Yes, spec work is exploitative - but why are these videos and messages always directed at designers?

Getting back in contact with an old friend in Eastern Europe has made me realise some of the things that designers in the UK/US/ANZ and much of Asia take for granted.

To many designers in these areas, yeah, sure, the video above makes perfect sense.

All fine and good until you're already working 2-3 jobs, and you're doing spec work on the side because winning it is like winning a mini lottery for you and the people you love.

I'm not arguing that spec work isn't exploitative - it is. But if you consider an economic situation like the one above... it's much harder to turn around and wave that admonishing finger at designers, saying they shouldn't do spec work. Bad. BAD! And the further tarring of all designers who do spec-work as hacks doesn't help.

Why not, instead, create videos that emphasize that companies should not do this, and that they should always pay a fair rate? Or is that just a dream?

Or to frame it another way, is the answer: Men are men, if you dress provocatively, it's your own fault! ;)

Forsaken World: Psychology + Framing + Virtual Economy = PROFIT!!!!!111!!1

So I've written a couple of posts about Forsaken World's economy. Here's where I explain how currency is gated, and how much things are worth in USD, and here's where where I talk about how PWE has elegantly solved the 'gold faucet' problem that's plagued the genre since MU* days. This post has more details on how the core Pay-2-Win stats are tied to the game's economy and currency.

Since I wrote those posts, PWE has made some brilliant adjustments to the entire game economy that I'm willing to bet a month's salary ;) has boosted their profit appreciably, and possibly massively.

It's also led to this being the first time I've seen a virtual economy model the RL problem where the rich get richer, and the poor, poorer.

Best of all, these adjustments are so Machiavellianly (lol word?) brilliant that, instead of causing players to blame PWE for these changes that benefit the few at the cost of the many, PWE has cleverly framed it so that players blame EACH OTHER. Not PWE. Not the instigators and architects of the changes who stand to gain the most.

People were blaming each other, calling each other greedy, having occasional (it's died down a lot now, 6 months later) rages on World Chat about how avaricious other players were. And not a single time, not in a forum post, not in world chat, not in local chat - NOWHERE have I seen anyone point out why and how PWE is at the heart of this change - not mercenary, greedy players who 'overspend' in the CS and then 'lord it over everyone else'. ;)

Such brilliant framing and manipulation of psychology cannot go unsung!

Sing it here, in all its glorious goldenness, I shall!

 

The Back Story
Before PWE 'tweaked' the economy (about 8 months or so ago), people could only convert a maximum of 5 Mercury Statuettes to gold, per day, per character, via a quest - and (iirc) how many times you could do this was also linked to your level.

For purposes of clarity, I will do a direct conversion from gold to USD. This is NOT how PWE does it, PWE gates you through 4 different currencies, and if you're not from the US, you can count that as 5, because you have to think about it in your own currency as well.

This means that people could only gain a maximum of 25g (US$2.50) a day on average per character via direct gold conversion.

This in turn meant that 'whales' would buy Mercury Statuettes in the hundreds from the cash shop, and then vendor them to other players for anywhere from 3g50s to 4g. The reason for this (if you didn't read / don't remember my previous posts) price range is: If you buy a Mercury Statuette from the Cash Shop (US$0.50) and sell it to a specialised in-game NPC, the NPC will give you 3g (US$0.30). If you do daily quests x 5, you'll get anywhere from 4g80s (US$0.48) to 6g (US$0.60) per Statuette+quest.

Whales were thus buying wholesale, then selling to minnows and plankton, because it was the fastest and most profitable way for them to get a lot of gold within a single day.

Of course, this meant that the only people seriously spending in the Cash Shop were the whales.

The minnows (small spenders, say... US$15 a month...) were only spending the bare minimum, and might not even be spending that much a month, because they had no incentive to do so. Because *in general*, unless they were looking for a large chunk of change NOW for a big purchase - say a mount, or a skill scroll - they could slowly build up their cash via Statuettes bought from the whales. Not much reason to purchase anything from PWE, other than impulse.

The plankton (truly free players) were obviously spending nothing! Because if they were willing to sloooowly increase their cash via Mercury Statuettes bought in-game from whales, and playing longer / smarter / etc... they had absolutely no reason to buy from PWE at all. Patience and buying stuff from whales was always cheaper than buying from PWE. And of course, buying from whales costs no RL cash.

 

The Change
PWE studied the situation, doubtless came up with a much more nuanced analysis than I gave above. They then quietly, strategically, and subtly changed one thing - with a ripple effect that I'm pretty freaking sure boosted their profits immensely.

They made it so people can now convert 25 Mercury Statuettes a day, rather than just 5.

 

The Results
Statue prices shot up from 3g50s to 4g75s minimum. 4g60s you can get... if you find a special whale to do a special deal with.

This was met with an initial massive outcry from the plankton and some minnows... not against PWE, but against the whales. GREEDY WHALES! OMG U PPL! SO GREDY. NO1 WILL BUY UR STATS! OMG! etc etc blah blah. This particular noisy state of affairs lasted for at least 2 months, but now, 10 months later, it's a non-issue.

4g75s. Suck it up, or buy your own from the cash shop.

And not once, not anywhere, in-game or out of it, did I see players blaming PWE, instead of each other, for the price increases. Simply brilliant.

 

But Wai Nuggeet, Wai Brilliant?
Because in one fell swoop, PWE:

Made whales happier by giving them a way to get more personal profit when buying from PWE, thereby giving them even more incentives to buy directly from PWE.

Converted some plankton to minnows.
You see, with this change, and the corresponding hike in prices, it's no longer viable to try to get your cash via Statuette quests if you're a plankton. Minnows with a nice little nest egg (which I was), and whales (should they choose to buy from other whales) weren't all that hard hit by the change.

In truth, both whales and minnows benefited - the changes made it possible for them to trade in bulk. So if you had enough gold on hand (minimum 1Diamond - US$10), you could invest, buy at least 25 statues a day, and either not be affected by the price hikes, or else, get even more back - since more statues can be converted.

If not - then as plankton, you'd be best served by *buying* US$10 worth of statues from PWE as your starting capital. And, you know, it's almost never 'just a this time' after you make that first purchase.

Made sure being a plankton was a lot less attractive, and a minnow a lot more so.
No capital to make the initial purchase, and can only buy one or two Statuettes at a time? Tough luck, suck it up, peasant. ;) Watch 'everyone' getting richer while you get poorer.

Acquired a lot more paying customers, and changed their economy to encourage paying customers from the ground up - without alienating their existing customers, whether plankton, minnows, or whales. There was no community perception of PWE as the greedy one, and certainly no hostility. Some, in fact, widely viewed this move as doing 'everyone' a favour.

 

Ahhh PWE... if you can't grow up to be good, you may as well grow up to be good at being evil. ;)

 

F2P Pricing Models & Preying on Decision Fatigue - NYT via NorthTemple

“Decision fatigue helps explain why ordinarily sensible people get angry at colleagues and families, splurge on clothes, buy junk food at the supermarket and can’t resist the dealer’s offer to rustproof their new car. No matter how rational and high-minded you try to be, you can’t make decision after decision without paying a biological price. It’s different from ordinary physical fatigue — you’re not consciously aware of being tired — but you’re low on mental energy. The more choices you make throughout the day, the harder each one becomes for your brain, and eventually it looks for shortcuts, usually in either of two very different ways. One shortcut is to become reckless: to act impulsively instead of expending the energy to first think through the consequences. (Sure, tweet that photo! What could go wrong?) The other shortcut is the ultimate energy saver: do nothing. Instead of agonizing over decisions, avoid any choice. Ducking a decision often creates bigger problems in the long run, but for the moment, it eases the mental strain.”
via northtemple.com

Yes, yes, not all F2P models are evil.

But of those that are (even the amazingly beautiful luscious evil that is PWE's Forsaken World), I suspect a lot of them depend on decision fatigue pushing people to buy impulsively without calculating the costs, whether in-game or in actual cash.

It would also explain why I simply can't understand some of the Auction House prices in Forsaken World - where I've seen people selling stuff for half of what it's worth in actual currency, if you were to convert actual to FW's currency.

...people are tired, impulsive, don't want to do the math (gated through 4 currencies), and they want money NAO. So they buy a high-priced item and undersell it, because they honestly don't know it's worth / are too tired to think through its conversion.

I have personally worked out these numbers for some in-game acquaintances when telling them to buy/sell higher/lower, and they simply don't want to listen. That's too much work! Games should be fun! Let me spend my moneh how I want! Fairynuff.

I don't mean to imply I'm immune to this too. In FW, converting currencies (through all 4 gates) has become second nature for me. But in the other PWE games I've played, decision fatigue from constantly WATCHING myself (can't do this can't do that) contributed hugely to my dropping the titles.

...PWE are like the evil marketing gods the evilmarketingbits of nugget want to grow up to be.

Terra Nova: An Exodus Recession?

Let’s construe the notion of “virtual economy” quite broadly: If you receive an experience by yourself through a machine that runs on digital technology, without doing or buying anything physical (other than press a few buttons), it’s virtual. To download a song and listen to it on your iPod is virtual; to go to a concert is real, to buy a CD and play it is real, to play your own instrument is real. The difference I want to highlight is in the physical nature of the economic transaction. The virtual transaction does not require the movement or alteration of anything physical. Not even physical money changes hands. The real transaction involves material being created, moved, consumed, all by human hands.

Using these concepts, there’s some evidence that an exodus from the real to the virtual is not only already underway (as I argued in my second book) but that’s it’s gotten big enough to affect our sense of a whether the real economy is healthy or not. In support, here’s a series of random judgments about the state of the real world.

TV viewing is down among 18-34 year old males, and movie attendance is flat. Meanwhile, more and more time is being spent online or playing videogames. If you want to get 80 hours of fun watching movies, you need $1000. You can get the same fun from a game for $50. Spending time online or playing videogames simply involves less expenditure in the real economy.

Human eyeballs see a lot fewer ads than they used to. As noted, some people are watching less TV. For most others, the TV they’re watching is increasingly DVR’d or Hulu’d, that is, stripped of ad content. On the internet, we avoid ads easily – they are usually in the periphery, and if not we can click them away, or surf to something else. Advertisers have made an industry on the presumption that ads make people buy things. If they are right, it follows that fewer ads would result in us buying less. Ads are less and less a part of our daily experience. HBO’s success with a show about evil advertisers is perhaps apt now, because we feel we finally have gotten the upper hand on these miscreants. The net result of our power over advertisers, according to their own model, would be a weakness in general real-world consumption.

Facebook is a great way for people to connect. In some FB games, you can buy someone else a beer. You can poke them, write on their wall, friend them. None of this causes anything in the real world to be moved or changed. There are 500m people on FB, hundreds of millions more on other, similar social networking sites. If you’re friending people on FB, you’re ever so slightly less likely to be sending them a real Hallmark card, ever so slightly less likely to write them a note on paper, ever so slightly less likely to give them a call. That’s probably not going to turn around, either. Our ability to socialize online puts a crimp in our general need to move stuff or change stuff in the real world.

People who spend time online don’t have to worry about what they are wearing. Suppose that some percent of a given day can be spent in pajama’s, the rest must be spent in decent clothes. For decent clothes, you need a whole and varied wardrobe. For PJ’s, you need a few comfy ones. Now increase the amount of time that can be spent in PJ’s. The demand for decent clothes falls, if ever so slightly. The internet allows us to do all kinds of stuff in our PJ’s – so it must have an ever so slightly dampening effect on the market for fashion.

One could go on. It is possible, slightly, that there’s a general weakness in consumer spending simply because, to get our social, emotional, informational, and needs met, we just need fewer movies, fewer beers, fewer trips, fewer shoes, fewer things in general. What if the world of human beings suddenly became converted to the idea of consuming less stuff? Why, there’d be a recession, of course. Less buying means fewer jobs and less investment, which means economic contraction. It would mean a general pessimism about the prospects of business.
via terranova.blogs.com

Really interesting and balanced post on how the move to virtual goods and services is influencing economies, complete with a highly intelligent (and answered!) comments section.

One of the things that makes it so convincing is that Castronova isn't running around splooting blood like a headless chicken (!the sky is falling!), but rather emphasizing how little things can add up.