Tuesday, 23 December 2014

How much is a WoWPLEX worth?

Yesterday, I expressed my misgivings on Blizzard's plan to plex WoW. Today, to practical matters. How much will a WoWPLEX* cost? Let me first assume that it will be the equivalent of a 60-day game time card, which currently sells at $30 [Edit: Updated March 2015: after Blizzard announced it will be a 30-day game-time token, so I'll assume a WoW token will cost $15]. I checked a couple of gold selling sites, to get a feel for how much gold I could buy for that. It seems I can get around 40k-50k of gold for $30. Let's say, to make the sums easy. $1=1500 gold.

That price sort of puts a bottom on the gold market for WoWPLEXes. At that price, a potential gold buyer can get the same amount of gold by selling a WoWPLEX as he could for buying the gold illegally**. Let's say the gold price of the WoWPLEX drops below the illegal exchange rate. Some potential WoWPLEX sellers will go back to buying gold illegally, at a better rate, and the supply of WoWPLEX will reduce. That should bring its gold price back up.

So, 1500 gold / dollar, or 22500 gold /WoWPLEX  30-day token is the floor price. What is the ceiling price? To answer that, let's look at WoWPLEX  buyers in Azeroth: the people who pay gold to acquire a WoWPLEX. Apart from speculators, their purpose is to swap the WoWPLEX for 30 days of game time. This group can be broken into two: people for whom this is sustainable, because they earn more than 22500g per 30 days (or 750g/day), and people for whom this is (currently) unsustainable. They earn less than this, but they have build up a stash of gold that allows them to afford several WoWPLEX purchases before the well runs dry. Some of this latter group will step up their AH and farming activities so that they can be sustainable, and some will buy a few WoWPLEXes and then stop. So initially the demand will be higher than it will be later. That means that the initial price will be higher, too (Belghast is predicting 100k initially).

It is the fact of having to earn in gold a thirtieth of a WoWPLEX per day that tends to put an upper limit on its price; but I don't know what that upper limit might be. I certainly have less taste for farming and AH playing than I formerly did, but that might be because I have more gold than I need. Perhaps this new mechanism might encourage me to improve my earnings. I'm sure the same is true of everyone. It will also reduce the demand for 'fluff' items, in order to conserve gold for buying WoWPLEXes.

What will the effect of this be on gold sellers and bot farming? I doubt any bot will stop running unless caught. After all, they can pay for their own accounts, now. The demand for their services will be greatly reduced. That in turn will lead to them reducing their prices. That'll feed back to affect the floor that I calculated earlier. If the dollar price of gold halves, then the gold price of the WoWPLEX must inevitably double (or else some gold buyers will revert to buying the gold illegally, instead of through WoWPLEX, reducing the supply of WoWPLEX and hence raising its value).

So those are the tensions that will govern the gold price of WoWPLEX. Illegal goldsellers set the floor price and to an extent determine the supply, and the determination of players to farm and trade in-game to improve their wealth governs the demand and the ceiling.

Edit: March 2015: Blizzard have finalized their plans, which are reasonably different to Eve's PLEX. My take on it is here: Controlling the Market. And how will the gold price move? My predictions are in Tokenomics.

* I believe Wilhelm Arcturus originally coined the term way back in 2011, in a comment on Syncaine's  blog.

** I.e. breaking Blizzard's terms and conditions. This isn't really illegal on Earth in the sense that a court can send you to jail for it. But it does put your position in Azeroth in jeopardy. You might end up in the stockades for several months. You might even be executed.

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