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MMORPG economics


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MMORPG economics

  1. 1.
  2. 2. This presentation is one of two parts I have created. This part describes the MMORPG economy in a general sense. It covers most of the more popular main stream games. Games like World of Warcraft™, Everquest, and Lord of the Rings Online, just to name a few with. Eve Online is the one mainstream game that isn’t described by what follows because Eve’s system of economics is a departure from what most MMORPG’s have done.<br />One of the reasons for putting this presentation together was to develop a baseline against which I can compare my own concept for an MMORPG system of economics. If your interested check out and discuss my ideas here:<br /><br />PART II: Putting the MMORPG economy in context <br />
  3. 3. What is an MMORPG?<br />MMORPG’s (Massive Multiplayer Online Roll Playing Game) are games where players can develop characters, in effect a persona, in large interactive persistent worlds over months or even years. The difference between an MMORPG and other games is that winning in an MMORPG isn’t simply completing a list of predefined objectives on the way to an ultimate goal. The type of MMORPG’s this document is going to focus on are highly social, adversarial games where success is usually measured by the level of achievement a player reaches within the game relative to other players, although achievement can be measured in many ways, it is often defined by the player. The economy of an MMORPG can be thought of as yard stick that players can use to determine if they are “winning”. <br />MMORPG’s have complex economic structures, for example, in 2003 Everquest™ had an economy so large the per-capita GDP was large enough that if it were a real economy it would rank 77th in the world₍₂₎. Most MMORPG’s have a true economy in the sense that players produce, distribute and consume commodities. Currency within the game is used to purchase things that help a player achieve the goals they wish to reach. Most MMORPG’s use an economic system called faucet-and-drain or F&D for short. Part 1 assumes that most players are familiar with faucet-and-drain, but if your not, here is a simple description of the ideal F&D system. <br />An economy where, ideally, money being earned by players through interaction with the game is being spent or lost back to the game at a similar rate.<br />This presentation is meant to illustrate , in general, the economic systems of at least a dozen of the most popular adversarial MMORPG’s on the market. Part 1 explains how the most main steam games implement thier economic system, usually called Faucet and Drain or just F&D. The presentation describes how the system works and points out some of its limitations. <br />Lineage II™<br />
  4. 4. Contents<br />What is an economy? <br />Why is the economy so important? <br />How has the economy changed over time?<br />What is money in an MMO and where does its value come from? <br />Is there room for improvement in the Faucet and Drain style economy?<br />
  5. 5. What is an economy?There are many definitions of the term economy. Some are simple and some are fairly complex, but to put it simply the economy can be defined as: Activities related to the production and distribution of goods and services in a game. Or, if you prefer a more complex definition: The orderly arrangement and management of the internal affairs of a game where goods and services are exchanged in a free market where the prices of goods and services are influenced by supply and demand. Either way, the economy is basically an accepted framework for player transactions that deals with wealth and how players determine the value of objects and services within the game relative to one another. <br />Why is the economy so important?<br />All players who play in persistent worlds have goals they wish to achieve. Those goals require the player do something and virtually anything that can be accomplished is made easier with stuff. Stuff (in this case) is literally anything in the game that can’t be obtained freely, that is, it requires some work to obtain. How stuff is acquired and what can be done with it are determined within the framework of an economy and the systems that make up the game. In effect achievement is the game and the economy is the rule set that all players compete within.Think of multi player online games without player economies. Virtually all FPS’s (first person shooters) and RTS’s (real time strategy games) have no economies. This is because the focus on games of these types is simply to end the game, to win, usually as quickly as possible. How much money or stuff you have when you win or lose makes no difference. Winning is the achievement.MMORPG’s are persistent worlds where the goal of the game isn’t simply completing a list of objectives on the way to an ultimate goal that will end the game. MMORPG’s are highly social, cooperative, interactive and sometimes adversarial games where players can engage in a myriad of activities like, exploration, quests, combat and trading to name just a few. Players can work solo or with as many people as can be formed in one or more groups that work together. Players can make decisions about what they wish to accomplish and work toward their goals. Gaining skills, exploring, gathering aren’t in themselves, the economy, they are factors and facets that all combine to influence and shape the system they are a part of. In MMORPG’s (unlike the FPS or RTS) there are a myriad of achievements and players determine what achievements they wish to reach. A good MMO should make sure that there more achievements than players can accomplish.Without an economy the persistent MMORPG would simply be players fighting NPC monsters and collecting stuff. Unused items would simply be discarded. Players would not craft (unless for themselves) or trade with other players, basically an MMORPG would be a persistent single player game you play with other people. This would of course limit the social, competitive and adversarial aspect, not to mention the almost indescribable feeling of being in a world where you can be whoever you want. This is what separates MMORPG’s and the persistent worlds that make them up, from other types of games. <br />
  6. 6. What is money in an MMO and where does its value come from?In the real world, money is in some sense a representation of labor, which of course takes time. It can be expressed this way: <br />T x W= E<br /> Where T= Time, W= Wage and E= Earnings. Wages are earned as a product of labor where the wage earned for that labor over a given period of time (usually an hour) is predetermined between the person/s providing the labor and the person/s requesting the labor. Earnings are usually paid in the default currency of a given society. The value of money comes from what can be obtained with it, the labor that it took to obtain and the reasonable assumption that money will retain its value over time. Because everyone in my society recognizes the dollar as valuable, and most people have some idea of what the dollar can buy, then most people will take a dollar/s in trade for an item or service they want to sell. In turn they will use the money earned to buy what it is they actually want. Think of it like this: money is what you give when you have nothing to trade the person that has what you want. In other words, if I sell a pair of skis so I can use the money to buy a bike, I would gladly exchange my skis to a person who had the bike I wanted (in the off chance they are worth about the same), but he chances that someone happens to have the bike I want and is looking for a pair of skis, and their value is equal, the skis I just happen to want to part with are pretty close to impossible, thus we exchange money. This is something known as the “coincidence of wants” problem. indecently, this is a really good reason to stay away from bartering as a primary source of trade in your MMORPG in this writers opinion. In society, there are virtually an endless number of things that can be bought with money, that is to say that virtually everything that is created can be bought and sold. This is one of the aspects that gives money value. Most people value their time, I think it’s ok to assume, that most people, if given a choice, would be doing something other than providing labor (work) with their time. The game world is a little different and as such the value of money in the game economy is different than it is in the real world. That is because money is earned over time, not working, but playing. This means, as a general statement, that people place less value on their time in a game then they might at work, thus little of the value of money in a game comes from the idea that it was work to obtain. On the other hand, players place much of the value of money on what can be obtained with it. Because items facilitate player goals, and items can be bought with money, this fact makes it highly desired. Ironically in game there are few things (relatively speaking) for players to spend money on. As players obtain more and more of what they want, the value of money for those players declines because there are few things in game for a player to buy. A third factor is that most games eventually reach a point where the amount of money in the economy relative to the amount of goods rises, this leads to inflation and players will often look to redefine the currency in the game by trading in rare items (things of universal value). All of these factors contribute to the devaluation of money in game and ultimately can make the game a lot less fun to play. Elder players often give money to other players or alts. The impact is negative because new and casual players just entering the game have to compete with players who have more money than they need and will spend whatever they have to in order to obtain what they want at any given “level” within the game. There is no intrinsic link between money and the things that it can buy in a game, what money can buy in game is clearly finite and many players reach a point where they have little need for money, or where the effort to acquire money is small, relatively speaking. As a result, the trend in games has been to move away from free and open markets. Players earn most of the items they need directly from the game in the form of quests and drops. This means that players are rewarded for their labor, not with money but with items. Many of the items obtained this way cannot be traded or sold to other players. When players have what they need, money becomes, intrinsically speaking, practically worthless. Ultimately this all contributes to decreased complexity, which limits depth and social interaction and for some people, fun. <br />
  7. 7. How has the economy changed over time? Traditionally, players collect items from interactions from NPC’s and trade items they don’t need with other players for items they need or for coin-of-the-realm which is then used to purchase items from other players. Some items are player made and others are obtained in questing or simply by killing a particular monster and receiving an item as a reward. It’s common for players to adapt their game depending on where the game’s best items come from. If players make the best items in game, then players that need items will gather the raw material needed to make the items they want. If NPC’s, via questing or drops make the best items, then the trend will be toward those activities to gain the rewards given. Games like Starwars Galaxies and World of Warcraft and others formalized the player auction market where players can sell unwanted items, and with little variation it still exists roughly the same way today. The recent trend, pioneered by World of Warcraft, seems to be to take much of the complexity out of the economy. The goal of increasing character power through the pursuit of items in the PvE environment has been transformed over the last ten years. In UO, AC, DAoC and EQ, virtually everything that was found could be traded or sold. The problem for developers is that players who purchase items are missing the content created to entertain them. Another issue is that player who buy there way through the game are resented by those who work for the same items. Because developers can’t control the creation of new money inflation sets in and money looses it’s value as a medium of exchange.<br />The solution has been to make most of the most valuable items in game untradeable. When a player picks an item up or equips it is forced to keep it. It cannot ever be traded again. This practice is known as “binding” and item. There are two types of binding, one that forces a player to keep an item if s/he takes possession of the item, called Bind on Pickup or BoP, the other type that forces a player to keep an item if the character uses the item in question, called Bind on Equip or BoE. BoPensures that players are not circumventing the content placed there for them. BoE helps ensure that the game doesn&apos;t easily becomesaturated with items.<br /> <br />Player auction markets are typically filled with what can be called “tier two” items. The majority of the items that can be sold or traded between players are second tier items. There are a few top tier items that can be bought and sold between players, but they usually have a few uses and have to be replaced repeatedly (e.g. potions) or the items for sale are one part of a several part set, the rest of which must be obtained in PvE. Expansion packs and content add-ons are seen, by most players as a way to enhance the player experience, but often they have a second less know purpose. Content add-ons and expansion packs are a method to reset the economy by creating a whole new list of new more valuable objects for players to obtain by playing the game thereby redefining what objects are valuable. These types of add-ons take the focus off PvP and puts the emphasis on PvE content.<br />
  8. 8. Is there room for improvement in the Faucet and Drain style economy?World of Warcraft™, Lord of the Rings Online ™, Warhammer ™, Everquest ™, Starwars Galaxies ™, Dark age of Camelot ™ and many others have been very successful implementing the traditional Faucet & Drain style economy. It would be silly for me to say that these games have not been successful in their own right. All together these games have entertained millions of users and it would be easy to take the “if it’s not broken don’t fix it” mentality, but all of these games suffer some version of the same problem. How serious the problem is depends on your point of view. If you enjoy questing, and fighting NPC monsters, then there may be no problem for you, but if your focus is on player to player interaction, then the problem is more pronounced. Certainly there are enough players who wish to play a game more focused on open player vs. player concepts to support a new style of game. The focus of mainstream games is between the player and the game. Player to player interaction is secondary. Even if the goal of the game for a particular player is to focus on other players in the game, the reality is that player to game interaction is mandatory to collect the stuff (items) in game necessary to remain competitive in the player vs. player arena. In all of these games it’s only a matter of time before the player base has acquired so many of the games top tier items, that there is little left to do other than repeat what has already been done. Few games offer PvP outside of instances, and those that do offer little tangible reward or any real reason to fight other players beyond the hope of simple self improvement. New content in the form of expansions gives players the opportunity to play the game (all over again) in order to acquire more powerful means. The reality is that while the scenery has changed all that has really happened is that the developers have reset the economy so that player can spend the next several months trying to acquire the means to be successful in whatever aspect of play a player has chosen, be it PvE or PvP. One simple improvement would be to tie the faucets to the drains. That is to say that the economy can be balanced by increasing or decreasing the money supply when the amount of money and raw materials in the world as a whole rises relative to the amount of goods. This idea is discussed here: agree with many of the assessments, and I think it is possible to follow the suggestions here, but I believe there are problems with this method and I think there is another solution. The solution involves a more competitive aspect between players. That is not to say that NPC’s aren’t a tangible part, but success against other players in the game will be just as important as success against the developer created challenges and content. <br />In my concept ( I discuss how I have solved some of the issues faced when trying to create a game where PvP and PvE are intertwined and equally important. If you would like to discuss my ideas please post comments here<br />
  9. 9. Creation<br />Once the decision is made to create an MMORPG, decisions like genre, story, setting, and other basics are some of the first aspects that are decided. Early on, decisions are creatively driven and usually provide much of the motivation to move forward on a project; examples are things like genre, story, classes, and the overall look and feel of the game. Before designers and developers get too far in the creative process, it’s imperative to look at the mechanics of the system the game will be based on so that the end result doesn&apos;t feel like a bunch of disconnected ideas forced together.<br />The foundation of virtually every large scale MMORPG is the economy. As a result creating a complex multi-faceted albeit intuitive economic system is the first step in creating a dynamic and immersive MMORPG.<br />Creative decisions should reflect decisions made after determining how the mechanisms in the game will work (form follows function). How players travel through the world, where money comes from, how items affect character power, how much players can store in player vaults, crafting and combat systems, what the consequences of death are, are all decisions that are affected by, and affect the economy. Creative decisions are often given more significance at the expense of mechanical systems. Many systems, especially the economic systems of current games are designed around the creative ideas of the game, instead of designing the creative ideas around the mechanisms of the economy and all the other systems that affect it.<br />Decisions<br />Once the decision is made to design a system of economics one of the first question should be; what is the primary source of wealth in the game and where does it come from? This is a fundamental question that in the past, has usually answered the same way. Players usually engage in activities where a player trades time performing pre-defined activities like quests and killing NPC monsters in trade for items or coin. <br />My concept will fundamentally change where money comes from and how players earn wealth. The system assumes four basic player types. Crafters, Explorers, Players who prefer PvP and players who prefer PvE. The concept is not limited to these aspects and players aren’t limited to a single type. Each player type will bring something into the world important for the production and creation of means.<br />
  10. 10. This diagram illustrates the most common ways that new wealth enters the MMORPG economy. Players engage in the activities in the chart to the right and they create new, virgin wealth. <br />The drawback of system like this is that the activities shown in the chart produce the same amount of wealth<br />consistently, no matter what the <br />state of the economy. <br />For example, inflation, arguably<br />The largest problem in the<br />MMORPG economy is controlled<br />by removing wealth after it is <br />created, not by dealing with <br />wealth at its source. <br />How new money is brought into the world in most MMO’s<br />NPC given<br />Quest<br />Selling to <br />NPC merchant<br />New Money<br />Mining<br />Gathering<br />NPC Monsters<br />(item drop)<br />Items<br />TIME<br />
  11. 11. How money is removed from the world in Most MMO’s<br />As the last slide explained and the chart on the right illustrates, the amount of wealth in most MMORPG economies is controlled by varying the number of different services paid to NPC’s and the amount each fee costs. Besides NPC’s, Obsolescence, decay and item destruction are strategies used to remove wealth from the system.  Decay is when an item, through use, becomes less effective or unusable over time. Obsolescence is when new more powerful items are introduced into the world over time. Though obsolescence doesn&apos;t directly remove money from the economy, the introduction of new highly desired items into the economy effectively causes items already possessed by players to decrease in value.  Item destruction removes an item from the economy because many systems force players to bind items to their character, making them un-tradable or un-sellable (to other players) once used. Most are sold back to NPC’s or broken down into raw materials. <br />Obsolescence<br />Buying item<br />from NPC<br />Item Destroyed<br />Buying service<br /> from NPC<br />Decay<br />Money <br />Removed<br />TIME<br />Players are re-invigorated to acquire means<br />Many MMORPG’s worlds begin to stagnate over time as items that have to be taken from NPC’s begin to saturate the market and player base.  Many players realize that items aren’t a means to there success, items are the defining end to success.New content helps prevent players from coming to this realization (the desire to own means is almost never ending), thus obsolescence achieves the goal of passively removing money from the system and simultaneously making most players happy. <br />
  12. 12. Where does a player attain wealth in the MMORPG?<br />The previous two slides in this presentation explained, in a generic sense, how new money is created and removed from the world. This section looks more closely at all the different sources that a player can earn wealth. Anyone that has played an MMORPG would probably agree that achievement is the primary goal of most players. How a player defines achievement in the game may differ from one player to another, but the achievement of goals is always facilitated with the acquisition of finished items.Wealth comes in three basic forms, money, raw materials, and finished items and all three come from one source, NPC’s. NPC’s come in two basic types; friendly quest givers or hostile monsters. In either case players usually have to fight hostile monsters or spend time going from place to place covering large distances avoiding monsters, to receive their rewards. Many games allow players to earn “points” from specific types of play. For instance World of Warcraft™ rewards players with “honor points” for players that participate in PvP (player vs. player combat). These “points” are earned and spent just like money, but in most games can’t be traded or used to buy things from other players. Points can only be used to purchase items from NPC vendors. Finished items are a means to an end, whatever the player decides the end might be. How players acquire and use finished items will have a huge effect on game play and the system as a whole. This diagram shows how players interact with the world and with each other with the goal of acquiring finished items. <br />Finished<br />Items<br />Gathering<br />NPC’s<br />Player<br />Auction<br />NPC<br />Vendor<br />Raw <br />Material<br />Player<br />Crafter<br />Salvaging<br />Money or<br />“Points”<br />
  13. 13. Supply and demand<br />When it comes to supply and demand there are two basic player types, player crafters and player adventures (though there certainly are more). Player crafters are those that take the games raw materials and using skills earned through game play, turn raw materials into something desired by players. Player adventures are those players who collect the raw materials (via gathering or fighting NPC’s) or even the recipes (blueprints) used by crafters to create items. Now a single person can do both, but very few people will engage in both better than a person who specializes in just one area. Games that allow specialization give players the opportunity to find useful roles in the world and  increases the potential  possibilities for social and interactive play between players.Player interaction in most MMORPG&apos;s has become limited to trading in the auction house with friendly players and combat with enemies.  There is little reason to kill your foe other than the promise of simple self improvement.  The roll that player crafters have in the economy has shifted over the last several years and most of the larger more popular games have minimized the roll a player crafter has in the economy.  There is little need for non-combat players in the areas of politics or item production.The diagram below shows what most games in the genre have become.  Player adventures are supplying their own demand for items without the need of other player types, thus the player is often forced to supply his own demand for items, selling what they don&apos;t need in the games auction houses or breaking un-needed items down into raw material.  Adventures fight NPC’s and gain item,  coin or points.  Points and/ or coin is used to purchase the items players need.  Points are spent at certain NPC vendors and coin is used in the games auction markets.  Most weapons and armor, core items, come from NPC rewards.  The trend has been to move away from crafters making much more than accessories or very specific core items. This cuts out the potential for complex social, economic and political structures between players within the MMORPG genre and almost entirely eliminates the need for player crafters. Instances only accentuate this this problem, because players are assured of entering without any competition.  Instances also ensure that all content is available to all players all the time.  The concept I have created in Part 2 will attempt to create a world where players, friend and foe, adventure, crafter and other player types will be an integral part of each other success. <br />Finished<br />Items<br />Gathering<br />NPC’s<br />Player<br />Auction<br />NPC<br />Vendor<br />Crafter<br />Raw <br />Material<br />Salvaging<br />Money<br />
  14. 14. This diagram shows how unwanted items can be sold in the player auction markets, or in the case of items with little player value, can be sold back to NPC’s. <br />This path shows how once finished items are acquired players can sell them to acquire more money , either from NPC’s or other players. If players can acquire items without the help of other player types or in some instances without other players of any play type, the potential for immersive and complex social interaction is limited.<br />World Of Warcraft™<br />Finished<br />Items<br />NPC’s<br />Player<br />Auction<br />NPC<br />Vendor<br />Raw <br />Material<br />Crafter<br />Money<br />
  15. 15. Monetary, price and item Inflation<br />Monetary and price inflationInflation in the real world can have several causes, but in most MMORPG’s it has a single cause. As player incomes rise relative to player expense, players naturally have more money to spend on commodities within the game. Put more simply, inflation is an “increase in the amount of currency in circulation”<br /> It’s important to realize that the cause of monetary inflation is excess money earned relative to expenses. The effect is that players raise prices, known as price inflation, on commodities available at player auction houses. <br />Developers cannot control (or at least they make no attempt to control) the amount of money players earn (see illustration on the right). The amount of new money brought into the game by players is limited only by player population and habit.<br />NPC merchants do not respond to changes in the price levels within the game. NPC’s always drop (or reward in the case of quests) the same rewards and their difficulty stays the same relative to the price level within the game. A healing potion or other items that assist players in combat with other players or NPC’s that may have seemed expensive early on can be bought in huge numbers as monetary inflation increases. This culminates in the real problem which is the disparities between the “top tier” player and the “beginner” increase. This can eventually lead to alienation of the player base.<br />The solution in many recent MMORPG’s has been to severely curtail what players can buy and sell with money within the system. This has been accomplished in several ways:<br /><ul><li> Binding of items – There are two types of binding BoP- Bind on Pickup and BoE Bind on Equip (use)
  16. 16. The majority of the games best items cannot be sold in player markets
  17. 17. Armor and weapons earned only from NPC’s
  18. 18. Weapons and armor repaired by only NPC’s
  19. 19. Players reduced to creating accessories (potions, gems, ect)
  20. 20. Points given in PvP to purchase items and skills
  21. 21. Points and the items they can buy cannot be traded or sold.</li></ul>The items on this list are cleverly disguised within the fiction of a given game, but the goal is to move away from open markets and monetary competition between players . As a result developers have more control over what players do within the game. As many of you have experienced earning the commodities needed to be competitive involves weeks and months , even years of questing for NPC loot or earning “points” in simple instanced combat between players. <br />Item inflation<br />Part of the problem is created by the perception of what players are willing to accept. Many players cannot accept any level of loss in experience points , money or items earned. Developers have responded by allowing players to keep everything they find indefinitely. This leads to item inflation. If the definition of monetary inflation is too much money in circulation, then the definition of item inflation is too many items in circulation.<br />The developer solution to this problem is to create expansions new content and new items is perceived by most players to be a positive, but it’s really just a way to control item inflation and continue the never ending cycle of trying to acquire means and assure that players always feel like they have something left to accomplish. For the majority of the US and European player base games that use these strategies are ok, but there is a huge number of players who are looking for a more competitive Player vs. Player element that systems described above are not delivering. <br />
  22. 22. Player vs. Player, just an afterthought?<br />The majority of MMORPG’s that use the F&D system follow the system illustrated in the flowchart below if some form of PvP is included in the game. In the flowchart PvE and PvP are separated from another. They are entirely different games within a game. Virtually all money and items that can be traded in the games markets come from PvE (players engaged in play with non-players or gathering). Players in most games have the choice to earn money and wealth in areas sheltered from enemy players, instances are a perfect example of this.<br />Players can play and progress fighting in sheltered areas free of any outside influence. Some games attempt to blur the lines between the different modes of play, but the reality is that PvP really isn&apos;t an integral part of any of the most popular MMORPG’s. The concept in Part II will fundamentally change this design and make PvP and PvE equally profitable and necessary. This does not mean that all players will have to engage in both modes of play, to the contrary, players will have the choice to do one or the other and participate in the economy with commodities from both modes of play. <br />Fury™<br />Fury™ had a very unique system based almost entirely on PvP unlike any game before it .<br />Points or tokens<br />for unique items <br />or abilities<br />PvE<br />PvE<br />Player 2<br />Player 1<br />PvP<br />Items and money<br />and Raw materials<br />Items and money<br />and Raw materials<br />
  23. 23. The diagrams on the following pages are meant to illustrate, in detail most of the potential inflows and outflows a player has in the faucet-and-drain system. In the example below, if a player chooses to take a quest, the diagram shows the potential gains, that is, the player can gain money, items or both. As you view the diagram next few pages, notice that to the right are the player-to-game exchanges. To the left are the player-to-player exchanges. To the top are player inflows and the bottom are player outflows. There are a few exceptions like items that are simultaneous inflow and outflow, like auction buying and/or selling. Keep in mind as you read the chart that not all situations may apply for all games. The diagram is meant to be a general illustration of potential player interaction in the game world for most of the popular MMORPG’s.<br />Player engages in<br />Inflows<br />Questing<br />When a player accepts a quest there are basically three possibilities, the character can earn money, items or both. Simply imagine the character is engaged in the activity in the small box and follow the arrows for all the potential outcomes.<br />ITEMS IN<br />MONEY IN<br />Player<br />Potential results<br />ITEMS OUT<br />ITEMS OUT<br />MONEY OUT<br />MONEY OUT<br />Outflows<br />
  24. 24. Player -to-Game<br /> exchanges<br />This diagram illustrates all the player-to-game inflows. With the exception of buying from NPC vendors, this is where all of the new wealth in game is created, these are usually referred to as the games “faucets”.. <br />Gathering<br />Inflows<br />Questing<br />ITEMS IN<br />Monsters<br />MONEY IN<br />Player<br />Sell to<br />NPC vendor<br />Buy from<br />NPC vendors<br />Green =Money<br />Orange = Items<br />
  25. 25. Player -to-Game<br /> exchanges<br />This diagram illustrates all the player-to-game outflows. Wealth from the game is removed in this section and are usually referred to as “drains”.<br />Player<br />Sell to<br />NPC vendor<br />ITEMS OUT<br />Buy from<br />NPC vendors<br />MONEY OUT<br />Outflows<br />NPC services<br />Rez, travel, heal<br />Taxes or fees<br />Paid to NPC’s<br />Item decay, <br />item destroyed<br />Raw Material used<br />Green =Money<br />Orange = Items<br />Drain<br />(money and items<br />removed from the<br />world)<br />
  26. 26. Player –to-Player<br /> exchanges<br />This diagram illustrates all the player-to-player inflows. There is no new money created between players. Only money exchanged<br />Gifts received<br />Inflows<br />Sell service<br />(repair ect.)<br />ITEMS IN<br />Stealing – Cash<br />and or items<br />MONEY IN<br />Player<br />Auction<br />Selling<br />Auction<br />Buying<br />Green =Money<br />Orange = Items<br />
  27. 27. Player –to-Player<br /> exchanges<br />This diagram illustrates all the player-to-player outflows. This is where a player exchanges wealth with other players.<br />Player<br />Auction<br />Selling<br />ITEMS OUT<br />MONEY OUT<br />Auction<br />Buying<br />Outflows<br />Buy service<br />(repair ect.)<br />Items or cash<br />lost<br />Gifts given<br />Green =Money<br />Orange = Items<br />Other<br />Player/ Characters<br />
  28. 28. Player -to-Game<br /> exchanges<br />Player –to-Player<br /> exchanges<br />This diagram represents the MMO world as most know it now. It is meant to be a general representation of a range of games that use the faucet-and-drain style economy and may not perfectly describe every game without some modification, but most transactions types fall into one of four categories.<br />In this diagram we can see inflows and outflows of wealth from both player-to-player and player-to game-exchanges.<br />Transactions at auction and between player and NPC vendors are simultaneous inflow and outflow.<br />The only transactions that bring new wealth into the world are player-to-game inflows (faucets). The only transactions that remove money from the world are player-to-game outflows (drains).<br />Gathering<br />Gifts received<br />Inflows<br />Questing<br />Sell service<br />(repair ect.)<br />ITEMS IN<br />Monsters<br />Stealing – Cash<br />and or items<br />MONEY IN<br />Player<br />Sell to<br />NPC vendor<br />Auction<br />Selling<br />ITEMS OUT<br />Buy from<br />NPC vendors<br />Auction<br />Buying<br />MONEY OUT<br />Outflows<br />NPC services<br />Rez, travel, heal<br />Buy service<br />(repair ect.)<br />Taxes or fees<br />Paid to NPC’s<br />Items or cash<br />lost<br />Item decay, <br />item destroyed<br />Raw Material used<br />Gifts given<br />Green =Money<br />Orange = Items<br />Drain<br />(money and items<br />removed from the<br />world)<br />Other<br />Player/ Characters<br />
  29. 29. Hording<br />Hording is simply the saving of items and coin in player vaults (sometimes inappropriately called banks). Players collect massive amounts of items and in turn save them in player vaults, this increases the overall wealth in the world and only contributes to rising price levels. Players do this simply because they can. Some games require that players purchase additional storage, but the costs are relatively minimal and are not in any relation to the amount of wealth stored or the overall price level within the game. It’s important to remember that wealth once put in a player vault is effectively removed from the economy unless a player chooses to bring it back into the world. <br /> Developers cannot affect money and items in player vaults (except though obsolescence) nor can they account for it in most games and while it may be convenient for players to horde items, overall it has a negative effect on game play. In the real world most wealth effects the economy, even if it is “in the bank”. The concept in Part II will attempt to solve the problem of hoarding and the removal of wealth from the economy entirely. The solutions will attempt increase the opportunity for meaningful conflict between players.<br />World Of Warcraft ™<br />
  30. 30. Review:<br />If developers fail to keep the amount of wealth flowing out of the economy in line with the wealth that players are pulling into the economy, the result will be inflation or deflation. Inflation, usually the bigger problem, causes the price level to rise, thus players with limited access to cash cannot purchase enough good equipment to be competitive. If the percentage of players that feel they cannot be competitive is high enough the entire game will be affected.<br />Up till now, the more efficient the faucet-and-drain system is at controlling inflation the more restrictive it is on players.<br />The creation of new money is limited only by player population and player desire to achieve wealth, thus the value of money within the system will change (price level will rise or fall) depending on how many players there are and how much effort the population as a whole is working to create new wealth. <br />Developers in most games do not have systems in place that allow the economy to adapt to increasing wealth. The solution has often been simply to redefine wealth through obsolescence. By creating periodic expansions with new more powerful items, developers are simply re-defining “wealth” by de-valuing the items already in the economy. This assures that players have to go back to playing the game (some call it the grind) instead of engaging in play with each other.<br />The inherent limitations in the faucet-and-drain system may also explain why severs in most MMO’s are limited to just a few thousand people. Games like Eve online™ have markets that are entirely player driven. It’s not unusual to have up to 25,000 people playing on the games only server.<br />Because adventurers can supply highly sought after finished items to other adventures, this severely limits the need for crafters in the economy. Add to that the fact that merchants supply items and buy up raw materials at fixed prices and the roll crafters play in any economy is limited at best.<br />When NPC monsters and merchants supply highly sought after finished items into the game the games social climate suffers.<br />Market structures in most MMORPG’s could be made to take advantage of more advanced market structures by allowing players to create similar items with some unique properties. If components for those differentiations are easier to obtain by some players, that should reflect in the price and properties of the item and leave players and crafters to make interesting choices.<br />Hording is a real problem that negatively effects game play. If players can bank large amounts of wealth indefinitely the amount of wealth in the world becomes difficult to account for. This is one reason faucet-and-drain systems have become necessary.<br />
  31. 31. Thoughts and comments<br />This system leverages the power of player competition set against self interest. The mechanics of the system shift the focus of play from the predictable player vs. NPC to player vs. player.<br />Money and items are proportionally linked. Adding or removing either will have an effect on another. This fact gives developers a lot of flexibility to keep the economy challenging for the greatest number of players.<br />Innovative game play, and graphics bring new players to the game. The social aspects and immersive game play will keep them playing.<br />
  32. 32. In Summery<br />I have worked for several years to define this concept. I realize that many of you have questions or opinions about parts of the system that may not be clear. I may have answers to potential problems. I tried to keep this as short as possible. I have ideas on the crafting system and how I think players should be able to utilize abilities in the world.<br />I tried extremely hard to stick to the concepts surrounding the economy. I have several other ideas not included here as they don’t directly contribute to the concepts of the economy, but would integrate well with these ideas.<br />What I would really like to hear from other about are crafting and combat systems that would work within this framework. I have some of my own ideas, but to work them out would take a very long time. I like the though of collaboration so if your interested, drop me a line.<br />I created this presentation in some haste, so I will apologize in advance for the spelling or grammar mistakes, I’m an idea guy not an English teacher.<br />Any questions should be directed to me at<br />Thank you,<br />Christopher S Brown<br />
  33. 33. The Author<br />I’m a FPS/ RTS guy who discovered MMORPG’s back in 1996 with games like UO and Meridian 59, though I didn’t dive in until the release of DAoC in October of 2001. There I found a new home in MMORPG’s and have played at least two dozen since then. DaoC, SWG, WoW, AoC. Eve and Warhammer, are the games I have spent the most time playing. Other games I have dabbled in are Shadowbane, EQII, CoH, AO, LineageII, LoTR and most recently Aion. I have also tried several F2P games as well as dozens of trial offers.<br />I’m an active member of several MMORPG developer forums, though my interest is strictly in game design as I have little skill in programming. By nature I’m a hardware geek and my job is troubleshooting, installing and planning for high end Storage Arrays.<br />I miss the competitive nature of the FPS, but enjoy the social and cooperative nature of the MMORPG. Much of the ambition behind this project is to expand competition between real players while maintaining the persistent and socially driven ideas of the MMORPG.<br />
  34. 34. References<br />Wikipedia,, Money, accessed April 2008.<br />Wikipedia,, Massively multiplayer online game, June 2008<br />3) Flying Scythe Monkey, accessed April 2008,<br />4) Economics for Dummies, accessed April 2008<br />Written by: Nathan Roberts, Ena Silva, Melissa Atwood and Tamara Hatch<br /><br />World of Warcraft,<br />© 2009 Christopher S Brown (<br />All rights reserved. Under the Copyright, Designs and Patents Act (1988), this publication may not be reproduced, stored or transmitted in any form, or by any means (electronic, mechanical, photocopying, recording or otherwise), except with the prior permission in writing of the author. Any person who does any unauthorized act in relation to this publication will be liable to criminal prosecution and civil claims for damages. <br />