• by Shankar Gupta , March 22, 2005

When the next generation of Microsoft's Xbox video game console is released later this year, it will include an online marketplace where developers can sell virtual items and services for real cash, developers announced at the annual Game Developer's Conference in San Francisco early this month.

But the online selling of purely virtual items for hard, real-world cash actually has been going on for years, with players of "massively multiplayer online role-playing games," or MMPORGs, selling virtual objects--including fictional possessions, "characters," and game currency--for U.S. dollars.

MMPORGs are online games in which players assume the role of a character in a fantasy or science fiction world, and interact with hundreds or thousands of other players, banding together to hunt for treasure, explore simulated worlds, and slay monsters. Examples of MMPORGs include the enormously popular "EverQuest" and its sequel, "EverQuest II," and a game based on George Lucas' "Star Wars" universe called "Star Wars: Galaxies."

The so-called "secondary market" for game items began on Internet auction site eBay, where players of "EverQuest," produced by Sony, bought and sold rare gear--such as a virtual suit of armor--in-game cash ("platinum pieces"), and entire in-game personas--a powerful wizard or an experienced warrior, for example. Such sales were made for hundreds--and in some cases, thousands--of dollars, said industry observers.

While developers have attempted to stop such markets, the markets have proven remarkably resilient. In 2001, "EverQuest" developers asked eBay to stop hosting these auctions, and announced that selling in-game property for real-world cash was a violation of the game's end-user license agreement. eBay stopped allowing these auctions, but the market for in-game property persisted. In fact, the selling of characters and items in these MMPORGs has even grown on specialized sites such as PlayerAuctions.com and MySuperSales.com.

More recently, Blizzard last week tried again to stop the practice by banning more than 1,000 accounts from its game, "World of Warcraft." The banned players had engaged in "gold farming," which involves harvesting "gold" in virtual mines, and selling it online for cash--much like collecting Monopoly money and selling it for U.S. currency.

IGE offers "World of Warcraft" gold on its market, charging $108.99 for 500 pieces of online gold; the company offers to purchase the same amount of gold from players for $25.

Cindy Bowens, a community manager with Sigil Games, which is developing the anticipated game "Vanguard: Saga of Heroes," said the secondary market for items and accounts poses difficulties. "If you can go out and buy this item or this level for cash when I've spent my time and effort and skill to earn it, it somewhat cheapens the experience," Bowens said. "I deal with players by the hundreds every day, and what I hear is that they don't want these sales allowed in their games."

Bowens said that she's seen entire areas of online games dominated by so-called "farmers," who are hunting for rare items or money to sell online. "To me that's a huge problem," she said, adding that "our paying customers are leaving these games because their play is being impeded by someone trying to make money."

"When it's interfering with the gameplay of our customers, we feel that's something we really have to take a look at," Bowens said.

What's more, Bowens said, companies that deal in the sale of online items are cashing in on the work put in by the developers of these games without investing anything in the games' creations. "It just seems incredibly unfair to me that an entire organization can come along and cash in and make money on that--without any investment or risk they can make a profit out of what these people are doing," Bowens said. "I have a problem with that."

Bowens declined to comment, however, on any action that Sigil would be taking to curb these secondary markets, either in the game development or in court. Representatives for IGE did not return phone calls and e-mails for comment.

Chris French, who runs the MMPORG information site "the Caster's Realm," www.CRgaming.com, said some players spend all their in-game time "farming" items to be sold on auction or online market sites. And, he said, there's a substantial amount of money to be made. "I know someone who bought a new car off of stuff they got in the game," said French.

So much money, in fact, that there are companies dedicated entirely to the online selling of MMPORG characters, items, and money. One such site, www.IGE.com, has stores for the major 15 MMPORGs, and sells characters, items, and online currency. IGE also owns MyPlayerAuctions, www.playerauctions.com, which hosts online auctions for players looking to sell their money, gear, and characters.

Some players and developers do not appreciate the existence of this secondary market, however, because sites like IGE make it possible for some players to get powerful characters and rare items without putting in the time and energy that others do. "They've largely been credited with destroying the market economy that was originally in 'EverQuest,'" said French. "My personal opinion is that it's very bad for the game."