Oh wow, this is an interesting find. Nice to see you around here, Jake, and I'm very surprised that my discussion reached out to you guys. I have heard about your operations and am familiar with some of the details, but please feel free to explain this if you can.
RMT is not exactly a purely legitimate business by any means. How do you guys protect your customers and in the case that a customer is banned for buying currency on your site, how is this dealt with? I see that you guys have a lot of sellers on board, but do transactions that take place get refunded to the buyer in the case of a banning? Your site makes a lot of bold claims about having high tech security and bank vault level encryption, but how does that stop the seller from getting away with the funds? Can't they just not deliver?
For me, I'm just curious at this point, but how do you guys justify RMT to a customer who plays a game? What reasons could be given to get people on board? Security? Ease of access? Reliability?
> How do you guys protect your customers and in the case that a customer is banned for buying currency on your site, how is this dealt with?
Excellent question. PlayerAuctions is very different from your typical run of the mill "gold selling site", which you can easily classify as "black market". Those companies go into the game, spam in-game channels, camp spawns, bot, etc. etc. Because they go into the game and produce the assets themselves, they become a part to the game developer's contract. PlayerAuctions is considered a "grey market", in that there is no actual legislation on the legality of secondary markets. In fact, some game developers actively encourage secondary markets for their games (check out the eBay section for Magic the Gathering). PlayerAuctions is based on the c2c business model (consumer to consumer) or what we like to call, player to player trading. Each user is responsible for their own trading activity when it comes to any contractual agreements they may have with third parties. We do not enforce third party contracts since we are not a party to them. In the event that a user is banned from the game publisher, this becomes a legal matter between that individual user and the game publisher, who has essentially infringed on their right to trade goods which they either produced or had dominion over. This has already happened in one of the world's largest game markets S. Korea (reference:
http://www.pixelsandpolicy.com/pixels_and_policy/2010/01/south-korean.html). In Summary, two gamers sued the makers of Lineage 2 who were banned for real world trading. The courts ultimately sided with the consumers citing customer rights. In this case, the consumers won against the developers, wherein Korean courts ruled that the Publisher's TOS and EULA were unenforceable and against public policy.
> I see that you guys have a lot of sellers on board, but do transactions that take place get refunded to the buyer in the case of a banning?
This is something that rarely happens on our platform primarily because unlike black markets, most of our trades occur between actual gamers. We have a few "professional" service providers on the platform, but we enforce strict quality standards before allowing them to continue trading with our users. In the rare event a banning does occur, again it is between the user and the publisher. Alternatively, we have seen users communicate this issue with the seller directly, and many times the seller will re-deliver or offer some sort of recompense as a measure of retaining loyal customers.
PlayerAuctions however will refund users who have had bannings as a result of actions taken by the seller however.
> Your site makes a lot of bold claims about having high tech security and bank vault level encryption, but how does that stop the seller from getting away with the funds? Can't they just not deliver?
No, this is not possible on our platform. While our business model is based on eBay, we take it a step further by deploying a proprietary escrow service which is specifically geared towards digital assets. We have been doing this since 1999, so anyone who claims they know how to do it better are either lying, or mad geniuses :-) As a result we are able to secure payment for the seller and protect against unauthorized payments & chargebacks, and we do not disburse payment to the seller until the buyers acknowledge delivery.
As it is, our platform has a 0.2% average monthly fraud loss rate. And at last closure, 97% of orders that have passed through our systems have gone on to successful completion with both parties leaving positive feedback for each other. A lot of our new users comment on our
Trustlink page, we are also highly rated with the
Business Consumer Alliance.
> For me, I'm just curious at this point, but how do you guys justify RMT to a customer who plays a game? What reasons could be given to get people on board? Security? Ease of access? Reliability?
RMT has a negative connotation as it is so closely related to black markets. I peg PlayerAuctions closer in line with actual "gaming secondary markets" and "gaming services industry". This idea of "it ruins the spirit of the game" and "fairness" are all old ideologies that have been propagated by people who fail to realize that it was simply a method of control for game publishers to reduce competition to their own revenue generation. There were other issues of bad behavior from black markets which I recognize, but this is the beauty of secondary markets. On a player to player trading platform, sellers can make their own price points, rather than selling to black markets for 30% of the actual value of the commodity, and buyers therefore get on average 30% savings as well. Not only this, but a true player to player platform reduces in-game spam, hacking, and all those other things which negatively impact our virtual worlds. By taking business away from black market traders who engage in such practices, you effectively put them out of business, by supporting honest, player to player marketplaces like PA.
Not only this, but there are inherent benefits to secondary markets. The first is psychological, in that something innately powerful happens when you allow a user to ascribe value to their gameplay. You become vested in that game. Secondly, secondary markets exist due to the way games are designed. The dynamics of which create a demand for secondary markets. If you have something so unappealing as repetitive, grinding gameplay, can you not expect gamers to want to bypass that unpleasant element so their interest in the game world can be retained? Thirdly, this also boils down to resource capacity. People in general have two resources at their disposal: time, and money. Some gamers are rich in time, and therefore can spend hours upon hours getting the "true nature of the game by grinding their way to success". If they enjoy it, more power to them. However some of us actually want our college degrees, or have full time jobs, or families, and therefore may not be rich in time as a resource. The basic goal of gameplay is entertainment, and playing to "win" so to speak. If RMT were off the map, then players who are poor in time as a resource are arguable "playing to lose" because they ultimately cannot keep up with gamers who are rich in time. This, I would argue, is unfair. Game publishers effectively isolate and alienate a large portion of gamers for which they could actually acquire/retain, by allowing them to enhance their gameplay and to dictate what the experience is like with regards to how they can keep up in game.
As for our platform specifically, well... we have high aspirations of creating an environment where people feel safe and secure to trade their gaming assets, both digital and tangible. I can confidently say, that we are presently the largest c2c exchange for Western gaming markets. And with my taking things over in October, the focus of the business has been to move away from being a "tech platform" and more in line with being a "Customer centric business", hence... why I'm here engaging with communities. I love doing this. Digital asset exchange has been what has made China & Korea the largest gaming markets worldwide. Game publishers recognize that their audiences may not be so keen on restrictive subscription models, and instead allow gamers themselves to define their own gameplay experience. This is something that has been picking up momentum in the casual gaming space, and as you can see is migrating into more mainstream models (such as what we saw with Diablo 3... which is an example of the wrong way how to do secondary markets, but that is a different topic altogether). We are pretty rad, an international team, we run lean (only about 50 of us work on PA), and we really care about reaching critical mass for users worldwide who love to trade.
Hope this answers your questions. I'm open for an interview if you guys would like to engage this further.
jake