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China Bans Gold Farming

ScuttleMonkey posted more than 5 years ago | from the shooting-yourself-in-the-foot dept.

293

InformationWeek is reporting that the Chinese government has declared a ban on the sale of virtual goods for real currency. This move is poised to shut down a several billion yuan a year business that has been growing by leaps and bounds every year. "The trading of virtual currency for real cash employs hundreds of thousands of people worldwide and generates between $200 million and $1 billion annually, according to a 2008 survey conducted by Richard Heeks at the University of Manchester. He estimates that between 80% and 85% of gold farmers are based in China. [...] Game companies typically forbid gold farming but committed virtual currency traders find ways around such rules. Some game companies have recognized the futility of trying to ban the practice and have built virtual commerce into their game infrastructure."

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Hundred Millions or Hundred Thousands? (5, Informative)

eldavojohn (898314) | more than 5 years ago | (#28517903)

The trading of virtual currency for real cash employs hundreds of thousands of people worldwide and generates between $200 million and $1 billion annually, according to a 2008 survey conducted by Richard Heeks at the University of Manchester. He estimates that between 80% and 85% of gold farmers are based in China.

Dear god! Eight tenths of one billion dollars is a lot of cash!

The Chinese government estimates that trade in virtual currency exceeded several billion yuan last year, a figure that it claims has been growing at a rate of 20% annually. One billion yuan is currently equal to about $146,000.

So what is it, hundreds of millions or hundreds of thousands? Because one is a nice chunk of change while the other is, across China's population, laughable.

These numbers just aren't adding up here. There seems to be a large disparity between what the Chinese government reports and what Heeks' study finds. It's entirely possible that Heeks' is stretching stats to make his research sound more important and news worthy. It's also possible China is understating the impact their ban will have so they can "cure you of your illnesses." The reality is probably both a little of column A and a little of column B.

Some game companies have recognized the futility of trying to ban the practice and have built virtual commerce into their game infrastructure.

And now China will realize that futility. One would think that China would enjoy the tax on those who report this income [worldwide-tax.com] but now it's just going to all go under-the-table. Hell, I'd say tax it but I'm certain China wants to look like the caring government attempting to heal the afflicted youth [slashdot.org] .

Re:Hundred Millions or Hundred Thousands? (4, Interesting)

Hojima (1228978) | more than 5 years ago | (#28518107)

Personally, I'm quite happy when oppressive people with power tighten their grip. It follows the law of tension: the harder it's wound, the more likely it is to snap. Organizations such as companies that bully, to massive governments, make stupid decisions to maintain and ascertain their power, when all they do is jeopardize it more. I can't wait till they make a huge mistake on civil liberties and practically give their citizens no choice but to revolt.

Re:Hundred Millions or Hundred Thousands? (3, Funny)

htwf_and_ip (1248696) | more than 5 years ago | (#28518203)

the harder it's wound, the more likely it is to snap.

I thought it was "The more you tighten your' grip, the more Star Systems will slip through your' fingers."

Re:Hundred Millions or Hundred Thousands? (-1, Offtopic)

Anonymous Coward | more than 5 years ago | (#28518329)

When CmdrTaco squeezed my cock, goo squeezed out.

Billy (Age 11) Linux 4 Life!!!!

Re:Hundred Millions or Hundred Thousands? (5, Insightful)

eldavojohn (898314) | more than 5 years ago | (#28518251)

Personally, I'm quite happy when oppressive people with power tighten their grip. It follows the law of tension: the harder it's wound, the more likely it is to snap.

Normally I would agree with you. But as a kid I watched tanks clear a square [wikipedia.org] in China. As a result of this, the Red Cross would later report twenty five hundred people dead with seven to ten thousand wounded. The same government that dealt with those protests in that way is still in power today, twenty years later.

If that didn't do it, I don't see banning gold farming and regulating the internet doing it. The Chinese government is a new kind of oppression that has survived many attempts to move in the opposite direction. It must be a decision made simultaneously by billions of people to change this. If you're sitting their waiting for that tension to snap, you may be waiting a lot longer than you think.

Re:Hundred Millions or Hundred Thousands? (1, Redundant)

Hojima (1228978) | more than 5 years ago | (#28519009)

Seeing as that was a move that the government regretted so much that it's practically purged from their history, and that it was one of the major events that contributed to their economical reforms, I'd say it might be sooner than later. Obviously the little hundred million dollar dent that this law made isn't going to do the trick, but the more the middle class gets bolstered, the more filled bellies with higher ambitions will appear. And once that number gets high enough, who knows what little events will make them snap. I'm only afraid of how much damage the government might do to take its final breath.

Re:Hundred Millions or Hundred Thousands? (5, Insightful)

fizzup (788545) | more than 5 years ago | (#28519011)

I was having breakfast in Idaho City, Idaho around the time the Chinese government put down the Tianenmen Square protests. I overheard a guy at a nearby table say, "This wouldn't have happened if the Chinese were armed, I tell ya." I nearly laughed out loud, but I took a moment to really think about what he said. For the first time in my life, I understood the Second Amendment to the US Constitution.

The First Amendment is the first line of defense; the Second Amendment is the last.

Re:Hundred Millions or Hundred Thousands? (2, Interesting)

GreatAntibob (1549139) | more than 5 years ago | (#28518321)

Why would the people revolt? I'd be willing to bet most Chinese citizens think these restrictions are reasonable.

It's one of those "common sense" type ideas in Western nations that everybody wants a democracy and that everybody wants nearly unlimited personal freedom. It's simply not true. Many (maybe most) Chinese people not only approve of some limits on speech and civil liberties but think the government may not be going far enough. Many of my co-workers are Chinese citizens, and they are just as happy to have the government set ridiculous (by Western standards) limits on civil liberties, tell people what an ideal society looks like, and go along happily, as long as there's food on the table, taxes are low (or non-existent), and the occasional corrupt official is put in prison/sentenced to death. So what if the government owns most major businesses and that the low taxes are a result of not giving the people a chance to share in the wealth? The biggest complaints I've heard from them over the last year have been that the US needs to butt out and that food prices have been too high (mainly because the standard of living is going up).

High minded ideals are great for students, but the people living over there (and here, for that matter) are more concerned with being fed, with educating/raising their children, and with getting on without too much trouble.

Re:Hundred Millions or Hundred Thousands? (4, Insightful)

sakdoctor (1087155) | more than 5 years ago | (#28518485)

Get with the time. Now there is a massive Chinese middle class that have more than enough food, and are trying to figure out what to spend their money on.

http://news.bbc.co.uk/1/hi/world/asia-pacific/8113149.stm [bbc.co.uk]

Re:Hundred Millions or Hundred Thousands? (1)

OttoErotic (934909) | more than 5 years ago | (#28518961)

Does......does 'sakdoctor' mean what I think it means? Because I think it means that you changed it from sac to sak and now all I can picture is some kind of Gestapo testicular surgeon, which is awesome.

Re:Hundred Millions or Hundred Thousands? (5, Informative)

Anonymous Coward | more than 5 years ago | (#28518189)

The numbers aren't adding up because the exchange rate for Chinese currency to U.S. Dollars is incorrect and the author dropped some zeroes. One Dollar is equal to ~7 Renminbi, so one billion Renminbi should be $146,000,000.

Re:Hundred Millions or Hundred Thousands? (1)

EvanED (569694) | more than 5 years ago | (#28518283)

(Posting in case anyone is reading at +1 or something; mod the AC up instead of me)

The parent poster is correct... TFA seems to have been changed too to be not stupid. The original version did math wrong and left off three orders of magnitude.

Re:Hundred Millions or Hundred Thousands? (2, Insightful)

dintlu (1171159) | more than 5 years ago | (#28518319)

China may enjoy the tax generated from gold farming, but virtual commerce cannot be regulated and controlled like real commerce. Ignoring the interaction between Real and Virtual economies is headstrong and foolish, so from my vantage point it appears that China is letting some other country pave the way for virtual regulation rather than saddle itself with unique problems caused by this novel form of earning money.

Think of it this way, if gold farming really is worth $1b USD per year, this is equivalent to the annual income of 400,000 Chinese citizens. If, for whatever reason, the purchase of virtual goods is "outlawed" in a country, or the virtual world in which gold farming is performed bans the practice, or the virtual world's maintaining corporation goes out of business, that's 400,000 people without a livelihood anymore, people who are now a burden on the state.

These are pretty basic scenarios and that's just off the cuff. I'm sure more consideration from brighter minds could produce even more coherent objections to allowing gold farming to grow as a legitimate industry.

Re:Hundred Millions or Hundred Thousands? (2, Insightful)

lgw (121541) | more than 5 years ago | (#28518959)

So, wait, are you seriously arguing that the Chinese government was smart to destroy the livelihood of 400K people to prevent the possible future destruction of the livelihood of 400K people? I take it you also support the death penalty for failure to wear a seatbelt?

BTW, the sale of virtual goods is "outlawed" in most of the games in which it occurs (without much effect) and gold farmers often move from game to game as popularity shifts, so thee are non-issues. "Gold Farming" is a legitimate industry - it's perhaps the first large-scale remote service industry, and it's no sillier than hiring someone to mow your yard for you.

I guess Communists are still just struggling with this whole "free market" concept - outlawing somehting just moves the market underground. Something America is trying equally hard not to learn about the War on Drugs(TM).

Re:Hundred Millions or Hundred Thousands? (1, Informative)

Anonymous Coward | more than 5 years ago | (#28518379)

One billion yuan is currently equal to about $146 million, not $146 thousand.

Re:Hundred Millions or Hundred Thousands? (1)

Danathar (267989) | more than 5 years ago | (#28518431)

The thing with China....just because the west says it's not possible (censoring the internet, cracking down on dissidents, outlawing stuff) does not mean they don't try anyhow. And if they try they give it their complete attention because they actually think they CAN do it.

Remember the saying...

Just because you believe in something does not mean it's true

Re:Hundred Millions or Hundred Thousands? (1)

kenp2002 (545495) | more than 5 years ago | (#28518459)

As far as I read it they are talking money EARNED not neccesarily exchanged. So both could be accurate depending on which end they are on. Also who knows how much dissapears into pockets so to speak.

Re:Hundred Millions or Hundred Thousands? (1, Informative)

Anonymous Coward | more than 5 years ago | (#28518511)

The Chinese Yuan is worth approximately 6.75 USD, depending on when you look. So 1 billion yuan is about 146.34 million USD, not 146 thousand as claimed. So $200 million to $1billion annually is pretty close to "several billion yuan."

Re:Hundred Millions or Hundred Thousands? (1)

zephris (925151) | more than 5 years ago | (#28518569)

I personally don't care how much it means in real money. What I care about is that, suddenly, 80% to 85% of the in game spam is going to stop. It will be as if millions of voices will suddenly cry out in terror and be silenced. I, for one, welcome the new found silence. These gold farmers have been a royal pain the MMO player's side for far too long. They've been seriously screwing up in-game economies and putting grouping players on edge, camping the spawn points for high gold mobs while legit players have to make do without. China has my full support in this.

Re:Hundred Millions or Hundred Thousands? (1)

IcyNeko (891749) | more than 5 years ago | (#28518941)

In other news, mass migration from China to United States and Canada has occurred...

Re:Hundred Millions or Hundred Thousands? (3, Interesting)

StikyPad (445176) | more than 5 years ago | (#28519053)

It's a pretty safe bet that the figure is in the millions USD, but beyond that it's hard to say.

While my sample size is very small, 3 out of the 4 people I know IRL who play WoW have each dropped $200 on such services. If we assume that 1% of the WoW population [warcraftrealms.com] spends half that, and that each 8 characters represent 1 account, that gives us $772k by itself. And that's just a very conservative estimate for one game, since some self-reported figures are much higher [pollhost.com] . If we expand our assumptions to say that each 4 characters represents 1 account, and that 15% of those accounts have purchased $100 worth of gold or other services, we end up around $23M -- a number which I still suspect is conservative.

China seems to want to enhance its image... (1)

ls671 (1122017) | more than 5 years ago | (#28517907)

Wow! China seems to really want to enhance its image, any other reason for that move that anybody can envision ? After all, it will be less money going straight into to China... Of course I may be missing something ;-)

I watched a program on TV where they visited a company working in this field. They basically employ 30+ people who play the game all day, we saw the player pool on TV while they were playing. They are based in countries where they can pay people very small wages, they take the points earned by those people and resell them with a margin on what they paid the players. Well at least this seems like a simple to understand business model ;-)

Just for fun, if you could get paid a decent wage, say same as you are earning now, how many of you would be interested in such a position ? ;-) Is it a dream job (playing all day !) or more like a hell job? Note that this could be similar to people getting paid to play all day to find bugs in new games but the qualifications required to get the job may vary a bit...

Re:China seems to want to enhance its image... (4, Insightful)

Spy Handler (822350) | more than 5 years ago | (#28518061)

It would not be a pleasant job, even if you got the same wage you do now. Your bosses will constantly be pushing you to maximize your per hourly gold yield. And most likely you would be running several computers at once and using various hacks, working like a dog. Any semblance of it being a fun game would be completely gone, replaced by simple drudgery.

I'd rather do straight data entry typing than be a gold farmer...

Re:China seems to want to enhance its image... (2, Funny)

jockeys (753885) | more than 5 years ago | (#28518209)

And most likely you would be running several computers at once and using various hacks, working like a dog. Any semblance of it being a fun game would be completely gone, replaced by simple drudgery.

how is that ANY different than your average MMO player?

Re:China seems to want to enhance its image... (3, Insightful)

dave562 (969951) | more than 5 years ago | (#28518657)

Your average MMO player has a choice of activities. To use WoW as an example, you can do quests, you can run instances, you can do battle grounds, do some world PVP, level an alt, do silly seasonal quests, etc. As a gold farmer, you do one and only one thing... farm the most valuable items out there. You don't have the opportunity to do anything else, because doing anything else is a waste of time and isn't what you are getting paid for.

Re:China seems to want to enhance its image... (1)

Endo13 (1000782) | more than 5 years ago | (#28518949)

how is that ANY different than your average MMO player?

how is that ANY different than your average lame troll post?

See the difference between our two questions is that mine is an actual rhetorical question, while yours is simply a troll masquerading as rhetoric.

Re:China seems to want to enhance its image... (5, Interesting)

Red Flayer (890720) | more than 5 years ago | (#28518261)

Your bosses will constantly be pushing you to maximize your per hourly gold yield.

My understanding is that most of the gold farmer "workers" work on a quota system. Of course the quota will get moved up depending on possible performance. It's not about maximizing yields, it's about hitting the quota dependably.

When labor is that cheap, it's probably more effective to hire additional workers than it is to squeeze every last drop out of the ones you have.

Anecdotally, back when I played MMOs, I was once asked to hold onto some surplus in-game cash for a farmer. He wanted to set it aside so if he had a bad day, he could use it to get over quota and avoid punishment.

I recall reading an article about this somewhere (Gamasutra?)... the gold farmers didn't want to make too much gold for their bosses, or their coworkers would get mad. Excess earnings in a session were hidden to (1) save for a bad day (2) sell independently for income or (3) play the game themselves. It was a really interesting look inside gold farming at the basest level.

Re:China seems to want to enhance its image... (3, Interesting)

lgw (121541) | more than 5 years ago | (#28519029)

I've done buisness with gold farmers in the past, and they were quick to contact me directly to solicity my next sale - to them, not to their employers. I think this is all a bit less Charles Dickens than people are making it out to be. Certainly it's better than typical jobs for kids in the West's industrial revolution.

Re:China seems to want to enhance its image... (0)

Anonymous Coward | more than 5 years ago | (#28518339)

I'm a lead farmer, motherfucker!

Re:China seems to want to enhance its image... (5, Insightful)

Anonymous Coward | more than 5 years ago | (#28518385)

This is still a hundred times better than working on a farm for a living. Life is hard in rural areas, and making any kind of living outside of farming is a huge step up from what your parents likely did. Even if the work is hard and demanding by our standards, people in the 'first world' live decadent soft lives that don't know what a real lifetime of work would look like if it slapped us in the face.

Re:China seems to want to enhance its image... (1)

SatanicPuppy (611928) | more than 5 years ago | (#28518849)

How is that different from actually playing the game?

Re:China seems to want to enhance its image... (1)

Evelas (1531407) | more than 5 years ago | (#28518069)

Being forced to play WoW as a job? How could that ever be considered a dream job. Sure it's not a bad game, but it gets old after a while.

Re:China seems to want to enhance its image... (2, Insightful)

fuzzyfuzzyfungus (1223518) | more than 5 years ago | (#28518351)

On the plus side, aside from RSI risk and lack of exercise during working hours, it is a largely harmless and physically undemanding job. No heavy machinery macerating your digits, no toxic exposures, no baking in the fields for 10 hours, no swabbing out other people's toilets.

It would certainly be a job, not a game; but not a substantially grimmer one than a nontrivial number of first world service jobs, much less third world peasant/sweatshop stuff.

NO! (1)

gubers33 (1302099) | more than 5 years ago | (#28517925)

How are they going to get their World of Warcraft gold! China is putting their World of Warcraft citizens in jeopardy of becoming weak.

Re:NO! (0)

Anonymous Coward | more than 5 years ago | (#28518105)

Yeah, sounds like I'm going to have to stop playing. I don't have time to farm gold.

YES! (0)

Anonymous Coward | more than 5 years ago | (#28518795)

The demand won't disappear, so they'll have to outsource their gold farming to Americans.

IANAL, but my dad was an accountant for this N. Ron guy, so I know what I'm talking about.

"Virtual goods" (1, Interesting)

Anonymous Coward | more than 5 years ago | (#28517927)

Would that include things like an online book or some online services?

Re:"Virtual goods" (2, Insightful)

CorporateSuit (1319461) | more than 5 years ago | (#28518119)

Would that include things like an online book or some online services?

I was thinking of software licenses... since it's like having bought something, but not really -- so it's virtual property.

Why would China do this? (1)

Raindance (680694) | more than 5 years ago | (#28517937)

It's certainly an interesting development, and one that I think will slightly curb the growth of gold farming, gold spam, wacky in-game currency trends, and so forth, but I think the real question here is, why would this be in China's interest to do this, and shut down a blossoming home-grown (if gray-market) industry?

The IW article notes that "The government justifies its ban on virtual currency trading as a way to curtail gambling and other illegal online activities." It just seems this isn't the real or whole story, though. Control? International reputation? Deals with Chinese MMO devs?

I don't care why they're doing this (1)

Benfea (1365845) | more than 5 years ago | (#28518345)

but gold farming has a real negative impact for legitimate gamers. I'm sick of having to compete with professional, hack-using gold farmers for in-game resources, I'm sick of having to hear badly worded spam every time I enter a major virtual city, and I'm sick of what they do to in-game economies. It could be argued that some games (e.g. Final Fantasy XII) were damaged by gold farmers, or at least made a lot less money than they could have because gamers quit over the antics of gold farmers.

The gold farmers have years of experience hiding from the game developers, so I doubt this law will have much impact on their operations, but it's nice to know those @$#% will have one more shoulder to have to look over.

Re:Why would China do this? (5, Insightful)

maxume (22995) | more than 5 years ago | (#28518391)

One reason might be that building an industry that is entirely reliant on the whims of a foreign company could leave them holding the bag for thousands of idiots who thought they had a job.

Re:Why would China do this? (0)

Anonymous Coward | more than 5 years ago | (#28518603)

What does the US housing situation have to do with this?

Re:Why would China do this? (1)

pmontra (738736) | more than 5 years ago | (#28518755)

One reason might be that building an industry that is entirely reliant on the whims of a foreign company could leave them holding the bag for thousands of idiots who thought they had a job.

Only a few countries build cars but every country service them. Local car service industries are at the mercy of manufacturers which, for example, make fully electronic cars that can be serviced only with expensive tools, but no country ever banned cars for that reason AFAIK.
I really wonder what the reason for the gold farming ban is.

Re:Why would China do this? (1)

maxume (22995) | more than 5 years ago | (#28519013)

That's a pretty tortured analogy. For one thing, there isn't an OEM replacement parts market for video game loot.

Half (or better...) of a gold farming industry could disappear overnight if Blizzard decided to crack down. Even if GM and Chrysler had completely dissolved, people would still want their existing cars serviced.

Re:Why would China do this? (2, Interesting)

vlm (69642) | more than 5 years ago | (#28518647)

It just seems this isn't the real or whole story, though.

Encrypting the client-server protocols, makes it harder to hack the "game". Sort of.

That also makes it a great tool for secret communication about counter-revolutionary activities ranging from simple gossip about Tienanmen square, to money laundering.

Its an interesting public admission that a video game company can make a government-proof encryption/authentication/communication system.

Re:Why would China do this? (3, Insightful)

Apache (14188) | more than 5 years ago | (#28518993)

I suspect that the article is actually blowing out of proportion the MMO currency trading side of things. A quick googling shows that evidently gambling is illegal in china and the government has gone to lengths to crack down on it:

http://en.wikinews.org/wiki/China_steps_up_anti-gambling_campaign [wikinews.org]

If :
  A) MMO currency trading is not a notable contributor to China's GDP
  B) Virtual currency makes bypassing gambling restrictions easier
  C) China is genuinely interested in curbing gambling
It sounds to me like banning on-line currency trading is a no-brainer as it will criminalize the entry point people would use to get around local gambling restrictions. Any problem with MMO currency trading is purely incidental.

And I doubt China cares about the cost the rest of the world pays for [Titansteel Bar]s on the auction house..

But havent banned willy smacking (-1, Troll)

Anonymous Coward | more than 5 years ago | (#28517947)

Imagine your willy being smackedd until it bleeds.

J.delanoy

So... (3, Insightful)

Darkness404 (1287218) | more than 5 years ago | (#28517969)

So let me get this right, China bans a highly profitable industry from operating in China that no doubt brings in lots of revenue in the Chinese government or at the very least prevents people from having to work directly for the Chinese government. Sound really smart. While your at it why not ban the production of shoes, hard drives and cheap kids toys, it would have about the same effect.

Re:So... (1)

wjousts (1529427) | more than 5 years ago | (#28518173)

FTA:

The government justifies its ban on virtual currency trading as a way to curtail gambling and other illegal online activities.

But it's probably more about control. In a tightly controlled economy, the Chinese government doesn't want a parallel and uncontrolled economy popping up.

Re:So... (1)

Darkness404 (1287218) | more than 5 years ago | (#28518237)

But China of all governments should know that whenever they start to control something it just leads to an underground movement of people who do it but they get no money from it and a communist/fascist/socialist government needs all the money they can get if they don't want to go the way of Soviet Russia. At some point they have to realize that even if the game currency is used to trade across multiple games, it will eventually surface as taxable cash.

Re:So... (1)

wjousts (1529427) | more than 5 years ago | (#28518691)

Nobody said governments behaved rationally.

China isn't socialist/communist (0)

Anonymous Coward | more than 5 years ago | (#28519045)

China is a totalitarian capitalist. Yay state and corporate oppression. Best possible combination.

Re:So... (4, Interesting)

Pollardito (781263) | more than 5 years ago | (#28518613)

It might be related to their attempts to limit the time that people spend playing games online [gamespot.com] . After all it would seem strange to limit people from playing more than 3 hours in their private life, while still allowing people to play 4 times that long at work.

what about subscriptions? (1)

poetmatt (793785) | more than 5 years ago | (#28517981)

subscriptions are intangible, are they going to prevent retailers from selling those too? FTA: "prepaid cards of cyber-games"....so they're not going to let people buy world of warcraft subscriptions or something?

Re:what about subscriptions? (1)

Manos_Of_Fate (1092793) | more than 5 years ago | (#28518111)

A subscription to a game is a service, not an intangible item. The ban is on virtual items that only exist in the game, not on selling anything without substance (which would make charging for services illegal).

Re:what about subscriptions? (1)

Darkness404 (1287218) | more than 5 years ago | (#28518279)

...But similarly its a "service" for someone to farm gold for you too. And at what point does this stop? Eventually you can charge for an expansion pack that might give you virtual items too, would that be illegal?

Re:what about subscriptions? (1)

blueg3 (192743) | more than 5 years ago | (#28518423)

They're not banning hiring someone to perform a service in a virtual world for you; they're only banning the sale of virtual goods. If you think you can trick them with that distinction, though, try convincing someone that when they buy a desk lamp, they're not buying a good, but rather are purchasing the services of the manufacturer of that lamp.

Re:what about subscriptions? (1)

EvanED (569694) | more than 5 years ago | (#28518557)

...try convincing someone that when they buy a desk lamp, they're not buying a good, but rather are purchasing the services of the manufacturer of that lamp.

Well, to be fair, buying the lamp pays for both the labor and raw materials. If I took a bunch of raw parts to some guy and gave him some money to turn the parts into a lamp, I think that line becomes much more fuzzy. Just in this case, there are no raw materials.

I'm not sure where the line falls here to be honest. It might depend on how it's marketed or something like that.

(What about this: if you hired someone by the hour to farm gold for you, is that buying the gold or the service?)

Re:what about subscriptions? (1)

Manos_Of_Fate (1092793) | more than 5 years ago | (#28518723)

Unless they're using your account, I'd say that's a commissioned good. If they're using your account to do the farming, that sounds more like a service, but also breaks the ToS of just about every game out there at the moment.

Kentucky Rejects +1, Helpful (-1, Offtopic)

Anonymous Coward | more than 5 years ago | (#28517989)

slot machines at racetracks. I predict the retail sales tax will be increased to 10%. A justifiable income tax increase is too politically sensitive for the State Senate Marijuana Farmers.

Yours In Paganism,
K. Trout

A 'Webpage' is a Virtual Item (1)

MrMista_B (891430) | more than 5 years ago | (#28517993)

So, China just fobade anyone who does any work on the inernet from receiving payment of any kind for their services.

Wow.

No, seriously, I'm impressed.

Re:A 'Webpage' is a Virtual Item (2, Informative)

blueg3 (192743) | more than 5 years ago | (#28518331)

All of the non-gold-selling Internet business that comes to mind involves either selling a real good (although that real good consists of data) or performing a service, not selling a virtual good.

You seem to be confusing real goods on the Internet that consist of data with virtual goods. (Note that a real good consisting of data -- like the contents of a website -- can easily, though perhaps inconveniently, rendered into data in a more "physical" form. I cannot give you WoW gold via any physical means.)

Cash4WOWGold (1)

Blixinator (1585261) | more than 5 years ago | (#28517997)

What will this do to the gold market? Will the guy on the Cash4Gold commercials become even more annoying and have larger graphs to show just how much he profits from buying gold from people at prices well below market price then selling it when the prices go up?

Isn't currency virtual already? (1)

caywen (942955) | more than 5 years ago | (#28518029)

Isn't virtual currency just a microcosm of a "real" currency system? Perhaps they should also start cracking down on retail gift cards and "point" systems, too.

Re:Isn't currency virtual already? (1)

Duositex (620105) | more than 5 years ago | (#28518225)

Nevermind the credit system. But "virtual goods" sounds an awful lot like the entire software industry and not just the trinkets you can buy in MMORPGS.

"Virtual goods" (1)

Lohrno (670867) | more than 5 years ago | (#28518049)

"InformationWeek is reporting that the Chinese government has declared a ban on the sale of virtual goods for real currency." If worded exactly like that, does that mean that there will be no Korean MMOGs there? Those game companies themselves make their entire business model to sell virtual goods for real cash...

Bit more worrying... (0)

Anonymous Coward | more than 5 years ago | (#28518065)

China is also moving away from the sale of real goods for virtual currency [reuters.com] .

Re:Bit more worrying... (0)

Anonymous Coward | more than 5 years ago | (#28518471)

Zing!

Chinas motives (1)

Gresyth (1103851) | more than 5 years ago | (#28518085)

The government justifies its ban on virtual currency trading as a way to curtail gambling and other illegal online activities.

Will the other illegal online activities include, dissent against the govt or telling the world about human rights violations? Looks like its another way to pass a law to restrict their populace.

But will they ENFORCE this? (4, Insightful)

elrous0 (869638) | more than 5 years ago | (#28518113)

If this is just another instance where the farmers just have to bribe the cops to look the other way, this "ban" will amount to nothing more than a PR stunt.

Re:But will they ENFORCE this? (3, Insightful)

Dan667 (564390) | more than 5 years ago | (#28518197)

I would guess this is the case. China probably needed to make a public announcement like this to get something they wanted in a negotiation. I bet they do nothing to enforce this.

Re:But will they ENFORCE this? (0)

Anonymous Coward | more than 5 years ago | (#28518375)

I suspect they're banning it because gold sellers tend to get the gold by stealing accounts. Obviously it won't be easy to stop, but they can probably make it a bit harder. Which I suppose is better than nothing.

There is always India (4, Insightful)

Hoi Polloi (522990) | more than 5 years ago | (#28518133)

And suddenly thousands of Indian techies have opened Warcraft accounts.

Re:There is always India (0)

Anonymous Coward | more than 5 years ago | (#28518299)

And suddenly thousands of Indian techies have opened Warcraft accounts.

So we might get something like this [youtube.com] except with a Bollywood flavor?

Re:There is always India (1)

Darkness404 (1287218) | more than 5 years ago | (#28518323)

So now when I call tech support I will have to wait twice as long as I usually have to because the support people are out busy on a guild dungeon run?

Loyaly Programs (0)

Anonymous Coward | more than 5 years ago | (#28518151)

Wouldn't that make loyalty programs (such as Air Miles) illegal? They also trade virtual currency (points) for cash and goods.

Corruption (0)

Anonymous Coward | more than 5 years ago | (#28518169)

That makes me wonder who greased who's palms to get this passed into law...

Why? I don't get it... (4, Insightful)

Monkeedude1212 (1560403) | more than 5 years ago | (#28518231)

It's not illegal to make Gold.
It's not illegal to Give Gold.
It's not illegal to Give real Money to someone else.

But somewhere along the way, selling Gold online becomes illegal. Wheras stating the transaction as a two-way donation easily bypasses the law.

Also - the big question - why would this become illegal? People do what they want with their money. If Blizzard was smart - they'd offer Gold at a price matching the market and get a cut on this. They've already ruined WoW four times over. Anyone who's played since the beginning can tell you how much more enjoyable it used to be.

Gold farmers also increase the amount of subscriptions that the game has, more money going into the developers... I don't get why they fight it so much.

To me - its the worst business logic I've ever come across, and games that have these microtransactions already involved will be the ones who come out on top.

Re:Why? I don't get it... (5, Funny)

rainmaestro (996549) | more than 5 years ago | (#28518357)

This reminds me of the old Carlin skit on prostitution:

"Selling is legal, ****ing is legal. So why isn't selling ****ing legal?"

Re:Why? I don't get it... (3, Insightful)

gujo-odori (473191) | more than 5 years ago | (#28518771)

George Carlin had a lot of insight into bogosity, and phrased it in memorable ways.

While I'm not particularly in favor of prostitution, the court long ago ruled that sex acts between consenting adults are legal.

That being the case, it seems - at least to this layman - that the law is on shaky ground in dictating how said consent may be achieved. Whether it's by flowers, dinner, and clever small talk, or whatever the going rate in cash is, consent is consent.

To make matters even cloudier, the court has also ruled that porn is protected under the first amendment. No matter how much sophistry they want to wrap around it, at the core of porn is the fact that people are being paid to have sex with someone that (in many cases) they just met for the first time a few minutes before the scene. Not that elapsed time between meeting and the act matters to prostitution laws. If it's legal for a third party to pay two (or more) people to engage in sex and film it, then it seems contradictory to say that it's illegal for one party to pay the other to engage in sex.

That discrepancy may also provide a way for people to beat the rap on prostitution charges: don't solicit someone for sex, tell them you're making a porno flick and you want them to be in it.

Re:Why? I don't get it... (3, Informative)

Chad Birch (1222564) | more than 5 years ago | (#28518367)

It's not illegal to have sex.
It's not illegal to give money to someone else.

It's not illegal to drive.
It's not illegal to drink.

Things aren't always just the sum of their parts.

Re:Why? I don't get it... (1)

Red Flayer (890720) | more than 5 years ago | (#28518641)

Also - the big question - why would this become illegal? People do what they want with their money. If Blizzard was smart - they'd offer Gold at a price matching the market and get a cut on this.

Once they start doing this, then they run afoul of banking regulations. Suddenly they are running an currency exchange board using a 'phony' currency... lots of countries would have issues with this.

China is trying to clean up its image regarding currencies, and one of the things necessary is that they limit certain transactions, especially ones involving other countries' currencies, that screw with international trade. Especially so in light of their recent request to the IMF that a 'supercurrency' is created.

Re:Why? I don't get it... (1)

HikingStick (878216) | more than 5 years ago | (#28518739)

If you give to someone else with the expectation of something in return, you are no longer talking about a donation, but either a financial transaction or barter. You can play the word game as much as you like, but if your character donates 100,000 gold to another player's character, and that character's player--out of the goodness of his or her heart--decides to find out who you are and send you cash, then a de facto transaction has taken place.

If your logic had any legal merit, you'd find cadres of hookers using the "I donated services" defense while the Johns make a "I made a cash donation" defense.

Besides, any time you give money to a group or individual and receive something tangible in return, the only part of the transaction that is considered a donation is the amount above the fair market value of the item. So, if you buy a tin of popcorn from your local Boy Scout for $10, and the tin would normally sell for $4 at retail, your donation is only $6.

Re:Why? I don't get it... (1)

Nathrael (1251426) | more than 5 years ago | (#28518871)

If Blizzard was nice, they'd just remove the necessity to farm gold and let players actually enjoy the game.

Farming Gold? (0)

Anonymous Coward | more than 5 years ago | (#28518275)

Where do I buy gold seeds so I can start gold farming?

I've heard that money doesn't grow on trees, yet I didn't know that I could farm gold.

Goldfarmer (0, Redundant)

rlp (11898) | more than 5 years ago | (#28518287)

Bond: Do you expect me to talk?
Auric Goldfarmer: No Mr. Bond, I expect you to ... play World of Warcraft.

so we are so lazy now (2, Funny)

stabiesoft (733417) | more than 5 years ago | (#28518309)

we have to pay the chinese to have fun for us now? What's next, do we pay them to have sex for us, eat for us, pee for us...

Re:so we are so lazy now (3, Insightful)

slyn (1111419) | more than 5 years ago | (#28518575)

Farming gold isn't what most players find fun about MMO's, hence peoples willingness to pay for it.

Re:so we are so lazy now (1)

dariuscardren (826733) | more than 5 years ago | (#28518903)

I have fun doing it (log in form work and do it in 64 colors over VNC) but still have fun

This Changes Nothing (1)

Greyfox (87712) | more than 5 years ago | (#28518393)

Assuming the companies that were actually making the profits selling the gold were inside China they could just relocate elsewhere and continue to employ Chinese to farm their gold. Even if the Chinese government cracks down on those employees, there are still plenty of impoverished nations whose citizens would be happy to work for 16 hours a day for $.20 a day. It just means that instead I'll need to brush up on insulting phrases in languages other than Mandarin. Does anyone know the Somali for "Go stick your head in a goat"?

Nothing to do with Gaming (5, Informative)

kenp2002 (545495) | more than 5 years ago | (#28518425)

In full disclosure: I work in the financial industry currently.

This ban has nothing to do with gaming, gambling, or local economy.

This is likely a direct response to MASSIVE money laundering.

Joe has $100,000 worth of illicit cash.
Joe strikes a deal to buy $100,000 worth of virtual currency in WoW. Joe smuggles the money. (Many times Joe can even hire the kid down the street and pay him cash...)

Joe turns around and over several months sells the gold BACK to the gold farmers and claims the sales as legitimate income. Selling it at a 50% loss he can convert $100,000 into $50,000 of legitimate funds. Even more so when he acts as a virtual broker (IGN anyone?).

While this is a simplified scenario but we are talking BILLIONS of dollars a year are now going through these kinds of channels.

I've seen locally here in the US $300,000 attempts and laundering money this way (through a combination of FF Online, LOTRO, and Maple).

While it is getting easier to deal with this now that the gaming companies are willing to share some data I can only imagine how hard is must be in Asian markets where channeling cash to chinese gold farmers is easier with the shorter phsyical distances. Oddly though, in my experience, I have seen more Korean and Indian gold farmers then Chinese.

Never had a problem with gold farmers, never will, but I have serious doubts that this ban has anything to do with gameplay.

I think this is in response to the forged bonds that were intercepted in Italy. They are worried about organized crime shifting large sums of money (which require laundering) through the virtual economy.

If I am an evil overlord and I have to get 4 billion to my agents around the world the easiest thing to do is buy a billion dollars worth of WoW gold, have all my agents log in with characters. Divvy up the gold then have them sell it off locally or back to the gold farmers at a loss.

No quicker way to distributed that much real world money then through a network of games.

Re:Nothing to do with Gaming (1, Interesting)

Anonymous Coward | more than 5 years ago | (#28518591)

It's sad that you work in financial sectory and don't realize this is a poor way to launder cash. The mafia would never be so dumb. In fact a regular software company is a much better way to do it. The only hard part of laundering money is doing it without paying lots of taxes. Otherwise I could just sale you custom state-management software for 1m/pop.

Re:Nothing to do with Gaming (0)

vlm (69642) | more than 5 years ago | (#28518811)

In full disclosure: I work in the financial industry currently.

Could it be that Blizzard is planning on inflating their virtual gold economy less than the local central banks?

Virtual gold might not be as stable of an investment as real gold, but it might be become better than currency. I'm sure virtual gold is more stable than Zimbabwe money...

This is not a ban! (1, Funny)

Orleron (835910) | more than 5 years ago | (#28518455)

It's a pretense for nationalization of gold farming companies! (Obama is only sorry he didn't think of it first, LOL.)

Re:This is not a ban! (0)

Anonymous Coward | more than 5 years ago | (#28518567)

Way to bring your pointless conservative negativism to a conversation completely unrelated. I'm sick of hearing this drivel about how everything Obama does is wrong even though he has tried to reach across the aisle and been spat at and frequently crossed his own damned party. He isn't a god but he is far better than the conservatives who've been in control for the past 8 years or the ineffective dems in congress. Drop this crap unless you have an actual issue you spoiled brat.

Screenshots... (1)

HunterZ (20035) | more than 5 years ago | (#28518489)

Screenshots or it didn't happen!

Not the end of Chinese Gold Farming (2, Informative)

tick_and_bash (1256006) | more than 5 years ago | (#28518519)

While they have expressly forbidden the exchange of virtual currency/services for real cash, it does not forbid the exchange of their time (services) for a player's cash. This does not prevent them from offering powerlevelling, honor farming, or item grinding. (Change the term for whatever your MMO of choice terms these services.) These services are normally quoted as a function of time. Anyone who uses a bit of creative wording/pricing can still continue to sell virtual currency. So long as they refer to it as a service, then in theory they should be able to skirt this new ban. Quite a few sites list a time frame in which they can get gold to you. Up to 2 days for larger orders. Let's say someone wants to buy 10,000g. With a 2 day turn around time, that's about ~210g per hour. (Most players with a bit of a clue can easily bang out that much if not more per hour.) Thus, they have sold the player their playing time for a specific goal. I honestly don't think this solves anything. It'll either create an underground market, or sites will start to use more creative wording.

you failed maths (0)

Anonymous Coward | more than 5 years ago | (#28518697)

ummm one billion RMB is actually one hundred and 46 million dollars as there are almost 7 yuan in one dollar.

Live rates at 2009.06.29 19:56:54 UTC
1,000,000,000.00 CNY = 146,318,619.51 USD
China Yuan Renminbi United States Dollars
1 CNY = 0.146319 USD 1 USD = 6.83440 CNY

Sillly (1)

FunkyELF (609131) | more than 5 years ago | (#28518855)

built virtual commerce into their game infrastructure

So you can go to work in a virtual world, selling virtual services for virtual gold.
You can then sell that gold to a 12 year old idiot who got his mom's credit card.

Thats kinda funny.
I have a roommate who is adicted to FarmTown on Facebook. He is constantly farming other people's crops to get money to buy stuff for his own farm.


Imagine a farmer in China getting a computer, and farming in a virtual world, selling his virtual income for actual income and that being more than he made farming in real life.
Crazy!

You owe them (1)

32771 (906153) | more than 5 years ago | (#28519043)

Something makes me think that the Chinese government helped some of you.

Not that I like the idea but - I can be pragmatic.

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