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China's gold farming ban not really a ban

The other day, we reported on China's recent ban on trading real currency for virtual goods, and it was hailed as the end of gold selling in the MMO world. Unfortunately, it may not actually play out that way. While this would put a stop to some gold selling, it won't stop all of it thanks to a convenient little loophole.

That loophole is the fact that their law has no jurisdiction over foreign transactions. While it absolutely can put a stop to these transactions on Chinese soil using Chinese servers and Chinese currency, Chinese goldfarmers can still happily (well, probably not happily) scrounge up gold on American realms and sell it to American players. Most likely, this new law won't have an impact on the gold selling industry whatsoever. The people being impacted are those crafting their games on a model of microtransactions rather than a subscription model. Developers, not gold farmers, will be harmed by this. A game like Free Realms is no longer a feasible option in China.

If you're not familiar with the model, games that are supported by micropayments typically work like this: The base subscription is often free, or at least cheaper than your average MMO. Their revenue is earned by selling things like mounts, vanity items or access to additional levels/zones for a small fee. To put it in a WoW perspective, it would be somewhat like if you could level a Hunter to 80 for free, but if you wanted to go to Ulduar you would pay $20 to allow your account to access it. If you wanted a sweet new mount, they would have a selection of them available for $5. Heirloom items? A few bucks each. Essentially, you decide how much (or how little) content you want to pay for.

In our speed to celebrate the 'end' of gold farming, we largely failed to see the real issue. This doesn't benefit gamers anywhere in the world, it has the potential to harm them and the developers. Of course, it protects those that can't resist temptation and end up spending every penny of every dollar they earn on wacky MMO items, but the gamers that can keep control over their own wallets? You're out of luck if you live in China.

Filed under: Analysis / Opinion, News items, Economy

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