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| The SOMER ISK for GTC model - Courtesy of FunkyBacon |
Following DNSBLACK's apparent sale of a character (the "sale" of his main was a troll), other players decided to follow suit. Many threads were locked on the EVE Online forums but the one by Katarina Reid met the requirements to not only stay unlocked but open to conduct business. Katarina contacted me and I was able to ask a few questions and get the story behind the fire sale.
Katarina is a player who started in 2009 who was on a break from EVE. Seeing the drama over the entire SOMERgate affairs, Katarina decided to contribute to the drama while at the same time trying to point out that SOMERblink was engaged in RMT. When I asked, she told me, "Come on, they [SOMERblink] get half a trillion for prizes then they get these rewards. Then I find out they have made alot of ISK with this ETC thing. I like drama in EVE so at the moment I get real money and drama." But she isn't necessarily planning on leaving EVE for good, as she's planning to keep 6 billion out of her initial 300 billion ISK in order to fund a career in faction warfare. Assuming, of course, she's not banned for RMT.
She also didn't expect to get this far in the process. "I thought I would be stopped before I started. I was thinking I get stopped then take down SOMER but I have not." Katarina was very open about the entire process. First, she petitioned CCP to see if the ISK for GTC purchase did not break any rules. After waiting a week without receiving a reply, Katarina then made a provocative post on the EVE Online stating her intention to sell her in-game assets for real life money. She even showed her post to a friend, who thought the post should be reported for violating the rules of the EVE Online forums.
When the post was not locked, she proceeded further and put in an affiliate link for the game time code reseller Shattered Crystal into her post. She sent me an update around 0230 EVE time today (2013.10.28) on how she's doing...
- Click-thrus: 986
- Tier 1 sales: 116
- Total balance: $395.31
- I get $1.75 per 60 day ETC i have sold some 30day ones but $395/$1,75 = 225 60 day ETC's which makes CCP $7800 so far.
- I have spent all day near my computer dealing with stuff till i sleep so 3 days at 16 hours a day to make $395 so $8.22 per hour.
In fact, with reports that Shattered Crystal was out of time codes, she attempted to become an affiliate of Markee Dragon. However, that did not work out. According to Katarina, "Markee Dragon doesn't want to work with me until CCP says it's ok. But when I asked about SOMER he said he couldn't talk about another affiliate."
I asked why she chose Shattered Crystal to do business with and whether she had contacted any others. "SC is where I bought my ETC's when I started," she said. "Payed $200 or more, got a character, and played mainly free since. I've put apps in with others but just 'cause SC was out of stock after I done 37 ETCs."
I also asked what she thought of CCP's response to her efforts. "Well, their response is none yet. The top brass are meeting about it. But that does show they can't tell if it's RMT right out." Thinking about the effects on the game, she continued, "I thought this would be bad in the long term for EVE. I have been thinking you get all these ebay sales, and, well PLEX is to stop people buying ISK from RMT. What if this is to stop vets cashing out [via] RMT? The more I look at it the more I don't know."
Of course, since this is EVE Online, I had to take the idea that this was a troll very seriously. But after contacting both Shattered Crystal and Markee Dragon, I feel pretty confident that Katarina is telling the truth. Let's take the response from Markee Dragon first. On Sunday I received a reply from Marcus Eikenberry, the owner of Markee Dragon, which was similar to what Katarina reported:
"We have some questions about everything as well and so we feel that it is best to not comment on anything until we know more. I can say though that CCP does not dictate who we have as affiliates. That is up to us. CCP has never attempted to influence us in any way as to who we work with. :)"I'm pretty sure that Katarina is not a native English speaker so I can't discount the possibility of a misunderstanding in translation about CCP allowing Markee Dragon to have her as an affiliate or not.
The reply from Shattered Crystal was a lot more comprehensive. I spent a good portion of Saturday night and into the early hours Sunday exchanging emails with the Chief Operating Officer of Shattered Crystal, Dennis Hutchinson. I initially sent an inquiry to Shattered Crystal describing what Katarina was doing along with her affiliate link. Mr. Hutchinson not only confirmed that the link was valid but that, "As far as I can see he is doing nothing different than one of our previous affiliates, http://cogdev.net/blink/ ."
When I pressed him for an explanation, Mr. Hutchinson first pointed me to point 2 of the EVE Time Code Bazaar rules, "Any form of ETC trading outside of the CCP created system is not permitted or supported by CCP." As I had also asked if he knew if CCP had approved of SOMERblink's "purchase GTCs, get ISK" promotion, he included that in his explanation...
"We are an authorized reseller so when the affiliate gives isk incentive to buy from us he is using the official ETC system. Shattered Crystal affiliate ###### and somer are doing the same thing. Somer gives blink credits which you gamble at a 20% loss to get isk, Shattered Crystal affiliate ###### leaves out the gamble part. It will probably be a few weeks until any official response is made by CCP, although I understand they are meeting about the situation. Anything that stops Shattered Crystal affiliate ###### scheme may do the same for somer. Somerblink has run for years and CCP has done so much with somer they just never got ask to make a direct decision about the incentives." [affiliate identification number edited out by me - NG]Personally, I disagree that the rules of the Time Code Bazaar override the EULA and ToS, but Mr. Hutchinson is the one with the 7 years experience dealing with CCP in a business to business relationship, not me. From everything I see, his explanation does fit best with the observable facts.
As determining the size of SOMERblink's operation is interesting to many people, I asked Mr. Hutchinson some questions about that. He was pretty forthcoming. First, he set me straight about the amount of GTCs sold by the Markee Dragon website. He told me that the total of 1 million GTCs sold quoted in the community spotlight included sales from Shattered Crystal, which Marcus Eikenberry founded. The community spotlight was about Markee Dragon, aka Marcus Eikenberry, not Markee Dragon the company. I had been erroneously using that number to estimate the amount of GTC referrals that SOMERblink was sending to the Markee Dragon website. Mr. Eikenberry had left Shattered Crystal following a divorce early in 2012. One million GTCs in 18 months probably didn't happen.
Another thing that Mr. Hutchinson told me was how much SOMERblink made from affiliate fees. SOMERblink was an affiliate of Shattered Crystal from 29 September 2010 to 9 May 2013 and made approximately $135,000. From looking at the records during this time, Mr. Hutchinson told me that the referrals from SOMERblink accounted for approximately one-third of all of Shattered Crystals sales (not profit) across all products. That includes game time codes, other cash cards and even copies of games for games like World of Warcraft and Guild Wars 2.
Of course, estimating the volume of sales is difficult. For most of the time, SOMERblink was receiving a standard 5% commission on all referrals. But near the end of SOMERblink's time as an affiliate of Shattered Crystal, Somerset Mahm began asking for a bigger and bigger commission. My guess is that Mr. Eikenberry, knowing what type of volume SOMERblink could drive to his site, engaged in a bidding war. Mr. Hutchinson told me Shattered Crystal let SOMERblink go when the asking price was 8% of the value of a GTC. That is probably a good guess as to how much in commission fees that SOMERblink receives from Markee Dragon for each GTC sale.
So, given this information, how much real life cash is SOMERblink making per billion ISK given out for purchasing GTCs? These factors have to be accounted for:
- An 8% commission means SOMERblink receives $1.60 for each 30-day GTC and $2.80 for each 60-day GTC sold.
- SOMERblink gives out 200 million ISK for each 60-day GTC and 100 million for each 30-day GTC sold.
- SOMERblink gives out a 200 million ISK bonus for every 4 60-day GTC sold.
- The only way to cash out is to win blinks. The house pays out an average of 80% of money bet.
So how many GTCs does Markee Dragon sell due to SOMERblink's referrals? Hard to say. A conservative estimate is to take the average number sold while SOMERblink was an affiliate of Shattered Crystal. That is probably between 2300-2400 60-day time codes per month. But since that includes when SOMERblink was first starting out and doesn't include all of the media buzz put out by CCP, I would estimate no more than 3000 60-day time codes per month. For those of you doing the math, I'd caution against sensationalism and suggest using a more conservative number like 2700 60-day time codes, which come out to around $7500 per month. I'll let those with the inclination to make spreadsheets figure out all the permutations, but I should point out that if SOMERblink is only receiving 5% of sales, which is highly unlikely, they will only receive approximately $4700 per month. The difference between 5% and 8% is huge.
Hopefully CCP will take steps to resolve the situation relatively quickly. Mr Hutchinson's estimate of CCP needed a few weeks is disheartening, but Katarina's story of waiting over a week before conducting sales does give home that a decision will come sooner rather than later. But the fact that a Katarina can conduct her business at all is an indication that something is wrong that CCP needs to fix quickly.
