Wednesday, April 22, 2015

The WoW Token Two Weeks Later

Two weeks ago Blizzard introduced the WoW Token for sale on World of Warcraft's North American realms. A lot of people were surprised at the initial price point of $20 or 30,000 gold. I don't understand why, as the figure fell into line with the price that gold sellers were charging. But what about now? How has the WoW Token market price for gold fared against the prices charged by the sellers of WoW gold?

First, the WoW Token, after a brief climb to 31,218 gold on the first day, settled into a range between 20,000 and 24,500 gold starting on 10 April. That range put the Blizzard-approved price of WoW gold between $24.50-$30.00 USD for 30,000 gold.

When I've discussed CCP's approach in its War on Illicit RMT, I've described the price of PLEX as part of the "top down" element of its strategy to make illicit ISK and PLEX sales as unprofitable as possible. With the introduction of the WoW Token, gold sellers now have to compete directly with Blizzard when selling gold. Worse, from the gold sellers' point of view, they have to offer a substantial discount due to the possiblity of Blizzard catching buyers and taking action against them, such as seizing all of the purchased gold. I call the difference between the official price and the price gold sellers offer the "hazard discount".

WoW gold prices on Earthen Ring (Horde)
So what is the hazard discount needed to entice WoW players to buy illicit gold? In an effort to determine that figure, I surveyed 12 websites that sell WoW gold that I found either through Google Ads or listed on Google. I know that each website is actively competing for gold sales, as each has posted at least 4 price changes over the past two weeks. The graph above displays the lowest, median, and highest prices for 30,000 pieces of WoW gold found on the twelve websites. As a point of comparison, I also graphed the lowest daily sell price for WoW gold purchased using WoW Tokens, converting the U.S. dollar value to the amount required to buy 30,000 gold in order to make the comparison clear.

After looking at two weeks' worth of data, I still can't determine the answer. The price of illicit ISK has fallen the last 12 days. The only price pressure that the WoW Token has put on the gold sellers is existing. But that's enough, because the gold sellers are still attempting to find the sweet spot. Or are they? I get the sense that the gold sellers are losing a considerable amount of business to Blizzard. But are the gold sellers still competing with Blizzard, or are they competing with each other over winning market share of a reduced clientele?

One thing enabling illicit gold prices to continue to decline is that the gold farmers/botters have not decreased their activity. In a thread on the Honorbuddy forums, one gold farmer was complaining that prices offered by wholesalers had declined to $0.12-$0.14 / 1000 gold. From what I gather, that is an extremely low price. The prices are getting low enough that some farmers are getting frustrated.

A disgruntled gold farmer
So far, the WoW gold selling sites have benefitted from a compliant farming/botting community. Even so, the gold sellers will eventually hit the limit to what gold farmers/botters are willing to accept. I believe at that point we will see the price finally stabilize. At that point Blizzard can then ratchet up the pressure on the botters and farmers and convince them that the small amount they are earning isn't worth the hassle and see a lot of them leave the field.

At this point, Blizzard appears well-positioned to knock a lot of RMTers out of the business. But even then, that is only a first step. With less competition, those remaining can sort matters out and create a new price and supply equilibrium.  Remember, the WoW Token, just like PLEX, is not a quick fix to the problem of illicit RMT. But with enough time, Blizzard can hurt the wallets of the gold sellers.


  1. Noizy,

    Do you think your top down, bottom up, get out analyses reveal a conscious strategy choice by those companies that are utilizing it. To clarify using Eve, do you think CCP was aware that introducing Plex would be a major step in a comprehensive antibotting strategy that also happened to hand them another income stream or, rather, do you suspect that the entire approach ‘gelled’ together after the fact when, one step at a time, CCP stumbled across a surprisingly effective comprehensive strategy?

    I don’t intend this question as convoluted method of diminishing CCP’s ability since recognizing serendipity when presented is no small skill, rather I’m curious when you started to see the coherent pattern emerging.

  2. I don't know that CCP had such a strategy in mind when they created PLEX in 2008, but they definitely created PLEX to combat RMT. I can say that Darius JOHNSON, when he was working at CCP as CCP Sreegs, openly stated at Fanfest 2011 that his strategy in combating RMT was to make selling ISK as unprofitable as possible.

  3. I think it's completely appropriate to conclude that the illicit gold sellers are being ground up by this. Of course, there is no way to determine how badly until they either go belly up or stabilize their price at some equilibrium point.

    Blizzard, on the other hand, has an enormous war chest at their disposal in that they can adjust the rules and set the price of the Game Time tokens to whatever they want simply by detaching the link from the RMT tokens in the item shop and the Game Time tokens in the AH, and that's assuming they haven't already done so.

  4. Great read as always on RMT stuff, there seems to be a lot of people in the EU wondering why the price was set at £15/€20 and a higher starting price of 35k gold. Im sure this was due to blizz doing there homework and checking around what the illicit RMT sites are charging and factoring that in.

  5. From the poking around I've done through the years, those in the EU were always willing to pay more for RMT gold than those in the States. But since I don't play WoW, I never pursued it.

  6. that i know and im trying to factor that across to people on reddit but sadly its not known, could Blizz have set the price at £12/€€€1`15

  7. pass on that ... i guess the US has more disposable income to spend on game time for gold etc?

  8. I think the answer to "accuse the game developer of fixing the price" is "Of course they're fixing the price!" At some point, they must fix the price in order to ensure that the RMT tokens in the item shop sell quickly on the market. That's the reason for their existence and the side of the transaction that MUST work.

    Blizzard can easily do that by setting the Game Time token price based on how many RMT tokens they want to sell. CCP has already admitted they have injected PLEX into the market to stabilize prices.

  9. What appears to be happening is that the EU price drift is set at only .5% / hour. At this rate, If the price is "too high" it will take days for the price to drop into the range of whatever equalizes the supply of RMT tokens and the setting of the price for Game Time tokens.

    It appears that they set the rate of change by selecting the time it takes to change by 1%. It's been as low as 15 minutes on the US servers (near the start, after it peaked) and as slow as 2 hours (Current EU setting.)

  10. CCP isn't fixing the price like some are accusing Blizzard of doing. CCP injects confiscated PLEX to do the balancing. People are accusing Blizzard of actually fixing the number. With as opaque as the Blizzard's process is, I don't know how they would prove otherwise.

  11. your missing the entire point, the inflation caused by Wow selling gold will eventually make botting the only viable way to 'earn' gold in the game, The hours required to make enough gold to buy inflated AH priced items become too great for a real player to manage, to the extent that botting becomes the only way to earn significant gold.

    Unless Wow introduces a bot feature for players, like other MMO's have done, the average player is priced out of the market, leaving only botters or whales left.

    Wow is shooting their own foot with this one.

  12. Wait, Blizzard are selling gold? I thought, like PLEX, this was blizzard selling transferable game time, and no new gold was entering the economy. Inflation is caused by extra money moving in the economy, so any inflation this causes is limited to what people are encouraged to grind that they otherwise wouldn't have.