Inkwell: Authors and Artists

    
Ok I've finished the book, finally, and have some thoughts to puzzle
out. I really enjoyed reading about the conversations you had with
PayPal and the IRS about whether "real-world" regulations were to be
applied to the "fake-world" commerce of the MMORPG. The fundamental
thing that still confuses me is that so many people are paying real
money for fake items. I say this as someone who has a lot of free time,
and spends a lot of that time playing WoW. I suppose if I had less
time to play, I might want to make the most of it by juicing my
characters with fancy items, but it's really hard for me to imagine
doing that. One of the great things about the game is how cheap it is:
$40 for the game, and $16 a month for unlimited playtime. But once a
person starts larding it up on eBay...

I have friends who are hardcore raiders. They raid 5-6 days a week,
leaving 1-2 days a week for farming the potions and materials they need
for raiding. These folks must be tempted to save themselves the
farming time by buying gold online, but all of them say that they do
the farming themselves. 

In any event, there are clearly a lot of people out there buying gold,
and it's a very alien concept to me. Remembering the stories involved
in the neat pieces of armor and equipment I'm carrying around is part
of the fun... The "Rod of the Ogre Magi" is a nice staff, and I'm happy
to have it, but the great thing about it is that I found it with some
friends after I'd just hit level 60, the highest level in the game. As
I was level 59 approaching 60, a bunch of us got together for a
"leveling" party, and went around killing dragons until I "dinged 60".
We shot off fireworks, drank in-game booze and stomped any unfortunate
hordies that happened into our path. Afterwards a few of us went off to
a dungeon I'd never been strong enough to visit, yet, and I found the
staff. 

Anyway, I should do more mulling.
  

    
It seems to me that one reason many folks find it hard to wrap their minds
around buying & selling virtual objects for real money is that the objects
emulate real physical goods. There may not *really* be a Staff of the Ogre
Magi, but we have in our heads what the physical characteristics of such a
staff would be -- its heft, its feel in the hand, etc. The virtual version
isn't real because it offers none of those features. Yet we are accustomed
to interacting with virtual goods every day, including those which can only
be accessed using specific kinds of software or hardware. We are happy to
pay real money for music, for example, even though when it's not in use it
exists only as bits in storage; the Rod of the Ogre Magi is just as "real"
as the music, in that -- through the use of a particular access tool, WoW on
a PC -- you can do things with it that elicit a measurable physical effect
on our bodies. Heart rate jumps during a fight; there's definite pleasure
when one is able to defeat an opponent or achieve a difficult goal. To the
degree that the Rod (or whatever) helps to make those victories possible,
the virtual item has a real-world effect, just like music.
  

    
>To the degree that the Rod (or whatever) helps to make those
victories possible, the virtual item has a real-world effect, just like
music.<

This reminds me of one concept of pragmatism, typified by W. James. 
The idea is that what has a real world effect is real. James asserts
this in the context of belief in God and perhaps elsewhere.  

Music is a good example.  Others may include audio books. Even print
books may qualify. For some people, books (e.g. the bible) may be
interactive as various passages are interpreted and reinterpreted
questing for more knowledge of God with various goals including favored
treatment at death, winning more souls, reducing doubt, reforming
existing sects, building a bigger church, getting someone elected,
etc.. 
  

    
Uh, similar reasoning could be used to prove that the playing cards in
a poker game make it exciting, or that a baseball is what makes a
baseball game exciting.  Sure, some baseballs sell for thousands of
dollars, but only *after* the game - the occasion and the players'
skill gives them value.  I think there's a similar effect in
role-playing games - things become valuable because you worked for
them, or because they trigger interesting effects created by artists
who built the game.  But valuable in themselves?  Not really.  Any
other prop would do.
  

    
A quick check-in just to apologize for my absence over the last day or
two. I am in Paris these weeks and learning a great deal about the
realities of contemporary global communications (main points: [a] all
communications are local, [b] sometimes your local ISP sorta sucks).

More to come. 
  

    
>But valuable in themselves?<

May I assume that things that are "valuable in themselves" are those
that have practical utility at the moment? If so, circumstances may
exist where gold or a hair pin or whatever are of no value. 

Perhaps the full faith and credit of the US government confers value
;-).
  

    
So: The questions and challenges have piled up nicely in my absence.
Good work, gang! Now where to begin? Jamais helpfully requested a
“fifty cent summary” of PLAY MONEY a while back. Let me see if I can’t
put together at least a quarter’s worth:

PLAY MONEY is, first of all, a true story. It’s the tale of my
encounter with what the game world calls the “real-money trade” (RMT) —
the exchange of “real” money (dollars, euros, yuan) for the virtual
items (weapons, armor, “play” money) that make up the economies of
massively multiplayer online roleplaying games (MMORPGs or MMOs). The
story begins with my announcement in early 2003 (to a blog readership
of dozens!!!) that I was giving myself a year to try to make a living
trading virtual goods and ends in April 2004, after it’s all over but
the crying. Along the way I make a friend or two, learn the true value
of a 100% Lower Reagents Cost suit of armor, infiltrate the bot-farming
underground, fail miserably in the attempt to set up a Chinese virtual
loot factory of my own, and make a minor spectacle of myself, blogging
the whole episode including, insofar as it affects the business, the
tumult of my personal life.

And there you have it, clocking in at approximately $0.28, €0.22, 75
Linden dollars, or 1 gold 85 silver (Azerothian), depending on your
primary reality. But as Jim Thomas points out, “there’s a lot to unpack
in PM,” and the story alone really just opens the box. Here’s Jim’s
helpful bullet-point list of PLAY MONEY discussion topics, partially
unpacked for your further consideration:

>  -MMOs themselves

And how. The game I worked in primarily was Ultima Online, the oldest
of the commercial MMOs, but the book also gives a peek at Final Fantasy
XI, Star Wars: Galaxies, EverQuest, and on the far horizon of things,
World of Warcraft. There’s a a glimpse, too, of their genealogy, going
back through MUDs to Adventure and on to the origins of computer
gaming, and a thought or two about what makes today’s MMOs unique in
the gaming landscape.

>  -Internet culture

Well, naturally, virtual economies being a creature of the Internet
after all. What’s interesting, though, is how deliberately they violate
one of the basic tenets of Internet culture as we’ve know it: i.e.,
roughly, Internet stuff wants to be free. What’s often celebrated about
the Internet is the ways it does away with scarcity, but a large part
of what draws people to virtual worlds is that they impose scarcity on
their inhabitants, with the full range of hilarious consequences
documented in my book. This complicates our picture of what the
Internet is about, to say the least.

>  -Economic shifts

OK, so I’ve hashed out some of this elsewhere in the thread, but
basically the argument is this: The contemporary global economy is
increasingly shot through with the phenomenon I’m calling
ludocapitalism, of which virtual economies are just the iceberg tip (or
coal-mine canary, if you prefer). “All that is solid melts into air,”
wrote Marx, and the argument starts there: With the relentless drive
toward abstraction that Marx saw as one of capitalism’s fundamental
logics, and an exploration of that logic’s affinity with the realm of
play and games. I look to Weber to dress this Marxian frame with an
understanding of how the religious imagination has helped form
capitalism (yes, Jim, I’ll get back to this!), and I switch partners to
get some ideas from Johan Huizinga about how and why the ludic
imagination might now be taking religion’s place. Finally, I draw on
Alan Turing’s formulation of the “universal machine” to help elucidate
the essentially gamelike nature of computers and the way their
increasing economic importance reinforces the gamelike aspects of
capitalism. To review, then:
Marx+Weber+Huizinga+Turing=LudocapitalismTheTheory. Next question.

 > -Subtle (and occasionally not so subtle) socio-political theory

See above.

>  -Changing legal issues

Hooboy. So yeah, reams of legal theory are being written about the
nature and potential legal status of virtual property, and I gloss some
of that in PLAY MONEY. There are also some interesting conversations
with the IRS about whether virtual goods received as barter or lewt
should be taxed as income, and if you think that’s an easy question to
answer, you should share your thoughts with the IRS, because they’re
still scratching their heads over it.

>  -Psychology of games

Indeed. Much of which comes down to the question floating around
elsewhere in the thread: Why would people pay real money for fake
items? A related question being: Why would people play games that feel
so much like work? Both of which I leave as an exercise for the reader.
  

    
The "Chinese virtual loot factor[ies]" you mention are a particularly
fascinating aspect of this phenomenon, as they presage a fairly radical
reimagining of globalization. Cory Doctorow offered his peek into what that
new virtual globe might evolve into with his short story "Anda's Game."

http://www.salon.com/tech/feature/2004/11/15/andas_game/

Julian, tell us a bit more about these loot factories.
  

    
A bit of film of Chinese gold farmers on YouTube:

<http://www.youtube.com/watch?v=ho5Yxe6UVv4>
  

    
Nice pointer, Jennifer. And here's a little more context for you all:

http://www.chinesegoldfarmers.com

That site was set up by Jin Ge, the Shanghainese filmmaker who's doing
the documentary that's excerpted on YouTube. I recently had the great
and very strange pleasure of traveling to China and visiting a few of
the gold farms he's looking at, with him as my guide, and I must say it
was eye opening, even for me. 

Keep in mind the typical take on the gold farms, as represented by
this recent London Times article reprinted on the Fox News site:

http://www.foxnews.com/story/0,2933,215860,00.html

Here we see the Chinese workers exploited and exploiting, holed up in
near-sweatshop conditions and ruining the game for everybody else --
"mugging" regular Western players to take their loot and sell it back
to some other Westerner. 

Personally, I've never put much credit in reports of active
malfeasance by gold farmers. I've put in a *lot* of hours in WoW and
never had a bad encounter with a gold farmer or heard of any such thing
happening to anyone I know. Besides which, it doesn't square with the
logic of the business -- why invite complaints to the GMs about you
when getting your account suspended costs you a lot more than any extra
profits you'd get from harassing other players?

What I did believe, though, was the image of the workers as
downtrodden drones -- immigrants just off the bus from Fujian maybe,
clueless about the world of games but desperate for work and happy to
sit at a computer all day long following an endlessly repetitive
scripted routine for farming gold. 

And that was where I came in for a surprise. 

It's not that the work isn't on some basic level a misery. You punch
your time card at 8:30am (if you're lucky; 8:30pm if you're pulling a
night shift), you work 12 hours with two 45-minute meal breaks, 7 days
a week, one day off a month, and after you're done you have an hour or
two of leisure before you go to sleep in workers' quarters upstairs
from the shop, 5 or 6 to a room on plywood bunks. For this you make
about $4 a day, which even in China isn't great, in a job most other
Chinese think is a little dodgy and at any rate not a stepping stone to
better things.

And yet:

I pulled a shift myself, in a "power-levelling" shop in Jinhua, China,
where Westerners pay to have the workers level up their characters for
them. I did the whole 12 hours, taking some European World of Warcraft
player's character into the player-vs.-player battlegrounds, an
activity I *love* when I'm playing -- and found grindingly enervating
to do for 12 hours straight with a supervisor keeping track. That much
I expected. What I didn't expect was the little crowds of other workers
who would gather around me, calling out advice, asking to sit down in
my place to try out this or that move, shouting and hooting when I died
-- *gaming*, ferchrissake.

Nor was this just an observer's effect, the locals amused by the white
guy giving it a shot. There were similar interactions going on all the
time, here and there, between the workers themselves. And when the
shift ended, can you guess where all the workers headed to spend their 
2 or 3 hours free time? Sure, a few hung out in their rooms, a few
watched television in the common room, but most of them descended to
the Internet cafe on the first floor of the building to PLAY WORLD OF
WARCRAFT. 

And yes, of course, there's a big difference between playing your own
character for your own purposes and playing someone else's for work.
But I spoke to a lot of these guys, and one of the conversations that
sticks with me was with two who told me, yeah, the job was interesting
at first but now it's a drag and a dead end and so forth. But when I
asked them if, nonetheless, when they found themselves battling a
monster and coming close to dying, their adrenaline didn't still flow
and their hearts still beat a little faster, they thought about it for
a bit and said of course.

They were still players, in other words, even when they were working. 
And I'm still trying to sort out what that means.  
  

    
Do you have any information on how long a given gold farmer will last at the
job? Is this something that they do for a few months, then move on, or is
this something they would willingly do for a year or more?
  

    
I spoke to many that had been on the job for a year or more. I think 2
or 3 years was about the maximum. And the oldest farmer I talked to
was 30, the average being much lower, around 23.

But that doesn't mean they all burn out and leave the business
altogether. The owners and supervisors -- those who had committed to
the business as a profession, for better or worse -- had all started
out as laborers as long as 5 or 6 years previously.

This too, by the way, was a surprise to me. In my imagination -- as in
Cory Doctorow's -- there was a big gap between the exploited workers
and the exploiting shop owners, whom I pictured as middle-aged
businessmen moving in on a subculture that only interested them as a
market. In reality, the owners hadn't moved in on anything. They had
come up through the ranks. And like the people they employed, they were
still gamers at heart.
  

    
So, an aeon or so back I wrote:

“As Max Weber points out in ‘The Protestant Ethic and the Spirit of
Capitalism,’ religion succeeded famously, but only once, when it turned
profit-seeking into a kind of sacred practice at the beginning of the
Calvinist revolution. And the end result was modern capitalism, which
soon kicked away its religious supports as an irrational, inefficient
framing device, leaving us trapped, Weber argues, in an ‘iron cage’ of
economic rules. Without the spiritual motivations of the Puritans to
drive us, he says, the only honest motivation we can have for
participating in this system is the universal urge to play games.”


To which jimthomas replied:
 
“Somebody might clarify the Weberian connection for me. I'm not sure
what's meant by ‘religion succeeded famously, but only once...’ --
succeeded at what? Is there a cite for this? It doesn't seem to be what
he's saying either in PE&SoC or in his Sociology of Religion. Weber
saw an interplay between some forms of Protestantism, especially
Calvinism, and capitalism, not a causal relationship. Other religions
(e.g., Islam, Judaism) succeeded by accomodating in ways unlike
Protestantism.

“Weber would likely argue that the motivation to participate in the
system is no longer asceticism or ‘calling,’ but the desire for more
worldly pleasures that result from obtaining resources. I'm not
convinced that Weber's analysis as all that relevant.”

In response to which I’ll say this: 

I haven’t read Weber’s later work on religion, Jim, so you’ve got me
there; and as both you and robflink have discussed, one of the great
things about Weber is how little interested he is in squeezing complex
social phenomena into one-size-fits-all explanations. 

That said, in “The Protestant Ethic and the Spirit of Capitalism” I
think he is clearly interested in shaking people out of their
one-size-fits-all Smith-and-Marxian understanding of the origins of
capitalism, specifically by showing how strongly the case can be made
for an explanation that privileges cultural — indeed spiritual —
factors over the strictly material or economic ones that are usually
put forth. And that to me is the relevance of Weber’s argument to mine
— that he expands the realm of motive forces underlying capitalism
beyond the bounds of the economic to include the religious and even the
ludic imagination. 

Yes, the ludic, and I’m not just projecting that onto Weber’s argument
either. Here’s the relevant quote, from the last pages of PESC where
he’s thundering on about the tragedy of the ‘iron cage’ and lamenting
the directions of contemporary capitalism:

“In the field of its highest development, in the United States, the
pursuit of wealth, stripped of its religious and ethical meaning, tends
to become associated with purely mundane passions, which often
actually give it ***the character of sport.***”

My emphasis, of course. And you could say I’m stretching a point that
Weber makes in passing, but given the central turn of his argument —
his privileging the role of imaginative factors in the rise of
capitalism — I don’t think it’s such a stretch. 

What do you think?
  

    
Jamais, Vince, and Jennifer all asked variations on the question
"Where are virtual economies heading?" and it's a good one.

Jennifer, to address your emphasis on the interface between virtual
and real economies, and particularly the weaknesses of eBay, well, heck
yeah. It's precisely the frauds and scams that go on in eBay (which
keep in mind offers fully insured fraud protection for just about every
sort of transaction *except* virtual-item sales) that game companies
sometimes point to when explaining why they ban RMT. But the reasoning
there is circular of course: As long as RMT is banned, there's nowhere
for it to happen except in unsafe places like eBay. 

Look what happens, on the other hand, when companies embrace RMT and
give players the tools to make it safe. This can be a partial embrace,
as in Sony Online Entertainment's setting aside a small number of
EverQuest 2 servers where RMT is both legal and facilitated by in-game
exchanges. Or it can be total, as in Linden Lab's Second Life, where
the company both makes the market in in-game currency and sanctions
third-party enterprises like SLExchange and SLBoutique, websites where
players can shop for SL merchandise, pay real money for it, and see the
goods immediately transferred to them in-game.

Whence we arrive at today's Official Answer to the question "Where are
virtual economies heading?": Toward legitimacy, is where. 

More and more, game companies will be recognizing the
short-sightedness of stigmatizing RMT as cheating and will accept it,
instead, as just another mode of play, like PvP or role-play. And I
will bet you dollars to Linden dollars that as this acceptance becomes
universal, 99 percent of what Edward Castronova, the London Times, and
maybe even you yourself find unsavory about RMT will go away like
bootleggers folding up after the repeal of Prohibition.

That, by the way, is what we in the punditry trade call a
*controversial* prediction, and you are all quite welcome to disagree
with it. 

I dare you to, in fact.

No wait, I double dare you. Yeah. 
  

    
I'll take that challenge!

The reason that real money trading is successful in Second Life and
less so
in games like WoW and Ultima has less to do with its legitimacy per se
than
with the nature of the virtual worlds themselves. To turn that around,
in
fact, the only reason why Second Life can so successfully legitimize
RMT is
because of the structure of the virtual world.

It comes down to competition.

When I enter Second Life, my perception of myself -- and the
perception of
others -- as successful or "powerful" in the world comes from my own
creative capabilities. This is by its very nature subjective, and
someone
can easily think of himself/herself as creative and cool, even if
others
disagree. The degree that RMT facilitates the expansion of one's
options   
and abilities in Second Life depends upon how much one's
self-perception  
*and peer perception* depends upon the kinds of virtual stuff one has.

To put it simply, your buying goods and money via RMT in Second Life
does
not objectively advantage you over me, as perceptions of success are 
subjective in a non-structurally competitive environment.

In World of Warcraft, conversely, competition is inherent to the
structure of the virtual world. I can objectively measure my success
against yours through criteria like level, statistics (HP, mana),
quality of gear, and so forth. While there are some people who play
with non-competitive success goals in mind (seeking out the most
unusual outfits, for example), the game structure does not encourage
that. There are aspects of the game that directly pit players against
each other in battle, where objective qualities like level, stats,
gear, etc. matter greatly.

To put it simply, your buying goods and money via RMT in World of
Warcraft (and similar virtual worlds) puts you at an objective
advantage over me, not because of luck or the randomness of the world
itself, but because you took an outside-the-world step to improve your
inside-the-world competitive capabilities.

That's inherently problematic, and any legitimacy granted due to
official recognition wouldn't do a lick to reduce the perceived
unfairness (and, dare I say, corruption) of RMT-acquired gear and money
in a competitive virtual world.

How's that?
  

    
(stupid cut & paste EOL errors...)
  

    
>My emphasis, of course. And you could say I’m stretching a point that
Weber makes in passing, but given the central turn of his argument —
his privileging the role of imaginative factors in the rise of
capitalism — I don’t think it’s such a stretch. <

This puts me in mind of Ortega y Gasset's discussion of the sportive
origins of the state which is a some what playful discussion of the
serious impact of play. 
  

    
Thanks very much for coming back to that question, Julian. As someone
who loves business and games both, it's at the heart of things for me.

I agree with (cascio) that outside transactions can really ruin the
gaming experience. Emphasis on "can" and not on "must". I wonder if it
might be worth experimenting with separate transaction servers, just as
there are PVP+ and PVP- servers today. People who enter them would
know the rules when they did. The gaming company could provide the
interface, perhaps in the form of an intermal/external escrow service.

This provides real-world/virtual-world trades that could benefit
people who have more money than time, and also provide a way for
businesspeople to turn their play efforts into cash. Perhaps some items
could be sold, while others remain no-trade to retain the value of
achieving them. That's a common game mechanic, and everyone would
understand it.

The larger and more difficult questions of bot-farming and
gold-farming are harder to address. For one thing, huge infusions of
cash can be deadly to the closed economies of game worlds. One game I
play now doesn't allow alts to transfer goods and currency to a main
account, just to discourage that type of farming and discourage
inflation.

The issues mirror some of the problems with large corporations in this
world. When a business entity works solely to increase profit, and is
large enough to rock the economy, it can cause a lot of pain in other
ways, or create outcomes that actually harm society. In the case of
games, the "pain" is that farming can suck out the fun in many ways,
and if you lose the fun, you lose your players.

Well, maybe I could argue that this is true in the real world as well,
but I'm not up to it tonight.

I'm biased towards really excellent in-game customer service. Most
games skimp on this terribly. You need real human eyes, lots of them,
who know your game and your players intimately, and who can personally
intervene in cases that are abusive. But I don't see signs that games
are moving in that direction.
  

    

  (and a reminder for those following this conversation by way of
  the World Wide Web, but not members of the Well: you may, if it
  pleases you, join in, by sending your comment, remark, thought,
  query, witticism, observation, insight, or other contributions,
  by e-mailing inkwell@well.com, and we can post on your behalf.)
  

    
>turn their play efforts into cash.<

Isn't this a common dream,(not that the game has the same pleasures
when it happens)?
  

    
Yeah, I think it is, and it's one thing the book talks about.
  

    
>Isn't this a common dream

Not necessarily.  Some people have more real world cash than time
in-game to earn currency.

Example: I was in a position when playing Anarchy Online a few years
back where I was working 60+ hours per week _and_ trying to game.  A
very rare weapon that was pretty much my ideal end-game weapon dropped
and was offered up for sale.  I didn't have the in-game currency on
hand to buy it, but for what I made in a couple hours of work I could
easily purchase enough "credits" via Ebay to afford the item in
question.  And that's just what I did with zero regrets...  That one
item considerably increased my enjoyment of what little game time I
had.  I personally haven't encountered that same need in WoW, but I
certainly understand where people are coming from when they do decide
to go that route.
  

    
> This puts me in mind of Ortega y Gasset's discussion of the sportive
origins of the state which is a some what playful discussion of the
serious impact of play. < 

Interesting! Can you elaborate a little and tell us where he wrote
that? It sounds a lot like some of Huizinga's theses in Homo Ludens. 

(And what do you know, Wikipedia tells us Ortega published Huizinga in
his Revista de Occidente sometime in the 1920s or 30s. I wonder which
way the influence flowed, if at all.)
  

    
> Example: I was in a position when playing Anarchy Online a few years
back where I was working 60+ hours per week _and_ trying to game.  A
very rare weapon that was pretty much my ideal end-game weapon dropped
and was offered up for sale.  I didn't have the in-game currency on
hand to buy it, but for what I made in a couple hours of work I could
easily purchase enough "credits" via Ebay to afford the item in
question.  And that's just what I did with zero regrets...  That one
item considerably increased my enjoyment of what little game time I
had. <

Great example, and a couple thoughts:

1. I'd been thinking that the reasons RMT is so uncontroversial among
non-U.S. players must be cultural, but I wonder, thinking about Jazzy's
case, if there isn't an economic element to it also. For Jazzy, coming
up with enough cash to buy the weapon was a matter of a couple hours'
out-of-game work, as opposed to the many hours' gaming he'd have had to
put in to farm the credits for the wep. In a labor market like
China's, though, the number of hours' "real" work necessary to buy the
credits approaches the number required to farm them. Hence RMT is
inherently less "unfair" there (though in a way that depends on
"unfairness" elsewhere, since the calculations depend on virtual-item
prices' being set in Western markets).

2. On the other hand, it's my understanding that RMT is less
controversial in Europe than the U.S. also, and over there (uh, here;
I'm still in Paris!) an hour's work buys at least as much play money as
in the U.S. So I still think cultural differences are key, and at a
guess I'd say the main difference is the American emphasis on
individual achievement and competition, Horatio Alger style. Which of
course highlights the importance of Jamais's points about
competitiveness and RMT. But more about that in a bit.
  

    <scribbled>