to contact us. We know we violate your user agreement - we just want this behaviour to stop! It hurts everyone, *including* your paying clients! I know you have detailed transaction records proving exactly when and where those transactions were made. This information could help get the ball rolling. Linden Lab has worked with this. So can you! ***

I hope the FBI laughs at OGM as much as I laughed when I read this bit. “We know we’re breaking the rules and hurting your paying clients, but let’s work together to stop the people who break the rules and hurt your paying clients when they hurt us.”

You want to cry “fraud” on the gentleman that has profited $3,000 dollars from ignoring your rules, while you were attempting to profit from disregarding the rules of the Virtual World. Help me with this Jamie, when is it okay to break the rules and when isn’t it?

There’s another label for people who abuse the rules; cheater.

12.

Richard,
Sorry, let me amend that to "commodification is a basic feature of many digital worlds." I'm not saying that all digital worlds must be commodified. What I am saying is that if the world is commodified, that both the players and the world will be better served in the long run by acknowledging these markets. Ths is a separate argument from my position that ties to the real-world (including financial ones) are a net positive for digital worlds. This argument is that the ills of black markets -- fraud, lack of enforcement, lack of consumer protections, labor exploitation -- need to be addressed in the worlds that see substantial digital item/currency markets and that the most immediate method to address them is to legitimize the markets.

13.

Staarkhand> Obviously it would be huge if GOM's case was upheld, but if/when it isn't, does this mean the end to virtual middlemen, or does it mean the end of PayPal for virtual transactions, perhaps in favor of a yet unrealized competitor? The difficulties of protecting the seller's rights have been well documented here, but maybe demand is high enough that players would be willing to absorb the risk - most view virtual sales as inherently risky anyhow.

I'd definitely hope the "unrealized competitor" would be the more likely of the two... the opportunity is certainly present for some kind of GOM-like brokerage service, and it's certainly do-able from the financial end so long as they partner with a financial conduit that is free from the risks of fraudulent chargebacks.

Of course, the other side of the equation still has its inherent risks, driven from the degree of enforcement that game providers choose to pursue regarding out-of-game transactions. The other major risk associated with a brokerage service is that a non-sympathetic game provider is going to recognize the transactions and then seize/cancel the associated accounts. From a brokerage "seller" perspective, this event would be equivalent to a "warehouse fire" at the brokerage.

Non-brokerage "reseller" 800 pound gorillas like IGE can generally absorb a series of "warehouse fires" due to the exorbitant markups that they charge... not so for low-margin brokerage services.

Is such a brokerage service ultimately workable in the face of game providers who oppose such transactions? I don't know. I'd like to see it, but I don't know of anyone who has worked out the mechanics of it to a sufficient degree to ensure a high enough ongoing success rate to make it viable, without also having huge mechanical hurdles to overcome. That's a shame, IMO.

14.

Tim,

First, it's GOM. Gaming Open Market.

People warned us that this type of fraud would occur. We listened, and built the site anyways. I wrote off that $3000.00 the instant I saw the emails from PayPal. The loss hurts, but the issues surrounding the loss hurt more.

My frustration is not with the pedestrian that stole from us, but with PayPal's policy that openly encourages this type of scam. My complaint to the FBI included both.

PayPal effectively sticks their fingers in their ears and blows raspberries at the victims. No amount of proof that these trades occured will convince them. And that is why I was calling for game publishers to step forward. If they're not going to eliminate trading from their games, then at least assist in eliminating the fraud that occurs. With minor pressure from them, PayPal could easily start considering signed statements as proof enough in place of courier tracking numbers.

I know users of my site violate the terms of service. I have sent emails to each game publisher explaining in great detail why a service like mine is extremely beneficial to them and their users so long as Cory's "commodification" exists. I even wrote that we would close down the markets in their games if that's what they wanted. All I was asking for was a response from them. :)

I'm still waiting...

15.

Tim Webb> You want to cry “fraud” on the gentleman that has profited $3,000 dollars from ignoring your rules, while you were attempting to profit from disregarding the rules of the Virtual World. Help me with this Jamie, when is it okay to break the rules and when isn’t it?

Well, let's see... one of them is a federal crime in the real world (felony fraud), and one of them is breaking an in-game rule. You're logically OK with treating them as equivalent?

Perhaps you also think it's OK for someone to steal your car if you moved an extra space in Monopoly (thereby avoiding in-game bankruptcy), eh?

After all, both of them are breaking the rules, right?

Tim Webb> There’s another label for people who abuse the rules; cheater.

Yes... and there are also labels for people who are unwilling/unable to differentiate between the relative moral importance/severity of different actions. Sociopath is the first one that leaps to mind.

16.

Hmm, I found interesting that the GOM case is something very similar to the one discussed already some weeks ago in May. The similarities are pretty striking and I wonder if the author of the fraud read the article/discussion too and was inspired but it.
A lot of "if"s but I suppose it is worth a thought about it.

17.

Luca Girardo> I found interesting that the GOM case is something very similar to the one discussed already some weeks ago in May.

I think the final line in that article expresses the key concept to take away from all of this, IMO:

Cringely> I DO see here a wonderful business opportunity, though, for someone to come up with a reliable way to handle payments for virtual goods. That would be worth its weight in gold, 'er platinum.

18.

Yeah, this is what I'm talking about. If PayPal's policy is really that inflexible, what is to stop a relative small group of players from systematically taking even IGE for all they're (virtually) worth? Or at least crippling them to the point of removing any profit?

Seems like someone out there would want to do this, with all the ire that gets raised when discussing this topic.

19.

Some things are against convention. Some are against established laws. Some are what an average member of a society would call "wrong".

Assuming that something (e.g. eBaying) belongs in all of those categories just because it belongs to one of them is not a basis for an argument. We know what GOM does is against the rules. But one may still ask if it should be.

20.

The thread has been games/.’d. Who have an interesting link to the Second Life forums where it says:

    meta 06-21-2004 04:38 PM Zeppi Schlegel Member Registered: Nov 2003 Location: Posts: 28 /meta Hi, sorry for the delay in replying - I really should check the forums more frequently.

    *** The fraud was perpetrated through PayPal and *not* through the site. Your cash and currency is safe. I locked out the site so I could take a few breaths and get my anger under control. ***

    Yesterday, I had a user breeze through spending over $3000 USD on EVE and SWG. Immediately after taking delivery of the ISK and credits, he reversed all the payments claiming he never received the goods. This is a well-known loophole in PayPal's seller protection policy. Basically, I have *no* recourse at all. PayPal accepts *no* form of proof of delivery except physical waybills (UPS, FedEx, etc).

    This is the second incident of fraud like this in 2 weeks. The first time, they user cashed out to Second Life, and thankfully, the good folks at Linden Lab came through and helped out. We'll end up losing a tiny bit of the $1200 worth of L$ stolen from us, but not enough to worry about.

    This time, however, we won't be so lucky. CCP (publishers of EVE Online) haven't replied to our emails, and even if they do, PayPal has *no* interest in any form of proof other than that of physically shipping something.

    So basically, we're out $3000, or about 70% of our profits since January. And to be completely honest, it hurts.

    Now, I don't want to point fingers here, but it's fairly obvious who the scammer was associated with. This type of scam has occured before, and will continue to occur so long as PayPal maintains their idiotic policy.

    As mentioned on the site, we will be up and running shortly. I just needed a few hours to get things straightened up.


    Jamie Hale (Zeppi Schlegel)
    President - Gaming Open Market Corp.
    jamie@gamingopenmarket.com


21.

Lee Delarm>Some people feel like someone saying "legalize VW trade" is saying "legalize satan for president".

Why do you think that is?

Richard

22.

Cory Ondrejka>Sorry, let me amend that to "commodification is a basic feature of many digital worlds."

OK, that's fair enough.

>What I am saying is that if the world is commodified, that both the players and the world will be better served in the long run by acknowledging these markets.

That depends on how the virtual world is designed. When commodification comes a VW's way, the VW is either going to be able to cope with it or it isn't. If it can cope, fine. If it can't, its developers have to decide whether to do a rewrite so it it can cope, or to reduce commodification to a manageable level.

It's as if there were an emerging fashion for the audience singing along in stage musicals. Some musicals would flourish if the audience joined in, but others would have bad problems as it would be inappropriate for their subject matter. Either these latter would have to be rewritten or the practice of singing along would have to be banned for them. You're saying that in the long run it would be better for musicals to go with the flow and be designed from the ground up to support singalongs, and for existing musicals to be rewritten so they embraced them. I'm saying that if this happened then a whole class of musicals which non-singers enjoy would be lost, and it's better if theatre owners get to choose whether to allow singing along or not. I don't particularly mind which of the three choices they take, so long as they do get the choice.

>This argument is that the ills of black markets ... need to be addressed in the worlds that see substantial digital item/currency markets and that the most immediate method to address them is to legitimize the markets.

There are other costs to legitimising black markets, though (which is why we don't see LSD for sale in supermarkets). In virtual worlds, for example, legitimising the sale of virtual objects for real money can take away a lot of the reasons why people enjoy playing in the first place.

Richard

[PS: I already posted this once, but typepad ate my message. If something similar suddenly appears, it remembered it...]

23.

So, contrary to better judgment, I think I'm gonna jump in here.

First, let me state that I'm saddened to hear of this loss. I was very excited about GOM, to the point where when they first came out, I shut down the FirstBankofThere.com and put a big notice, "Please go see GOM, and Tbux.com." It has also been exciting to watch the Therebuck come back after Black Friday.

Staarkhand:
"If PayPal's policy is really that inflexible, what is to stop a relative small group of players from systematically taking even IGE for all they're (virtually) worth?"

So I think this points out a key issue. Personally, I am reluctant to put the blame on Paypal here. They have a service. They are very clear, and very up-front about that service. People use that service in all kinds of ways. Paypal has protection for certain types of transactions, and they have no protection for other types of transactions. I fail to see the crime that they have committed here. We could argue that this is bad business, but I'm not sure that's a crime. For example, Fire insurance doesn't cover water damage, unless its due to a fire.

Now, I am not saying that a crime didn't happen here. One did. A serious one. But, the enforcement of civic laws is the duty of the criminal system, and not private businesses.

The reason that IGE isn't put out of business because of Paypal's policies is because they have legal recourse through the courts.

-bruce

24.

Bruce Boston>The reason that IGE isn't put out of business because of Paypal's policies is because they have legal recourse through the courts.

What sort of legal recourse do they have that GOM does not?

25.

Corey> What sort of legal recourse do they have that GOM does not?

None. That's the point. GOM has the same legal recourse that the big guys have.

-bruce

26.

Out of curiosity, what kind of legal recourse do the 'big guys' have, in such a case?

27.

I'm also curious about these legal recourses. This is a relatively high-profile deal in the virtual world community. Might we see some copycatters in the next few weeks targetting IGE and the like?

28.

Hi Kenneth,

Nothing sexy, mainly local courts. I think GOM is on the right path with contacting the FBI.

Also, most companies use prevention, over repair. I know There.com had over 200+ employees at its peak, plenty of financial backing, and access to the best lawyers in the industry. Even so, there was (and still is) a daily limit of $100/day. Even with this we are at significant risk, as multiple accounts, and multiple cards are very easy to create. For the most part, $100/day is more than enough for 99% of all honest consumers.

Also, I think it’s important to note, these problems are hardly new, or unique to virtual worlds or even payment systems. Visa’s policy for years has been they don’t cover payments made with fraudulent visa cards. Even if you take the guy’s fingerprints and hand a very tangible product to them with 20 witnesses, if the card was stolen, most merchant accounts with visa don’t cover this. I am sure there are programs out there that may cover some things like this, but I think they are akin to insurance systems where everyone pays a little extra for the security and if you have too many incidences they kick ya out of the program.

Cory O> “for example, that the maximum liability in digital currency is L$50.”

Who’s liability?

-bruce

29.

I don't think comparing a list a college students side projects to Everquest is realistic. Let's throw out all the Muds that NEVER have 1000 concurent players, and see how many of THOSE are 'commodified'.

There's got to be demand before anyone's going to buy anything. I've only seen a few MUDs that have communities that size, and they have all been commodified. "Joe's Mud" hasn't been commodified because there aren't enough people that think the items or characters are worth money.

And it's foolish to try to stop it anyway. The elephant is in the room, anything else is denial. I'm really not in favor of the practice as a gamer, but it is hear to stay regardless of how this turns out. Why let the crooks control it? That's got to be worse than any perceived threat to gameplay.

30.

I would suggest a read through PlayerAuctions http://www.playerauctions.com/ fraud board. It is full of similar stories from probably hundreds of sellers, dating back years. (try entering the following search on Google "site:www.playerauctions.com fraud" for about 8k hits).

I don't get the idea of knowing about a problem (PayPal chargebacks) that *will* happen (no 'if' here) and not taking preventive measures or adding it to the plan as part of the cost of doing business, and later shutting down when the problem does crop up.

31.

MM>Let's throw out all the Muds that NEVER have 1000 concurent players, and see how many of THOSE are 'commodified'.

If there were laws brought out to regulate virtual worlds, and these laws prevented virtual worlds from functioning unless they adhered to banking-style regulations, those MUDs that had never had 1,000 concurrent players really WOULD be thrown out. They could only exist if they flouted the law.

My point was that there is a spectrum of virtual worlds, some of which are OK with commodification, some of which aren't OK, and some of which are ambivalent. Commodification is going to mean laws at some stage. If those laws apply only at one end of the spectrum, that screws over those at the other. You seem to be advocating a cut-off point based on numbers of players. OK, so anything with fewer than 1,000 concurrent is non-commodified and anything over is commodified. Does SL have 1,000 concurrent players? Well, maybe it does now with the There refugees, but it didn't 6 months ago. Does Wheel of Time have 1,000 concurrent players? Yes, but it has no commodification problems to speak of (as far as I know).

Instead of setting arbitrary limits, why not let the developers simply decide whether they want their virtual world to be commodified or not? What do you have against that?

>There's got to be demand before anyone's going to buy anything.

There's a demand for virtual worlds where buying stuff with real dollars is not tolerated. Shouldn't this demand be given some supply?

>And it's foolish to try to stop it anyway. The elephant is in the room, anything else is denial.

"I can't think of a way to shoot the elephant" is a piss-poor reason to let it sit on you.

Richard

32.

Isn't commodification a result of (bad) game design? A MMORPG in which there is no way to transfer items or currency from one player to another would be feasible, and it would have no commodification. If you absolutely wanted the game to have trade, you could make transfer of items and currency possible only via in-game auctions. Shoo, shoo, elephant gone.

Only if you allow high-level player A to give low-level player B 1 million platinum pieces and the sword of uberness for free will you have commodification, including eBay, PayPal, GOM, IGE, and some scammers. And I don't see any valid reason why such uneven transfers have to be allowed. Morally it does not make a difference whether you "cheated" by getting 1 million PP from eBay for $50 or from a guild mate for free.

I think there is room for games both with and without commodification. It is just the middle ground, games like EQ, which encourages twinking but tries to suppress commodification, which have a problem. Neither a game with no direct trading, nor a game in which the virtual goods are sold directly by the game company would have a problem with a black market.

33.

Richard>"I can't think of a way to shoot the elephant" is a piss-poor reason to let it sit on you

Technically, I think this elephant is supposed to have its invincibility flag on--unless Richard Garriott is controlling it perhaps. The point of it is that you can't annihilate commodification. But this doesn't mean you can't load your gun with tranquilizer darts. As your example with the Olympics demonstrates, this is what is called for both there and with VWs, since I see them as suitably analogous.

MM>Why let the crooks control it? That's got to be worse than any perceived threat to gameplay.

Did you actually consider your question?

Here is my answer to it, and why Richard's analogy is particularly lucid:

Rules are being broken that diminish the spirit in which the entity (game, world, ...) was created.

The use of steroids in the Olympics is banned because it destroys the spirit of physical competition. The victims are the spectators and, more importantly, the innocent competitors who respectively watch and participate because they enjoy the core ideal. Now let "use of steroids" and "the Olympics" become "commodification" and "VWs"--and let "spectators" -> "Terra Novans" :) (though most of us qualify as both spectator and competitor). I think we can agree that banning steroids in the Olympics is warranted; so to first order, it makes sense to ban the RW sale of virtual items.

In addition to the loss noted above, we have the problem of loss of immersion. The best analogy I have for that is the rule of common courtesy to turn off one's mobile/pager while at the cinema. While the legal implications aren't there, I've heard multiple stories about fistfights over the matter. In any case, the preservation of immersion and fair competition are both important, though I imagine most players heavily favor one or the other.

The most important point to remember now is that there is nothing binary about this: 1 in 10 people using steroids/IGE is much worse than 1 in 20. This is the crux of the argument for prohibiting such activities.

So, how about the side effects of a black market?

I can't see any negative ones. I mean, the crime lords of IGE aren't taking out hits on other players. The closest I can come up with is that the developers are ignoring a chance for further revenue. But, of course, I'd rather argue they are losing subscribers (net change) by embracing the virtual item market, and thus a possible net loss in revenue. Someone please elaborate on how the innocents are being hurt by this.

We do get a positive side effect though: an underground market has a lower profile. It breaks immersion much more quickly if the developer is posting ads for selling items on its home page or in-game.

As far as victimization is concerned, we have crooks swindling crooks, since both are breaking the world's terms of use. We're banning firearms and only criminals are getting shot. This isn't a compelling argument for legalization.

34.

Back to Richard, I believe that some people believe so vehemently that their time is "cheated" from them, or made less valuable by other people who put a higher morale (and real?) price on their characters.

Most people I know in the US at least, would be willing to sell out even their most prized possessions at the right price. The only difference between those who sell and those who don't is the value they put upon the objects in question.

I pretty much gurantee you that someone who says they would never sell their character/items, etc will give in once an appreciatable price is reached, and the price would be MUCH higher than is currently in trade.

This is why they see these people as "bad" or "immorale" because they value their objects so much more (even though comments such as "it's just a game" are thrown around) that devlauing the characters and items to a level where normal people can buy it disgusts them.

I would imagine the attitudes are similar between things the rich and the poor do differently. Things where the poor would nearly die (or literally) such as throw food away whereas the rich could care less. Whether they like it or not it comes down to not a judgement of morality, but one of capitalism and choice in a market system.

35.

Over on games/. someone made the point about virtual transactions: why not use access codes and ship them, that way there would be a physical transaction which should fall within the comfort zone of service providers like Pay Pal and the authorities.

Well - it's an idea.

36.

Ren>Over on games/. someone made the point about virtual transactions: why not use access codes and ship them, that way there would be a physical transaction which should fall within the comfort zone of service providers like Pay Pal and the authorities.

Unfortunately, most companies such as GOM conduct business on a small scale and the cost of buying and sending a personalized package would be detrimental to their company. It apparently isn't enough that paypal has a recording of the transaction, the game company has a recording in server logs, the business has screenshots and personal logs and the player has a ton of money suddenly, why should PayPal suddenly change their Nazi ways over a piece of paper which would admittedly hold more weight in court that all that evidence combined?

Quite obviously the system is skewed if a single piece of paper can hold more evidence that a trunkload of virtual footprints. People need to get out of the dark ages *sigh*.

37.

Tobold>A MMORPG in which there is no way to transfer items or currency from one player to another would be feasible

Whether or not players would actually enjoy this is one issue, but even before that, you have to get them to buy the game; I imagine most players think they would positively hate such a rule. It might be worth an experiment, but I don't see anyone serious adopting this (until the experiment has positive results).

In my previous post, I forgot to talk about taking the immersiveness of the VW into consideration. Some worlds have more clearly defined ways of how things are supposed to work. In the Star Wars universe, you become a jedi through intensive training (SWG puts emphasis on intensive, and not so much on training, heh); buying a jedi character off of someone destroys whatever meaning/story is associated with it (for argument's sake, consider only the good). On the other hand, Second Life is a "free-form" world (accurate?), where there is no a priori reason why things shouldn't happen in a given way. So commodification in SL does not break immersiveness the way it does in other games. The same could go for the competitive aspect, since I think the competition is mostly artistic/skilled. Thus, where SWG should probably ban item sales, the same reasoning holds less water with SL.

38.

I am truly amazed by how intelligent some of the posts here in favor of commodification are. Unfortunately these posts lack a certain amount of foresight.

Consider what you are advocating, where real world laws apply to virtual world items and transactions. Some of you even suggest that such laws apply even in virtual worlds where the creators do not want commodification at all. When you begin to have real world laws interfering with the virtual worlds (Never mind the jurisdictional nightmares, you think you have it bad now with Nigerian scam emails... wait until they figure this one out!) even when it is against the will of the creators and maintainers of the virtual worlds you have undermined the point of being in a virtual domain.

Let’s be very blunt here and boil this down to one line:

It is being suggested that a RW value associated with a VW item should be enforceable under some RW laws, even if the VW owner doesn’t want his VW items to be valued.

So now if a VW allows me to steal or loot (either through normal game mechanics or an exploit) items from other players, I should be accountable for the RW value of their loss? This isn’t an analog about some elephant; this is exactly what will become of any RW laws interfering with VW property value.

Lee> This is why they see these people as "bad" or "immorale" because they value their objects so much more (even though comments such as "it's just a game" are thrown around) that devlauing the characters and items to a level where normal people can buy it disgusts them.

The reason I am personally anti-commodification is due to my well developed sense of sportsmanship. As soon as 3rd party influences from the RW (eBay, hacking utilities, macro utilities) give one player an advantage over another the VW (and the competition there of) has been compromised and the sport is lost.

39.

Lee>Whether they like it or not it comes down to not a judgement of morality, but one of capitalism and choice in a market system.

You can argue it comes down to capitalism for the example of RW class disparity, but the case of VWs retains its moral nature since it is a decision whether or not to break the rules that everyone is agreeing to abide by. Using steroids in the Olympics devalues the winning of a gold medal because the rules were not followed. You can use economics to explain the change of values, but it is not the cause.

40.

On the RL issues, many here are looking at PayPal and thinking that they are the problem. They're just an extension of the financial *services* industry. Even if PayPal decided to honor somone's server logs (or what have you) a scammer would only need to move one notch up the chain and instead of calling PayPal to let them know their ID was used without permission, now they would have to call their Credit Card to let them know it was stolen, and used to fund a PayPal account or their banking info stolen and used. Do you think PayPal will absorb the losses from merchants happily?

While there are people who might go pull PayPal, Credit card or banking frauds with their own identity, there are people who don't. Lots of trojan horse programs and 'phishing' e-mails out there allow bad people to collect PayPal, banking , eBay and more information from the computer of an unsuspecting victim. They turn around and use (or sell) that information. The scammer that uses it gets the goods, the honest person gets dinged. Put yourselves in the shoes of the user who receives a 1000 illegitimate charge on his credit card form PayPal, or Flowers-r-us, or sex.com. He's likely to call his bank. He has minimal/no libility since the financial system is set up that way, charges flow backwards an the merchant is most often left without the goods or the money.
PayPal's 'delivery confirmation' policy is just a measure to lessen fraud and chargebacks, it is useful in *some* cases of fraud perpetrated by people using their own identity, but it can't do much for the third-party scammer scenario which is very common these days.

41.

The current issue of the Economist (1970's disco shoe on the cover) in Economics Focus| "In The Shadows" - The Informal Economy Is Neither Small nor Benign (p76) that raises some questions that are of interest when discussing VWs and property.

The article points out that in developing countries the informal economy is equivalent to 41% of GDP in OECD countries its 18%. This economy exists in response to taxes, regulations, corruption and other factors. The article goes on to say that the grey economy may shave as much as 1.5% off the growth rate of countries such as Brazil and Turkey.

In VWs commodification and the current state of virtual property law makes for larger grey economies in VWs. This adds to developer costs by increasing customer care and other management costs (see this post by Jessica Mulligan http://terranova.blogs.com/terra_nova/2004/01/themis_group_pr.html) as well as alienating some players. Though we don't know the extent of the negative effect this has on growth an profitabilty of VW companies we can be sure there is one.

In the real world economists argue for changes in government policy to help make the grey economy legitimate because of the economic benefits that would provide.

Should the VW economists be doing the same?

42.

Tobold>Isn't commodification a result of (bad) game design?

In some cases; in others, it’s as a result of bad play (aka cheating).

>A MMORPG in which there is no way to transfer items or currency from one player to another would be feasible, and it would have no commodification.

You’re arguing for a solution in code to a problem that is out-of-code. There are people who like virtual worlds just the way they are except they don’t like commodification. You’re saying that these people should have to play a different kind of virtual world that prevents commodification through code. Why should they have to do that? They may (in fact probably will) like that virtual world much less than the ones without the code changes. Just because some people insist on breaking the rules, that means you have to change the rules? No! Ask any kid in a playground what you do when someone breaks the rules: you throw them out and don’t let them play with you again until they’ve promised not to do it!

The rules of cricket say the bowler has to keep their arm straight during the delivery. If you bend your arm, that’s throwing rather than bowling, and you are penalised for that. You’re arguing that the cricket authorities should attach wooden splints to bowlers’ arms to stop them from bending them. It’s feasible, and it would stop throwing. Thus, your argument goes, if the cricket authorities don’t stop people from throwing when they could adopt this simple mechanism to do so, well surely that means they’ve given the green light to people who want to throw? I say that no, it doesn’t: people shouldn’t have to put up with unwanted and inconvenient changes to their game just because some people don’t want to play by the rules. Keep the game the same: those who don’t want to play by the rules should find some other game to play instead.

>Morally it does not make a difference whether you "cheated" by getting 1 million PP from eBay for $50 or from a guild mate for free.

Well under that morality, as I’ve said before, both practices should be banned.

>I think there is room for games both with and without commodification. It is just the middle ground, games like EQ, which encourages twinking but tries to suppress commodification, which have a problem.

There are many reasons why EQ might not want commodification. Here are two:

1) If they allow gift-twinking, that doesn’t open them up to anywhere near as many legal problems as they’d get if they allow sell-twinking.

2) It may be that the developers feel EQ can absorb the twinking that it gets from people gifting one another stuff, but that if it allowed full-blown commodification then the additional twinking that would result could shatter any remaining illusion that the game is "fair". It could be the straw the breaks the camel’s back.

Richard

43.

Lee Delarm>Most people I know in the US at least, would be willing to sell out even their most prized possessions at the right price.

Bill Gates: Would you sleep with me for 20 billion dollars?
Britney Spears: 20 billion? You bet!
Bill Gates: How about 40 dollars?
Britney Spears (slaps Bill): No way! What kind of woman do you think I am?
Bill Gates: We’ve just agreed what kind of woman you are, we’re just negotiating the price.

>The only difference between those who sell and those who don't is the value they put upon the objects in question.

So from my example above, we should make prostitution legal? A similar argument can be made for just about everything, from selling internal organs to contract killing to selling children.

>Whether they like it or not it comes down to not a judgement of morality, but one of capitalism and choice in a market system.

Let’s say a very, very rich person wants to play in a virtual world that has no commodification. Capitalism and market choice being what it is, shouldn’t this very, very rich person be able to find a virtual world somewhere that has no commodification? After all, there’s a demand for such worlds, the person is very, very rich, so why don’t these virtual worlds exist? Because less rich people are commodifying them, and trying to use arguments that it’s OK because capitalism allows it to support their activities. Maybe the very, very rich person should buy a few politicians and get the law changed so that these pipsqueaks are fined out of existence if they try to commodify a virtual world. Then, all virtual worlds will be uncommodified. Capitalism wins again!

Richard

44.

I can't really blame PayPal for its policy. Without the cooperation of the game designers, there is no way to verify a transfer of virtual property, and most of the operators simply wish the issue didn't even exist. I don't see GOM getting much help from the FBI either. Fraud cases are messy and difficult to investigate, so they are usually ignored, even in the real world.

So, basically, nobody cares if you get screwed buying or selling virtual property. Caveat auctor.

45.

Tom> "In the real world economists argue for changes in government policy to help make the grey economy legitimate because of the economic benefits that would provide. Should the VW economists be doing the same?"

Argue, yes. Require, no. There is a huge difference between RL economics, and VW economics, if for no other reason than participation in the later is absolutely voluntary.

At the end of the day, game developers should have the right (and do last time I checked) to set the rules of their game as they see fit. Yes, even if those rules don't work. And, yes, even if they are unable to enforce them. And yes, even if those rules mean zero customers. Bad business is hardly illegal. (note: illegal business is still illegal). To disallow game developers to set their own rules, would be like requiring all Stories/Books/Movies/TV Shows to end happily because happy books sell better. (counterpoint: see Romeo and Juliet, Shakespeare,1595)

-bruce

46.

DivineShadow(11/20/03)> Not to be rude or pejorative, but ideally you figure out the risk factors/model before opening shop.
(http://terranova.blogs.com/terra_nova/2003/11/virtual_world_c.html)

DivineShadow> I don't get the idea of knowing about a problem (PayPal chargebacks) that *will* happen (no 'if' here) and not taking preventive measures or adding it to the plan as part of the cost of doing business, and later shutting down when the problem does crop up.

I too was very taken back by the response of fully pulling out of all markets due to a single problem that should have been foreseen. $3,000 transactions are just too high a risk, for any company to take, imho.

-bruce

47.

Whoops,

"all markets" should be "all markets except 2L"

-bruce

48.

Tobold> Only if you allow high-level player A to give low-level player B 1 million platinum pieces and the sword of uberness for free will you have commodification, including eBay, PayPal, GOM, IGE, and some scammers. And I don't see any valid reason why such uneven transfers have to be allowed. Morally it does not make a difference whether you "cheated" by getting 1 million PP from eBay for $50 or from a guild mate for free.

Precisely!

Tobold> I think there is room for games both with and without commodification. It is just the middle ground, games like EQ, which encourages twinking but tries to suppress commodification, which have a problem. Neither a game with no direct trading, nor a game in which the virtual goods are sold directly by the game company would have a problem with a black market.

I agree, but there are plenty of solutions that map to the middle ground between "no trading" and "twink hell via commodification".

Someone decides to twink 1 million platinum and the sword of l33tness to a new character (regardless of why, let's say it happened).

You can minimize or eliminate the major BENEFITS of twinking without eliminating tarde entirely, or going to a company-only-sales formula.

Make the sword of l33tness require character level 72 to wield. Likewise, put level restrictions on the cool armor, etc. Make NPC vendors (if they exist) sell only level-appropriate items.

Better yet, use the Diablo II currency solution and cap the maximum amount of currency that can be carried based on character level.

The point is, there are a variety of solutions which make twinking far less attractive, without having to go on a witch hunt for those who twink with financial capital instead of social capital.

49.

Tim Webb> The reason I am personally anti-commodification is due to my well developed sense of sportsmanship. As soon as 3rd party influences from the RW (eBay, hacking utilities, macro utilities) give one player an advantage over another the VW (and the competition there of) has been compromised and the sport is lost.

And is the "sport lost" when a guild decides to twink up a new member with all the cool items that give him maximum advantage?

I hold that it is equally lost in that case... and if so, that your real objection should be to ALL FORMS OF TWINKING, not to just commodification.

I hold a fundamental premise to be that if no twinking is possible, impactful commodification simply will not arise... there is no benefit to it.

Eliminate twinking and you eliminate commodification. Eliminate commodification, and your sport is still lost due to social twinking.

The real enemy is not money entering into it... the real enemy is allowing the competitive advantage from twinking in the first place.

50.

Richard Bartle> The rules of cricket say the bowler has to keep their arm straight during the delivery. If you bend your arm, that’s throwing rather than bowling, and you are penalised for that. You’re arguing that the cricket authorities should attach wooden splints to bowlers’ arms to stop them from bending them. It’s feasible, and it would stop throwing. Thus, your argument goes, if the cricket authorities don’t stop people from throwing when they could adopt this simple mechanism to do so, well surely that means they’ve given the green light to people who want to throw? I say that no, it doesn’t: people shouldn’t have to put up with unwanted and inconvenient changes to their game just because some people don’t want to play by the rules. Keep the game the same: those who don’t want to play by the rules should find some other game to play instead.

Now consider the case if the rules of cricket read that you must keep your arm straight if your team is from Kent, Surrey or Yorkshire if you want to avoid a penalty. All other teams are allowed to bend their arms without penalty.

Just because it's a rule, that doesn't mean that the rule is ethically or morally RIGHT. In this case, certain teams are being handicapped based on nothing that is happening in the game itself... simply because to who they are, or what they may have done in the past.

We see this analogous situation in many VWs, where social twinking is permitted, while twinking for financial reasons is cause for a permaban.

The game rules should be reliant only on (and only govern) in-game aspects... not legal out-of-game actions or attributes.

Do you think it's OK to penalize a game player or team during today's game just because they beat you last night at darts in the pub? If not, why not?

51.

Richard> You’re arguing for a solution in code to a problem that is out-of-code. There are people who like virtual worlds just the way they are except they don’t like commodification. You’re saying that these people should have to play a different kind of virtual world that prevents commodification through code. Why should they have to do that? They may (in fact probably will) like that virtual world much less than the ones without the code changes. Just because some people insist on breaking the rules, that means you have to change the rules? No! Ask any kid in a playground what you do when someone breaks the rules: you throw them out and don’t let them play with you again until they’ve promised not to do it!

Counter: [Bigot]We've set a rule in our neighborhood that no colored people are allowed to live here. We like our neighborhood just the way it is 'cept we don't like the coloreds. You’re saying that we should have to live in a different kind of world that doesn't let us choose who can live next to us. Why should we have to do that? We may like that world much less than the one without the changes. Just because some people insist on breaking our rules, that means we have to change our rules? No! Ask any kid in a playground what you do when someone breaks the rules: you throw them out and don’t let them play with you again until they’ve promised not to do it![/Bigot]

52.

Barry>Just because it's a rule, that doesn't mean that the rule is ethically or morally RIGHT

I don't see how ethics applies to the design of the rules for a game. Not collecting $200 when you pass Go has no moral implications. These rules exist to define a game that will be fun to play, nothing more.

Moving on, here is the outline of why I feel banning virtual item sales (or "financial twinking") works and banning social twinking doesn't:

1) Financial twinking (FT) is much more easily defined, and thus enforced. We prohibit the exchange of RW currency for anything in-game. Social twinking (ST) is a much different story. Can one give a gift without it being twinking? It's not hard to see that this goes south fast.

2) FT breaks immersion, ST often doesn't.

3) Both break the spirit of competition, to a degree, but FT is far worse. FT gives a bonus based solely on out-of-game parameters (mostly RW wealth). ST results from actions done in-game or "near-game", such as game-related communities/forums. Also, ST only imbalances competition on a player-to-player basis; as far as guild competition is concerned, all guilds are expected to engage in ST (fair assumption?), thus it doesn't cause problems on this playing field. However, many guilds (most notably RP guilds) will strictly avoid FT, and will be at a disadvantage to the others.

4) The presence of FT draws the item farmers, who are definitely not there in the spirit of the game. ST has no such side-effect.

5) FT is prone to scamming, as evidenced by GOM, and etc. ST is, by definition, victimless (amongst participants).

6) ST is much more prevalent and accepted, as is. The cost of trying to ban ST (in direct ways) would be enormous, while SWG and some others are already banning FT.

Thus, while I see no problem with using indirect means (e.g. level req's) to reduce the effect of ST, the reasoning behind why we ban one and not the other is clear to me.

53.

First, SOE isn't the publisher of SWG.

Hypothetical: Let's say you sold virtualbucks to a fellow for $1. He received the credits, at which time you were overcome with feelings of guilt at having violated the EULA, confess to the misdeed, and both your account and his account are banned.

Shouldn't he ask paypal to reverse the charges? I would!

Just how much "help" do you want from the companies whose EULA's you are violating?

54.

Barry> Just because it's a rule, that doesn't mean that the rule is ethically or morally RIGHT

Tek> I don't see how ethics applies to the design of the rules for a game. Not collecting $200 when you pass Go has no moral implications. These rules exist to define a game that will be fun to play, nothing more.

Ethics applies the moment the rules (in this case, EULA and TOS) start to poke outside the boundaries of the game itself, and start referencing the outside life and behaviors of your players.

A game rule has ethical implications if, for example, gays or Protestants are not allowed to collect $200 for passing Go in Monopoly, but everyone else is.

These two threads have helped to refine an idea that I think will illustrate the dichotomy that I'm trying to point out, but I think it I'll put it together as a separate thread... this one in particular seems to be getting pretty off-topic.

Tek> Moving on, here is the outline of why I feel banning virtual item sales (or "financial twinking") works and banning social twinking doesn't:

Your points provide reasons and justifications for developers to not like the practice, but framing this as a question of "banning both" completely misses the point I'm trying to make.

I'm not saying that both should be banned if one is banned. That's two wrongs, not one right. Neither should be bannable offenses. Instead, in-game behavior should be addressed via in-game mechanics.

I'm saying that, from an ethical perspective, game providers should keep their noses out of their players' out-of-game personal lives. Constructing in-game rules to deal with in-game behavior is admirable. Constructing contract terms (EULA and TOS) that are discriminatory is not.

I'll save the rest for a new thread.

55.

>> Richard: You’re arguing for a solution in code to a problem that is out-of-code.

I do not believe that commodification is an out-of-code problem. As you said yourself elsewhere, there are quite a number of VWs that do not have commodification, in spite of basically having the same player base. The only difference between commodified worlds and non-commodified worlds is code. Just like many developers decided to solve the problem of griefing by limiting PvP, if commodification was really a problem, it could be eliminated.

Would a game with no direct player-to-player trade be accepted by the players? I can't be sure, but trading via the auction house is rather popular in Final Fantasy XI, so direct trades might not be missed that much if indirect trading was offered.

Of course prohibiting player-to-player trade is only one, rather blunt, code solution. The better solution would be to design a game in which players wouldn't have any motivation to buy virtual goods. If GETTING to level 50 was a lot more fun than BEING level 50, there would be no market for level 50 characters. But as long as there are games where people perceive gameplay as a treadmill necessary to reach the fun of high level content, the market for characters and means to shorten the treadmill phase of the game will exist.

By the way, there are many more code solutions, already existing in some games, all of them in some way limiting commodification. For example many games have some sort of level limits on their items, you need to be at least level 30 to wield the sword of uberness, so there is no demand on EBay for it from less than level 30 players.

56.

Richard: "You’re arguing for a solution in code to a problem that is out-of-code. There are people who like virtual worlds just the way they are except they don’t like commodification. You’re saying that these people should have to play a different kind of virtual world that prevents commodification through code. Why should they have to do that?"

I'm arguing from that stand point as well. The sticking point seems to be the first M - Massive. There are no out-of-code solutions in a massive game. Your players will play what is in the code. There is no way to communicate with them any other meta rules.

Consider another well known out-of-code problem, the Grief PK. I'd like to play a game with full PvP. No murder counts, notoriety, etc. I'd like it to be that the people who need killing get killed, and we all are careful when greeting strangers cause they *could* attack us. Furthermore, only then can I possibly be good by choosing to not attack. I don't want, however, to have to put up with grief attacks of pks. (Note the lack of clear definition of what a grief attack would be!)

This works with one's friends playing a real world RPG. After all, as you have pointed out, those who do not abide by this meta rule: "No excessive killing" will get booted. You can get it working with larger groups. Guilds in UO, for example, have full PvP internally, so either they have worked this out or they implode :> Ask any guild leader, however, and they will tell you what a pain it is dealing with: "So and so killed me while sparring..."

Now, try to go to thousands. Or tens of thousands. Or, in the game I'd like to play, hundreds of thousands. You are going to get rampant PKing. It's a simple law of human nature.

The same applies to economics. I don't buy board walk from someone as we both agree to a set of rules in which that is illegal. In a massive game, you have no control over people's game space other than the code. You can post a "Play nice policy", but in the end it is code changes that will get people playing nicer.

Designing a game which allows item trades, is massive, and can't handle commodification, is as foolish as designing a game which has full PvP, is massive, and can't handle rampant PKing.

I don't believe there can be a magic circle around 10,000 players. I know it is hard enough negotiating to set one up for 20 people. The more people you have, the simpler the circle has to be. In the end, you end up with the laws of physics.

- Brask Mumei

57.

Barry Kearns>Now consider the case if the rules of cricket read that you must keep your arm straight if your team is from Kent, Surrey or Yorkshire if you want to avoid a penalty. All other teams are allowed to bend their arms without penalty.

Er, OK, but that’s in no way analogous to the situation we’re describing. What happens is that there is a game-like situation, there are rules that govern this game, and these rules are perfectly lawful in the real world. The rules clearly state that something is not allowed, and what will happen if you break the rule and go ahead and do it anyway. Your argument is that because there is some mechanism by which the rules could be enforced physically (ie. in code, for a VW) then unless this is done the rule can legitimately be broken with impunity. My argument is that people shouldn’t have to make changes because some rule-breaker keeps messing them about: they should be able to stop the rule-breaker from playing.

>Just because it's a rule, that doesn't mean that the rule is ethically or morally RIGHT. In this case, certain teams are being handicapped based on nothing that is happening in the game itself... simply because to who they are, or what they may have done in the past.

In that case, yes, but that’s not what’s happening with commodification in virtual worlds. Your twist on my analogy is completely bogus.

>The game rules should be reliant only on (and only govern) in-game aspects... not legal out-of-game actions or attributes.

I refer you to my argument in the Virtual Property Overview thread. Taking caffeine pills is legal in the real world, but banned by the Olympics committee for people running the 100m. The rules of the 100m cover things like how the race starts, keeping to lanes, type of footwear allowed – all of which are "in-game" – and not taking drugs – "out-of-game". By your argument, the game rules should not be able to cover out-of-game activities, so taking caffeine tablets and other legal drugs (eg. steroids) should be allowed.

Well no. Game rules should be able to cover out-of-game activities so long as it’s not illegal for them to do so. If you don’t like the rules, don’t play the game.

>Do you think it's OK to penalize a game player or team during today's game just because they beat you last night at darts in the pub? If not, why not?

Personally, I don’t. I wouldn’t play a game that had that written into its rules. If I did play the game, though, I could hardly be surprised if it happened.

Richard

58.

Barry Kearns>Counter: [Bigot]We've set a rule in our neighborhood that no colored people are allowed to live here.

Well in that case, [Bigot] is breaking the law. Virtual world developers are not breaking the law, because there is never ever going to be a law that says you can't discriminate for a non-essential service based on people's ability to pay for it.

Your whining on about discriminating against the rich is doomed to fail. Why? Because rich people can place themselves in exactly the same situation as unrich people simply by not spending their money. A "coloured person", faced with a situation where being a "coloured person" is disadvantageous, can do absolutely nothing about it. That’s why discriminating on the grounds of skin tone is forbidden in civilised countries except in very specific situations (eg. it’s legal to turn down a black actor for the role of Abraham Lincoln in a historically authentic movie). A rich person faced with a situation where having money is disadvantageous can always not spend the money.

In a virtual world, commodification favours people with money to spend and disfavours people with no money to spend. Removing commodification disfavours both equally. It’s not that "I can’t help having money, but you bastards are treating me differently just because I do". Rather, it’s "This is only for people who don’t spend money on certain things, and although I do have money I can indeed comply with this".

Richard

59.

Tobold>The only difference between commodified worlds and non-commodified worlds is code.

This is like saying the only difference between countries is geography. Different countries have different peoples, different laws, and different ways of enforcing laws. Different VWs have different players, different rules, and different ways of enforcing rules. When isolated incidents of commodification are tackled quickly and energetically, this can nip the problem (if it is a problem) in the bud. If they’re not noticed for ages, or are left in laissez-faire fashion, then that makes it much harder. In that regard, it’s a customer service issue, not a code issue. We don’t have as many shootings per capita in the UK as there is in the USA because it’s very hard to get a gun here and mere possession without a licence can get you a term in jail. A VW with a similar attitude to unsanctioned commodification (well, with banning rather than jail!) could have a similar effect.

> The better solution would be to design a game in which players wouldn't have any motivation to buy virtual goods.

I agree that this would render the debate moot. However, we’ve yet to find the magic formula for such a VW, if indeed there is one.

Richard

60.

Brask Mumei>The sticking point seems to be the first M - Massive. There are no out-of-code solutions in a massive game. Your players will play what is in the code. There is no way to communicate with them any other meta rules.

You can tell them the rules and the meta-rules, but they don’t have to listen. If someone were to play a VW and started calling everyone a "ducking fickhead" then pretty soon they’d be in trouble, even though the code was letting them do it.

>Now, try to go to thousands. Or tens of thousands. Or, in the game I'd like to play, hundreds of thousands. You are going to get rampant PKing. It's a simple law of human nature.

I agree that solutions to these problems don’t often scale up. In VWs, the "local police officers", ie. the CS staff who monitor player activity, tend to have too big a patch, insufficient tools for proving criminal activity, work schedules that mean they rarely get to recognise the players (let alone get to know them) and they burn out after 8 or 9 months anyway. Small, cosier VWs may not have the numbers to make a big profit, but they do have the people to make sure everything runs smoothly.

A village can be a friendlier place than a city, but then there are friendly cities so I don’t think the problem is necessarily intractable.

>In a massive game, you have no control over people's game space other than the code. You can post a "Play nice policy", but in the end it is code changes that will get people playing nicer.

You could do it with perfect logging – the panopticon approach – so long as the logs were properly searchable. This wouldn’t stop people from commiting a breach of the rules, but it could stop them from doing it more than once.

>I don't believe there can be a magic circle around 10,000 players.

I do. I’ve seen historical recreation societies enact battles with those numbers of people participating in them. If the magic circle broke, it was only when uniformed stretcher-bearers came to carry off someone who got hurt by accident.

It’s possible, but I agree that we don’t have anywhere near the the expertise or the player willingness to support it yet.

Richard

61.

Barry>Ethics applies the moment the rules (in this case, EULA and TOS) start to poke outside the boundaries of the game itself

I would say the EULA is preventing outside influences (in this case financial influences) from poking into the game. So gays and Protestants are collecting $400 from passing Go, but we want them to only collect $200.

I still agree that we should explore every in-game option we have to reduce twinking in general. Level requirements, or the equivalent, for using items is probably the easiest and most effective. Limits on your bank account that slacken as you attain higher levels/skill sound good as well.

However, these limitations don't stop a player from buying someone else's Lvl 50 character so they can use the Sword of Uberness that they also want to buy. I can't think of any coded way to prevent this, which is why I propose that we must at least ban this practice.

My bottom line is that, I think we can only go so far with the limitations. Not allowing direct trade has a high price: people could no longer order custom-made items from crafters, friends could not share resources inside their virtual business, you can no longer tip the entertainer. So if we make the call that a complete ban of direct trade is not worth it, there will still be some modicum of both types of twinking going on. Even here, I still say we go on and ban virtual items sales--we've already made it clear that buyers/sellers won't benefit much from this world, we've already lost their business.

62.

On our best months, we hope to have reversals like GOM’s. Ours are consistently more and this is only a fraction of what is attempted. We have a few customer service reps working at all times just to analyze orders that have been flagged with a high potential fraud rating. We also hire private investigators to track down the larger scammers. Ultimately, this kind of fraud should be written off as the cost of doing business and must be accounted for when determining margins.

63.

I always wondered about that, that is, if IGE and Yantis suffered the same fate now and again when they did business for much longer and much larger scale (I would imagine).

Have you found the scammers ever? Did you get any charges to stick? Did they pay you back? Do tell :)

64.

Yes, I'm very curious what happens when your private investigators actually find the larger scammers. Turn them in for possession of adena? Or is it more of a shakedown?

65.

Most of the scammers are minors who pay us back quickly once their parents find out.

66.

Most of the scammers are friends or family, many of which pay back the stolen goods.

67.

Lets see if I got the problem. We have several different roles in the whole:
• game service provider
• the buyer (customer of the game service provider)
• the seller (customer of the game service provider)

The acquirer decides to buy virtual items for real currency initiating an out of game transaction with a vendor (also a customer of the service provider). We assume that the EULA and or TOS prohibit such type of transactions between customers. Still both sides decide to go on and fulfill the transaction. At same stage the buyer decides to rescind the contract and nullify the transactions occurred because they violate the previous contracts (EULA and TOS).
And now? The seller decided to engage in a transaction without owning the trades he wanted to sell (assuming he is trading any good and not providing a service for a fee (what the newest MMOG’s EULA/TOS are also prohibiting). Why should a game service provider tolerate such type of behavior? It makes no sense from a legal and business point of view.

68.

Richard> That’s why discriminating on the grounds of skin tone is forbidden in civilised countries except in very specific situations (eg. it’s legal to turn down a black actor for the role of Abraham Lincoln in a historically authentic movie). A rich person faced with a situation where having money is disadvantageous can always not spend the money.

Sigh. And a Jew can always renounce their religion if asked, and many have CHOSEN to make that their faith. They could "do something about it" if they wanted to. Does that make it OK to discriminate against people for being Jewish?

The principle is the same: There are situations where a person's life choices or circumstances are NOT a legitimate reason for discriminating against them.

If you want to be not be friends with Jews, that's entirely up to you. When people start offering services to the PUBLIC, however, I think it's important for them to set aside their own personal judgements of others.

Heavily commericalized VWs (especially 100k+ with monthly subscription rates) can hardly be expected to be considered equivalent to someone's private home, or even an "exclusive" country club.

Like movie theaters, they are much closer to being "public accomodations". Movie theaters are going to get into pretty hot water if they want to deny sales to gays, Jews, or people who spend money at porn shops. So long as people behave themselves properly IN THE THEATER, the theater owners shouldn't be throwing them out if an usher tells the manager that he saw them renting a copy of "Debbie Does Dallas" from a local shop.

They might not LIKE those people, but that doesn't make it a legitimate reason to deny service to them.

69.

Tek> I would say the EULA is preventing outside influences (in this case financial influences) from poking into the game. So gays and Protestants are collecting $400 from passing Go, but we want them to only collect $200.

That's absolutely what's NOT happening with financial twinking vs. social twinking. Nothing is being conjured out of the the air. If you had financial twinkers who were able to CREATE a Sword of Uberness where one didn't exist before, and social twinkers couldn't, you'd have a good point. But the Sword was already there, it just moved from character to character. And the social twink moved their Sword over with no penalty, so there's no disparity in the competitive landscape introduced by permittingn twinking for financial reasons WHERE IT IS ALREADY PERMITTED for social reasons.

70.

Tek> However, these limitations don't stop a player from buying someone else's Lvl 50 character so they can use the Sword of Uberness that they also want to buy. I can't think of any coded way to prevent this, which is why I propose that we must at least ban this practice.

I agree wholeheartedly! I fully support and recognize the practice of making accounts non-transferrable assets... but such a policy also makes it illegal to give someone else an account to someone FOR FREE, so there is parity there.
Socially-motivated folks don't get benefits that are denied to the financially motivated in that case.

If a company wants to ban all twinking, then I'm perfectly OK with not being able to twink for financial reasons in that game. What bothers me is that some players can get huge advantages for social reasons with no penalty, yet when people do the same thing for financial motivations, they are banned.

Of course, banning all twinking in a game where twinking has large and obvious competitive benefits is an inelegant solution at best, and an enforcement nightmare at worst. Far better IMO would be to structure the game to remove the competitive benefits of twinking, and the problem becomes moot. In the absence of that, I think game policies should be consistent regardless of a player's motivation.

71.

Barry wrote: >So long as people behave themselves properly IN THE THEATER, the theater owners shouldn't be throwing them out if an usher tells the manager that he saw them renting a copy of "Debbie Does Dallas" from a local shop.

But what if spectators enter the theater with 100 kgs popcorns and start selling them to other spectators? What will happen is that they will be thrown off and most probably they won't get a refund of their ticket.

And that is also what is happening here. It is not a discrimination case. It is a business what is going on. Someone would like to take advantage of another business (the one run by the game provider) without the permission of the owner of the business. Why not taking a license from the game provider to run such a “virtual asset trading”? Who knows some game providers could also license it.

72.

This whole "Spending social capital is the same as financial capital" is very worrying to me.

I don't see a clear response, but I feel there must be a difference. In a MMORPG, I often spend my social capital for stuff other than twinking. I go adventuring with other people, therbey reducing my risks, increasing my rewards, and fun. It is unfair for me to spend my social capital on this, whilst the social capital poor person has to slowly grind levels alone?

Clearly, if a power-leveling service were being sold: "For $15/hour, we'll let you group with us and we'll show you a cool time!", I think the anti-commodifiers will be just as pissed as they are with the selling of items. After all, this isn't about immersion (One never sees the anomolous transactions in game), it is about knowing that the unspoken rule of the game not to bring real-world stuff into play has been broken.

I guess my problem is that social capital is accrued in game as often as without. In UO, I received a massive inheritance from someone who was quitting. I have never met the person in the real world, but we were good friends in game. As such, there is no breaking of the magic circle. Within game, the transaction was perfectly logical.

The same goes with many other transfers. If one pays someone for decorating your house, to the logs of the game it looks like a massive one sided transfer. In fact, there was equal value *in game*. We also have "lending" of items. Perhaps something is to be sold on commission. One then sees a gift from A -> B of an item. Then a valid transaction between B & C. Then a gift of B -> A. (The SWG server logs may show some 100,000 credit stimpacks being sold as a result of such transactions when I was running a shop)

This is, not surprisingly, looking a lot like trying to seperate "Good PvP" from "Bad PvP". The more code you add to refine it, the more restrictive it becomes, and the abusers just find more peculiar loopholes.

Re: 10k magic circles
Richard: "I do. I’ve seen historical recreation societies enact battles with those numbers of people participating in them."

Wow. I stand corrected. My faith in human nature is increased :>

I realized afterwards that there are some other counter arguments as well. Nations have their own "Magic Circle" of laws which we follow, which often have millions of people obeying them. While enforcement isn't 100%, it is more than enough for people to get on with their daily lives.

I guess my rephrased stance on commodification would be that if a MMORPG developer wishes it avoided, they should do more than just add a term to the EULA and assume everyone will play nice. They need to make that aggressive stance from the beginning. Unequal gifts need to be investigated by staff. (Indeed, if after such a gifting a GM shows up and asks for an explanation, you will at least ensure all players *know* the meta rule.) This has a very high support cost, however, so I'd think commercial worlds would be wiser to consider just ensuring there is no harm from commodification. Much like they have sadly taking a depressing stance re: PvP.

- Brask Mumei

73.

Brask>After all, this isn't about immersion (One never sees the anomolous transactions in game),

But you do hear about them, either from chatting in-game or reading the online forum for the game. This knowledge comes with you while you play and prevents you from reimmersing yourself.

Most children like to eat hamburgers and franks. Children who have seen and understand what goes on at a meat-processing plant are often less fond of them. The food itself is unchanged, but the knowledge surrounding it has been disturbed.

Tek> I would say the EULA is preventing outside influences (in this case financial influences) from poking into the game.

Barry>That's absolutely what's NOT happening with financial twinking vs. social twinking.

I'm not using trying to compare the two, I'm saying that there is no discrimination. The point is to remove any unfair advantage, which is what people who spend RW money on the game have. Members of cross-game guilds have a roughly similar advantage. If it were feasible to ban social twinking, I would support it--I have made clear why I don't see it as feasible.

I don't buy that stopping one injustice while being unable to stop another is discrimination. Let's go back to the Olympics. One could argue that, concerning running speed, African genetics are superior to all other genetics (just look at the recent history of Olympic sprinting events). Is this an unfair advantage? Probably. Is it something that can be easily fixed? No. We know that steroid use is also an unfair advantage, but is much more easily fixed, so we do it.

Thus, is it discrimination to ban steroid use and not ban competitors of African descent from playing? No.

Another example is winter sports. Do Finnish skiiers have an unfair advantage over Jamaican skiiers? Probably. Finland naturally offers a very long training season, and also, as a consequence, skiing is much more popular there. Future Olympians can start training there while very young, but over in Jamaica you have to wait until you can afford to fly (frequently) to Colorado or some equivalent. So, can we easily fix this? No. We simply have to accept that the slalom will be overwhelmingly won by Germans, Finns, and other countries with suitable environments.

These examples mirror why I think we should accept (perhaps grudgingly) social twinking, but ban financial twinking.


74.

>Tek: These examples mirror why I think we should accept (perhaps grudgingly) social twinking, but ban financial twinking.

(Somehow the discussion is stretching over two threads now.)

I have a practical objection: how do you tell apart social twinking from financial twinking?

My suggestion of removing all forms of twinking by changing the code is based on what is actually possible. Does a game company really want to hire private detectives to find out whether the transfer of 1 million platinum pieces from one player to another was socially or financially motivated?

So your suggestion "we should accept (perhaps grudgingly) social twinking, but ban financial twinking", then suddenly becomes "we decided to accept social twinking, so we will not be able to enforce our ban of financial twinking". Writing a letter to EBay and asking them to remove a couple of auctions is a publicity stunt, not a solution.

Of course everybody is free to discuss what he thinks is right and what is wrong. It just isn't very relevant to game design unless you can offer a practical solution to go with it.

75.

Barry Kearns>The principle is the same: There are situations where a person's life choices or circumstances are NOT a legitimate reason for discriminating against them.

I agree when those situations are such that the life choices are just another means of discriminating against people who can’t do anything about their lot, eg. discriminating against people of the Jewish faith in order to discriminate people of Jewish descent. I disagree when the life choices are the cause of practical problems, eg. discriminating against people of the Jewish faith in a ribs restaurant by not providing ribs from kosher animals that Jewish people are allowed to eat.

I would have to have a rather strange view of the world to believe deciding to buy objects for a virtual world was a life decision equivalent to changing religion.

>Like movie theaters, they are much closer to being "public accomodations". Movie theaters are going to get into pretty hot water if they want to deny sales to gays, Jews, or people who spend money at porn shops.

Soccer stadia are public accommodations, yet you can be barred from a soccer stadium because you bought a ticket from someone else. In the England v Portugal match yesterday (which England lost due to a series of disgraceful refereeing decisions, grrr), English supporters who had bought tickets from Portuguese supporters were not allowed into the ground. They were being discriminated against not only on grounds of nationality, but also on grounds of individuality: if you aren’t the exact person named on the ticket, you can’t even sell it to another English supporter. Why is this legal? Because the consequence of allowing English fans and Portuguese fans to sit alongside each other would likely be that there would be crowd trouble. This would impact on the game, therefore such sales are prohibited. Sure, you can get crowd trouble anyway, but that’s no reason not to take this precaution.

In virtual worlds, the consequences of letting people buy and sell stuff offline can impact on the virtual world, too. Virtual world operators should have the same rights to ban entry for what people do outside the virtual world that soccer clubs have to ban people for what they do outside the ground.

>They might not LIKE those people, but that doesn't make it a legitimate reason to deny service to them.

They don’t need a legitimate reason to deny service to them. The people being denied service need a legitimate reason to request that their service is not denied. Being allowed to spoil the virtual world for others is not such a legitimate reason.

Richard

76.

Brask Mumei> In UO, I received a massive inheritance from someone who was quitting. I have never met the person in the real world, but we were good friends in game. As such, there is no breaking of the magic circle. Within game, the transaction was perfectly logical.

If characters give stuff to other characters for reasons that make sense for those characters, I don’t think there’s a problem. In fact, I think there would be a problem if they couldn’t do it – a problem which would arise if those people howling about "fixing the virtual world so it doesn’t allow twinking" got their way.

>This is, not surprisingly, looking a lot like trying to seperate "Good PvP" from "Bad PvP". The more code you add to refine it, the more restrictive it becomes, and the abusers just find more peculiar loopholes.

As you said in your earlier post, this may be a size issue. In a small-scale VW, admins can check the logs and interview people. They are effectively judge, jury and executioner, but they can still do it. In a big VW, this isn’t currently an option for practical reasons.

>Wow. I stand corrected. My faith in human nature is increased :>

Historical re-creation societies are just that, societies. They can throw people out if they don’t act in accordance with the rules of the society. Depending on how accurate they want to be, they can throw people out for reasons that might be entirely inappropriate elsewhere, eg. banning for sex and race on the grounds of authenticity. As it happens, the last recreation I saw (English Civil War) didn’t do that: it had women pretending to be men, and black and Asian guys pretending to be 17th Century Lincolnshire farmhands. Nevertheless, they all played their parts. If they hadn’t played their parts, they would have been removed from the field.

>I realized afterwards that there are some other counter arguments as well. Nations have their own "Magic Circle" of laws which we follow, which often have millions of people obeying them.

I agree, this is very interesting stuff – the extent to which law-makers can govern law-making by groups of willing individuals (eg. to play a game). What justification do governments use to assert their right to make laws, and why does this justification not apply to virtual world developers?

>I guess my rephrased stance on commodification would be that if a MMORPG developer wishes it avoided, they should do more than just add a term to the EULA and assume everyone will play nice. They need to make that aggressive stance from the beginning.

Although I think under the current way things stand this would be wise of them to do, I don’t think they should (by law) have to prosecute it aggressively or face losing the right. I realise you’re not saying that, but I’m worried that what you are saying might lead to it.

Richard

77.

Tobold>Does a game company really want to hire private detectives to find out whether the transfer of 1 million platinum pieces from one player to another was socially or financially motivated?

I'll add this to what I said in the other thread:

As long as the players believe the ban on virtual item sales can be practically enforced to a significant degree, the goal will be accomplished: prevention. Convincing potential buyers/sellers that it is not worth the risk is the point, not waiting to catch them.

78.

Richard> which England lost due to a series of disgraceful refereeing decisions, grrr

I thought that they lost because Beckham shanked it :-)

79.

Barry wrote: >So long as people behave themselves properly IN THE THEATER, the theater owners shouldn't be throwing them out if an usher tells the manager that he saw them renting a copy of "Debbie Does Dallas" from a local shop.

Luca wrote: But what if spectators enter the theater with 100 kgs popcorns and start selling them to other spectators? What will happen is that they will be thrown off and most probably they won't get a refund of their ticket.

Yes, because they are physically bringing something into the environment that wasn't there before, and generating a visibly disrupting activity within the environment. For the game environment, if someone was offering to IMPORT Swords of Uberness into the game in exchange for cash, that would match up with your example.

Let's recast it so that it matches the social vs financial twinking case: Let's assume a theater didn't sell popcorn outright, but you can win bags of popcorn in the theater lobby as prizes in one of those carnival "knock down the milk bottles" games.

The theater also allows people to share their popcorn with others, or give it away. Bob knows that he sucks at the ball toss, so before going to a particular movie, he offers his neighbor John $3 if he'll share his popcorn... John is really good at the ball toss.

Should the theater throw John and Bob out, while letting other freely share their popcorn for reasons of pure friendship or altruism?

If John decides to stand up inside the theater and shout "I'm selling popcorn, $2 per bag, come and get it", then I agree that throwing him out is reasonable. But so long as his actions within the theater are not disruptive, and most importantly are indistinguishable from the actions of others also in the theater with different motivations, I think his motives should not be a reason to deny him service.

80.

Cory Ondrejka>I thought that they lost because Beckham shanked it :-)

If Portugal had gone first and their player had kicked the ball into Row Z, then judging by his performance in the rest of the game the referee would have looked at the penalty spot and ordered it to be retaken. As it was, Beckham's kick identified the crumbling nature of the penalty spot and everyone else then knew to do the sand dance on it before taking their kick.

Of course, the way Beckham played in the match he was quite capable of skying it even if he'd kicked it off green baize...

Richard

81.

Hi Cory,

Cory>
"Or, a digital world could decide to act like an issuing bank and say, for example, that the maximum liability in digital currency is L$50. In other words, if a chargeback happens, it is treated as fraud, the person who sold their digital currency gets most of their currency refunded and the user who made the chargeback is suspended or banned from the world."

Are you suggesting that Game Developers should insure 3rd party trading sites?

Cory>
"Since world creators can't stop commodification -- yes, they *may* be able to reduce it, but there is no evidence that they can stop it...."

Replace 'commodification' with the word 'fraud' and the statement may remain true.

Furthermore, I still don't understand the basis behind the argument that because developers are unable to stop commodification, developers therefore have the responsibility to support, encourage and insure 3rd party trading sites. Are you suggesting that games like SWG should be required to dedicate resources to support '3rd party to 3rd party via 3rd party' transactions? Maybe you could expound on this?

-bruce

82.

See Penny Arcade's latest comic.

83.

"But what if spectators enter the theater with 100 kgs popcorns and start selling them to other spectators? " -Luca

What I find fascinating is that the spectator is entering the theater with 100kgs of the theater owners popcorn which the spectator made using the theater owners popcorn machine with the theater owners permission. The theater owner only gets upset when the spectator starts to sell the popcorn.

84.

Sorry to keep coming back to this same topic, but there appear to be a number of details that need to be worked out here.

Cory> "Obviously, this would require cooperation between the digital world operators and the trading sites"

Now, I am wondering what sort of changes to the Privacy Policy of most TOSs would be required before a game developer could fully cooperate with a trading site? Are you talking about exchanging personal information? Financial information? IP addresses? What else? How much information can a 3rd party request? How often? About whom?

-bruce

85.

Bruce,
Not sure that it's so complicated. It could be as easy as providing the 3rd party site, PayPal/YowCow and both participants a transaction ID. Then give PayPal/YowCow an API to query a transaction ID for confirmation of the digital item delivery. This is far more information than a postal receipt.
c

86.

Posting this for Ren:
---------------------------------------
_______________ Forward Header _______________
Subject: [NEWS] Gaming Open Market
Author:
Date: 26th June 2004 2:27:02 am

It's funny. I have a very short attention span, and yet I frequently write enough volume to bore even the most patient of people. With that in mind, I've put the important bits at the top here. Those of you with lots of time on your hands, please feel free to read my rantings that follow.

1) As of midnight eastern time on July 9 2004, Gaming Open Market will no longer take deposits from or send withdrawals to PayPal accounts. As of that time, we will begin transferring all remaining cash on deposit to our master YowCow account. YowCow will be the main payment service, although we will make Interac and e-gold transactions more accessible. If you leave your cash with us past July 9, you will simply have to choose another method of withdrawal - your GOM account balance will remain!

2) Effective immediately, trading of all game currency *except* the Second Life L$ is terminated. Without the combined support of the game companies and payment services, the risk for us is too great. If you have currencies on balance in any of these other games, please request withdrawals in the usual way and contact either Tom (for MTGO, SWG or There) or myself (for the rest) to schedule them. THE RECENT FRAUD IS *NOT* THE REASON FOR THIS CHANGE.


Now on to the gushy stuff.

First, let me send out a sincere thank you to everyone that emailed offering their support over the past week. There have been some really nice things said about Tom and I and our work, and let me tell you, it's great to know that the work we've put into GOM over the past 9 months is appreciated. If I haven't responded yet, I'm sorry. I'll try to get to everyone in time.

Second, to those of you who have made donations, again, please accept our most sincere thanks.

A lot of you have written in offering suggestions of ways to help prevent fraud, like the event this past weekend, from happening again. All of them are valid suggestions, and we appreciate the feedback. Don't for a second think the decision to terminate trading has been made without a huge amount of thought. We have reviewed the options, and we're confident our choice is the right one.

PayPal is a funny company. They have *so* much exposure, and so much weight in the marketplace. If they were to put their minds to it, they could revolutionize game commodity trading. With a little pressure from them, they could no doubt get a few of the game companies on board providing signed documented proof that deliveries actually took place, eliminating *most* of the fraud that occurs in our community. Our community by the way, that of the North American game commodity trader, spends on the order of $25-50 million USD per year, a number that's growing steadily as more games are released. For some reason, I'm just not able to get through to them.

YowCow, on the other hand, is a relatively small but fast-growing payment alternative. Small, in this case, is terrific for us. They are agile enough to work directly with us towards more fully integrating our services. These guys are working very hard to make online payment safer for you. Check them out! (And help us out by using our referral link! http://www.yowcow.com?578)

Last Sunday, as most of you are aware, we were the victims of over $3000.00 worth of fraud through PayPal. This is not why we are closing markets. Let me repeat that. THE RECENT FRAUD IS *NOT* THE REASON WE ARE CLOSING MARKETS. The fraud was simply a slap in the face, making us sit up and take serious notice of our situation.

In order for us to provide a safe place for you to trade, we need three things:

1) Game publishers need to recognize the commodification of their game worlds, and accept that out-of-game trading is going to occur. Plain and simple. Until they do that, no trading, mule or deposit account is safe. Of course there are *many* good reasons why the companies might not want to do this, and I won't bore you with the details. (Email me if you would like to discuss it.)

2) Payment services have to start recognizing that FedEx courier tracking numbers are *not* the only way to prove delivery was made. PayPal doesn't, and has no interest in considering it.

3) Game companies have to become open to working together with payment services to prevent fraud. This isn't hard. The game companies simply have to be willing to provide documented proof for the payment systems to use when defending themselves against a claim. What's so tough?

Working together with Linden Lab and YowCow, we *can* provide you with a safe trading environment.

This is why we're terminating the other markets. Not because we've been beaten down, but instead to continue pushing boundaries. With more time to focus on a single world, you will witness Gaming Open Market grow its list of banking and financial services. What's in store? Well now you'll just have to wait and see won't you?

To everyone that has traded with us over the past 9 months, we send a heart-felt thank you for taking part in our tiny piece of history. While we sincerely regret what we have to do, we feel confident that what we have built *is* the future of game commodity trading. Watch your worlds for Gaming Open Market branches re-opening soon!

Sincerely,

Jamie Hale
President - Gaming Open Market Corp.
jamie@gamingopenmarket.com

87.

Focusing on willing partners sounds like a good move and a strong stance. Companies with pure profit motive would just plow on in the attempt to cash in on a cash cow.

Frank

88.

Thanks Betsy.

Interesting move by GOM, thought I think when an organisation makes a policy change during or just after a crises, however much it says that change is not related to the crisis, however true that may be, however many capital letters they use in the pursuit of this message – in the eyes of the public it’s hard to shake the connection.

89.

Here's something interesting:

I recently read some "beta diaries" from World of Warcraft, and there was some treatment of a mechanic called soulbinding. The effect: a soulbound item can only be used/equipped by the character it is bound to. The scope: any quest-related item or high-level crafted item (from what I could gather). The first person to equip these items after they are instanced becomes the target of the soulbind.

While Blizzard has declared neutrality on item/character sales from an out-of-game standpoint (according to the FAQ), the mechanics seem heavily geared towards addressing the issue. The tester who wrote about soulbinding seemed mostly frustrated by it, though considering the source it probably wasn't thought through.

So, does this take it too far; is more being lost than gained?

90.

Bruce,
Sorry, I didn't see your earlier post until just now.

Bruce> Are you suggesting that Game Developers should insure 3rd party trading sites?

If the developer thinks that 3rd party trading sites are important to the success of their world then they should look at options that make their world look more inviting to those sites.

Bruce> Replace 'commodification' with the word 'fraud' and the statement may remain true. Furthermore, I still don't understand the basis behind the argument that because developers are unable to stop commodification, developers therefore have the responsibility to support, encourage and insure 3rd party trading sites.

I'm not sure when the MadLib style of argument became accepted but you have erroneously combined several arguments that I've made separately. I realize that many of them do involve related topics, so confusion is understandable. Allow me try to clarify, and please remember that these are *separate* assertions that address different components of MMOs.

1) As stated above, if a world wants commodification via 3rd parties, it makes sense for that world to work to improve the business opportunities for those sites.

2) If the sale of digital goods is to continue as a healthy and vibrant market, it needs to find solutions to fraud that protect consumers and sites attempting to broker these sales.

3) If a world has massive commodification -- and most of the large commercial worlds do -- I believe that the world would end up with a larger and more diverse customer base by embracing the commodification and legitimizing the transactions than by making it against the EULA and then largely ignoring it.

4) I think that in most situations, the game design decisions required to prevent commodification cause more damage to the game and immersion than commodification itself.

5) I think that strong links to the real world -- including commodification -- offer a way to expand MMO markets significantly beyond their current base.

6) Commodification is an important component to successful user-created content, as it provides context and motivation.

I am *not* arguing that the Olympics should allow doping, that fraud is good, that Sony should insure IGE or any of the other Strawmen raised in this thread and the virtual goods thread. If you want to see my expanded reasoning behind these positions, look at the various papers on the SL site here.

91.

Somehow when I read Richard's paper last week this phrase struck the chord of elightenment. Richard calls it obvious, I call it "gee, he's right":

"Finally (and perhaps obviously), players can feel resentful about a virtual world with commodification if they can't afford the prices of virtual goods on sale. This is the case even if they're pro-commodification. A manifestly inferior player with a manifestly superior weapon is harder to stomach when you know that to buy such a weapon would cost you a month's salary: you're never going to get a weapon like it because you simply don't have the money.

When poor people can't even role-play being rich, they're going to be disheartened."

That final sentence really stuck to my mind.

92.

Cory wrote:
>1) As stated above, if a world wants commodification via 3rd parties, it makes sense for that world to work to improve the business opportunities for those sites.

Certainly makes business sense. But why bother with third parties? Is there a public statement anywhere about why Linden does not run an out-of-game trading system? From a consumer point of view it would certainly make sense as there would be a single entity for recourse.

In fact why does Linden not just buy GOM?


>2) If the sale of digital goods is to continue as a healthy and vibrant market, it needs to find solutions to fraud that protect consumers and sites attempting to broker these sales.

Use of some form of unique key and a paper record of the transaction does seem a possibility.


3) If a world has massive commodification -- and most of the large commercial worlds do -- I believe that the world would end up with a larger and more diverse customer base by embracing the commodification and legitimizing the transactions than by making it against the EULA and then largely ignoring it.

This is think is highly arguable if the world does not want to commoditise, I’ve covered these issues at length in my 2003 AoIR paper (http://www.ren-reynolds.com/downloads/RReynolds_AoIR_2003.htm) and Richard’s Themis paper (http://www.themis-group.com/uploads/Pitfalls%20of%20Virtual%20Property.pdf).


4) I think that in most situations, the game design decisions required to prevent commodification cause more damage to the game and immersion than commodification itself.

I really have not seen that many tried. Someone just mentioned soul binding in Warhammer, then there are item decay methods, and for characters of course the Jedi Council things that SWG are rolling out – I’m certainly not giving up hope on the MUD-DEV hive mind finding very immersive solutions.


5) I think that strong links to the real world -- including commodification -- offer a way to expand MMO markets significantly beyond their current base.

Possibly, but we don’t want to burn our bridges!


6) Commodification is an important component to successful user-created content, as it provides context and motivation.

Well, yes, but its only one of many ways.

93.

Cory> If the developer thinks that 3rd party trading sites are important to the success of their world then they should look at options that make their world look more inviting to those sites.
Yes, and if a developer (like those at SWG) doesn’t think so, then should we all be so surprised when they don’t make companies like GOM a development priority?

Cory> It's time to stop ignoring the elephant in the room and realize that commodification is a basic feature of digital worlds. Only then will fair and rational approaches be taken to address the problems that it raises.
Cory> I'm not sure when the MadLib style of argument became accepted but you have erroneously combined several arguments that I've made separately.

My apologies for making too many assumptions. Maybe we should start with what exactly you think the elephantine problems are. I had assumed it was fraud, and risk management. From your writings here, I could guess it might be the existence of black markets, but black markets are very common in any economy. For example, garage sales are by definition black markets, and I don’t see the problem there.

Maybe the real problem is that the elephant isn’t so obvious.

Ren> But why bother with third parties?

Exactly. I would be much quicker to recommend to developers that they have specific shards where real world <> virtual trading is facilitated, before recommending that they take on the legal and financial burdens of working intimately with 3rd parties.

At the same time, I also agree that it makes perfect sense that if the developers of a digital world think it’s in their strategic self-interests to work with 3rd parties that they do so, of course.

Cory> If the sale of digital goods is to continue as a healthy and vibrant market, it needs to find solutions to fraud that protect consumers and sites attempting to broker these sales.

Ok, maybe. But we would first have to assume a few things. Are there no other ways to do this same thing? Does it have to be 3rd party sites? Is zero fraud possible? If zero fraud isn’t possible who takes the risk? Are we assuming that solutions don’t already exist? If we measure the volume of trade and discount the value lost through any fraud , IGE and eBay seem to be working well enough for some. Are we to assume that a market can’t be healthy and vibrant without linking it to the real world? Are we to assume that lowering the risk of outside trading is a higher priority than finding ways to increase the illusion of the ‘magic circle’, or the priority of decreasing the number of exploits that pop up periodically? It just seems like there are an awful lot of assumptions going into this one statement.

Cory> I believe that the world would end up with a larger and more diverse customer base by embracing the commodification and legitimizing the transactions than by making it against the EULA and then largely ignoring it.
Cory> I think that strong links to the real world -- including commodification -- offer a way to expand MMO markets significantly beyond their current base.

So maybe it’s just me but I am more likely to ask the market leaders for advise on how to increase a world’s population, then try and give it.

Cory> I think that in most situations, the game design decisions required to prevent commodification cause more damage to the game and immersion than commodification itself.

Maybe. I have been playing City of Heroes for some time now, and while there is plenty of trading going on at eBay, I would never be able to tell you with any certainty who was buying influence there. As such, I think I have to assume that there is little if any damage being done to the immersion side of the game.

Cory> Commodification is an important component to successful user-created content, as it provides context and motivation.

Yes, if that is the goal. However, there are a few games are actually focusing on entertaining people, and in many cases user-content isn't required.

-bruce

94.

Ren> Certainly makes business sense. But why bother with third parties? Is there a public statement anywhere about why Linden does not run an out-of-game trading system? From a consumer point of view it would certainly make sense as there would be a single entity for recourse.

A fascinating question, actually. In general, I think that options are good if you are a consumer -- assuming a certain level of consumer protection -- so multiple 3rd party sites allow exploration of market in ways that the game operator might not think of or decide to explore. Plus, the aggregate of multiple 3rd party sites provides a great metric for the value of the currency. The trick, of course, if figuring out how to provide consumer protection.

95.

Cory > In general, I think that options are good if you are a consumer -- assuming a certain level of consumer protection -- so multiple 3rd party sites allow exploration of market in ways that the game operator might not think of or decide to explore.

In general I agree. But I’m not talking generally. I’m talking about the state of the market right now. Given the margin on trades, issues with payment methods like PayPal, transaction tracking in-game etc., then there seems to be a good argument from both the standpoint of stimulating the market and consumer protection for games companies that so support the notion of commoditisation to support the actual business of commoditisation.

Not that I’m telling you how to run your business, oh, hold on…

96.

Question: Anyone have any thoughts about how Magic Online has evolved over time? Their business model is selling virtual cards online and I believe there is a good amount of trading going on.

97.

Rune scape will not let me log in so then i changed my password and it stillwont let me in !!!!!!!!!!SO YOU BETTER FICK IT YOU FERS:(

OR I MIGHT JUST SOE JUST SUE YOU>:)

98.

RUNE SCAPE IS THE BEST THING IN THE WHOLE WORLD:)
I KNOW SOME CHEATS.ONE OF THE CHEATS II PUT
Money Bags ON YOUR BUDDY LIS THEN ON SATURDAY
MONEY BAGS WILL APER .CLICK ON MONEY BAGS .
MONEY BAGS CAN GIVE YOU SOME BIG $$$$$$$$$$$

99.

Lay off the drugs, Lauren.

100.

How come anyone thinks GOM lost 3000$? They just lost what THEY say is the equivalent of 3000$ in virtual money.

Lz see, they break the aggreement they made with CCP and Sony upon opening their accounts, try to sell non-existant money and when scammed out of it file a complaint for 3000$ which they never had?

It's not a RL felony that's going on here, it's one virtual world cheater beating another virtual world cheater. I just find it funny.

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