Virtual World or Virtual Vegas?

May 3rd, 2006 Jun Sok Huhh Posted in articles |

Gambling is a hard business to do in Korea, for the law about gambling is very strict. Nation-widely, only one place called 'KangWon Land' is allowed for lawful gambling activities for the domestic. Undoubtedly, Online gambling is also under square prohibition. The real face of the business, however, is somewhat different with clean-cut world of law. For latest two years, many ill-legal or half-legal places for gambling are thriving vigorously with various forms.

RMT in MMOGs is one of most interesting and stormy areas that are connected with real world. We could find many kind of motives for RMT, but it is generally true that online game designs/mechanics could facilitate or disturb RMT. What the inner objectives are is not to be dealt with here. I'm to introduce a weird case that a small ticking in game design make a scandalous swing in RMT.

Lohan is the sleeper hit in deadly fierce Korean MMOG markets. According to the publisher, YNK Korea, the total monthly revenue of Lohan for March of 2006 was around 4.5M USD. This is a spectacular number considering recent severely competitive situation of Korean markets.¹ Usually, games tended to experience a big drop down in users at their commercialization.

Some players and game journalists argued that the success of the game was due to a mini-game which had included just prior to its official service. It was modified Baccara games that is famous for its intense gambling fun. The developer explained that the mini-game was not major strategic content but just a small amusement.

So, according to its word, it was expected that the in-game Baccara could not have any real impact on RMT. Was it true?

Price trend of Lohan's in-game currency for Loha and Taruga(per 10M Kron)²

(X: time trend(month-day format) for about 3 months, Y: Korean Won)

The first update(the link is in Korean language) was done at Feb 22 of 2006. 'Loha' and 'Taruga' are typical servers where in-game Baccara gambling was especially active. As you could see from above graph, after card game service launched, the price of in-game currency was upward explicitly. Owing to the mini-game, demand for in-game currency was increasing. The developer excused that proper function of the mini game was a cure for the in-game inflationary trend. As you've looked, the rising of the price went beyond anti-inflationary purpose.

The second update was done at Apr 5 of 2006, which was about limitation on bidding money for the game. This struck two servers so strongly that the prices plunged down more than their half previous level. Even more interesting side effect came about in other server named 'On'.³

Price trend of Lohan's in-game currency for Loha and On(per 10M Kron)

(X: time trend, Y: Korean Won)

Price trend of Lohan's in-game currency for Trauga and On(per 10M Kron)

(X: time trend, Y: Korean Won)

Seen from graphs above, contrary to falling trend of two servers of Loha and Taruga, there was a huge rising in the On. Maybe, Baccara-holic players in Loha and Taruga might have transferred their characters to the On.⁴ Another update was done at Apr 18 of 2006, which was on applying above limitation to all servers. You can easily observe a drastic downfall in the On after this patch.

Judging from these results, card game that was said to be just a small time-killing stuff might swing the entire game.⁵ Wag the dog? Without more thorough investigation, the final verdict is to be suspended.

BTW, what are merits of enjoying gamble via MMORPG? Firstly, it is half-legal, which means much at least in Korea.⁶ Secondly, the convertibility between gambling token and real money is guaranteed by item trading market and its intermediaries.⁷ Thirdly, the accessibility to gambling and the easiness of matching are conveniently accomplished in MMORPG.

Is Lohan virtual world or virtual 'Vegas'?

1. Actually, there was a serious marketing exaggeration in that players and PC-bangs that bought in-advance 3 or 6 month tickets are also included. Even so, the financial record of the game is beyond all the expectation [back]
2. The data were extracted from Itembay. [back]
3. The On was one of popular servers that has attracted many players. [back]
4. In Lohan, it is possible for players to transfer their characters to other servers which they want. [back]
5. I heard from an insider of Itembay that the large proportion of Lohan's RMT had been done in above three servers [back]
6. Korea Media Rating Board that is somewhat similar to ESRB of US, is recommending the publisher/developer to delete the Baccara from their game. [back]
7. The developer had contracted strategic alliance with the most largest mediator in Korea, Itembay [back]