Wild Wild Guess

March 5th, 2006 Jun Sok Huhh Posted in news |

As previous post told, recent registration number stealing is still hottest issue of Korean online gaming. Many game watchers fiercely blamed RMT business from abroad. Suddenly, I wonder how many stolen accounts were used for RMT. It’s just brave and wild guess, and we have not enough data or information. But, it might be more useful than just loud voices.

First, let’s gather some pieces of information.

1. Last year, Korean Police Agency(KPA) picked up a band of real money traders that consisted of Korean and Chinese. The announced trading size, around $ 100M USD, was so large that many experts considered it as largely exaggerated. I heard from an insider source that the size was approximately total size of RMT betwen China and Korea during 4 years. Police presumed that the arrested were the largest group of brokers arranging organizational gold farming between China and Korea.

2. According to NYT, the labor cost of a Chinese gold farmer was around $ 250 USD.

3. The number of illegal accounts in NC Soft’s Lineage passed 150K as of 4th of March. Korean newspapers are expecting the number could be 200K at maximum.

My wild calculation consists of two stages. The one is estimation about yearly revenue 'per accoount.'¹ the other is about total size of transaction. For yearly revenue, see following table.

(Calculating on USD)

Subscription fee is set as Lineage. Labor cost is got from an NYT article. The concept of mark-up is somewhat different from conventional one.

TR = (1+m)*TC
- TR: total revenue(in table [c])
- m: mark-up rate (in table [b])
- TC: total costs (in table [a])

I assume m is between 10% and 30%.²

Go to the next. Estimation on total size is messier than the first one. The number of illegal accounts by stolen numbers is between 150K and 200K. I assume that this is total size that has been done for 4 years. Simply, let’s set average stolen number per year as total number divided by 4. I do simple arithmetic for 8 probable cases with account in use by gold farmers.³

(Calculating on USD)

[d] is calculated by [a]*[b]*revunes of previous table in each case of [c].

The rate of accounts in use is set between 0.1 and 0.3. You could throw suspicious eyes on the assumed rates. Is it too small? If it be set as 0.4, the size of gold farming is too large in comparison to the size of Korea online game markets. Also, this range is relatively fit well with KPA’s investigation results.⁴ Though the hugeness of illegal Lineage accounts made a national wide sensation, the number of the real in use might be much smaller than what firstly appeared.

I’ve said, it is just wild(maybe wildest) guess. Make your valuable contribution to improve this crude guess!

1. We have no reliable data for the total number of gold farming sweatshop. The size of illegal stolen account, however, is close to reality. [back]
2. During 4 years from 2002 to 2005, the average economic growth rate of China is around 15%-20%. If returns on gold farming had been too low, it would not have been such a flourishing business. [back]
3. I assume that one farmer orperating 2 clients/accounts for 12 hours . So, labor cost for one account is the same as that for one worker. [back]
4. Multiply 4 with this yearly revenue. 0.2 is best fitting rate for KPA's data under our assumptions. For this is just guess, the probable range is set for covering enough bounds. [back]