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D3 RMAH as testbed for Project Titan RMAH

Discussion in 'Diablo 3 Market & Economy Discussion Forum' started by chriscowart, Dec 19, 2011. | Replies: 30 | Views: 4058

  1. chriscowart

    chriscowart IncGamers Member

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    D3 RMAH as testbed for Project Titan RMAH

    I believe there's a good possibility the D3 RMAH won't be the last RMAH from Blizzard we see (assuming it goes well, of course, which I believe it will be fine).

    Here's why:

    disclaimer: I don't play WoW

    Recently, Blizzard has been selling a mount in WoW that can be traded on the Auction House. This is a big change since every previous mount was tied permanently to the owning account. Anyway, this means one could arrive at a dollars per WoW gold figure since real money can be "injected" into WoW through the mounts. Essentially, they're selling gold! So, Blizzard feels safe with WoW gold as a real-money analogue, to some extent.

    Also, WoW had the auction house in it from the beginning. I'd imagine running such a beast is a lot like running a free eBay. There are servers, server maintenance, potential transaction issues, bandwidth consumption, and not to mention the development time. I think they felt it was a good feature, and it is, but they might have overlooked the maintenance cost a bit. Surely they've nailed it down to a science so its smooth to operate now. It costs money to operate an auction house, even if its free!

    Regardless, once real money is introduced, the system must be essentially bug free, and they must to succumb to "the customer is always right", potentially handling slews of customer issues (i.e. I bought the wrong item; I want a refund; Where's my item? ... ad infinitum).

    Diablo 3 will no doubt be a big game in terms of sales figures and concurrent users, however its safe to say it won't top WoW. So, the system must be thoroughly tested to handle such a massive audience.

    So, to me, Diablo 3 would be a great test bed for a new profit center for Project Titan so they can have all the systems in place to reduce the massive cost of developing the beast from the ground up for just one product. In fact (err, speculation?), they could be testing much of the same technology right now in Project Titan. Why not develop the system in two products instead of one, thereby reducing the development costs, and along the way, create ways to get money into the system and maybe keep it there (Blizzard Balance), create good relationships with third-party internet money machines (PayPal, and incidentally, eBay), and put a stop to Chinese gold farmers? Instead of being a liability (like old school Diablo BNet and WoW AH), RMAHs will be an asset!

    That just seems logical to me.
  2. Moik

    Moik IncGamers Member

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    Re: D3 RMAH as testbed for Project Titan RMAH

    It's probably also a test bed for the SC2 User-Made-Maps Marketplace, which was noted as still being in the pipeline on a recent investor call (possibly for Heart of the Swarm). Likely every future Blizzard product will have some type of similar transaction system in place.
  3. Azzure

    Azzure IncGamers Member

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    Re: D3 RMAH as testbed for Project Titan RMAH

    I think Titan at the very least will support Player to Player currency selling. And that's not really a bad thing, since in WoW many many players buy gold from gold-selling sites.
  4. Neinball

    Neinball <a href="payments.php">IncGamers Site Pal</a> and<

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    Re: D3 RMAH as testbed for Project Titan RMAH

    If successful I think there is a pretty good possibility of the RMAH making it's way into Titan, but I wonder... If the RMAH is successful enough, would Titan need a subscription fee along side the RMAH profits?
  5. Pheal

    Pheal IncGamers Member

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    Re: D3 RMAH as testbed for Project Titan RMAH

    If they don't go with a subscription fee the playerbase will be waaaaaayy higher. Most people (including me) don't like monthly recurring fees =).


  6. Neinball

    Neinball <a href="payments.php">IncGamers Site Pal</a> and<

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    Re: D3 RMAH as testbed for Project Titan RMAH

    That's my thinking behind it. "How do you get bigger then WoW?" One of the biggest barriers to entry for most people to MMOs is the monthly fee, get rid of that and you open the market to a much larger audience. If the RMAH is able to cover the cost of D3 server upkeep and cut a profit on the side, it'd be a greater way of bringing down that barrier and get more people in the game.
  7. AKUder

    AKUder IncGamers Member

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    Re: D3 RMAH as testbed for Project Titan RMAH

    I had the same thought, about no monthly fee for Titan. Diablo will be a bit of a test ground for them to gauge how much popularity/use the RMAH gets. Assuming success, it will be implemented into Titan and possibly allow Titan to have no monthly fee, or at least be cheaper than WoW. I seem to recall reading somewhere that more and more MMOs are moving to no monthly fee.

    I have a couple of friends who wouldn't play WoW because of the monthly fee. To be honest, that's why I only played it for a few months. Maxed 1 character, didn't feel like I had the time to put into raiding, so I just went back to other games.
  8. galzohar

    galzohar IncGamers Member

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    Re: D3 RMAH as testbed for Project Titan RMAH

    If anything, more and more MMOs are moving towards micro-transactions, which is something Blizzard fans will most likely never accept in a Blizzard game or any other game, and is probably against what Blizzard believes makes a game good.

    Of course, the people who won't even pay monthly fees will be even more reluctant to pay micro-transactions. And making a f2p micro-transaction based MMO playable for those who don't pay anything while still keeping it profitable is probably impossible (see: World of (fail) Tanks).
  9. Concupisco Quaestus

    Concupisco Quaestus IncGamers Member

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    Re: D3 RMAH as testbed for Project Titan RMAH

    It's like I've been saying, the D3 RMAH is just the tip of the ice berg, once someone (namely Blizzard) steps out and shines a little light on exactly how much money is floating around in RMT and exposes how blind the industry has been to keep their death grip on monthly subscriptions going for so long it will become an avalanche of legitimized RMT, once those in the industry who are completely void of all creative thought (which let's face it is most of the industry at this point) are shown "how" to do it they will all start doing it.

    Ultimately, it doesn't matter what the "fans" think or even what the "developers" think... It's what the bean counters think that decide what will or will not happen... Keep in mind that even for the industry this "stuff" isn't new, there have been successful micro-transaction/legitimized RMT options available on the Asian MMO scene for years, it's just here in the west we've been dragging our arse beating the monthly subscription horse to death.
  10. chriscowart

    chriscowart IncGamers Member

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    Re: D3 RMAH as testbed for Project Titan RMAH

    You're right. The big guys are dragging arse. In the mean time, there's plenty of microtransaction games also paving the way in the West. Here are a few biggies:

    League of Legends - probably the fastest growing esport; primarily cosmetic micros
    Gunbound - 'import' game -- one of the first games I've seen F2P w/ micros
    MapleStory - same as above
    Project Entropia - probably the first game to have a real money economy; you can buy PEDs (ingame currency), or cash them out. Interesting fact: a real estate investor decided not to invest in real life real estate, but instead bought a space resort in-game and taxed transactions etc. and made more money than he would have in real life. Sold for ~$600,000!
    Team Fortress 2 - weapon and hat sales

    Anyway, I was bored and thought you guys might find this info interesting.
  11. Azzure

    Azzure IncGamers Member

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    Re: D3 RMAH as testbed for Project Titan RMAH

    For the RMAH to bring in more profit than a subscription-based game (WoW), it will need to do the following things:
    - Have a fully active playerbase of over 10 million. (note that I said Fully active).
    - Average player spending $13-$15 on RMAH FEES per month (I doubt the average person will spend $13-$15 on items, let alone fees.)
    - Keep the two above items happening at the same rate or better for multiple years.


    In other words, highly unlikely. WoW is ridiculously profitable. It is by far the most profitable game in history, and even Titan may not ever reach the level of what WoW did.

    My estimates on RMAH revenue is in the ballpark of no more than 100-200m per year. Which is actually very good mind you, in just a year it comes close to SC2's total sales. However WoW generates 300-350m per quarter.
  12. galzohar

    galzohar IncGamers Member

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    Re: D3 RMAH as testbed for Project Titan RMAH

    Profit is income minus expenses. Since we do not know how much they spend on WoW to keep it going, it's going to be hard to compare. Of course I still doubt it will compare to WoW's profit, but looking only at the income is quite silly.

    If a project made you more money than it cost you (in total, taking everything into account), it was worth doing.
  13. Azzure

    Azzure IncGamers Member

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    Re: D3 RMAH as testbed for Project Titan RMAH

    Thankfully, ATVI break down the costs of WoW, so we know the profit margins. I took this in to account in the above post. There wouldn't be a huge cost difference in hosting Diablo servers than WoW servers. Both have extensive use of DB storage infrastructure, both have similar hosting / bandwidth requirements. In other words, we can estimate that the costs involved for running servers is not that far apart, on a per-active-player basis.

    HOWEVER the one exception is WoW's billing/support/admin/GM teams, which Diablo 3 will only have Billing support. This represents a moderate decrease in operating costs for Diablo 3. However, one can argue that the RMAH uses more complex systems and requirements than the WoW AH, due to its much larger size and real-money component, which needs to be 100% solid and secure.


  14. galzohar

    galzohar IncGamers Member

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    Re: D3 RMAH as testbed for Project Titan RMAH

    The paychecks for GMs alone can sum up rather high. Plus WoW gets content patches on a rather regular basis (not counting expansions, since those sell just like any new retail game). I mean, it's easy to see that WoW costs Blizzard a lot more than a normal game does, but then again I still bet it probably way more than makes up for it in the monthly fees. We don't actually have any info that indicate what the true difference in eventual profit really is, though.
  15. Azzure

    Azzure IncGamers Member

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    Re: D3 RMAH as testbed for Project Titan RMAH

    I'll trawl through their last quarterly statement and post what it costs and what it pulls in.

    *Edit*
    Ok:
    Last quarter:
    Revenue - Online subscriptions $336m
    Cost of sales - massively multi-player online role playing game ("MMORPG") $59m

    Keep in mind that the cost of sales figure is not the total amount spent on WoW. A huge amount of ATVI costs are pooled together, such as sales and marketing. The revenue figure counts subs + value added services, basically everything WoW generates.


  16. galzohar

    galzohar IncGamers Member

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    Re: D3 RMAH as testbed for Project Titan RMAH

    If a quarter is 3 months, and the minimum monthly fee is 13$ (when you pay for 6 months in advance), then 336m$ mean at the most 8.6mil subscribers? I thought WoW had more than that... If you count people paying 15$/month and/or value added services you get even less subscribers. Maybe this "revenue" number already substracts some sort of expenses?
  17. Azzure

    Azzure IncGamers Member

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    Re: D3 RMAH as testbed for Project Titan RMAH

    Different regions have different fee structures in WoW. For example, I think in China you pay by the hour or something like that and its less profitable for them. Half the WoW players are in China.


  18. galzohar

    galzohar IncGamers Member

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    Re: D3 RMAH as testbed for Project Titan RMAH

    Ah, that explains things. Chinese players probably pay much less... For all US and EU regions, though, the price is quite similar regardless of which currency you're using (I think it ends up slightly cheaper if you're paying in GBP).

    Is it half the WoW players playing on the Chinese region paying Chinese fees, or actually living in China (which would count Chinese "players" (more like "farmers") playing on other realms)? I'm guessing it's the former?
  19. Bowzer

    Bowzer <a href="payments.php">IncGamers Site Pal</a><br>D

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    Re: D3 RMAH as testbed for Project Titan RMAH

    What I, and many others are more concerned about is the Pay2Win model for Titan. Micro transactions in and of themselves aren't so much the issue. Most of the free to play MMO's coming out have common items like potions and hats for sale until you get to the higher more competitive levels. Once they have you hooked, you can't even compete unless you pay for their "micro-transaction only" gear and potions.

    I will go out on a limb here and say that they will most likely keep the current bind on pickup mechanics for the best loot, and build a RMAH around that model; selling ponies and other stuff on the side. This would allow them to make a substantial profit without breaking the competitive nature of the game.
  20. galzohar

    galzohar IncGamers Member

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    Re: D3 RMAH as testbed for Project Titan RMAH

    Micro-transaction-based games generally can require you to use real money to have a chance because they create power boosts out of thin air as soon as you put in the money, giving the developers no limit on how much they can make it increase your power.

    As soon as you only buy stuff that other players actually obtained by playing the game, making you "required" to pay real money is much more limited. Of course having some extremely rare extremely powerful items will still be messed up and make those who pay real money the most powerful, but those will still be the minority no matter what, since if everyone can have those items, then mostly everyone can also find them without paying real money.


    Are there any micro-transaction based games for the PC that are actually successful in US/EU (not China/Korea, which I know do have some micro-transaction games that are successful)?

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