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The real reason PLEX is so expensive

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PotatoOverdose
Handsome Millionaire Playboys
Sedition.
#21 - 2014-04-18 21:39:58 UTC  |  Edited by: PotatoOverdose
Andski wrote:
PLEX prices are high because of speculators, not because a bunch of players suddenly decided to start using PLEX for their accounts. It's an unfortunate consequence of CCP introducing PLEX as a convenient alternative to GTC trading and as a foundation for monetized perks like multiple character training.

This doesn't look like speculation to me. Speculation could be a local spike from 700 million to 740 million back to 700 million.

The linked market graph indicates sustained and reasonably linear growth in Plex price over the course of a year from ~550 million one year ago to ~710 million+ today. That looks far more like demand is outpacing supply by a bit and eroding into existing plex stockpiles.
Erufen Rito
Republic Military School
Minmatar Republic
#22 - 2014-04-18 21:48:28 UTC
Divine Entervention wrote:
It's not a certainty that PLEX being bought and sold on the market within EvE is new plex recently bought for $20.

Increasing the price of PLEX has 2 benefits for CCP.

1) it raises the ISK subscription fee resulting in more people needing to continue their ability to stay within EVE with subscription purchases with real money, which real money benefits CCP.

2) Because the PLEX is more lucrative due to it's having a higher ISK worth, more people are willing to pay CCP real money to buy PLEX to then turn into ISK, which results in CCP getting more money from people buying more PLEX to sell for ISK.

If Plex were worth only 300mil ISK, more people would be subbing to EvE with plex rather than money, which would result in less money for CCP. Eventually, through the PLEX disappearing through use of pilots licenses, they would become scarce resulting in them raising in isk and worth over time. And since $20 would only be buying 300mil ISK, less people would be buying PLEX since at that time, $20 = 300mil isk.

It's very obvious that PLEX being worth more ISK benefits CCP.

The question of the matter though, is CCP manipulating the worth of PLEX behind the scenes to benefit themselves? Which if they were, IMO, would be perfectly acceptable since ultimately they are a business providing a service.

This only applies under the scenario in which PLEX is NPC seeded, which it isn't. Every single plex in the market was placed for sale by a player, that paid real money for it.

This is as nice as I get. Best quote ever https://forums.eveonline.com/default.aspx?g=posts&m=4137165#post4137165
Rowells
Pator Tech School
Minmatar Republic
#23 - 2014-04-18 22:04:11 UTC
Petrus Blackshell wrote:
higher PLEX prices? Yes. They noticed more people not using subs, and a drop in income because people don't want to pay for all this feature-less "development" (lol "expansions") and they are using their own methods to force us into paying them more money. It's a cash grab, pure and simple.

Are you buying into it?

You do realize somebody had to pay for those right? No matter what happens after they are bought somebody is paying for someone else's subscription at a higher price. So when lots of people use plex to play EVE instead of paid subs, CCP makes more money, not less. PLEX doesn't spawn on it's own and can't be made in game so it is always paid for, by someone.
Divine Entervention
Doomheim
#24 - 2014-04-18 22:16:34 UTC
Erufen Rito wrote:

This only applies under the scenario in which PLEX is NPC seeded, which it isn't. Every single plex in the market was placed for sale by a player, that paid real money for it.


No, it doesn't. I even explain that since people have to buy PLEX for it to exist, that it causes a desire for PLEX to be worth more isk to justify the investment of real money to make the isk return worth it.

Also, it could be construed that PLEX is NPC seeded because no one builds the PLEX, CCP materializes the ISK out of thin air upon it's purchase.

No one creates the PLEX other than CCP. If CCP didn't create PLEX, it wouldn't exist within EVE.
Caleb Seremshur
Bloodhorn
Patchwork Freelancers
#25 - 2014-04-18 22:23:59 UTC
Hevymetal wrote:
Petrus Blackshell wrote:
When looking for the source of a problem, you need to look at the intersection of who profits from the problem and who can enable the problem to occur.

Do regular subscribers benefit from high PLEX prices? No.
Do subscribers with PLEX benefit from higher PLEX prices? Hell no.
Do people who buy PLEX to fund their activities benefit from higher PLEX prices? Yes, but how are they going to drive PLEX prices up?

Does CCP benefit from higher PLEX prices? Yes. They noticed more people not using subs, and a drop in income because people don't want to pay for all this feature-less "development" (lol "expansions") and they are using their own methods to force us into paying them more money. It's a cash grab, pure and simple.

Are you buying into it?


As I said in another thread high PLEX prices are due to: demand > supply, basic economics, no conspiracy here.


There probably used to be a considerable surplus. What we're looking at is probably the tail end of the lag in consumption produced by multiple character training and all the other things. I wonder if the supply of plex producers has remained static and that the consumers haven't necessarily grown just merely been enough to consume at a higher rate than they're generated?

Also the latest price hike is timed around the aftermath of B-R. I wouldn't put it past the big players trying to squeeze the market a little bit by buying up plex to drive its inflation up. Unless mineral prices are increasing at a similar rate then this hypothetical plex driver stands to make a lot of money on the way up... and probably even more on the way down. The kind of person who benefits from plex manipulation typically would have the backing to do it.
Tippia
Sunshine and Lollipops
#26 - 2014-04-18 22:27:34 UTC
Divine Entervention wrote:
Also, it could be construed that PLEX is NPC seeded because no one builds the PLEX, CCP materializes the ISK out of thin air upon it's purchase.
That doesn't make it NPC seeded.

Quote:
I even explain that since people have to buy PLEX for it to exist, that it causes a desire for PLEX to be worth more isk to justify the investment of real money to make the isk return worth it.
…which only explains how players benefit from higher prices, not CCP. Your scenario still hinges on the notion that PLEX are seeded, which they're not.
Divine Entervention
Doomheim
#27 - 2014-04-18 22:31:00 UTC
Tippia wrote:
Divine Entervention wrote:
Also, it could be construed that PLEX is NPC seeded because no one builds the PLEX, CCP materializes the ISK out of thin air upon it's purchase.
That doesn't make it NPC seeded.

Quote:
I even explain that since people have to buy PLEX for it to exist, that it causes a desire for PLEX to be worth more isk to justify the investment of real money to make the isk return worth it.
…which only explains how players benefit from higher prices, not CCP. Your scenario still hinges on the notion that PLEX are seeded, which they're not.


Where does PLEX come from?
Tippia
Sunshine and Lollipops
#28 - 2014-04-18 22:33:05 UTC
Divine Entervention wrote:
Where does PLEX come from?
Cash payments to CCP.
No, no NPC is involved. No, they're not seeded. No, CCP does not miss out on money when people PLEX their accounts.
Divine Entervention
Doomheim
#29 - 2014-04-18 22:34:10 UTC
Tippia wrote:
Divine Entervention wrote:
Where does PLEX come from?
Cash payments to CCP.
No, no NPC is involved. No, they're not seeded. No, CCP does not miss out on money when people PLEX their accounts.


So CCP creates the PLEX.
Tippia
Sunshine and Lollipops
#30 - 2014-04-18 22:35:35 UTC
Divine Entervention wrote:
So CCP creates the PLEX.

Roll Cut to the chase. Your hypothesis is still incorrect since it relies on a fundamental misunderstanding of how PLEX work.
Divine Entervention
Doomheim
#31 - 2014-04-18 22:39:10 UTC
So since CCP creates the PLEX, it is in their best interests to have PLEX be desirable enough to want to buy.

Buying PLEX equals money to CCP. PLEX worth more ISK makes PLEX more desirable to buy.

PLEX being bought because it's desirable equals more money for CCP.
Volar Kang
Kang Industrial
#32 - 2014-04-18 22:39:42 UTC
Your logic is missing a few points...

1. Plex costs more than a months sub fee
2. CCP profits more from Plex than they do a monthly sub fee
3. CCP would actually like to see the in-game cost of Plex lower so more people pay with Plex.

I pay with Plex using isk which means I get a free month due to someone else paying MORE than my monthly sub fee. Why would CCP want to see me stop buying Plex by artificially raising the cost of it in the game?
Tippia
Sunshine and Lollipops
#33 - 2014-04-18 22:46:20 UTC  |  Edited by: Tippia
Divine Entervention wrote:
So since CCP creates the PLEX, it is in their best interests to have PLEX be desirable enough to want to buy.
…which means keeping the volumes up, which means keeping the PLEXing players around, which means keeping prices at levels that they can sustain. That's why they have a buffer of confiscated PLEXes that they can dip into to push prices down every now and then. If prices go too high, CCP loses money by the bucketload.

Quote:
PLEX being bought because it's desirable equals more money for CCP.
They were desirable at a quarter the current price. CCP doesn't particularly benefit from higher prices — only the PLEX buyers do. It only equals more money for CCP if the volume of PLEX sales increases, and there's very little to suggest that this is happening. In anything, sales volumes seem to have tended downwards, which is a far more ready explanation for why the prices go up. This downward trend is, if anything, in spite of CCP's attempts to keep trade volumes high by reinjecting those confiscated PLEXes and keep prices low.
Divine Entervention
Doomheim
#34 - 2014-04-18 22:48:48 UTC
A PLEX costs $20.
A subscription costs $15.

If a person is looking to sub his account using money, it's understandable that he's going to use the option that results in him paying less, being a $15 subscription costs. He COULD buy a PLEX for $20 and then immediately turn around and use it to sub his account, but IMO, that's a waste of $5 because he could've got the same product for 25% cheaper.

Now considering that it's more cost efficient for a player looking to subscribe his account using dollars to go with the cheaper option, the purpose of PLEX existing has to be taken into consideration.

That purpose is to sell PLEX for isk. If PLEX is worth 350million isk, it is less desireable than a PLEX being worth 700million ISK. Higher desirability potentially results in more PLEX being bought to get more value.

Cheap isk PLEX hurts CCP more than expensive isk PLEX, because cheaper isk PLEX is less desirable to purchase from CCP for $20 than a more expensive isk PLEX for $20.
Tippia
Sunshine and Lollipops
#35 - 2014-04-18 22:54:24 UTC  |  Edited by: Tippia
Divine Entervention wrote:
Cheap isk PLEX hurts CCP more than expensive isk PLEX, because cheaper isk PLEX is less desirable to purchase from CCP for $20 than a more expensive isk PLEX for $20.

No, they're not. Again, they were desirable at a quarter the price and there is nothing to suggest that the higher prices has stimulated higher purchase volumes. And if anything, lower ISK prices on PLEX means people will have to buy more of them to get the money they need, which translates into more sales for CCP.

But at least you figured out why more accounts PLEXing is beneficial to them.

So your first proposed benefit is incorrect, and your second proposed benefit relies on a price-purchase relationship that hasn't been established and which might just as well be the exact opposite of what you're suggesting.
Divine Entervention
Doomheim
#36 - 2014-04-18 23:03:25 UTC
I understand the concept of attainability. CCP wants the isk price of PLEX to be low enough for people to want to purchase it to continue their game play so the PLEX purchasers will want to buy it since people in game are willing to spend the ISK to make the purchase worth the PLEX purchasers investment.

But at the same time, it works both ways. The isk price needs to be low enough for the PLEX purchasers to feel that they'll get a return on their investment, but they want it to be worth more to make their investment more valuable. It's all about trying to find the most people are willing to pay.

With PLEX right now being sold at 740million, that could be enticing people who don't already have PLEX in supply to buy plex, which is a benefit to CCP.
Tippia
Sunshine and Lollipops
#37 - 2014-04-18 23:06:23 UTC  |  Edited by: Tippia
Divine Entervention wrote:
But at the same time, it works both ways. The isk price needs to be low enough for the PLEX purchasers to feel that they'll get a return on their investment, but they want it to be worth more to make their investment more valuable. It's all about trying to find the most people are willing to pay.

With PLEX right now being sold at 740million, that could be enticing people who don't already have PLEX in supply to buy plex, which is a benefit to CCP.

…except that this isn't happening. Again, and I'll keep repeating this until it sinks in: they were desirable to buy at a quarter the price and if anything, lower ISK prices means people will have to buy more of them to make up for their ISK needs. The trade volume at 740M is the same as it were at 540M — there is no visible “enticement” from the higher price.

So all that is happening is that the higher price makes people shut down their accounts, which inevitably translates into lost money for CCP. That's why they have their PLEX slush fund to push prices down and why there is pretty much nothing to suggest that they have ever pushed it upwards.
Divine Entervention
Doomheim
#38 - 2014-04-18 23:12:16 UTC
Tippia wrote:
Divine Entervention wrote:
But at the same time, it works both ways. The isk price needs to be low enough for the PLEX purchasers to feel that they'll get a return on their investment, but they want it to be worth more to make their investment more valuable. It's all about trying to find the most people are willing to pay.

With PLEX right now being sold at 740million, that could be enticing people who don't already have PLEX in supply to buy plex, which is a benefit to CCP.

…except that this isn't happening. Again, and I'll keep repeating this until it sinks in: they were desirable to buy at a quarter the price and if anything, lower ISK prices means people will have to buy more of them to make up for their ISK needs. The trade volume at 740M is the same as it were at 540M — there is no visible “enticement” from the higher price.

So all that is happening is that the higher price makes people shut down their accounts, which inevitably translates into lost money for CCP.


I never said they weren't desirable enough to be bought. I stated that PLEX being sold for more isk makes PLEX MORE desirable than a PLEX worth less ISK.
Tippia
Sunshine and Lollipops
#39 - 2014-04-18 23:15:39 UTC  |  Edited by: Tippia
Divine Entervention wrote:
I never said they weren't desirable enough to be bought. I stated that PLEX being sold for more isk makes PLEX MORE desirable than a PLEX worth less ISK.

…except that there is nothing to suggest that it actually happens that way, and even if it did, being “more desirable” is only beneficial to CCP if it at the same time both creates more sales and keeps people from closing down their accounts. By all appearances, it does neither.

So again, the only one who benefits from the higher price point is the PLEX sellers — CCP certainly doesn't, and they definitely do not benefit from people switching from PLEX to subscriptions.
Divine Entervention
Doomheim
#40 - 2014-04-18 23:20:27 UTC
Tippia wrote:
Divine Entervention wrote:
I never said they weren't desirable enough to be bought. I stated that PLEX being sold for more isk makes PLEX MORE desirable than a PLEX worth less ISK.

…except that there is nothing to suggest that it actually happens that way, and even if it did, being “more desirable” is only beneficial to CCP if it at the same time both creates more sales and keeps people from closing down their accounts. By all appearances, it does neither.

So again, the only one who benefits from the higher price point is the PLEX sellers — CCP certainly doesn't.


We don't have the figures of PLEX being bought from CCP, so we have no idea of knowing if they are benefiting from an increase in PLEX being bought.

Because we can't know since they won't tell us, you can't state the "the only one who benefits" because you can't know if CCP is not also benefiting.

You can't know it.

You can suppose, you can believe, think, feel, but you can't know it.