@Ares42 said:

@gamefreak9 said:

The laws of supply and demand disagree with you. If more people post these items on the AH then prices would go down.

That's quite a simplistic view. While increasing supply will in most cases lead to lower prices, it most definitely doesn't necessarily mean lower profits.

Lower profits are implied, i'd consider this as intervention and I can't think of a case where aggregate profits increase when intervention is occurring. There is no point in manipulating a market when your the only one who can possibly gain from it working efficiently.

@gamefreak9 said:

@Ares42 said:

@gamefreak9 said:

The laws of supply and demand disagree with you. If more people post these items on the AH then prices would go down.

That's quite a simplistic view. While increasing supply will in most cases lead to lower prices, it most definitely doesn't necessarily mean lower profits.

Lower profits are implied, i'd consider this as intervention and I can't think of a case where aggregate profits increase when intervention is occurring. There is no point in manipulating a market when your the only one who can possibly gain from it working efficiently.

That makes no sense. Just because the market is working efficiently doesn't mean it works at optimal capacity. Calling any kind of massaging of the supply or demand intervention sounds pretty drastic to me. But either way it's getting quite far off topic :P

It's certainly possible. But I really don't know if it'd be necessary. The benefit from that kind of micro manipulation is going to be small compared to the overal profits. They'd have to both be accurate in their manipulations, able to prevent players from exploiting it, and not get caught doing it. I don't think the risk is worth it for them. They can make a fair game and it'll still make them piles.

@ipaqi said:

Disclaimer: I begin writing this post at 19:30 BST, 20/05/2012. The information, suggestions and suppositions written heretofore are a result of my personal experience playing Diablo 3 over the past few days, as well as my own experience as a program designer and programmer, and cannot be proven by myself at this time. This is theory and conjecture, be it convincing or otherwise. DO NOT TAKE MY WORDS AS FACT, BUT AS THEORY ALONE.

Right, now that we're done with that, let get to the nitty-gritty. I'm writing this article/post to put forth a theory, according to which Diablo 3's always-online DRM and real currency Auction House have a more "sinister" purpose than we've been led to believe.

First off, I put forth the following supposition as to the working of the DRM. Diablo 3 works much like an MMO with many lacking features. Every action is synchronized to the server, be it physical travel, ability activation, item activation, merchant and artisan interactions, etc. Whenever an action is made in-game, the game client interacts with the servers, obtaining whatever information it requires. Germane to the issue I bring up, is that the game contacts the server whenever loot needs to be distributed.

Having recently experienced a lot of lag on a high-latency connection with the game, and having observed that the lag was most visible and game-breaking when loot was to be distributed (killing mobs, opening chests, destroying destructible items, etc.), I theorize that whenever loot is to be distributed, the game client requests a loot drop from the server (that is, which items to drop, if any). Assuming this is true, it would mean that Activision-Blizzard is poised to control which loot is distributed, how much, and even to whom.

And, since every player-action is apparently reported to the servers, it seems likely that if they would wish to, Activision-Blizzard can track player's usage of items, as in sale, salvage, equipping, stashing, transfer to alternate characters, transfer to other players, sale on either Auction House, and even dropping on the ground.

With the item usage tracking information Activision-Blizzard could accrue and aggregate, it's very likely that they could then analyze which players are more likely to sell unneeded items and on which Auction House, and, given that they made the game's systems, it would be very easy then to give a player with a Witch Doctor and with no alternate characters an extremely rare and high-valued item, with the expectation that he'd sell the item for a large sum, of which Activision-Blizzard is entitled, as per the TOS, to 15%.

Having manufacture an economical system that can be so efficiently manipulated to provide Activision-Blizzard with additional funds beyond the money paid by gamers to merely play the game, they would be either foolhardy or exceptionally honest not to engage in any of the aforementioned manipulation.

After all, WoW subscriber numbers are slowly but steadily declining if I recall correctly, Diablo 3 and Starcraft II have no subscriber models that we know of, and Blizzard's project Titan is nothing more than a name on a two-year-old release schedule. A market completely controlled by Activision-Blizzard, where demand is closely monitored and supply can be manufactured on the spot, is a cash cow that I don't believe can so easily be left unmilked.

But in order to completely and utterly control this clearly valuable market, strict DRM has to be enforced. Whether or not Activision-Blizzard analyzes all player actions and in accordance with that distributes loot, they have to be able to regulate the rarity of items on their market. If due to a duping glitch or hacking large amount of previously rare items could be brought onto the Auction House, it won't be long before the value of these objects declines, and thus Activision-Blizzard's profit margin off of the real currency Auction House suffers.

If my theory is correct (and I am no more sure of that than I am sure of the shape of the back of my head), then whether or not Activision-Blizzard is actively spying on what Diablo 3 players do with their items, it's clear that Activision-Blizzard has the capability, if perhaps not the willful intent, to fully and frequently manipulate the market of Diablo 3 items, in which every transaction is profitable - to them.

While I applaud your acknowledgement that this is all conjecture, this is textbook conspiracy theory at play. You are making assumptions as to the intention of things you can't possibly know and extrapolating the worst possible mentality of the company involved. The fact of the matter is that Blizzard has a pretty good (really one of the best) track records for taking care of their customers and it would be negligant to assume that they would go full Bond super villain evil now. Remember that Blizzard permenantly delayed the SC2 real money mod market place because they couldn't find a way to work it in while meeting their very high standards.

I mean why even bother? No seriously think about it why go to all this trouble of determining and adjusting loot drop % on the fly for each single person individually based on their habits, potentially screwing over a lot of players and pissing people off, just to get a small cut of a bit bigger pool in the end.

Blizzard can create all the items they want, it would be far simpler and far more profitable to just inject extra gear into the RMAH created by Blizzard and them recieving 100% of the profits and not screwing over people in the process, while also doing less work.

Take it all the way.

@Ares42said:

While you might've gone a tad too far into the woods there, I definitely agree with the fact that there's something "fishy" with the RMAH. I've talked about this before, but the fact that Blizzard has total control over supply and a real motivation to encourage trading just can't be good for the end user. However they do it (if at all), it's just a bad deal as they are making the players pit against each other (trying to get others to spend money) while they are just leeching a profit. They're basically deputizing every player to become a salesman for their virtual goods.

I think the auction house is a very good development for me as a player.

First place, buying Diablo items for real money is NOT new. I can point you to websites where even today you can buy Diablo 2 items for real money. Except those sites are extremely sketchy, and maybe scams. Still, people can and have been buying Diablo 2 items for real money for over a decade.

So since it will happen anyway, I think it's better with Blizzard in charge. Also, the ability to buy gems and crafting ingredients just plain makes the game more fun.

Relax. Have fun.

@alternate said:

Tin foil hat brigade. They will be happy to take a cut of all transactions and do not need to manipulate it like you suggest, actions that - if they were to leak - would be illegal at worst and would totally destroy consumer confidence at best.

If you don't believe that corporations have any morals at all then at least concede that a rational business, however greedy, if not going to risk an already hugely profitable venture for a comparably negligible extra gain. They might be evil but they are not stupid.

This.

@tescovee said:

Although I don't have a horse in this race and couldn't care less. Imagine if this were true. The size of the sql data would be massive. Considering all the random data it would have to track, Item/stats and all of the user classes and straight up users. Then you would have to have software that parses this info in real time to rig drops. Damn the cpu/hard-drive space and bandwith would be pretty huge.

I'm actually really curious what their SQL setup looks like. In theory there's a high amount of transactional data to be considered since every item drop is something that needs to be sent to the database.

@Maluvin: yeah it would be pretty interesting, considering how large the mySql data dump in a zip form just for my music database is and that only calculates band name/track number, track genera, times played, rating and a few other things. The zip of that is pretty large: I can't Imagine what it would look like for diablo 3, the amount of tables that it would need would be off the charts.

@ipaqi said:

@Tennmuerti: You misunderstood my point. My post isn't here to say that Activision-Blizzard is doing something wrong - it's here to speak on the amount of power Activision-Blizzard has on the Auction House market, which will, very soon, be dealing with actual money.

Do they have a shotgun to your head. Are they forcing you to buy things off of the as of yet unlaunched auction house. Have you actually seen the RMAH in practice yet. I have seen many conspiracy theorist's out there and every argument they have boils down to the one you are making now. The phenomenon is quite common. There is a deep seeded need in humans to posses and share secrets. When real secrets are to plain many people create them. They become convinced by them and without any evidence they believe them. It makes that person special. They believe they know more than anybody else. It doesn't have to be logical. They rarely make sense when applied to Occam's razor. They usually make some amount of common sense when shined in the right light. My point is you should be unconcerned about the possible power of a video game manufacturer taking your hard earned dough and start living in a world of facts. When they are doing what you speculate they might be capable of doing than you have a reason to speak. Right now you are making noise to hear the sound of your own voice.

@happypup70 said:

@ipaqi said:

@Tennmuerti: You misunderstood my point. My post isn't here to say that Activision-Blizzard is doing something wrong - it's here to speak on the amount of power Activision-Blizzard has on the Auction House market, which will, very soon, be dealing with actual money.

Do they have a shotgun to your head. Are they forcing you to buy things off of the as of yet unlaunched auction house. Have you actually seen the RMAH in practice yet. I have seen many conspiracy theorist's out there and every argument they have boils down to the one you are making now. The phenomenon is quite common. There is a deep seeded need in humans to posses and share secrets. When real secrets are to plain many people create them. They become convinced by them and without any evidence they believe them. It makes that person special. They believe they know more than anybody else. It doesn't have to be logical. They rarely make sense when applied to Occam's razor. They usually make some amount of common sense when shined in the right light. My point is you should be unconcerned about the possible power of a video game manufacturer taking your hard earned dough and start living in a world of facts. When they are doing what you speculate they might be capable of doing than you have a reason to speak. Right now you are making noise to hear the sound of your own voice.

Dude, are you even reading what I'm writing? Whether you decide to mark me a loon, or actually listen to what I'm saying, what I've been trying to say is that there's a great deal of power in ActiBlizzard's hands right now. They've got a market fully under their control, and they can most likely assert that control whenever it would suit them, and in whatever way it would suit them.

All I'm saying - all I've been saying - is that there's a lot of power in Activision-Blizzard's hands here, whether or not they elect to use it. I'm not trying to incite people against ActiBlizzard - I actually think they've built this brilliantly so they can choose whether to manipulate the market or not.

I'm not trying to Nostradamusize this - I have no foreknowledge of the future or of the mindset at ActiBlizzard. But, much like you seem to be, I am an analytic thinker. I am able, through analysis and deduction, to see potential for what might be done given a certain situation.

I believe that where power is given to anyone, people need to analyze what can be done with that power. If there's anything we have to have learned from the past few years is that many people have no qualms about running markets into the ground, any economic field left unchecked for long enough is going to cost someone money, and Activision has had a good few occasions of running their own workers into the ground and firing them then and there.

Of course I'm concerned with giving Activision a completely profitable market to play with. But if there's one thing you (and the other people who posted with an alternative opinion to mine) got completely right, it's that for now, there's probably no reason for Activision to intervene. It's quite possible that they'll never find need of it. But if there's any one company in the industry right now that can and will squeeze blood from a stone, surely Activision is it.

@ipaqi: Of course they have power They made the game. If it weren't for them the loot wouldn't exist. They created the fucking market. If they abuse that power and have to be regulated by the government then it is there own damn fault for losing the power they have..

@happypup70: Fair enough. :)

They could definitely also have their own "Buy gold" and generated items/ubers up for sale with employees/accounts that wire directly to the company itself. Who's gonna ever know? And is it bad?

What happens when it isn't so popular anymore, prices are inflated, and not that many people grind for items or bother wasting their precious 10 slots on any item below inferno difficulty?

I think this has been quite a fun read and does pose some questions on how virtual goods markets could work.

I wouldn't consider this tinfoil hat territory at all. Zynga basically has entire departments devoted to analyzing and mining player data to "optimize" games in order to extract as much money as possible from players by looking at behavior, psychology, economy, and all the rest.

The funny part is going to be when governments start catching up with all this. They've admitted the loot has real-world value and killing mobs is like pulling a virtual slot machine. The fact that they have complete non-transparent control over the random loot generator is just all the worse for them, considering that most casinos have to have full disclosure on those sort of things.

Well thought. I don't know if you are correct, but this is an inherent issue with this system. This actually appears slightly more obviously in some iOS games, for example, the "Fairway Golf HD" solitaire game lets players use real dollars to buy in game currency, and then has a "random event" where a gopher steals said in game currency, or possibly, your real life dollars.

Something to be watched for sure.

On the other hand, this stuff happens all the time anyways, item and gold farming for cash is nothing new, and those were based on the same underlying systems that Diablo has in place. Sure, now Blizzard has a way to monetize it, but the option to control loot to force players to make purchases is nothing new, be it from in-game NPC or real world vendor.

@SuicidalSnowman: Thanks for the input. I have to say, regarding gold farming, etc, is that I recognize why Activision-Blizzard had to make the choices it made. Even if they are entirely innocent, I would expect the same systems to crop up anyway.

By the way, I've heard somewhere that the real money AH is going to have a flat $1 commission to Blizzard, instead of 15% like they charge at the gold AH. If this is indeed the case, I believe we have nothing to worry about. If the amount of money Blizzard gets for transactions isn't dependant on the object's price, then AB will have no need to manipulate the markets.

Even though they probably still could.

@ipaqi: Yeah they are only charging a buck for a transaction. And they are capping the amount you can sell at 200. They do get 30% of the cut when you transfer it from umm blizbucks?.. to real cash,

In the end its pointless and would take a lot of man power.

And no one has said they could not. Everyone is saying why bother? They gain nothing.

You gave us a interesting read, that is really far out there, and i cant see a single reason as to why they would do that much work for a few extra bucks.....they still have the WoW cow...and Titan coming out!!! (sure that will be a massive cash cow as well...)