Monday, July 11, 2011

A Look At The PLEX Market After Incarna's Launch

I think players in Eve Online generally agree that the launch of the Noble Exchange (NeX) was, to put it kindly, less than optimal.  One of the objectives of the Noble Exchange was to reduce the amount of unused PLEX in New Eden by offering items that players would want to buy for the new Aurum currency that is only obtained by breaking down PLEX.  So I thought I'd looks at the PLEX market again almost 3 weeks after the launch of Incarna.

Just as a reminder, at the end of May the price of PLEX hit 410 million ISK in Jita and around 400 million in the other major trade hubs of Amarr, Rens and Dodixie, apparently due to an influx of players chasing too few available PLEX.  Once the spike of players dropped, the price of PLEX dropped down to the 370 million to 390 million range, depending on the market region.

The market saw a speculative bubble occur on launch day (21 June) and then a steady decline until Saturday (26 June) during which time the leaks of both the Fearless newsletter and the leak of the Hilmar internal email occurred.  The PLEX price stabilized and then rose a bit (at least in Jita) following the announcement of CCP calling the CSM to Iceland for an emergency summit.

The price of PLEX actually fell again on 1 July after a joint statement from CCP and CSM failed to materialize.  Did the uncertainty in the future of Eve cause the drop?  I don't know, but after the joint communique and video blog appeared on 2 July the prices stabilized.  On 9 July, prices again began to fade after CCP issued a dev blog on 8 July explaining the pricing strategy of the Noble Exchange.  I am guessing the market was as impressed as I was at the marketing strategy.

Is a lack of demand causing the price drop?  A look at the numbers shows that demand has not decreased.

The 7-day rolling average of the number of PLEX sold each day in New Eden's four major trade hub regions shows that while the sales have dropped almost 6% since 1 June (3405 to 3203), that number is not really indicative of the direction of the market since that figure includes the bubble that occurred at the end of May that coincided with holidays in both the U.S. and U.K.  A better indicator of the effect of Incarna is looking at the number on 20 June, the day before Incarna launched.  Even with the events called Monoclegate leading to players leaving Eve, the number on 9 July is still up slightly over the day before launch (3184 vs 3203).

So if demand is constant, why the drop in prices?  Supply.  I started taking snapshots of the PLEX market in the four major trade hub regions every Sunday and found that the supply of PLEX for sale had risen by 29.5% from the Sunday before Incarna launched to yesterday.

While I don't have the ability to look at the numbers throughout all the regions, CCP can.  I believe this growth rate in the PLEX supply is the reason that the PLEX reward for the Buddy Program was discontinued on 7 July.  After all of the talk about the need for improved communication, I am a bit surprised at the language in the announcement.
"The PLEX reward option for the Buddy Program will be going on temporary hiatus as of July 7, 2011. This means no new PLEX based invites can be sent after that date. This is a planned part of the experiment to measure the effects of the program on the PLEX market and to find new ways in which we can evolve the Buddy Program for our players. The program looks to be very successful initially and will likely return within a few months.

"Players can still send Buddy invites normally after July 7, but the only reward option will be 30 days of game time; as before."
Perhaps CCP Fallout was referring to the increase in numbers that I keep referring to that occurred at the end of May.  In that case, yes, the program succeeded.  But at a time when CCP is attempting to remove PLEX from the economy, a program that adds them does not help matters.  Maybe the program will return if the Noble Exchange gets its footing and starts attracting all the PLEX hanging around New Eden.  However, with the current pricing structure where even a mid-tier outfit costs about what I normally where to work each day, I really don't see that happening.

Looking back at my last article on the PLEX market, I think I'll forgo making any predictions.  Here is what I posted back on 20 June.
"I really have the feeling we are about to see the price of PLEX rise even higher in the near term future.  But time will tell.  That's what makes Eve fun.  You never really know what to expect next."
Given the contents of this post, I think I'll chalk that up as one prediction that didn't come true.


  1. I think it is pointless to speculate on the economic impact of a store that barely has anything in it yet and whose products can't serve their primary function as long as they can't be worn outside the CQ.

    Your analysis is outrunning the events.

  2. Can you cite a source that suggests that this is "a time when CCP is attempting to remove PLEX from the economy"? Or are you referring simply to the fact that the NeX store is a PLEX sink?

    For Aurum to be generated, a player needs a PLEX. Where some players will simply pony up the cash for a PLEX to convert, others will be purchasing them from the market. Where supply and demand end up is really going to fall on out-of-game decisions by players about what they are willing to spend real money on: ISK or virtual designer jeans.

    I don't think we have enough data to make any predictions one way or the other.