Hidden in a Guardian story about the general Icelandic economic collapse:
On three shiny floors of a former fish factory is CCP, a company best known in computer gaming for Eve Online, which has 300,000 participants all over the world – as many inhabitants as Iceland itself. However, restrictions on access to foreign currency for individuals and businesses and on foreign investment into Iceland are making life difficult. “To make new games, we need foreign investors,” says Eyjolfur Gudmundsson, formerly an assistant professor at the University of Akureyri, who supervises Eve’s virtual economy. “The present currency restrictions are putting us in a straitjacket. We are in talks with the government, but if we can’t let capital in, we might be compelled to leave Iceland, even though this would be against our wishes.”
No word on if this is a lock-stock-and-barrel move or, more likely, Eve’s ‘headquarters’ moving to offshore offices, as hinted by a CCP developer in a related thread. CCP is one of Iceland’s more successful companies, so changing its mailing address to Bermuda would be kinda a big deal.
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No idea how this works, but they have an office in Atlanta… cant they just open up a new checking account there?
If I’m not mistaken, here is the problem: Iceland has put some rather draconian restrictions on foreign currency movements OUT of Iceland because the nation is just about bankrupt thanks to the local banks going bust and wiping out majority of the foreign reserves of the whole country. I’m sure Iceland is happy to take every single cent (euro or US) of hard currency INTO the country, but investors are not happy because right now there may be no way to take any potential profits OUT of the country. Converting ISK (that would be the Icelanding Krona this time) to USD or EUR, at least in any significant quantities, is currently non-trivial.
I also recall reading somewhere that CCP was planning to build a massive server co-location site at the old Kevlafik airbase – cold climate (saves on cooling) and very cheap energy (geothermal energy in Iceland is as close to free energy as you can get). The whole economic implosion of Iceland kinda put that project into doubt. I think this was to be a subsdiary of CCP, but logically one would assume that EVE game servers might end up there as well – with reasonably low latency to Iceland from both US *and* Europe. (EVE servers are located in London at the moment)
I’m sure you can find more details on this by looking up relevant searches on EVE forums where the subject has come up several times. (www.eve-search.com is useful for that)
I like how it took their professional economist dude twelve years to discover that uber dupe.
This is a good example of what government stupidity could do to its own economy. Companies could only be bend so far before they either break or move away.
You may be mistaken Jarnis.
Iceland may be limiting capital investments because at the the current exchange rate you could buy and own pretty much all of Icelands infra-structure, resources and businesse – making Icelanders little more than renters and cheap labor.
This of course make no sense with respect to CCP since they are a multi-national service business.
Said economist, Dr. EyjoG, joined CCP in June 2007. EVE Online was first released in May 2003. Where’s this “twelve years” figure coming from?
Move to Alaska. I hear you can see Russia from there.
Just one of our 57 states, eh Apache?
It’s called exaggeration buddy.
Okay so Iceland’s troubles have gone a step further – because their foreign reserves were wiped out, that tanked their currency and… well, then it’s like you said.
I wonder if in the end they just give up with their mickey mouse money and adopt Euro – either officially or unofficially.
an other for the prediction thread I guess… http://terranova.blogs.com/terra_nova/2008/10/whither-mmo-eco.html
CCP has a huge debt note to the now consolidated bank(s) of Iceland. So they may have trouble extricating themselves. Particularly if the country’s taxpayers gave them any tax rebates.
“Assets
At year end 2007 CCP’s total assets amounted to USD 47,295,214, compared with USD 18,076,407 at year end
2006, an increase of USD 29,218,807, or 262%, since the beginning of the year. The increase is explained in part
by the bank note with Kaupthing. The proceeds from the bank note were mostly invested in market securities. [EEK!]
Liabilities and equity
CCP’s total liabilities amounted to USD 33,767,943 at year end 2007 compared to USD 8,526,258 at year end
2006.”
So, when is EA buying Iceland?
I’m sure that somewhere on Goonsquad’s mothersite, plans are now being hatched to invade Iceland just for the fun of wrecking the place.
I’m sure the gov of Iceland is crapping themselves over the spectre of CCP’s possible departure. “OMG, there went 90% of our GDP” XD
umm how do i change my comment avatar, it looks like he’s strung out on meth or something.
I’m always glad to hear about EVE’s (& CCP’s) success, I see them as the champions of the niche market for subscription-based MMORPGs.
It must be trying times for them with Iceland’s economy so tanked. =/
I agree with dartwick’s perspective above. I don’t know much about Iceland’s infrastructure, but it does seem like a situation where globalization could have very strong negative impact on Iceland as a country. Economy and the good of the people is strongly linked, but the threshold hits when lives are in danger of almost literally being bought and sold. Wow, heavy stuff, it’s hard to wrap my head around it.
Does anyone else see the obvious solution to Iceland’s problem? Sell island to Activision/Vivendi, offer lifetime WoW subscription to Icelanders to pacify them, as well as free ticket to opening ceremony of forthcoming Wrath of the Lich King Theme Park (TM).
In related news, Ozzy gets new full time gig as the other Prince of Darkness, Arthas, reality show from Iceland insues.
HAHAHAHAHAHAHAHA! Its funny because it seems plausible!
-Michael
Muckbeast – Game Design and Virtual Worlds
http://www.muckbeast.com