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Tuesday, October 25, 2005
Virtual Transactions... $100,000
Back in June, I wrote a couple of posts (linked to a couple of other people's posts) about the real-world sale of virtual real-estate for real-world green. Now pre-played characters that get you past the tedious levels of goat-herding or whatever I can understand, but I am cognitively challenged when it comes to the exploitation of virtual real-estate for real world profit. Imagine, then, my current lack of comprehension. From Collision Detection:
A space station inside the online, multiplayer game Project Entropia has just been sold for $100,000. The buyer was Jon Jacobs, a very popular in-game figured known as "Neverdie". Why spend so much on a piece of virtual property? Because it's just like owning the Mall of America -- it's a place to conduct business and make real-world cash. Indeed, Project Entropia currently has 236,000 registered accounts, and the game allows you to use Earth money to buy in-game currency, which makes it spectacular place for any entrepreneur to set up business, really.
Here's my thing. Does plunking down that much money to buy something make it real? Was it already real? How can it be used for commercial gain, & how long will it take Mr. Jacobs to get his investment back? For some answers, perhaps, I'm off to read the longer piece that Clive Thompson has written on in-game economics. I'll let you know....

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Posted at 6:17 PM by John.
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Blogger Mojotek said...
having taken WAY too many economics and finance classes, the "market value" of anything is exactly what the market will pay for it... no matter how stupid of an investment it seems.

And since the "virtual real estate" isn't actually tangible, what the guy is really paying for is the right to use a certain section of a larger computer program/application as he wishes. Which is mainly to have other online players trade items using electronic cash payments of which he gets a percentage.

Knowing how rabid those MMORPG players are... this is actually brilliant. I bet he makes his investment back within the year, and then starts earning a profit.

After the profit he can "sell" the space station for even more money.

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Blogger Mike Abundo said...
In the world David Wong predicts, all buying and selling will be in-game. ;)

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