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Posts with tag real-money-transactions

Congressional report says you 'may' owe taxes on your WoW income

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If you're a World of Warcraft or Diablo 3 player, the federal government would like to have a word with you. Congress's U.S. Government Accountability Office (GAO), at the request of Senators Max Baucus (D-MT) and Orrin Hatch (R-UT), just wrote and filed a 23-page report on the tax implications of earning gold in MMORPGs. Seriously.

The report, titled "Virtual Economies and Currencies," focuses on buying, using, and selling virtual currencies like WoW gold. The key takeaway for World of Warcraft players is that the in-game economy is a "closed-flow system" -- because you can't exchange your gold for U.S. dollars, you don't need to worry about claiming those 26 gold pieces from completing a quest on your 2013 income taxes. If, however, you decide to sell your accumulated WoW items through a third-party exchange (Don't do it! It's against the Terms of Service and could get you hacked!), then you "may have earned taxable income from the sale of these virtual goods."

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Filed under: Analysis / Opinion, News items, Economy, Gold Capped, Diablo 3

Guide to microtransactions in WoW and the Diablo 3 Real-Money Auction House

Piles of gold
Since the advent of gold sellers, players have discussed the ethics of buying gold with real currency, as well as what would if Blizzard started selling gold. Then came the Guardian Cub, and suddenly Blizzard was allowing gold buying and selling via a vanity pet.

Later, Blizzard hit us with the announcement that Diablo III would have an auction house that uses real money. Now that the Real-Money Auction House has been launched, the debates have heated up. This guide is to help you decide, debate, or deliberate about real money in Blizzard games.

Real-money transactions for WoW

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Filed under: Analysis / Opinion, Economy, Diablo 3

Guardian Cub taking a bite out of third-party gold sales

The new Guardian Cub, the pet you can buy with real-world currency and exchange for in-game gold, has been available for sale on most realms' Auction Houses for a good 24 hours now. And early reports are looking very favorable for Blizzard; it is now significantly cheaper to buy gold through Blizzard than through one of the less-reputable, third-party Chinese gold sellers.

The price of the Guardian Cub varies wildly by server -- a function of supply and demand. An impromptu Twitter survey suggests that the pet is currently selling for between 6,000 gold and 40,000 gold in game, depending on server size, competition, and a number of other factors. Most realms are currently seeing prices just north of 10,000 gold.

Certainly, the final page of the Guardian Cub saga has yet to be written, and prices will be extraordinarily volatile in the next few days, weeks, and months. Still, even at a conservative exchange rate of $10 for a 10,000-gold pet, players can get a far better (and safer!) deal buying gold through Blizzard via the Guardian Cub than dealing with a gold seller. The difference is stark -- the same amount of gold may cost you $20 or $30 through a third-party site. And even then, you have no guarantee of getting your gold, no guarantee that your account won't be compromised, and no guarantee that your purchase isn't supporting forced labor and account theft.

Will the Guardian Cub kill off third-party gold sales? Probably not, at least on its own. Interest in this new pet simply cannot be sustained long term. But if the last 24 hours of trading on the in-game Auction House are any indication, Blizzard just fired a shot into a multi-billion-dollar gray market.

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Filed under: News items, Economy

The Lawbringer: Mailbag 7.0

Pop law abounds in The Lawbringer, your weekly dose of WoW, the law, video games and the MMO genre. Mathew McCurley takes you through the world running parallel to the games we love and enjoy, full of rules, regulations, pitfalls and traps. How about you hang out with us as we discuss some of the more esoteric aspects of the games we love to play?

Wow! Did you see all those cool announcements and awesome World of Warcraft news items that we are currently reporting on? Me too. I'm writing this article much earlier than BlizzCon, so you'll have to excuse my lack of foresight. How about we mailbag us some Lawbringer questions?

Albert wants to know what's up with gold sellers stealing gold and why Blizzard can't just track it and remove it. Seems simple, right?
Hello, love your column. I was wondering if you can explain something. When these gold sellers hack someone's account and move their gold, can't blizzard track where the gold is going and just claim it? I mean i assume they have the tools to do anything in game, they are god. Seems simple enough to do, i got hacked, see where gold went, take it back. do it for a few months and done. am i missing something?

Thanks in advance,

Albert
Thank you for the email, Albert. It probably is not that tough to track currency moves and associated transactions, but it's really about the volume of text and transactions that go on at any given time. It must be hell to search through all the records to find this stuff, even if you know the name and server that people are on.

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Filed under: Analysis / Opinion, The Lawbringer

The Lawbringer: Q&A on Diablo's real-money auction house

Pop law abounds in The Lawbringer, your weekly dose of WoW, the law, video games and the MMO genre. Mathew McCurley takes you through the world running parallel to the games we love and enjoy, full of rules, regulations, pitfalls and traps. How about you hang out with us as we discuss some of the more esoteric aspects of the games we love to play?

Since Blizzard dropped the Diablo 3 bombshell on us early Monday, I will post the second article in my series on micro-transaction models next week. For those of you who have been living under the proverbial internet rock (you are missing some awesome memes right now), Blizzard announced that Diablo 3 would feature two auction houses, one using in-game gold as currency and the other using real currency that would be deposited into a Battle.net account wallet and used from there.

The whole system gets more intriguing when you take into account that sales made on the real-money auction house can make their way to your own very real wallet through an unannounced third party or deposited back into your Battle.net wallet for use on anything digital in the Blizzard store, including WoW game time.

If you're a regular reader of The Lawbringer, you already know how excited I get over virtual currency. This is my wheelhouse. I feel like a master carpenter at Wood Con 2011, cosplaying as my favorite oak tree, quercus alnifolia. Pair that with real currency, and excitement levels hit the stratosphere. I may break through the atmosphere at some point. That faint sonic boom you hear will be me hurtling through the air in excitement and wonderment.

Sure, the Diablo real-money transaction (RMT) auction house is not related to World of Warcraft -- or is it? Oh, it very much is. Faithful readers and not faithful alike (how could you, Debbie?) have been writing in questions via Twitter and email asking me to explain the auction house and talk about some of the potential legal and tax issues that could come around because of it. Also, many people want to know how the RMT auction house could benefit World of Warcraft, despite Rob Pardo's saying there are no plans to bring it over to WoW. Let's take a look at your questions.

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Filed under: Analysis / Opinion, The Lawbringer

The Lawbringer: Fighting the gold fight -- how the strategy must change

Pop law abounds in The Lawbringer, your weekly dose of WoW, the law, video games and the MMO genre. Running parallel to the games we love and enjoy is a world full of rules, regulations, pitfalls and traps. How about you hang out with us as we discuss some of the more esoteric aspects of the games we love to play?

Last week on The Lawbringer, I introduced you to the world as it is, a battlefield littered with the corpses of stolen accounts, inconvenienced players, and a priceless reputation on the line. This week, we look at concrete solutions to actually helping the gold selling system wind down and remove many of the hurdles that instant gratification with purchasing gold sets up for Blizzard. You might have mixed and angry reactions to what I'm going to talk about, but do give me the benefit of the doubt. I think being open-minded might win this fight.

So what can Blizzard do besides selling its own currency? Here are my suggestions for the first steps that Blizzard needs to take in the new war against gold selling.

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Filed under: Analysis / Opinion, Blizzard, Economy, The Lawbringer

The Lawbringer: Fighting the gold fight -- the world as it is

Pop law abounds in The Lawbringer, your weekly dose of WoW, the law, video games and the MMO genre. Running parallel to the games we love and enjoy is a world full of rules, regulations, pitfalls and traps. How about you hang out with us as we discuss some of the more esoteric aspects of the games we love to play?

The Lawbringer has in the past been used as a personal launching pad for some of the more out-there or esoteric ideas that I have in regards to the World of Warcraft and virtual currency in general. You guys seem to love it, and there's always plenty of great discussion about these ideas. For the next two weeks, I want to introduce you to my thoughts on how Blizzard should be attacking gold sellers and, at the same time, working to remove some of the content gates that gold has erected in the MMO we all love. This week, we will set up the story and the history of it all, and next week, we will talk about hard conclusions.

Gold selling isn't going away as long as fungible and liquid currency exists in MMOs. Gold is "fungible" because it can be exchanged for something exactly like it, at a 1:1 ratio -- gold is gold. Gold is also liquid, as it can be used and exchanged for other goods or services. Short of Blizzard's getting rid of this type of currency altogether or selling its own currency for a cheaper price than gold sellers can furnish it, people will sell gold and items that can be traded.

Blizzard has shown that it has the guts to go after gold selling as an industry but has so far failed in scope to bring down the snake that slowly poisons everything it has worked to build. As sellers become hackers, and as hacking chips away at the good will, reputation, and stability of the game we love to play and the company we love to patronize, there has never been a more urgent time to fight the gold fight. The strategy needs to change from focusing on the people who sell gold to a combination of those that sell and the gold itself.

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Filed under: Analysis / Opinion, Economy, The Lawbringer

Blizzard strikes gold sellers with Paypal notices

Last week, Blizzard sent out strongly worded complaints to Paypal, accusing many gold-selling companies and resellers of "intellectual properties violations" for selling World of Warcraft goods. After receiving these complaints, Paypal sent notices off to the gold sellers Blizzard had complaints against, stating that if these activities continued through their websites and the Paypal service, Paypal would revoke their ability to use the popular payment site as a payment option.

Here is Paypal's letter to the gold sellers:
You were reported to PayPal as an Intellectual Properties violation by Blizzard Entertainment Inc. for the sale of World of Warcraft Merchandise.

If you feel your sales do not infringe upon the intellectual property rights of the Reporting Party, please complette the attached Objection to Infringement Report by January 21, 2011.

The completed form should be faxed to the attention of the Acceptable Use Policy Department at [number removed] or emailed to [email removed].

Should you choose not to object to the report, you will be required to remove all World of Warcraft Merchandise from the website [url removed] in order to comply with the Acceptable Use Policy.
What's very interesting is that Blizzard is claiming intellectual property violations in the face of the most recent decision in the Glider case. Where Blizzard lost on intellectual property concerns under the EULA, they could have a better shot over their game assets being sold, if somehow it ever went to court. Still, Paypal is the easiest route to go for Blizzard's plan of attack against gold sellers, since most of them are run outside of the country. Suffice to say, it's nice to see some action being taken against gold selling.

Filed under: Blizzard

Breakfast Topic: Will you be buying either of the new vanity pets?

This Breakfast Topic has been brought to you by Seed, the Aol guest writer program that brings your words to WoW Insider's pages.

Blizzard has been selling us in-game items for a while now; however, it has kept this to noncombat pets and mounts -- things that, outside of counting for totals for achievements, have little to no real effect on gameplay. Some of the items Blizzard does for self-profit, and sometimes it sells in-game pets for charity. People who buy the items get different reactions from the community; the sparkle pony especially got a lot of hate.

Personally, I have not bought any of the real-money pets, partially because I am not a collector and partially because I felt that paying for downloadable content should add something major to the game experience. However, I am considering buying the Ragnaros pet for one main reason: because Rags is my major epic memory of vanilla WoW, I always felt he was an awesome model and so imposing, and many of us went around saying "too soon" on Vent.

Have you bought any of the vanity pets? Do you buy them all as a completionist/collector? Do you pick and choose the ones you think look cool? Do you only buy the charity pets? Or do you avoid real money transactions in games altogether?

Filed under: Breakfast Topics, Guest Posts

Breakfast Topic: Would you pay for extras in a F2P WoW?

This Breakfast Topic has been brought to you by Seed, the Aol guest writer program that brings your words to WoW Insider's pages.

Lord of the Rings Online went free-to-play. "Free" is a questionable term, since they charge you for a fee for features you can technically live without but are still fairly important; things such as the gold cap, the ability to gain rested XP, and certain instances and PvP options require a fee. You get an enhanced version slightly above a trial, but you are still limited in what you can do in the free-to-play version of the game.

While playing a game, I want to play the whole game, have the entire experience, and not feel as if I have been shortchanged by being on a limited version. Personally having purchased some of the Mass Effect 2 and Dragon Age DLC, I would still have to pay for the added functionality. Not being able to fully advance my character and see large amounts of content would irritate me more than the cost would. Not being allowed to make use of content would make me feel like I was missing out.

I want the choice of whether or not I do this instance, raid, or battleground. Could you imagine attempting to zone into Icecrown Citadel and seeing a message that says, "Requires a V.I.P. membership"? WoW has sold us a few items for extra money that are not required, but not having a Lil' XT or a sparkle pony doesn't affect your game functionality.

LOTRO offers things like more bag spaces and removing the gold cap and even priority login for those with V.I.P. accounts. So if World of Warcraft decided to follow the LOTRO model and go semi-free-to-play, would you just play the free portion? Would you pay for the V.I.P. portion? Would you buy the other nickel and dime upgrades they have on top of that? Or would you quit WoW altogether, feeling as if Blizzard had shortchanged players by making us pay for things like bag space, PvP and raid availability?

Filed under: Breakfast Topics, Guest Posts

15 Minutes of Fame: Cory Doctorow on gold farming

From Hollywood celebrities to the guy next door, millions of people have made World of Warcraft a part of their lives. How do you play WoW? We're giving each approach its own 15 Minutes of Fame.

A conversation with Cory Doctorow plunges into the matter at hand so quickly that it's almost impossible not to imagine yourself falling through an internet-era rabbit hole of pop culture and technology. Doctorow is all about synthesizing ideas and spitting them out in as accessible a fashion as possible, and the ground he manages to cover in a single stride can be mind-boggling; he's a science fiction author, activist, journalist and blogger, father, gamer ... A former WoW player and husband of gaming standout Alice Taylor (also previously profiled here in 15 Minutes of Fame), he's widely known as the co-editor of Boing Boing and author of the bestselling young adult novel Little Brother.

Doctorow's latest young adult novel, For the Win, pries open the seams of the shady scene behind MMO gold farming. Its young protagonists are gold farmers and gamers themselves. Doctorow has woven his own experience and sensibilities with focused research to outline a world of gold farming that sprawls far beyond the lines of cartoon-image gold farmers that most of us have painted in our heads. We chatted by phone with Doctorow for this lengthy conversation on gold farming and game economies, plus a companion piece at our sister publication Massively.com on gaming culture and his recent fiction.

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Filed under: Economy, Interviews, 15 Minutes of Fame

Breakfast Topic: What are you willing to buy?



The Celestial Steed and Lil' XT went live the other day to the delight of many, the disgust of a few, and one mother of a checkout line. Toward the end of the day as I write this, the line for purchasing the mount in the North American store clocks in at 148,108 and climbing. I think it's safe to say that the shiny horse, at least, has been a runaway success.

I haven't yet bought anything from the Blizzard store, but I come from a long line of suspicious New England cheapskates for whom saving 10¢ on bulk toilet paper was a day for the diary. Most people don't seem to have a problem with RMT (Real Money Transactions/Trading) as long as they're kept to things that don't exercise any real influence on the game. If they're just for fun and they don't give anyone an unfair advantage -- we ask reasonably -- what's the big deal? Then again, it makes me a bit sad to see brilliant new pets and mounts head straight to the store while things like the moonkin and Tree of Life models have languished for years without updates. Oh well. Everyone has mounts and pets, but not everyone plays a druid (more's the pity).

I have to admit that Blizzard selling formerly TCG-only rewards like the Path of Cenarius might make me reconsider, although I'm not sure it'd be great policy for them to undermine the card game's rewards. Have you bought anything from Blizzard's store, and do you think they should sell anything in addition to pets or mounts? Or, to put it another way, what would you love to buy?

Filed under: Breakfast Topics

Gold farmers try to take their game onto guild web sites

Last week I wrote about my harrowing experience of finding a gold farmer in one of my instant messaging windows. Apparently somebody "in one of those countries" (I'm slapped on the wrist every time I single-out China) must have swallowed a creativity pill. Just when I thought there was nothing new on the horizon, Aleeyah from Livejournal posted an article -- complete with screenshot -- of an odd in-game e-mail that was received from someone we can fairly safely assume is in the professional gold farming business.

The written English in the in-game message is nearly bad enough to send one of my editors into a seizure. It's almost bad enough you can't understand it at all. The bare essentials that I can (barely) glean from the message is that the farmers are now offering gold to guilds in exchange for advertising.

Why would they do this? As I said in my last article on this subject, I think they're losing on the home front. I think their current marketing techniques are not bringing the level of revenue that they want. I think more and more people are discovering just how easy it is to right-click a spammer when they're checking their mail, silence the spam, and have the feel-good feeling of knowing they've done something right for their community. I know I do it all the time. I won't go as far as to call Blizzard's anti-spam tactics a flourishing success, but as the old saying goes "If you can't beat 'em, wear 'em down," and I think that's exactly what is starting to happen.

So if real-money transactions are frowned upon by Blizzard and prosecuted by Blizzard, why wouldn't they just try and move their advertising medium to neutral ground? Sure, there are lots of guilds that will have nothing to do with selling their corporate souls to the devil in this manner. You can rest assured however that there are also lots that would jump at an opportunity like this that could pay for all their bank tabs for nothing more than a measly advertisement on their guild web site. It does bring up the interesting question however, of whether a guild that supported a gold farming business financially could potentially face retribution from Blizzard. While I can't see a guild getting banned en masse for this, it would sure be a wakeup call if such a guild logged in to find their tag gone along with all their guild bank slots and contents.

Does this mean that the spamming around the Ironforge and Orgrimmar mailboxes is going to let up? Not likely, or at least not very much. It just means "these people" have found yet another way to devastate our server economies for their own profit.

Filed under: Analysis / Opinion, Virtual selves, Odds and ends, Economy

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