tech article by England’s The
Guardian is any indication, a veritable virtual world earthquake is
rumbling across the pond. Correspondent Victor Keegan gets the impression all
of this virtual commerce may be more permanent than the Furby:
Unlike the industrial revolution, the virtual one is led by
the East, not the West. Market researcher Plus Eight Star puts the virtual
goods market in Asia at more than $5bn, or 25 times higher than recent estimates for the US, though
they may be a serious underestimate.
Keegan pulls from data harvested by virtual researcher par excellence Edward Castronova of
Indiana University, who took on the heart-pounding feat of reading hundreds
of pages of Everquest 2 player transactions in an effort to map virtual economic
It’s refreshing to see the growing virtual-to-real currency
conversion market taken seriously. What’s great about Keegan’s Guardian article is that it brings in an
area of virtual commerce that is exploding while remaining under the radar of
the graphical worlds scholars: Facebook and social networking games.
For those unfamiliar, Facebook is rife with free-to-play
games like Mafia Wars, Farmville (of
which your author is a recent addict), and Roller Coaster Kingdom. While these
games are entirely free to play, any serious player will find themselves
quickly limited unless they opt to invest real money in purchasing in-game
upgrades and currency.
Zynga, developer of
Mafia Wars, Farmville, and nearly every other big-name social networking game
on Facebook, draws a pretty penny from these “microtransactions” of anywhere
from one to five dollars, all the way to $40.
These games aren’t a joke, and Zynga was right to bank on
the spendthrift tendencies of teens driven by immediate gratification. Zynga
recently closed nearly $50 million in revenue on the backs of these easy-to-produce
browser games, and hauled in nearly 30 million active players. That’s a rough
average of a little over a dollar spent per player.
So what is the future of these virtual transactions? The Guardian shows no lack of hope:
First, the technologies behind virtual spaces are powering
ahead. It is even possible, indeed likely, that products will be constructed in
a virtual world and then "printed" out in the real world as a
While we may not be printing things out on three-dimensional
printers any time soon, Keegan is right to point out that technology shows no
signs of slowing. As the iPhone has shown, engaging games can be produced with
little start-up capital, increasing competition and raising quality. People are
willing to pay for the experience.
The economic world is changing, a dollar at a time.