MMORPG.com has a “debate” between Brad McQuaid (you know, Vanguard, Everquest, vision, supercore, yadda) and… a self-righteous gold farmer. I guess Brad was bored that day (and actually seems to have just shrugged and wandered off near the end).
The actual points you’ve all seen before dozens of times. Bad for the game. Money grubbing companies. Taking money off the table. Fighting for the little man. Purity of the game. Etc. I did like the farmer just devolving into threats at the end:
In closing it does not matter if a game is designed with RMT in mind or not, the transactions will continue to take place. It is simply a matter of time before the gaming companies choose a RMT company to work with so that they will get the piece of the market they deserve.
“You sees, Mr. McQuaid, it’s an offer youse can’t refuse.”
One thing I’ve noticed though, with RMT partisans, is a sort of dumbstruck fury that someone is trying to stop them from this great free market they’ve discovered. Damn it, they farmed that gold fair and square, and companies are banning them and taking their gold and threatening them and what the hell? Isn’t making a buck American? Whatever happened to free speech and capitalism? I paid for this game, why *can’t* I sell what I do to someone else?
Of course, I would respond that for much the same reason that I can’t run a crack dealership out of my office. I mean, I *could*. I paid for the crack. It’s my office. I don’t get it. Why can’t I sell crack? I give away a lot of crack anyway with my design docs. This is just …better crack! I’m fulfilling a service. I don’t get it. Isn’t this America? Did al’Qaeda take over and prevent people from selling crack?
Clearly, there are social reasons to block some behavior. And in most games, gold farming is a harmful behavior. The RMT partisans (at least the honest ones) can’t really make this connection, because they don’t see MMOs as a society, but merely an entertainment medium and unexploited resource rolled into one. Since to them it’s not a society, they see no harm in their actions. It’s just, you know, making stuff. Virtual stuff. Then selling it, to wacky people who pay real money for it.
So, at the other end of this spectrum is something else today I found illustrative. Second Life is as far from most MMOs as you can get in, well, most things, and among them is their RMT policy. They’re all for it! Sell all the “Lindens” you want, knock yourself out, make it a convertible currency! That after all simply validates the worth of the “second life” within the first one. (WARNING: NSFW links follow. This being SL and all.) Of course, quite a bit of those Lindens are going to things Linden Labs doesn’t issue press releases on, but, well, that just makes it more like real life, I guess. We have a real economy here – an economy driven by cat-girl harlots, but we have to start somewhere out here in Multiverseland.
Which brings us to a blog entry by Kunikos, a Quarter to Three poster who seems confused by this whole virtual economy thing. He asks, plaintively, what’s to stop Linden Labs from just, you know, messing stuff up? What’s to stop them from just printing money, since people seem to let them… print money?
How long will it be before such “real economy” virtual worlds are regulated by the real world governments? How long before the bubble bursts or an Enron style collapse occurs? Do we know that Linden Labs isn’t already siphoning off $1000′s of dollars from the economy of Second Life already?
Of course, many people immediately pointed out that Blizzard siphons off considerably more than $1000 a day from World of Warcraft. It’s called, you know, profit. But here is someone who admittedly isn’t that familiar with all the associated arguments surrounding RMT, who asks, quite rationally, are we all playing with Dutch tulips?
Combined with the tax mania currently going around the web (OMGZ BLIZZARD IS GOING TO SEND YOU A FORM 1099 IF YOU LOOT THAT EPIC) and the recent news of the Korean government getting in the act… well, pretty soon we may have Mr. McQuaid debating someone who knows the law considerably better then Mr. Gold Farmer. And no matter what side of the RMT argument you come down on… that way lies madness.
Because I’ll just come out and say it – over-regulation can very easily choke the MMO industry in its crib. No company is going to operate an entertainment business with anything close to the liabilities being bandied around. It simply will cost too much. No sane MMO publisher will fund a project that requires more lawyers than world builders. Thus, no MMOs, as we currently know them, will be published.
And that will definitely settle the argument.
{ 29 comments… read them below or add one }
Is there any sign that Vivendi is aware of this threat and is deploying out the resources in the form of lawyers and lobbyists?
And are there any good articles people could point me to that would bring me up to speed with the whole RMT debate?
A start would be to click the friendly little Nazi Girl Scout RMT icon.
Actually, the sensible model of tax on “real money” gains realised from the sale of virtual goods has been repeatedly mooted. And seems quite logical to me.
Do remember that even criminals, let along EULA breakers, need to pay tax so I’m really REALLY not concerned with that aspect.
I’d add that personally I see a great difference between Ebay and IGE. There are plenty of legal situations where an individual can resell items, but a company cannot without a contractual agreement.
Saying “OMG you cannot” may or may not stand. It’d be…smart at this point to have another clause requiring companies reselling to have sad contractual agreement.
So if IGE *did* manage to get the RMT clause anulled (and hey, it’s lawyers – logic does NOT come into it!), they’d still need a signed piece of paper saying you’d allow them to operate in your online world. Yea, right.
Well, RMT is a black market and needs to be treated as such.
Perhaps someday, someone will examine it in that light and review the answers others have found for dealing with black markets?
I know it is a gaming community filled with people who already know everything. /shrug
No, RMT is not any form of “black market”. It is not even illegal. Against EULA’s for some games, yes.
A EULA is not a law.
Overdramatising the issue just lets IGE and its ilk use their own language, and attract customers, as well as allowing deliberate witch hunts. Keep it focused and practical.
Your desire for a “war on drugs”/”prohibition” against RMT, given the lack of success of those programs IRL, frankly astonishes me.
Its a bit of a stretch to associate an activity that incites real life violence on a large scale to one that involves paying someone to do something boring for you. Its like comparing a lawn service to RMT.
Frankly I wouldn’t mind regulation. Let it choke the industry if it must, to eliminate the highly lopsized ‘contract’ that the EULA’s represent. You’re wrong though, companies will still make them. Perhaps not yours and probably fewer… which means fewer of your type jobs. Tough, that’s life, change fields.
Well the problem with the argument is plenty of RMT people are NOT earning their gold “fair and square.” Unless running 180 instances of WoW across 60 PCs hooked into a KVM switch all running bots farming in Master’s Cellar on different servers, unattended for days is somehow considered such.
Exploiting and bot running are not the same issue as RMT. People, again, like to conflate them. And even if you do, those 180 instances says that they are running it as a business, not a private individual.
See above for the answer to that one.
Well spoken, although I doubt World of Warcraft will ever get to the point of player taxation or similar government regulation. After all, their terms of service restrict the sale of any virtual goods, rendering any market based on such practices ultimately illegitimate. Sure, money’s changing hands, but it’s about as legitimate as people buying and selling illegal drugs.
Then again, I’ve heard that some states tax illegal drug sales because tax evasion carries a heavier penalty than drug trafficking. It certainly is an interesting world that we live in…
As several of the SA goons who made Second Life Safari have pointed out, Linden *constantly* “messes stuff up” by monkeying with the price of “land” in SL and occasionally “reclaims” land purchased by users because, well, because they can. (Well, that person was also hosting SA goons on his land, and SA goons fuck up EVERYTHING.)
Taxing profits from RMT isn’t going to affect the game developers at all. It seems clear that the IRS is planning on doing the smart thing to start with: only tax the realworld exchange. As such, there will be no profit until it is realized, so any player who avoids RMT will never be taxed.
What could kill the game developers is if they have to treat the loot as “profit” prior to its exchange into real world money. This way lies madness – one would need to continuosly revalue the worth of epics (some which may have never been sold, being unique) against changing ownership and worth. If the Kool Sword gets nerfed, owners would have to be able to recognize that as a loss on their tax return if they had to register the looting of the sword as a profit.
This means RMT businesses would only be able to claim profit on sales and not have to file their inventories, loss due to depreciation, etc. In a way, this makes good sense. As game developers are quick to assert, an RMT business doesn’t own the inventory. All they “own” is an option to switch some bits on a server to make the exchange. Further, this right is revocable on whim by the game developer, and, in a sense, has a fixed cost of $10/month. What the RMT business sells is a service of actually flipping the bit. It isn’t the Kool Sword that is worth $100. It is getting someone to toggle the bits on the database that is worth $100. Looting a Kool Sword cannot be said to have given you $100. It has granted you to the option to perform a service for $100. Getting a truck driver’s license, for example, doesn’t give me the annual salary of a truck driver. I’m not suddenly liable for that additional salary on my tax forms.
Taxing someone because they looted a Kool Sword makes as much sense as taxing someone because they *could* perform cybersex for money. They only time they should be taxed is when they sell the sword or perform the cybersex.
(This is all orthogonal to the question of whether changing those bits on the game server is allowed by the EULA, is legal, or what not.)
Good grief… somebody else has heard of tulipomania?
That’s made my day.
Please the tulip bubble was one of the first and honestly best ever bubble there was (sorry south seas company fanboi’s.)
Tulips? Try lupins.
“Dennis Moore, Dennis Moore
Riding through the land
Dennis Moore, Dennis Moore
Without a merry band
He steals from the poor.
And gives to the rich
Stupid bitch.”
“Then again, I\’e2\’80\’99ve heard that some states tax illegal drug sales because tax evasion carries a heavier penalty than drug trafficking.”
Tax evasion is a lot easier to prove in many cases than drug sales.
Even if only real-world sales are taxed, companies could be forced to maintain and divulge in game logs for evidentiary purposes.
And as to the idea that someone will make these games – Not if there isn’t a profit to be made. Even a crazy liberal such as myself understands how to kill a goose that lays the golden eggs.
Scott wrote:
Clearly, there are social reasons to block some behavior. And in most games, gold farming is a harmful behavior. The RMT partisans (at least the honest ones) can\’e2\’80\’99t really make this connection, because they don\’e2\’80\’99t see MMOs as a society, but merely an entertainment medium and unexploited resource rolled into one.
You know, while I see your point, I think that the anti-RMT people are the ones missing the point that these virtual worlds ARE societies and are not just competitive games. In a real society, nobody objects when someone else is paid to do something for them. If you are only looking at WoW or whatever as a competitive game you’re much more apt to look at RMT as a problem since it messes with “the game” (of course, so does giving people things because they’re your real-world friends or family). I tend to look at virtual worlds as societies, and thus my object isn’t to “win.” It’s just to exist and enjoy myself, and if enjoying myself means buying gold (ie participating in RMT), why should you care?
–matt
I should also add that that doesn’t mean that I as a developer am all about RMT, just that I as a player have no objection to it (though don’t engage in it myself due to EULA restrictions on the games I play/played.)
Matt it is also a game. It’s got rules that anyone playing has actively stated that they will play by (hitting the “I accept” button EVERY TIME you log in ). In real world games, there are also rules that people agree to play by, and most people certainly do object when someone playing real world games decides to sell their play against the rules. Consider a pitcher who decided to put each pitch up for bid – I’m pretty sure there would be some objections. The rules of the game are that those pitches aren’t actually his to sell to anyone he wants.
As far as RMT drawing government notice and involvement – I agree with Scott, this would kill current and future games. Consider: RMTers will always be able to manage to obfuscate their money transfer in some way, making it impossible for the government to actually follow their trail in a cost effective manner. So the thing for the IRS to do then would be to follow the transfers actual of items, which are easy to track. So some guy wins the lottery on the “Massive Flaming Sword of Uber Pwnage” from his last raid. RMT value for the MFSoUP is $100. As long as the player never gives that sword to anyone or only sells to a non-player merchant, he doesn’t owe anything. As soon as he trades it to another player though, according to the IRS he just transfered the equivelent of $100, and he’s gonna pay his $24 to the IRS for it. Doesn’t matter if he was giving it to a guildie who could use it, doesn’t matter if he was giving it to a noob, or his girlfriend, or anyone. If the government gets involved, he owes $24 to the IRS if he transfers it.
You want to ruin the game for people – tax them everytime they find something cool. Tax crafters real world money for making decent items in game. Tax people for just trying to help out their friends or guildies. If virtual items are recognized to have valid real world values, then you can count on the IRS to get involved eventually, and you can count on that to break MMORPGs
Add this to the quagmire in store for game designers who would no longer be free to determine the content of their games. If virtual items are worth actual money, then anything designers would do to change the value of an item would set them up for more lawsuits than their subscription fees could possibly pay for. No one would make a game with this sort of legal mess looming over them.
People who are willing to cheapen the value of their word by breaking the EULA with RMT still might want to look at the long term repercussions of their actions, rather than the short term gain they get for being a liar. Break our games, and you won’t even have the option to pay some poor devil to play them for you.
Flame away
Well, it IS the oldest profession (service).
Yes, 2nd Life’s most remarkable feature, maybe even their ONLY remarkable feature, is the RMT policy. Speaking of media twisting, I thought that was a statement about Linden removing currency from the world. It’s just a what-if… I was wondering how they would go about that, because unlike WoW, etc the money doesn’t grow on trees.
Surprising Brad M would use the most evil argument possible. I mean, that’s like hitman mentality, and we wonder why MMOs are so obscure. Instead of changing the design of the game, prop it up by spending billions on frivalous lawsuits, now THAT’S American.
I don’t have much of a problem with RMT as a concept, but in execution most of the RMT companies fail on many levels. Questionable practices for gathering currency and power leveling, and the outright lies they tell every customer about it. I’ve worked at an RMT company for a few weeks, and it was a real eye opener.
Now, if the companies would handle the RMT themselves it would be a lot better in the long run. At least the transactions *should* be just as secure as the game accounting itself, and deliveries would always be expected in a reasonable time and manner since they wouldn’t actually have to farm anything.
“As soon as he trades it to another player though, according to the IRS he just transfered the equivelent of $100, and he\’e2\’80\’99s gonna pay his $24 to the IRS for it. “
I’m not an accountant or anything, but aren’t taxes based on the value you actually receive for something, and not on the theoretical market value that you could have received? Seems he’d only owe tax on the currency he got for the sale.
Also, aren’t taxes based on the net profit, not the gross sales? Deductions on raid mats, repair costs… not to mention that since some gear is considered a prerequisite for certain encounters, it could be written off as a business expense…
This way madness lies, and even the IRS is going to recognize that the expense of tracking all these kinds of issues will a) kill the source of revenue, and b) cost them more in paperwork than they’ll make in taxes.
I reject the notion that MMOGs are societies by default or design.
It is not a given. All you can do as a developer is lay the groundwork and work like hell to cultivate the world you want to have. Ultimately, what you create is a social playground that no one is obligated to live in.
Sweetmeat, again, read the reasonable proposal that it be treated like a capital gain. You pay nothing, until you RMT. YOu then oay tax on the RMT value.
The EULA standing of the RMT is quite irrelevant to the tax men.
I also reject the notice that calling for witch hunts and using the typical politics of hysteria makes you “decent”.
J… society is nothing more than a flow of memes through time and space. Any online space which allows interaction is by definition a society.
Andrew, if cashing out at the end of the grind is the norm, then wouldn’t most MMO’s just be elf-themed illegal online casinos?
yes, Jeff. that’s exactly what they are. And just like at a Casino, if you cash out of a MMORPG you should be filling a tax form.
Of course, the anti-RMT people assure us that cashing out at the end of the grind is *not* the norm, but the exception.
Asking the game developers to be responsible for taxes on RMT is like asking sporting teams to be responsible for taxes on bets made on said teams.
I agree Brask. It should be the companies that support the sales transactions.
Jeff,
Oh, I agree that you should design to minimise it. But when you completely eliminate the skill-based argument for it (Eve-Online), it still happens.
The entire “illegal gambling” thing is… very specific to where live.
The only mechanism I’ve ever seen which has actually succeeded in smashing the market cost of their game’s currency (by a factor of fifteen) without causing in-game inflation was Eve’s gametime codes, which can be resold for in-game cash.
Then Eve goes ahead and causes in-game inflation anyway via market mechanics, but that’s another rant.
Halcyon: Good point about the deductions etc. I’m not an accountant or a lawyer either, but the internet is a fact of the future. Internet gaming will be too. My dad is 75 and he plays DiabloII with me every Monday night. These games will catch on with nearly everyone in one form or another, and at that point the revenue stream for RMT will be massive. The Congress will not ignore that money. That’s where my argument is based. Following the money may not be possible, but following the items is very easy. Items will indisputably have a monetary value. Congress gets to make tax law. How that eventually shakes out is hard to say, but I don’t expect anyone here to like it.
Either the EULA is given force of law and RMT becomes an illegal thing ( much like the war on drugs ), or items will have real value and taxes will find their way in. You can’t have it both ways with the kind of money that will be generated someday. I wonder if Biff will be willing to be Bubbas’ bitch for 3 years in the slammer for that PHAT LOOT.
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