Jul 27, 2011

Posted by in Blasters, Beggars & Credits | 21 Comments

Blasters, Beggars & Credits: Schubert Says No Infinite Money

Some players do it for glory. Some do it for infamy. Some like to accumulate the most points, or explore the far reaches of the worlds they inhabit. This, however, is not a column for those people. This is a column for those people who, quietly or not, enjoy making money so that their digital avatar can sleep on large piles of cash.

Hi all, I’m Momus – long-time reader, first time author. My main focus will be on economics, though as with any MMO, all systems tie into each other. You might see tips and strategies you find interesting no matter what your level of dedication to commerce is; certainly, we’ll be focused on making money off the trends of what players are doing with their time in-game. But what do we do until then? Speculate, of course!

Every so often, the developers smile upon the poor, downtrodden economic players and give us a juicy tidbit. Mr. Damion Schubert, Lead Systems Designer for The Old Republic, did us that favor recently (twice, actually).

To list the important points:

  • Cost of sending companions on missions exceeds the vendor cost of materials returned
  • Anticipating supply/demand economies (not a huge reveal there, I’m afraid)
  • Won’t be able to just gather with all companions all the time; will run into money problems
  • More economic to do it by hand (i.e., traditional farming)
  • May or may not have a mission to gather it anyway
  • HOWEVER, certain rare materials come only from companion gathering

These are some fairly heavy tidbits, and they are very telling about the system they are designing. The crew skills are not intended to simply be, “Send people here and make money,” but we already knew that, considering the costs of sending your people on missions as seen in the previews. Instead, now we know that recuperating your costs through vending items will not be viable, save for very rare instances. To turn any profit, you will have to look to the open market for materials or products, which can be both good and bad.

A Scoundrel and his Wookiee companion prepare to walk into a Tatooine cantina.

In other games, one of the primary ways that wealth is distributed is through raw materials. Raw materials were often worth more than many of the end products that could be produced with them – most noticeably through the leveling game. For example, Mithril in World of Warcraft was frequently worth far more than the other metal products obtained at higher levels. This had to do both with scarcity and the fact that you absolutely needed it in the mid-levels. Sometimes it was even worth more than the highest level metals.

In The Old Republic, I don’t know if we can assume any different, but the relative (pseudo) high cost of raw materials might invalidate them as a primary traded item. First off, putting goods at an actual cost to gather, while a great idea, actually gives people an estimate of their worth. To use completely made-up numbers – if it costs 100 credits to get 10 pieces of steel, then we can generally infer that the minimum value of that steel is 10 credits per. To turn a profit, we must sell it at 11 credits per. That’s basic math that anyone can get.

However, if we have a player farming by hand and foot, that is, actually driving around and picking up the nodes themselves, he might decide to sell for 8 or 9 credits per – thus, our first player will be unable to turn any profit (assuming he’s impatient), which might force him to just retire from gathering from crew skills as a money-making alternative. It is entirely possible that the system will discourage its own use simply by making materials more expensive than the market will bear.

But wait, Momus, you’re forgetting the rare raw materials you can only get from gathering with your crewmates! Except that I’m not. What will likely happen, under the scenario I discussed, is that the resource gathering professions ignore the bulk of what they get, or it becomes end-products, and instead they focus entirely on those rare materials. The bulk of the raw materials of standard quality (i.e. where the wealth usually is) gets discarded or used, and not distributed as the baseline. It could be good, and it could be bad; and it could be that lots of items get reverse engineered in the process.

The fruits of your labors...and possibly just as reverse engineering fodder.

The potential problem here is that it could decrease the amount of activity on the auction house. Another basic law of economics is that if you can’t make money from it, there’s no reason to do it. It gets muddled when looking into the crystal ball – after all, it’s a numbers tweak. But if it’s expensive enough to discourage farming of raw materials through the crew skills system, it might be enough to discourage good trading. The price controls on crew skills will dictate a lot of what you see on the auction house, both in terms of volume and pricing – you might see quite a bit of stuff at a close (but above) price point to what it costs for crew skills, or you’ll see less and it’ll be cheaper than the crew skills.

The real problem may come in the form of credit farmers who crash markets – whether through a sense of monetary deflation benefiting them or just trying to make as much as they can, and quickly. They may have a major effect on the market when they sell goods. Here’s to ardently hoping this is not the case in TOR. But if it is, it might throw the crew skills for a loop as well, which is not the fault of the designers. I’m on board with the system, I just hope they pay attention to the numbers and try and make it reasonable.

To focus more on the positive: gathering rare materials through the crew skills profession is a fantastic way to promote not only high level usage of the system but also to ensure that those items are both rare and valuable. One of the major problems plaguing the auction houses in other games is relative value: that is, I value an item at X, and you value an item at Y, which happens to be either well below X or high above. Items that are imbued with value (i.e. acquisition costs) are of far more worth to the economy and to players in general. There will be frustration with their scarcity, and I don’t know if there’s a good way to alleviate that – though I do believe that scarcity of high-end materials is good if it keeps high-end items at a premium.

Beggar’s Tip: Each week, I will be including a fast and easy tip for the player who just wants a quick hit and isn’t necessarily focused on the economy. For this week, the tip is simple: prepare, prepare, prepare! The information is starting to trickle out of BioWare – consume it greedily. The more planning you do, the better off you will be (assuming you stick to your plan; that’s a another story, and post topic, entirely). If you read nothing else, the developer tracker is your best bet for confirmed information (though if you’re on Ask A Jedi I find it hard to believe you aren’t pilfering other sites for all the info you can get).

Where do you think the economy will go? How do you think the crew skills system will impact the traditional model of auctioneering?

  1. prenerfed says:

    I think that the crew gathering missions are a great idea, if the return is worth the time and credit investment. e.g. If a 24-hour gathering/invenstigation/etc. mission costs a significant amount of credits for your level but returns an exclusive material or result at a ratio of about 1:3, it will be popular. However if your protocol droid fails to negotiate agreeable terms for your Diplomatic Missions less than 33% of the time (at 24 hours per attempt!) he’s likely to end up disassembled in an Ugnaught’s junk pit somewhere. ;)

    • The mission skills are, to my knowledge, distinct from the gathering. Gathering missions just return items, but the missions serve other purposes (alignment correction, companion affection, etc.). No word on costs yet but my hunch is that “they” (being Bioware) are putting gathering skills higher than the others. And I agree on the dis-assembly (or dismemberment) part!

      • prenerfed says:

        True, Diplomatic Missions, Underworld Trading, etc. are Mission skills and not Gathering skills. The math on their ROIs will probably be vastly different, depending on the utility of the results, i.e. LS/DS Side points will probably be way more useful than any given crafting material and their costs should be adjusted accordingly. Success and failure rates of sending Companions on any Crew Skill mission will be a part of those costs.

        It will be interesting to see just some of the more non-traditional Crew Skills affect play-styles and the economy! Sending Crew to gather materials is great, and most people can immediately grasp the utility of it. How easy to use, useful, and rewarding the more esoteric skills are is going to be really fascinating! I hope we get more comprehensive info soon, and of course I hope that all of them have a well balanced ROI. :)

  2. Nice article!

    I think that Bioware probably wants to steer community demand towards crafted items versus raw materials assuming that NPC crafting (while you are away) doesn’t cost more than the finalized product. Also, I think that there’ll be plenty of crafted items for sale on the auction house we have to worry about gear for our NPC companions in addition to our main toon.

    • Add: Forgot to include my curiosity of schematics if it turns out that the focus will be placed more on crafted items versus raw materials.

      • Thank you for the compliment!

        I am indeed waiting to see how schematics are handled – they’ve been mentioned as acquirable (and difficult to acquire) – so I’d want full info. That’s also a plan for a future article. ;)

  3. Having only played WoW my exposure to the economies of MMORPGs is limited. But having worked in finance and working on a graduate degree in Applied Economics I’m very curious to see how TOR’s economy develops.

    One thing that concerns me about TOR in regards to their stating that there won’t be mods at launch is the lack of any mod that helps people track auctions (a la Auctioneer from WoW). If I craft something and want to sell it, how will I determine a “fair” price for my good? The current price listed at auction? How will I know that is a “good” price? I would love if the developers would understand that there are economies within their game and easily furnished price history is essential for prices to gravitate to equilibrium. Would it be too hard to provide the median price and a range of prices over a period of time (i.e. 52 weeks)? Until there is a viable system to provide price information, I don’t think the economy will operate at its potential regardless of the mechanics for accumulating wealth or goods.

    My two cents.

    • True enough about the mods – I also took advantage of the Undermine Journal and I also wonder if such a project would be possible in TOR (one can only hope…). Frankly, I may focus my crafting on a few items in the initial portions of the end-game and might even throw in some excel spreadsheets to quickly determine means and hi/low points, though to be fair I think the market will experience a lot of volatility in the first four to six months. WoW had a nice routine going for it that it followed, with little deviation, for a long time (still is to my knowledge, though I’ve been out for five months now) – those that knew it could profit, those that didn’t made flasks on Tuesdays only and wondered why they were having money problems.

      The other advantage to the mods, of course, is time vs money, and that it decreases the amount of time and increases the money intake (including on items you may not have noticed in the first place), and that is a huge part of the calculus for making money. Though, frankly, I may grow to enjoy the challenge (and have the time to spare – my girlfriend wants she and I to level our mains together, and she’s never been the swiftest to level at any rate – accepting quests by holocom will going out my goblin activities will be the norm I expect).

      Back to the point, though, we will have to determine those new deviation periods and what items correspond to those – which to some is fun and interesting, and to others scary and overwhelming. The column will, hopefully, reach out to both crowds. :)

  4. Great work! It is so refreshing to start to see others writing on topics I love as well. Keep up the good work.

  5. Erraticstates says:

    I think the purpose of requiring credits for gathering is a 2-part thing. First, since everyone will be able to use the crew-system as well as traditional farming, it puts a value on the materials you get out of the gathering. With everyone gathering, and some people farming it too, most of the materials will go for slightly above to slightly below the cost of gathering them. This can be used to devalue or overvalue materials and gives Bioware stronger control over the player economy for gathered goods than in most other games.

    Now, since they have this stronger control, the question becomes why do they want it? First, they can use it as a counter to in-game inflation, if they raise the price over time it will create some inflation in the value of the materials, but it will also suck more money out of the system, reducing overall inflation. Whether this is good or not is up for debate, and certainly depends on how long you’ve been playing the game.

    Second, they can use this control to discourage credit farmers and the secondary market. By devaluing farming, they seriously injure the value of farmers main sources of income(aside from stealing accounts). Again, whether this is worth potential problems for players is debatable, but it seems like it might be an idea in Bioware’s mind.

    By the way, great article, absolutely loved it :).

    • Yep, I just hope they don’t lean the controls too hard one way or another. Of course, if TOR could figure out the credit farmer problem and solve it, it would fix some economic woes (and possibly exacerbate some on the supply side) and it would definitely allow TOR to claim a victory in a sense over other games plagued by virtual money farms.

      And thank you as well, appreciate hearing that people enjoyed the read. Especially as Lethality told me I’d only get to write more if people liked the first one…

  6. Great intro to the channel, I look forward to more info. I see the missions as a great way to introduce some rarer materials into the community without tie-ing to nodes. If metal node A has a 1% chance to get a rare drop and 0.5 % for uber drop what happens? Farmers horde the nodes as a chance to generate credits for sale but add in the wildcard of missions I see opportunity. Now if something would just break in the research concepts :)

  7. Erraticstates says:

    Taking some time to sit and think about this I’ve come to the simple and obvious conclusion. This system will lead to one of three possibilities:

    The credit cost of gathering through crew skills is higher than the cost to get the materials through some form of auction house, in which case no one will do it as it’s cheaper and faster to purchase them.

    The credit cost is the same as the auction house, in which case, again, no one will do it because it’s faster to buy out from an auction than to wait for a mission.

    Finally, the cost is less than you would get from an auction, in which case large numbers of people will do it and deflate the market. This is the most likely scenario.

    I don’t know if I really like any of those possibilities.

  8. The thing i’m concerned about is since some valuable stuff will only be attainable through missions, people that pay real money for in game currency will have an advantage.

  9. cool article. economics isnt my strong point but i could understand most of it. :) looking forward to reading more

  10. Great article.

    I like the crew system as well. However, one part really prompts an ‘eyebrow raising’:
    “More economic to do it by hand (i.e., traditional farming)”

    What gets me about this – it actually goes against the heroic feel. If you create a system where it’s more practical to go out and get the common raw materials (so you can level up and gain more skills) then you’ve actually created a situation where you, the hero, are going out gathering the raw materials.

    But that aside, I see this as a minor element. Overall, I’m looking forward to seeing how the system works out.

    • I absolutely agree about the heroic feel, but I think it’s the unfortunate intersection of heroic game elements and practical game systems. If gathering costs virtually nothing, then DarthDarthxx can send his companions out and sell his items for virtually nothing and still make a profit – though it would be an intense and over-competitive jungle out there. When there’s virtually no component to sending out the companions on a gathering mission, the value is much less as well.

      On the other hand, if the materials are expensive and DarthDarthxx puts his items up for less, then the smart auctioneer will snag them for well below the opportunity cost and make some decent money off of it. The economy part comes in for players in trying to determine what constitutes the best use of time – farming, crafting, leveling, questing for money, etc. If farming has a cost associated, I think it’s better for the economy – but worse for the heroic game element.

      Which, in essence, is fine for me – it allows those economy players to go about their money-making business, while the (more) story-driven and game-driven generally ignore that portion – until of course they need something. :)

      • And I agree with you. We’re so agreeable today, aren’t we.

        There is no way around it based on the current evolution of MMOs and economies. The reality is, if there’s not an incentive to get people to go farm, then you’ve got an impact to the crafting cycle. You remove one layer, and simplify it. And of course, there’s actually a group of player that likes to farm (either full time or for downtime). The comment really comes down to, sometimes the desired atmosphere won’t be practical in all cases.

        You make a good point about determining what makes the best use of a player’s time. The reality for me is, I like role-play (social hanging out), quest role-play (combat and hanging out), some crafting, and raiding. Questing/leveling makes money. As does farming. And invariably, for me it’s less about making the most cost-effective choice, as it is, the most enjoyable one. And like I said, that brings us around to the reality that some people love to explore and gather stuff. It’s a part of the wide and wonderful appeal of MMOs. An economy that matures and allows some coin to be made is a good thing. And a crafting system that has several layers to add something to crafting game-play and auction options is only a good thing really.

        • Yeah, the hard part for economy players is making the decision on what’s fun. Sometimes, the econ players are fully committed to economy, to the point where other things (such as flash points and operations) become secondary or totally neglected – because that’s what they find fun. I like to think I strike a balance – I like to spend time on the crafting / economy portions, but I also enjoy raiding (operating? I think we need to officially move to change the lingo, but I digress). The wonderful part of MMOs is that it lets you set your own pace and play how you would like to play – you aren’t pigeon-holed into any particular playstyle. Though some would certainly disagree.

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