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All of the latest Mists of Pandaria newsThe Lawbringer: The lessons of globalization and gold farming
by Mathew McCurley 
Jan 21st 2011 at 1:00PM
Back in 2008, I wrote an article for The Escapist titled Crossing Boundaries, a piece all about globalization as the greatest issue facing video game developers and producers at the time. Guess what, ladies and gentlemen? It's 2011, and globalization still takes the top spot as the prime issue challenging video game development and production.
Rather than rewrite an article on the effects of globalization and the problems the phenomenon causes for the video game industry at large, I thought it might be fun to use globalization as a rubric for discussing the very global industry of gold farming, especially when it comes to the legal nature of things, whatever things may be. We will talk about the lack of predictability in the global market, gold farming as globalization, and the problems with fighting the good fight against the grey market. Won't you join me?
The issue of globalization
As technology pushes forward, the world gets smaller. From tweets during revolutions to global events being recorded on YouTube, the world travels at the speed of light rather than the speed of a clipper ship bringing news from far away lands. With globalization comes partnerships and relationships that would have never been experienced in the old world. Markets open, products cross unheard-of borders, and the world becomes porous. That's all well and good for the big-picture thinkers, but we're here to talk about a very small subset of industry and commerce that deals with our world, MMOs.
WoW, and MMOs in general, provide us with many interesting issues surrounding globalization. Censorship, competition, cultural acceptance -- all of these things are global issues that might not have ever occurred to you as issues a video game company has to deal with on such a broad basis. Every market you want to release your game in has rules, regulations, and sensitivities that have to be heeded before you make a dime from those players. The uncertainty and risk involved is astounding. What happens if that $80 million you raised to create a Chinese-specific MMO is suddenly worthless because the Ministry of Culture says no to your game?
That was a trick question, actually, since you can't even create or run an MMO in China if you aren't a Chinese national corporation (or cleverly fake-partnered/licensed with one). Ah, globalization.
Gold farming is a global industry
I think I've said this before, but it bears repeating: Gold farming is bigger than you think it is. A lot bigger. Someone once told me gold farming is now in the billions of dollars a year all across the world, and I wasn't hesitant to believe that in the least. Back in 2006, that number was potentially just under a billion. Now, with the number of MMOs and the huge increase in WoW players alone, the numbers must be astronomical.
A lot of people email me with statements or questions that sound like this: Why can't Blizzard just sue these guys and stop them? Sure, Blizzard could probably sue on some basic contract claims or, as it often tries, sue on a copyright infringement claim of some kind. The problem is jurisdiction. You can't sue someone you don't have jurisdiction over, meaning the rules have to apply to them as well for there to be any recourse, or the acts have to have their nexus where jurisdiction would be applicable.
Take China, for example. Our rules and regulations have no holding in Chinese courts because they aren't Chinese rules and regulations. Chinese courts are also famous for ignoring default judgments in U.S. courts. We may live in a global village, yadda yadda, but the rules we deal with are more separated than you could possible imagine. The real answer is you'd have to sue in China for a judgment in China, and that's not the simplest thing in the world to do.
Gold farming as global
After choosing this topic to elaborate on, I went and drew a little picture of the transactions that take place to illustrate a point to myself: Gold farming and the transactions that occur from the practice are heavily in favor of continuing those practices with little to no recourse available by foreign game companies.
Despite being a global phenomenon, the left side of the transactions never see or understand the right side of the transaction. The income from gold farming goes to a lot more than employment, obviously, but you get the point. And with a workforce that is so easy to assemble and easy to pay, the profit margins on gold farming must be immense, not even counting volume.
Lessons from a global, virtual industry
What can we learn from gold farming as a global industry that permeates almost every MMO on the planet? A lot, actually. Virtual worlds are still very much the domain of games, but one day they won't be. Recourse, therefore, is the issue we must begin to truly dissect. As the world gets smaller and virtual worlds become more popular and more pervasive, finding recourse to our problems will become the real issue, as the means and mechanics to creating and dealing in virtual currency may or may not have evolved to the point of real currency in our laws and in our minds.
Greg Boyd once asked me if Facebook was a virtual world, and I didn't have an answer. I probably mumbled something like "of course not," followed by "well, maybe," then weaseled into an "aah you got me and I learned something." The truth is, Facebook is a virtual world, and one day you might sign a contract with Facebook connect. You might buy actual real estate in Second Life and pay for consideration in Linden dollars. We have no idea.
Will our laws hold up when the very real-world grounding that our systems are set up to deal with slips out from under us? We can tack on new ideas to existing laws, sure, but creating something fresh lets us operate under a new paradigm. Maybe gold farming is a step in understanding virtual currency and the potential recourses available to companies affected by it.
Something that has always bothered me about the global village concept is that we all play by different rules. Sure, it's a product of cultural, religious, and idealistic differences, as well as those that govern us, but in the case of MMOs and the grey market, I don't think it's fair to say that we're all on the same page yet. The communication is there, yes, but the recourse, for the most part, is not.
This column is for entertainment only; if you need legal advice, contact a lawyer. For comments or general questions about law or for The Lawbringer, contact Mat at mat@wowinsider.com.Filed under: Analysis / Opinion, The Lawbringer
Reader Comments (Page 2 of 4)
sekkusuichi Jan 21st 2011 2:07PM
You make a good point. It's not against the ToS. You can buy gold, and Blizzard cannot ban or suspend your account for your part in that action. It's just considered a bad idea because you're facilitating someone that is violating the ToS. Without you, they couldn't do it. You're also putting your account at risk which requires Blizzard to hire more people to recover your account.
Golis Jan 21st 2011 3:21PM
wow... could you be more wrong.
There is a specific section right in the Terms of Use that it took me all of 30 seconds to find (read the last sentence for clarification):
Ownership/Selling of the Account or Virtual Items.
Blizzard does not recognize the transfer of World of Warcraft Accounts or BNET Accounts (each an “Account”). You may not purchase, sell, gift or trade any Account, or offer to purchase, sell, gift or trade any Account, and any such attempt shall be null and void. Blizzard owns, has licensed, or otherwise has rights to all of the content that appears in the Game. You agree that you have no right or title in or to any such content, including without limitation the virtual goods or currency appearing or originating in the Game, or any other attributes associated with any Account. Blizzard does not recognize any purported transfers of virtual property executed outside of the Game, or the purported sale, gift or trade in the “real world” of anything that appears or originates in the Game. Accordingly, you may not sell in-game items or currency for “real” money, or exchange those items or currency for value outside of the Game.
Golis Jan 21st 2011 3:27PM
well... before I get railed on, let me say after further examination I can see what you are stretching at, that the sentence says you may not sell (does not say you may not buy).
If you can prove that somehow absolves the buyer in the transaction, then I applaud your ability to pick at trivialities.
Paultab Jan 21st 2011 4:11PM
@Golis
This is precisely my point. Having read the EULA front to back it is never stated that "buying" virtual currency is an infraction.
This leads me to wonder why? Well put on your tin foil hats for this one. Blizzard only stands to gain more money by randomly banning gold farming accounts. A player who buys gold and is banned is less likely to come back to the game. However, a gold farmer is very likely to purchase a new account once banned. This adds up to more money in the pockets of Blizzard. Each time Blizz sends out a ban wave they're effectively forcing the farmers to purchase (or steal) new accounts. One hand feeds the other. Seems like simple logic to me.
On a side note, I'm also confused as to why anyone would think the act of buying gold somehow compromises account security? How does a farmer knowing your character name in any way make him able to hack your account? One doesn't need to hand over any information outside of that. I can understand a powerleveling service doing so, but not gold buying.
I'm not condoning the gold trade. Just playing Devils' Advocate.
Cyrus Jan 21st 2011 4:48PM
Looks like it's against the ToU to me. From Golis' quote:
"You agree that you have no right or title in or to any such content, including without limitation the virtual goods or currency appearing or originating in the Game, or any other attributes associated with any Account."
You have "no right or title in or to" gold bought with cash. That doesn't explicitly say "... and if you get it, you'll be banned", but if you have something on your account you have no right to, then what do you think happens? (To put it more exactly, you have "no right or title in or to" anything on your account. Blizzard owns it. They could ban you for rolling need on an item you don't really need. It would be very bad PR so they won't do it, but it would not be illegal or a breach of contract. So they don't have to specifically enumerate "no gold selling... and no gold buying either, dumbass", but anything Blizzard doesn't like is against the Terms of Use.)
But if that's too broad for you, fine, how about this?
"Blizzard does not recognize any purported transfers of virtual property executed outside of the Game, or the purported sale, gift or trade in the “real world” of anything that appears or originates in the Game."
"Trade" includes both selling and buying. Seems straightforward.
Paultab Jan 21st 2011 4:59PM
@Cyrus
"Blizzard does not recognize any purported transfers of virtual property executed outside of the Game, or the purported sale, gift or trade in the “real world” of anything that appears or originates in the Game."
I'm hearing what your saying about Blizzs' ownership of accounts. They can do whatever they see fit under any circumstance.
Now to be clear, in lawyer speak "does not recognize" is by no means stating these actions are punishable in any way. It's simply a safety measure to remove themselves from any action a player may take outside of the game when dealing with currency sale. If a player were to buy gold from a third party, Blizz is in no way connected to, or responsible for anything that may or may not take place before during or after said transaction.
Kevin Fitzgerald Jan 21st 2011 5:20PM
"You agree that you have no right or title in or to any such content, including without limitation the virtual goods or currency appearing or originating in the Game, or any other attributes associated with any Account."
This means that you do not own your character, or the gold itself. Blizzard can take it away from you without reason or ban you. This does not mean you cannt effectively sell gold. They mention specifically above that you cannot sell an account, but they do no afford the same language when it comes to currency.
Why? Because it's been tried before. Selling vendor coupons without their consent is illegal. Selling the labor to cut the coupons from a newspaper, and then shipping the coupons to the buyer is legal.
Case in point, you're paying for their labor in farming (which Blizzard does not own) and getting gold as a gift in addition to their labor.
TR Jan 22nd 2011 6:29PM
That's often the same argument used by minors in some states when they get caught buying alcohol - that the statutes only say the SALE of alcohol to minors is illegal. It's been about as successful as a liquor store saying that since sales are contractual in nature, i.e. mutual agreement, benefit, consideration, etc. and that minors cannot enter into valid contracts, that a sale did not actually occur. lol
Simulcram99 Jan 21st 2011 1:52PM
Amazing. Didnt think you could still write this crap with the title "lawbringer" with a clean concious. Worked for the escapist did you? The fail site with the British dude? How often have you dined out on that?
JT Jan 21st 2011 2:03PM
If you're going to be sanctimonious on the internet, do take a moment and learn to spell "conscience."
BB Crisp Jan 21st 2011 2:16PM
What the what? Somebody woke up on the wrong side of the bed. Here's what Simulcram99 wrote on a previous Lawbringer article dated Jan 14th:
"It really is tangential articles now isnt it? that brush wow, of which I suspect you know little, and legal hypotheticals so armwaving as to be absurd. This is a qualified "lawyer", as in UK Solicitor with a healthy interest in the outside world, pleading with you to stop this.
You are doing active harm to the world via the media of bad journalism.
The question is of the esoteric type Id expect to see at Defcon, only in much more technical and legal detail, due the unlikeness of it happening. Your writing on both the topics of wow and the law being so uninteresting and arm-waving and, most importantly, uneducated.
Write something about warlocks instead. Focus on one specific topic and absorb its contents. Before shoddily summarising two of which you no surprisingly little beyond the average consumer advice pundit."
See how he uses the word "uneducated" in there, yet clearly has no grasp of its meaning? Dude, you need to relax, pick your battles more wisely, and proofread your material before posting (especially if you're going to claim to be a lawyer). I suggest that for your own sanity, just stop reading these articles. Then we won't have to suffer through your comments.
Odinfrost Jan 21st 2011 5:07PM
@Simulcram99
OK who ordered the douchebag with a side of jackass?
Seriously if you are really a lawyer or solicitor, you need to find a new line of work right now because not only can you not make a coherent argument you don’t seem to be able to spell properly either…
Pure fail.
Guttsu Jan 21st 2011 6:55PM
Oops this is my bad everyone! I was trying to piss in Kia's cerial this morning and I think I switched the bowl with Simulcram99. No wonder he's such a Negative Nancy!
Sorcha Jan 22nd 2011 11:12AM
That guy's just a nob, tbh. I never understand people who take time out to ramble incoherently on the comments section of posts they dislike.
Balrickst Jan 22nd 2011 10:30PM
What i want to know is why does Blizzard say most of all gold from gold sellers comes from hacked accounts? Hacking accounts isnt easy regardless of what is said here and on other forums. Gold is not easily moved from server to server to start so why cant when someone has their account stripped GM cant just follow the money has it's traded and where it ends up bam there is your gold seller. Even when an account is hacked someone cant just set there auctioning off everything because there is no way to tell when the reall account owner is going to come back on. Which means everything has to be sold to a vendor most items are only worth less than 30 gold which adds up to almost nothing. Disenchanting wont work either cause not everyone has that proff and the shards are worth less than the vendor price cause again they cant sit there and wait for an auction to be over. And with gold sellers prices at 10 to 15 bucks for 5k gold thousand of account would have to be hacked on a daily basis and that simply isnt the case. I'm sorry this is so long and not really on topic and will be downvoted but every interview and magizine piece and documentary and youtube video of gold sellers is people in poor countries playing and making gold the same way legit palyers make it, andis it on blizzard to prove that ultra hackers are the driving force behind gold sellers and not people just trying to make a living. TLDR Dont belive gold comes form hacked accounts.
Kevin Fitzgerald Jan 21st 2011 2:19PM
You make several incorrect assumptions. You assume that "hacking" is how people gain access to accounts. More often, the password if phished. This IS where most gold comes from. You fish a guild officer's account, log in, take note of their inventory and guild bank access.
Then you advertise on a 10 day trial character that you buy in bulk. When you have a buyer, you log into the that officer's account (whose password you have had stored for months) and sell that gold.
A friend of mine had his account ACTIVATED when they allowed the free ten day period before Cataclysm came out. He hadn't had an active account if over a year. That means for a year, someone had his password and waited for him to activate it, or for the opportunity to activate it themselves so they could sell his gold.
Psiwave Jan 21st 2011 2:30PM
So, when accounts are hacked, toons are stripped and guildbanks are emptied all that stuff is just deleted for laughs?
There are genuine farmers true enough, but why spend hours doing that when you can phish for idiots with an email bot and then sell their gear.
When a guildies account was hacked last year both methods were used, all their gear and the guilds was stripped then their DK powerleveled skinning and mining.
On the plus side when the account was restored the DK had bags full of titanium and that expensive leather mat whose name escapes me.
JT Jan 21st 2011 2:01PM
Another great read, and the picture was really helpful.
One thing I've never quite figured out: why doesn't Blizzard just region lock IP addresses? In other words, if your IP is coming from China, those are the only servers you can log in to.
One thing I'd really like to see Blizzard take a look at is the program EVE currently has going: buying ingame time with ingame currency. Seems to be working well for them and very good players are even able to make a little cash on the side.
Vogie Jan 21st 2011 3:41PM
I've thought about that too... they seem to enjoy having redemptive things going on now more than any other time period of the game.
Frozo's selling Wrath mats for Frozen orbs, Vendors selling Cata mats for Justice points. Redemption cards from the TCG. I could see being able to "farm" rare mats to trade for gametime... Farm as in Baron's Mount, not Farm as in Cinderbloom.
Boobah Jan 21st 2011 5:41PM
"One thing I've never quite figured out: why doesn't Blizzard just region lock IP addresses?"
Probably because it's fairly trivial to arrange your traffic to and from Blizzard to be routed through an IP within any given region you care to name; region-locking only locks out the most unsophisticated users.
Anyone in the gold-selling business doesn't qualify.