Legitimizing RMT

Interview with Live Gamer’s Andrew Schneider.

On the same day that John Smedley, President of Sony Online Entertainment, gave his keynote speech at ION 2008, a press release came out announcing an extended partnership between SOE and Live Gamer, the company that supports legitimate (ie. SOE-approved) virtual goods sales in Everquest II. This extended partnership covered both of SOE’s upcoming games that Smedley talked about that day - Free Realms and The Agency.

Because real money trading (RMT) and the sale of virtual goods in MMOs has always been a controversial topic, we tried to reach the people at Live Gamer and luckily, were able to sit down and chat with its founder and president, Andrew Schneider.

“It’s controversial, it’s a sensitive topic, and we know that. But you can’t ignore the consumer demand that’s out there,” Schneider makes his case in a soft-spoken, articulate manner.

“The dollar value of the market is around $2-billion worth of transactions a year. That’s a lot of people trading and it’s happening now without the publishers’ cooperation and in violation of the terms of service, and there’s fraud and credit card theft running rampant. Also publishers are incurring additional customer support cost due to trades gone bad that they had no control over. The question becomes how do you deal with that.”

Live Gamer’s answer to that is to partner with game publishers to provide a safe and secure environment in which to trade their virtual goods. All this is fine in games like Free Realms for example, where the business model involves ingame micro-transactions, but what about MMOs where players earn their gold and gear through quests and hunting creatures?

“A lot of the controversy originates from the competitive hardcore player who thinks that you should spend time playing the game, and that it’s not fair for other people to buy characters or items to advance. But people are playing these games for a variety of reasons. There are people who are social players. There are people who just want to explore everything the world has to offer and that the designers have created. For some players there’s no ‘winning’ the game.”

“It’s interesting but I don’t think it will be a polarizing topic in three years’ time,” he adds.

Trinity: Can you tell us more about your partnership with SOE?

Andrew: Well we’ve been working with SOE for some time now. The first announcement we made was that they were part of our publisher lineup to support the legitimate real money trading marketplace. And then we announced the incorporation of the Station Exchange technology that Sony had built into our own Wall Street focused technology to create a very robust web experience and in game experience with the trading of assets for real money. We launched in EQ2 on April 15th so the marketplace is up and running this past April and it’s been going very well.

And today, we announced that we are expanding the relationship to include two of their major upcoming titles – Free Realms and The Agency. Sony has been in the business as long as anybody else. They really define the MMO genre from the early days and they continue to innovate and to be responsive to the marketplace. These two new titles are very exciting – very broad demographic appeal, new audiences, new business models and the secondary market trading is a huge part of that mix going forward.

Trinity: So how is Live Gamer going to come into the picture in these two games?

Andrew: What we see emerging are two distinct markets. You have a primary market which is generally a publisher selling an item to a player. But what has also happened over the last 10 years or as long as there have been MMOs or any sort of persistent world, is players selling to other players. Today, this happens to be done in the black market. Through our partnerships with Sony and other publishers, we are enabling a fully supported legitimate player-to-player marketplace. If you’ve used Ebay, it’s a similar type of experience. You have something you want to sell, you list it in the marketplace, you can create a buyout price, you can set it up in an auction style, and then that goes into a listing and buyers come in and browse through the marketplace, do a keyword search, find what they are looking for and then buy it. We handle a very seamless transfer. We integrate with the game publisher so if you buy something from another character, you are doing it within the terms of service, in a safe and secure environment. We are just making it a more positive experience for people who want to engage in that type of activity, rather than them having to go to the black market and getting ripped off and getting their credit cards stolen.

Trinity: What other publishers/games do you have a partnership with?

Andrew: We’ve got 9 publishers now that we’re working with – Acclaim Games, GoPets, Instant Action, Ping0, 10Tacle, True Games, Interzone Entertainment, FunCom, and of course SOE. There’s real consumer demand and they want to provide a safe and secure place for people to engage in that demand.

Trinity: How do players access the marketplace?

Andrew: There are two ways to do it. We have an ingame client where we integrate into the game and the client can be accessed by a hotkey so players can trade from the convenience of the game. So like if you’re about to go into an instance or you’re in a major quest, you can access the marketplace without leaving the game environment. We work very closely with the publisher to create the design and integration into the game.

The other way is through our web client. If you go to https://exchange.livegamer.com you will see how we handle it in EQ2. There you can click on the buy tab or the sell tab, you can browse through characters, items or coin, and you can place bids or you can buy things immediately. There is no manual delivery of items. The items will be on your character when you login to the game.

Rosethorn: How will you prevent gold farmers from using it?

Andrew: There are certain patterns of behavior that we see in all fraudulent activity. We’re dedicated to doing that so we spot suspicious IP addresses, people who have multiple transactions in a short period of time, that sort of thing. We flag those and we work with the publisher to shut it down.

Rosethorn: What kind of response have you encountered so far? 

Andrew: We didn’t know the response we would get when we started this business. We saw the gap and the need that’s there, but we’re working from the ground up to be legitimate. We got a great team of people from the industry and went out to see what publishers think and not one person said that they hate this idea.