Gaming markets

The concept of gaming markets is relatively new. It grew out of the MMORPGs in the late 90s, such as Everquest and Asheron's Call. Players build up their characters by hunting monsters, earning experience points, and collecting artifacts. Although there are in-game markets for artifacts, denominated in artificial game currency, some players wish to further enhance (or accelerate the development of) their characters with real money. Naturally, secondary markets, denominated in real US dollars, arose to meet this demand.

The first of these markets were found on auction sites such as eBay. For sale: artifacts, in-game money, characters, even mentoring services. This is a vibrant multi-million dollar market. Some players make a (real) living from it. Another class of markets serving the online gaming community are forex-style in-game currency markets. The leaders in this field are IGE and Gaming Open Market.

Not everyone embraces real-money gaming markets. Some say the influx of real money corrupts the gaming environment by giving novices with a lot of money an unfair advantage. Market supporters respond that trade between willing participants, even with real money, does not significantly affect game dynamics. In fact, it often seems that bad design decisions made by game "central planners" have wreaked havoc on game economies.

Besides gamers, the game studios themselves are uneasy about gaming markets. These markets are technically against the Terms of Service of most MMO games. It must also irk the studios that they are missing out on revenue, which they cannot capture due to perceived conflict of interest. However, the studios have not made any concerted move against the markets. They know that they ultimately benefit from them via subscriber revenue, while maintaining plausible deniability.

Regardless of community opinion and studio skepticism, gaming markets are in demand and growing. Why is this happening? And why is this important? I will explore this in part II.