China bans virtual world gold farming

Up until now wealthy players of virtual worlds and MMOGs like World of Warcraft have been able to expedite their progress through the game by spending real money to acquire levelled up players and other in-game virtual goods in a grey market largely supplied by Chinese labour.  According to Information Week China has now banned the trade of virtual goods and services for real money, so this practice will largely come to an end – or maybe move to Africa….

This little talked about aspect of the MMOG ecosystem is actually quite important because it makes the games much more attractive to time poor but cash rich players, which are exactly the type of punter that everyone wants in their worlds.

I have been writing much less about this sector recently because it has become clear that virtual worlds are very difficult businesses to make a success of, much more difficult than I had thought.  On top of the difficulty and expense of building a good virtual world it has transpired that cost effective customer acquisition has been beyond most startups in this category – largely because of poor conversion from visitor to active player and monetisation.  This development will make monetisation more difficult still.

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  • So how exactly would they control this? I guess through paypal, ebay and specialized markets this can be done without much possible oversight.

  • Enforcement might be tough, but then again they are monitoring just about everything that happens on the web…

  • Yes, I was referring to that. Let's see how it plays out in the end, the article says that virtual goods (instead of currency) might still be tradeable. The more sophisticated market places within games and especially the game devs upselling items and currency for real money themselves might be the beneficiaries here.

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