Personal loot changes

These changes to "Personal Loot" in 6.2:

"rather than treating loot chances independently for each player—sometimes yielding only one or even zero items for a group—we’ll use a system similar to Group Loot to determine how many items a boss will award based on eligible group size"

Source: http://us.battle.net/wow/en/blog/19162236/dev-watercooler-itemization-in-62-5-20-2015

Let's imagine that our 10-man raid is set to "Personal Loot" and will get awarded 5 items of loot. Just how will this be distributed? Does Blizzard look at the first team member and decide "Well that's a 50% chance of them getting personal loot. Let's toss a coin. Heads! You win". Then the next person in the group has a 4/9 chance of being awarded loot? I.e. 4 items left to distribute among 9 players. Is that how the mechanics of this will work? I don't know, but I'd like to. Do you know for definite?

First they came for the pet-collectors ...

I know it's a while since I posted about the price of WoW Tokens, but that's mainly because I'm dumbfounded by it.

Blizzard engineers continue to play with the algorithms governing the in-game price of  WoW Tokens. By now I'd come to doubt that the relationship between price, supply and demand is anything more than tenuous. I note that we have never seen any data on actual volume of transactions, and also that wowtoken.info has ceased to report the "time taken to sell", presumably because it was stuck at a fixed "4 hours" for so long. I think that in their effort to smooth price fluctuations, Blizzard's engineers have erred in reducing current supply and demand to a minor input in their equation.

I continue to buy the game-time tokens from time to time when I see them cheap on the auction house.

However, I have cancelled my subscription, and won't be renewing it when my gold runs out. To me, these tokens are the point of no return. In effect, Blizzard are now selling epics for cash (with the intermediate step that you must first exchange your cash for gold, then exchange the gold for epics). this is something many people (I include myself) have been warning about for many years, and it has inevitably happened. Take a trip down memory lane with my favourite mage blogger, Larísa of the Pink Pigtail Inn. The context of that article is that selling pets in-game for cash is the start of a slippery slope. It has proven to be so, and all the arguments people made that Blizzard might sell fluff for cash but never what matters (epics) have turned out to be wrong. Larísa, knew it, I knew it, you knew it, deep in your heart.

I know there is plenty of fun to be had in Azeroth that doesn't rely on earthly cash or Azerothean gold: I love exploring and finding little nooks and items not shown on the map. I love to stand, as Painter Mikkal does, and just gaze at the beauty of the world. I love finding routes up to "unreachable places", I love chatting to the many amazing people I have met, and I love killing orcs. But the group finder tool dealt a heavy blow to my sense of immersion in a virtual world; and now being able to buy epics like this has been the final straw for me.

I'm sure I'll keep some gold back so I can resubscribe for a while post-Draenor, and I've still plenty of game time tokens on my account, so I'm not going real soon; but my heart is no longer eager.

NBI2015

Izlain has posed this question as the first TalkBack Challenge in the Newbie Blogger Initiative:

How did GamerGate affect you?

Are you mad, Izlain?

WoW Tokens: What the ...

I am at a loss to understand the disparity in the gold (game-time) WoW Token price between the EU and NA regions. Many people have tried to explain it, but none of the explanations ring true.

However my investigations have now uncovered the truth. Let's look  in the NA region first. The token price rolls between about 24 000g  and 20 000g. Let's examine that.

If you want some Azerothian* gold, you would buy a $teel (RMT) WoW Token from Blizzard for $20. If you need the gold instantly, you stick it on the AH immediately, and are take whatever the going rate is. If you can wait a little, you sell it only when the price nears 24 000g (I showed yesterday how the peaks and troughs are predictable).

What about buyers of the gold (game-time) WoW Token? You buy that at auction. If you need the token instantly, you buy it at whatever the going rate is. If you can wait a little, you buy it only when the price nears 20 000g.

So we can pretty much see that for most people, sellers get 24 000g and buyers spend 20 000g. This is a bargain for buyers, of course. If you can make 1 000g/hr, that's only 20 hours of farming**. Oops! That means I'm farming at a rate of $1/hour. That's okay, if it's fun, and you'd be doing it anyway. But otherwise, wouldn't I be better off buying a token and working an hour extra in overtime on Earth? Ah, but if I've got kids, the situation changes. I can use them as slaves.

Now let's look at Europe. On EU realms, sellers get about 43 000g and buyers pay about 33 000g. Great deal for sellers, right? Let's assume again that I can make 1 000g/ hour, so it takes me 33 hours of farming to earn a gold WoW game-time token. Since the token costs €20 or £15, that's an income of  61c or 45p an hour. Thank goodness for kids, eh? Finally all those six-year-old kids out playing football can be put to good use. Sadly it's illegal for them to sweep chimneys now, but there's nothing preventing me from enslaving them in the mines of Azeroth.

So I think I've shown what's behind the disparity. Europeans have more slaves.


* What an ugly word. I much prefer "Azerothean". However the Azerothian Diamond shows Blizzard's preferences.

**  Your mileage may vary. Feel free to use your own rates. 

Tokens: A tangled web

Blizzard changed the algorithm they used to calculate bid and offer prices on the WoW Token, just four days ago. Previous to that, the prices steadily climbed, until suddenly they started steadily falling. And vice versa. A steady climb in price followed by a steady drop. The graph of the North American Gold (Game-Time) Token was almost a saw wave. Blizzard social engineers didn't like that, and around the 23rd or 24th of April, they tried a new algorithm. They tried to curve those straight lines, and I think they are pretty happy with the result, the price graph looks more fluid now.

I certainly loved it. It coincided with the  launch of the WoW Token in Europe, and it made it the most predictable price graph on the planet. I'm sharing this with you now so you can benefit as I have done. the prices are so predictable that I predict Blizzard will be tinkering with the formula pretty soon now.

The "secret" is in the rate of change of prices. They are too predictable, too like a sine wave. The price rises at a steady rate until it's near its peak, then the rate of change drops.

Do you want to buy a $teel (RMT) WoW Token to sell for gold? You want to get the most gold for your money. Don't sell that token until the positive rate of change drops. That signals that the price is near its peak (there are no sharp random behaviours here). That is the time to sell, to maximise your gold.

Do you want to buy a gold (game time) WoW Token? Easy. Just follow the prices downward until the negative rate of change  drops. That signals that the price is near its trough (there are no sharp random behaviours here). That is the time to buy. Don't spend your Azerothean gold until then.

Blizzard social engineers are tinkering with the exchange rate, like the USSR of old. They don't trust the free market. They want to control it so that there are no unexpected jolts to the system. That's what makes it predictable. I've been able to use this in the few days since EU launch to predict the best time for me to buy my tokens, and I hope you have, too.

What about Blizzard? Are they happy with the result? I don't know. They may be happy that both sides of the equation get the best deal possible, at their expense. It isn't a big expense. Smart buyers of the $teel token get a lot of gold for their euro, dollar or pound. Smart buyers of the gold (game time) token, get their 30 days for the cheapest gold price possible. Both sides are happy. The piggy in the middle, who absorbs the difference in gold, is Blizzard - who can print gold coins for free. It's win-win-win (except for the inflation, of course. But these are the sort of economic sins that are paid for by the next government - or development team -  not this one).

Blizzard are experimenting. Blizzard will change this again. I don't think they meant to make their prices so predictable. Expect them to tinker with the algorithm again. Meantime, make use of this actionable information while it is still current. I have.

[Edit: I just noticed that WoWToken.info is now including rates of change in their graphs, which makes timing your purchases a snap. When the rate-of-change curve crosses the zero-point, you are at a price max or min. It won't recross that line for several hours. The rate-of-change curve is too predictable.]

Tokenomics

With further details of the WoW token released by Blizzard yesterday, it's time to review what will happen when it is released, which should happen in the Americas first. It will be rolled out there "in the weeks following Patch 6.1.2’s release". I imagine Blizzard will want to get Noblegarden over before the launch, so they can start collecting data in a "normal" period, rather than one where prices might be driven by a seasonal event. So let's say the Tuesday after Noblegarden, Tuesday 14 April. [Edit: it actually appeared the previous Tuesday, 7 April]

Blizzard have also firmed up the earthly price ($20 or the equivalent in your currency). What they haven't yet done is firmed up the Azerothean price. Gold is still selling on various "illegal" websites for about 1500g/$, so I think that 30 000g is a reasonable place to start. I imagine, though, that Blizzard will want to make this attractive to gold buyers, and put pressure on third-party gold sellers. That makes me think the initial price will be 40 000g for a token. [Edit: the initial price was 30 000g]

Let me first distinguish two tokens here. There is a WoW Token that Blizzard sells for $20. It has only one use: you can sell it in the Auction House for an Azerothian price set by Blizzard. When it appears in the Auction House, it is transformed into a WoW Token that can be bought at a price fixed by Blizzard, and it too has only one use: to add 30-days of game time to your account. As their icons are different (one looks like it's made of steel, the other is golden), I'm going to refer to them as the $teel WoW token (costs $ to buy) and the Gold WoW Token (costs gold to buy).

So let's look at the buyers of the $teel WoW token. Firstly, these are our avatars on earth (the 'players') rather than ourselves in Azeroth (the 'adventurers' or 'characters'). Players buy these tokens for $20, and presumably assign them to a particular adventurer who then lists them on the AH. Why would players do this? Because their adventurers are poorer than the players - they have less gold than they want, while the players have more dollars than they want.

The wants of the adventurers can be split into one-time wants and ongoing needs. Take the typical raider: she may want some pets, mounts and toys. These are one-time wants in the sense that once she has the item, she doesn't need another. To stimulate this want, Blizzard will have to release more pets mounts and toys that she can buy for gold (expect expensive flying licences for Draenor later this year).

Her ongoing needs are mainly for flasks, potions, food and repairs. She also needs gems and enchantments as she gets some gear. Up to now, she has been struggling to meet her repair bill, eats other people's food and skimps on flasks and potions. On a typical raid night, her bill should be about 250g for repairs, and another 250g on the other stuff, but she struggles just to scrape together the money for repairs. If she raids twice a week and does LFR/dungeons another night, she could easily want 1500g/week, though in reality she keeps the bill to 500g by skimping on consumables and not repairing damaged gear before and during LFR. Selling one $teel WoW token will initially cover these ongoing costs for about 26 weeks (if the initial price is 40 000g). Or fewer weeks, but leaving spare gold for one-time wants - mounts, pets and toys. For the sake of argument, let's say the gold lasts the average buyer 20 weeks, and then they will want to buy another.

Who are the buyers of the equivalent Gold WoW Token? They are players with a stockpile of gold, with nothing else worth spending it on. They will be wanting to buy 30 days' game time. If the cost of the token is 40 000g, they need to be earning 1333g/day to keep up. Otherwise, they will run down their stockpile and eventually will have to spend dollars again.

If the price is to remain in equilibrium at 40 000g, then the number of Gold token buyers, who want to buy a gold token every month, must be about the same as the number of buyers of Iron tokens at any time. But we've seen that they need only buy once every 20 weeks or so, while the buyers of Gold tokens want to buy every 4 weeks or so. So the pool of Iron token buyers must be about five times as large as the pool of Gold token buyers for this to be possible.

Now lets look at week 1. The prices will be around 40 000g/20$ that week. Almost every $teel token buyer will spend their $20 that week to get the gold they want. Every Gold Token buyer will be spending their 40 000g to get their free game time. All $teel token buyers will receive the gold they want. Blizzard will see to that. Even if it means printing gold, I very much doubt that Blizzard will return a token unsold to a player. If the pool of $teel token buyers is indeed five times the size of the pool of gold token buyers, all gold token buyers will be satisfied.

What will happen in week 2? Nothing much. Buyers and sellers of both currencies will have dried up, as everyone did what they needed to do on week one.

Week 5? Any $teel token buyer [who as you recall is a gold token seller] bought and sold in the first few weeks. They have their gold. It'll last most of them 20 weeks or so. But gold token buyers, who want free game time, need to use a new token; and unless they stocked up on week 1, they are going to have to buy one. While sellers are still thin on the ground, buyers will be turning up in their droves, camping the AH to snap up any that might appear. Prices will rocket.

So. Whatever the initial price is, be clear that it will rise steeply in week 5 if not before, and continue to climb until $teel token buyers run out of gold again, or see the gold value of a token as too mouth-watering to ignore.

Recommendation: buy Gold WoW tokens on day 1. Buy all you can afford. There will never again be such a concentrated glut of sellers. The price will never drop to 40 000g again. Don't buy $teel WoW tokens before week 5, once the upward price momentum of gold tokens is obvious.


Addendum: I expect Blizzard to be a little surprised by this. Once they see the inexorable rise of the gold WoW token, they'll be scrambling to find things for people to spend their cash on - expect expensive new mounts, new toys, new pets, soon. Also expect repair bills to rise and gold sources (such as quest rewards and mission rewards) to dry up. See also Plexing Warcraft for the social effects of this move.

Controlling the Market

Blizzard have announced their long-awaited PLEX scheme, the WoW Token. I wrote about it back in December: first about the idea itself, and then about the price. True to form, Blizzard have found a way to do this that minimizes player agency, and maximizes Blizzard's stranglehold on the world.

Of course Blizzard sets the dollar price, as it is the only manufacturer of WoW Tokens on Earth. But Blizzard has also decided that it alone will set the Azerothean gold exchange price, and once bought, the token cannot be resold. You can't decide what price you want to sell it to other players for, or what offer you will make to other players to buy it. You can't undercut other players, in order to make your sale happen earlier. You can't buy when there is a glut for resale when there is a famine. You can't bargain with other players at all. Your choice is this: sell at Blizzard's price or don't sell at all. Buy at Blizzard's price or don't buy at all.

Blizzard say that at any given moment, they calculate the gold sale price of a token dynamically, and that all tokens on sale will be at that price, but the price the seller receives is fixed at the moment of offering it for sale. How is that going to work? How can the price the seller receives be calculated dynamically when she puts it on sale, but the price of all tokens on sale be the same at any moment? There are a couple of possibilities.

1. There is a disparity between sale price and buy price. Blizzard takes a variable commission depending on the dynamically calculated price. For instance, let's say there are 10 WoW tokens for sale at 25k gold each. If I offer a WoW Token for sale, Blizzard might tell me that I will get 24k gold for it, and then Blizzard will list it at 25k, making a 1k commission. Or (as a variant of this):

2. Blizzard keeps it's price promise, and makes up the difference from its own gold mint. For instance, let's say there are 10 WoW tokens for sale at 25k gold each. If I offer a WoW Token for sale, Blizzard might tell me that I will get 20k gold for it, and then Blizzard will list it and all the others at 24k, losing 1k on the earlier, more expensive tokens. They might also take a fixed commission from the transaction to mitigate having to mint more gold.

3. In effect, there is only one token ever on sale. It is the oldest token in the queue. It cannot be undercut and will never return unsold from the AH. The dynamic price offered to new sellers is calculated depending on the size of the queue, but the price offered to buyers is the price of the oldest token.

4. A combination of 2 and 3.  The token on sale is always the oldest token, but it is on sale at the current dynamically calculated price (i.e. the price calculated for the newest token), while its seller gets the price that was dynamically calculated at the time she offered it for sale, less some AH fees. For instance, let's say there are 10 WoW tokens for sale at 25k each (and the sellers were promised 25k less commission). I offer mine for sale, and Blizzard calculates a new dynamic price of 24k for mine, less commission. The price of the other 10 are now set at 24k, and mine joins the back of the queue. When someone buys the oldest token for 24k, its seller still gets 25k less commission.

This is all just guesswork. Update: Blizzard have confirmed that it is option 4, and that there is no commision.

I don't understand why Blizzard doesn't trust its players to buy and sell these tokens normally*, nor why these tokens cannot be resold. If they are afraid of dupe bugs, they should first fix their game so that such bugs cannot occur.


* The reason stated on their blog made me laugh. They wanted to do it "without making players feel like they’re playing a game with their hard-earned money". That's exactly what we're doing when we pay our subscription.