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OMG it’s an MMOG! |
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Social and Economic Evolution of Online Gaming |
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Advertisement for virtual resources within the World of Warcraft universe, a blurring of the boundaries between “real world” and virtual economies. |
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Economic Impact of Online Gaming |
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The MMOG industry is growing at an ever-accelerating rate, both in revenue and subscribers. World of Warcraft alone, which in 2006 held 54% of market share for all subscription MMOGs, has eight million registered users, as many as 200,000 of whom are online at any given time. The three biggest markets, both in terms of current subscribers and new growth prospects, are China (3.5 million users), the North America (2 million users) and Europe (1.5 million users). The industry in 2006 was worth an estimated $1.01 billion, and is projected to grow to $1.5 billion by 2011. 87% of this revenue is received in the form of subscriptions, and the remaining 13% is derived from related endeavors, such as advertisements and the sale of virtual resources for real-world money (Western World MMOG Market: 2006 Review and Forecasts to 2011). Blizzard, the gaming company responsible for the development and support of industry leader World of Warcraft, has announced plans to turn all of its products into similar MMOGs, at a cost of some $50 million per game. Skeptics abound within the industry as to whether or not this plan is feasible, but the confidence exhibited by Blizzard (and a majority of investors) is a good sign for the long-term health of the subscription-MMOG economic model. Established advertisers are taking notice of the growth potential in the new markets created by MMOG communities. Microsoft-owned Massive, for example, recently signed a deal with the MMORPG Anarchy Online to produce game-based advertisements for Toyota (MarketingVox.com). Advertising firm WildTangent is also moving into the realm of MMOG advertising, selling ads within the RuneScape Universe (MediaBuyerPlanner). More curious is the advent of the online industry to buy and sell virtual property within MMOGs. On Craigslist.com, for example, World of Warcraft characters can be bought and sold for up to $1000, as of June 11th 2007. We challenge you to find one that is more expensive, although it should not be too difficult.
In South Korea, successful gamers have an accepted social status, and can even make careers out of success in the game (either through competition in tournaments, or through resale of acquired virtual property). As can be seen under Social Impact, however, these new economic endeavors can have unintended and unhealthy consequences, even leading occasionally to death from overplaying. Pioneering software companies have also been developing a variety of bots, programs to play the games for benefit, without the required presence of a human being at the keyboard. The most common Bot, known as Glider, was designed by MDY Industries to accumulate resources within the World of Warcraft universe. MDY Indutries has been engaged in a fierce legal battle with Blizzard, the creators of WoW, to determine whether or not Glider’s function undermines WoW’s economic platform or uses proprietary source code, but in the meantime the bot has proven popular among a small segment of the online community.
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