Jan 16th 2009 11:42AM bak said... "Whatever it may be - it's pretty unbelievable that someone would take out an insurance policy on video game time."
I agree - it's a bit laughable. But I remember the first time I heard someone was selling houses on Ultima Online or that somebody actually thought anyone would pay real money for game gold ... or that WoW characters would sell for hundreds or thousands of dollars. I laughed then too. Actually I still laugh. But that doesn't mean it's a scam or hoax.
Jan 16th 2009 11:25AM Derang you are right - but the fact that Blizzard offers no guarantees of uptime or refunds is EXACTLY the reason these guys saw a possible market for this hedge service.
There are millions of players who take a $15 a month price risk in the WoW "market" with no guarantee of $15 in returned service. To offset that exposure, you would take an opposite obligation in the hedge market (aka these guys' service). Of course, you have to pay to offset your risk - a concept that WoW players likely do not understand. Nor will do they seem to understand that their one day price risk is $0.50 and a hedge could net them as much as $10 (according to the article).
All very amusing to read but a little sad to see such lack of intelligence. Reminds me of this PUG I was in yesterday...
Jan 16th 2009 11:11AM Since most people seem to understand Wikipedia, I cite this reference: http://en.wikipedia.org/wiki/Hedge_(finance)
"In finance, a hedge is a position established in one market in an attempt to offset exposure to the price risk of an equal but opposite obligation or position in another market "
The people screaming "scam" and "worthless" are likely the same people screaming "refund" when the server goes down for half a day. Go back and look at those patch day comments. Why would you pay some service $6 dollars to get back $8 if the server goes down? I guess I would also ask why would you scream "refund" for a half day of lost play time when it amounts to 25 to 50 cents in lost fees?
I give high marks to these guys for coming up with an innovative solution to those cries for refunds, however, I give equally low marks for their overestimation of the financial acumen of the average WoW player.
Jan 16th 2009 10:56AM As a financial risk manager, I can tell you that all they are doing is a hedging strategy -- probably WAY too advanced for the average WoW player to understand but a perfectly normal, legal, sane business concept. It's done every day in hundreds of different industries.
Comments on this site remind me of an experience I had in Russia a few years ago. I had set up a business there that was doing very well and I wanted to extend some benefits to my employees as a way of sharing that profit. My idea was to establish a 401(k)-type fund where I would match their contribution. When I happily announced this new benefit, it went over like a lead balloon. Most people could not grasp the concept that we take for granted every day here in the USA. They just thought it was some way for me to not pay them their full salary, steal from them, and give them nothing but a promise.
Nov 24th 2008 5:06PM To be honest it happens so much to me, I haven't felt much guilt over doing it to others - especially of the opposite faction. As a druid with swift flight form it's extremely easy to nab an herb or item and if someone tries to repay the favor, a quick aggro-shadowmeld does the trick. If it's the same faction, I may think twice but you can lose half an hour on crowded realms fighting for sparkly items.
Nov 11th 2008 7:04PM pick me!
Nov 11th 2008 6:35PM pick me!
Nov 7th 2008 11:26AM pick me!
Nov 7th 2008 11:23AM pick me!
Nov 7th 2008 11:13AM pick me!