Joystiq has a fascinating interview with Hoyt Ma, project manager for World of Warcraft’s Chinese distribution.
The subscription model for WoW in China is different from other parts of the world. Instead of a monthly subscription fee, Chinese gamers purchase WoW Points cards for 30 Yuan ($3.64) that are worth 600 points. Points expire at a rate of 9 per hour of play, so this amounts to 66 hours and 40 minutes of play for each card at an average of .45 Yuan ($.06) per hour.
#1 by FNORD on February 12th, 2006
So, best rate I can get here is 12.50/month. So, it meet our price, they need to play for an average of more than 208 hours per month. So, unless they spend seven hours a day logged on, they get a better deal. Hmm.
#2 by Goemagog on February 12th, 2006
profit
#3 by Goemagog on February 12th, 2006
that should be profit is less important than inflating the subscriber base.
Goe, cause it ate most of my poor widdle post.
#4 by Psychochild on February 12th, 2006
I don’t think it’s really any trickery on their part, that’s just how online games work in Asian countries. Plus, wages are significantly lower in China, so they pay less for things.
On the other hand, here’s a handy link to prove that Blizzard isn’t making 5.5M x $15/month.
#5 by Patrick McKenzie on February 12th, 2006
In Beijing, the city with the highest average salary in China, that salary is roughly $430 monthly. A player with a moderate WoW habit, say 10 hours per week, would pay roughly $2.40 for WoW access. As a percentage of income, thats equivalent to a young American with a $28,000 salary paying $13 a month.
I believe you also generally have to pay for your time at the Internet cafe on top of that but am not positive.
#6 by Dom on February 12th, 2006
I’m assuming it’s the same system in the other Eastern countries, too. Obviously Korea has its baangs, but WoW was also released in Taiwan and stuff, so do they use a similar model of internet cafes? Or am I making totally baseless assumptions?
If they do, then the only locales which pay the monthly subscription are “North America” (which includes Australia, baffling all geography fans) and Europe. I think they both have roughly 1 million subscribers, which is obviously still pretty bloody good, but it definitely doesn’t sound as good as “5.5 million zomg!”
#7 by Kalain on February 12th, 2006
Could this have anything to do with the generally wonky chinese economy? We complain constantly that they rig it so their people pay less for goods than anyone else.
That aside, asia has always done this model of MMO pricing, same with their habit of letting beta characters go live. Europe and NA don’t buy into that, and we’ve got our monthly fees and short head starts.
#8 by Guest on February 12th, 2006
A bit tangential, but points which only have one purpose are spent in units of nine? Why not, oh, charge one point an hour, charge nine times more, and sell them in batches nine times smaller? Or charge sixty points an hour and adjust the fees accordingly?
#9 by Cael on February 13th, 2006
Psychochild’s link seems to be missing…..
But Patrick MacKenzie seems to have nailed the issue. If you got out your oiuja board and asked Adam Smith, he’d say that the overall price to a North American player and a Chinese player are identical since similar rewards are earned with similar amounts of working time.
#10 by Psychochild on February 13th, 2006
Psychochild\’e2\’80\’99s link seems to be missing\’e2\’80\’a6..
I meant the link that Scott posted.
I’ve seen a lot of people argue that since Blizzard is making $80M+ (5.5M players * $15) per month they should fix stuff faster. They are making a lot of money, don’t get me wrong, but not quite that much.
#11 by Jason on February 13th, 2006
A bit tangential, but points which only have one purpose are spent in units of nine? Why not, oh, charge one point an hour, charge nine times more, and sell them in batches nine times smaller? Or charge sixty points an hour and adjust the fees accordingly?
Same reason frequent flyer miles are accrued in hundreds and thousands and spent in thousands and tens of thousands. People respond better to larger numbers. Plunking down your hard earned cash for 600 points “feels” better than spending it for 66 points. I’m surprised they didn’t go with the 1 minute = 1 point and just sell them in chunks of 4000. Same approximate value but with a larger psychological reward.
But then again they get kudos for doing it as 9 points per hour. It allows the calculations to be mildly confusing enough to the point where people won’t argue about rounding errors. Of course, there could be another reason for the 9 points per hour, but I’m a cynical bastard when it comes to business.
#12 by Fred on February 13th, 2006
A straight minute to point conversion has the side effect of giving the player a sense of urgency since every minute another point slips away, which the publisher probably doesn’t want (since this leads to watching minutes more closely). An hour is a more substantial chunk of time, so it’s more likely you’ve done something that feels productive in it.
#13 by Jessica Mulligan on February 13th, 2006
Yes, players who access the game from an Internet cafe pay a fee on top of the WoW fee. The standard seems to be about 2 yuan per hour, which is about 25 cents US.
#14 by D-0ne on February 13th, 2006
They could offer WOW for free in China and I wouldn’t care. Frankly, I’m so Damn glad I’m not living in China that well… God Bless Bliz for offering those poor people WoW at all.
Come on people, the Average hourly rate for labor in China is $0.03 an hour.
#15 by slog on February 13th, 2006
Actually, Adam Smith would say something else, and it would have been wrong.
This is an example of Market Segmentation. Different markets (in this case China and the USA) pay a different price for the same product due to the supply and demnand structure in said Market.
It’s perfectly normal, and works because 999.99% of American players will not play on a Chinese server.
#16 by Brask Mumei on February 13th, 2006
9 points per hour lets you silently change the burn rate to 10 per hour without changing the card price or card point value.
Visa did this recently with my card “points”. I still earn them at 1 per dollar, but the exchange rate back to coupons was stealth-nerfed to 125 for $1 from 100 for $1.
#17 by Kalain on February 13th, 2006
Yep, wierd point values let you change the rate later up or down, without having to go into decimals. I was looking, but I can’t seem to find chinese shopping sites or anything nearby. I wanted to compare the prices of other things we buy to the equivalent in china. Easy stuff, like bread and milk.
#18 by Elistor on February 13th, 2006
Gota love the CIA’s website, not quite what Kalain was looking for but interesting info.
China
GDP – per capita: purchasing power parity – $6,200 (2005 est.)
Population below poverty line: 10% (2001 est.)
Inflation rate (consumer prices): 1.9% (2005 est.)
http://www.cia.gov/cia/publications/factbook/geos/ch.html#Econ
USA
GDP – per capita: purchasing power parity – $41,800 (2005 est.)
Population below poverty line: 12% (2004 est.)
Inflation rate (consumer prices): 3.2% (2005 est.)
http://www.cia.gov/cia/publications/factbook/geos/us.html#Econ
God alone knows how acurate that is. Ohh and theres always the big mac standard. http://www.economist.com/images/20040529/CFN894.gif
#19 by Kalain on February 13th, 2006
Oddly, the big mac standard helps a lot. That SCARES me. But it does seem like the chinese are getting ripped at this rate. They pay a little more than half what we do, but don’t actually make nearly half what we do (on average, in both cases).
#20 by Djamonja on February 13th, 2006
“Oddly, the big mac standard helps a lot. That SCARES me. But it does seem like the chinese are getting ripped at this rate. They pay a little more than half what we do, but don\’e2\’80\’99t actually make nearly half what we do (on average, in both cases).”
Keep in mind that China is still a developing country — they’ve got around 1 billion people, but probably 500 million of that billion are still living in relative poverty and will bring down the average income or GDP per head a fair amount. The ~300 million who would currently be considered a middle-class in China are the ones making enough money to play games like WoW at internet cafes.
#21 by Kalain on February 14th, 2006
But the CIA numbers make it appear the relative poverty isn’t that much worse than the US. Is their lower class just HUGE? And if so, where are the millions of game players coming from, and what’s their average income?
#22 by Shawn on October 4th, 2006
You have to remember that the poverty level for each country is based on that countries economy rather than an overarching model. For example, someone in the US who is considered under the poverty level still usually has electricity, a television, cable, cell phone,etc…while someone in China at the poverty level might be lucky to have electricity..its all relative to the economy that the level is set at.