Market Discussions

I think what he meant was buying PLEX with RL cash and selling them for ISKies now. If he's planning to buy the PLEX with RL cash as opposed to using ISK, the market peaking out would rather work to his favour.

We discussed PLEX and it's possible effects on the market, both in-game and meta, in the first half of our last weekend show; here:

http://www.evemorningreport.themumm.com/?p=53

The troll is strong with this one....

I found the discussion both informative and arousing, I'd also like to wave my fist in triumph towards the bigwigs who gave me such a hard time earlier in this post.

The gentlemen who made this fine production were clearly more versed and informed in the ways of the market, but in a more raw and unrefined way my post was pointed in the same direction.

The problem you have is assuming that real life purchases of Plex will go up as the value becomes better.

I agree that people will buy More ISK if it is a better value and people buying plex and turning around and selling them in game ARE BUYING ISK with $ not buying PLEX .

We do not know by any means that the new purchasors of plex (because of getting more isk per $) will offset those that were buying plex to sell for isk with a given ISK goal in mind. If their goal was to buy a fully fit carrier for 1 billion isk, they very well would buy only 2 plex at 500 million per isk instead of 3 plex if the exchange rate were 333 million per plex.

On top of that, I really think the tail that wags the dog for people considering putting extra $ above and beyond their subscription cost has Far far more to do with their interest level in the game rather than any value equation in terms of how much ISK they can get per plex. At some point, those people who don't like to farm but only pvp, will start losing interest in the game if the amount of ISK that people get per $ by other people who don't like to farm (note the specific subsection of players) overwhelms the abilty of people who will not pay extra for any product on Principle to keep up ship wise with people paying more.

again in bullets:

• Interest in the game is the number one factor in money coming into the $ (no doubt huh?)
Interest in spending extra $ to play the game has both goal/mechanic motivations (i.e need a carrier or a couple hics) and value based on ISK per $ (not plex per $ unless plex prices change in $) , those two will offset and the net increase or decrease is unknown
Interest in the game CAN be effected by perceptions of whether you need to pay real $ to keep up. (and this is made independantly by people with differerent game play styles... those filthy rich in isk don't care terribly much (unless it goes to insane levels) nor do people who are quite willing to spend extra real $ to play a game. If a significant subsegement (pvpers who don't like PVE and will not pay extra to play a game on principle just like they wouldn't pay extra for a quart or mile perhaps) has less interest the more people who pay extra (who are likely pvp-play style peers), over all player base could shrink based upon more ISK being purchased for $ (and as stated in the above, more isk could be bought with less plex/$ purchases)

I do agree that on the bottom end of the price range, there is an elastic demand based upon in game industry profitablity per account (and datacores and char sales etc). There is nothing saying however that that elastic demand isn't so great that the price hasn't been driven up to non-ideal values in terms of maximizing plex sales as plex sales volume is not synonomous with isk sales and there is the potential market supply is more based on game interest (player count) that has lots more to do with whether people enjoy the game balance or not.

Well, crap. We're working on the volume issues.

I would like to point out, that EVE is already "free to play" game as a result of PLEX.

But as EVE is "hard" game there is a quirk in its free-to-play model. You can "starve" in EVE if you are not playing hard enough. You put in some effort and grind and "play for free" or you swipe your credit card and get that "advantage" over free to play players in the form of isk injection you can spend on having fun - whatever is your definition of fun - without having to grind for that isk. At least not in game.

There is certain volatily assosiated with PLEX ofc - as as you pointed out - if PLEX price rises enough some accounts will "starve" as a result. CCP is quite aware of that and is implementing tools making it possible for them to intervene in PLEX market if they see the need - however they are not planning to do that in foreseeable future - according to CSM minutes.

I doubt that they would intervene as a reaction to "normal" PLEX price changes - even if the PLEX will hit the 1 bil mark or whatever other arbitary "red line". In my opinion they are implementing these tools as a potential safeguard against malicious market manipulation attempts. For Example - should goons (or whoever else) decide that it's good time to throw couple of trillion isk at PLEX market in an attempt to "hurt" EVE. The subscription base high reliance on PLEX market can introduce some shockwaves in the economy if PLEX price changes too rapidly.

While CCP intervention can "smooth out" the shockwaves introduced by the theoretical manipulation attempt its a bit hopeless to hold back the flood if the change is caused by normal market forces. It can "buy them some time" to change underlying game mechanics tho if there is a problem.

Really good point bout the particularity in their Free to play option...

that is really an issue in terms of the idea that more and more people might be accustomed to legging into a game in a generally free to play world,

AND ... paying players accustomed to a free to play world might only pay when their interest is high but expect to be able to tool around in some limmited fashion in a paid world.

As for where they would intervene. if it were only for emergency reasons I might agree with you.

But, if they gamed that by putting 5% more plexes on the market, they'd drive down the market price to a level that there were actually be increased purchases of plex for $ (because people would need more plex to get that carrier) and more players(as in people, not accounts) retained and over the long run attracted... they should do it crisis or not.

I could very easily see it being possible that if they placed 5 % more plex on the market, the price could fall from 500 to 400 million.

I don't know that, but commodity markets can have large swings. It would take an extra half a plex to get a billion isk, and while fewer people might buy isk for that carrier, the number of people buying 1 billion isk migh drop 5% but the number of plex bought might increase say 15% (the percentages aren't quite so round but the point isn' about the preciseness of estimates). They'd have 20% more accounts active under that scenario (accounts not players...players is a different guess) with 3/4s of the difference coming from $ purchases and one quarter coming from extra game time they dispense free.

It is Plausable, and worth experimenting with.

PRICING strategies at any retailer are subjective choices looking for a pricepoint that will balance volume and margin to maximize profits short term and position the brand to a demographic in the long run.

CCP is in it to make money, not to have the absolute purest economy beyond the point that game play quality suffers. Game time has far more meta overtones to it than drakes...supply is already influenced by meta things like buddy account and power of two decsisions etc.

There's a whole lot of bad economics in this thread. Its simple. Higher plex prices means the guys who pay cash to create plex are more likely to do so.

Lower plex prices means the guys who pay cash to create plex are less likely to do so.

The larger the wallet of those who pay cash to create plex the greater the effect of higher or lower plex prices. If someone has 1billion ISK in wallet they may accept 350 million ISK as reasonable when they decide to create a plex through cash. Someone with 10 billion ISK may not feel inclined to create a plex through cash unless the price is 500 million isk.

The guy who uses ISK to buy a plex mean jack squat in the equation outside of being a part of the demand. The subscription has been paid already when the plex is created. Whether or not a plexed account is let to expire matters not. If it were a paid subscription thinking of going to plex, that's allowed to expire because they can't/won't afford a plex, the net effect would be the same.
By hook or crook this class of player was no longer going to pay cash for the account.

The simple truth is the price of plex is going to continually rise over time as long as the population increases (demand) and the supply of ISK (faucets) rise along with it.

To summarize. There is no inherent right to cheap plex, free plex or anything else. You have the option to pay your subscription through cash or buy a plex at market value. Should you opt for neither your account will be closed. There is absolutely nothing CCP can do to control the market value of plex short of giving it away for free or selling it through game and removing the player market. That's not going to happen.

And as one with disposable income to buy plex for resale be assured I want to take as much isk as humanly possible out of your wallets for each and every plex I sell. No luv. Work harder slaves. The more I make the more i'll reinvest to drive the prices up even further. And i'm not alone. We can't hear your whimpers from the ivory towers, dirty smelly unwashed masses.

"The subscription has been paid already when the plex is created".

So every time I or you pay for subscription with real money we basicly pay not only for our sub, but for sub of that guy who buy a PLEX from market and use it.

That means CCP is loosing 50% of potential profit from subscriptions as a company.
Thats very generous!

Also PLEX prices will be high as long as it's possible make ISKs for buying one in just a few hours running Incrusions in hisec.
Another reason is fanfest.

Should see plex go back up to previous levels over the next few days. Will be cool.