Intolerant buffoons: Shanda bans cross-gender play

OK, this just takes the cake.

(via Kotaku), Shanda has announced that one of their MMOs, King of the World, has chose to disallow, and frozen accounts of men who chose to play female characters in-game. Emphasis below is mine:

Shanda (Nasdaq: SNDA) subsidiary Aurora Technology has frozen game accounts of male players who chose to play female in-game characters in its in-house developed MMORPG King of the World, reports 17173. Aurora stipulates that only female gamers can play female characters in the game, and it requires gamers who chose female characters to prove their biological sex with a webcam, according to the report.

Yeah, this isn't going to be a problem, right? Not to mention that meatspace cross-dressing in order to enable in-game cross-dressing is kind of funny too.
Crazy.

Mickey, Put on your Parka - Disney buys Club Penguin

To the earlier discussions about large media companies getting into the MMO space, today we here that Disney buys Club Penguin.

Things that are interesting about this:

• $350M. That's a lot of kippers, kids.
• Not sure how that compares to subscription revenue, but as I said earlier, I'm not sure it matters.
• Club Penguin is based in Kelowna, which is very close to some kick-ass skiing. Why was I not told!? This is important!

What should World of Warcraft and David Copperfield both fear?

...someone giving away what they charge for, and tanking their business in the process.

Wha-wha-wha-what?!

I'll explain. But first a commercial interlude. Please watch this very short video. It's brief, and it's entertaining.



OK, so this is one of a series of clever little commercials (series of them can be seen here - thanks to boingboing for the link) for a company doing technical support. Very catchy. "See how simple it is when we explain how it's done?".

Now, if that series of commercials takes off, it could be a real thorn in the side of a busking street magician that makes his living doing these exact tricks. Of course, that's not going to bother Belgacom. After all, whats a couple street magicians compared to a successful ad campaign of a large corporation. Casualties of War. Can't make a cake without breaking a few eggs and all of that.

OK, so where am I going with this?

There've been few posts as of late (Techcrunch, Raph Koster, etc) about the new Barbie Virtual World. Some see it as a response to Webkinz, which in one way is true, but it's not the most interesting way to look at it.

Barbie and Webkinz are loss leaders. They are giving it away to sell dolls or plushies or whatever. MyCoke (FKA Cokeworld) is giving it away to build brand affinity only. You don't even need to buy a can of diet/vanilla/lemon/zero coke to play this version of Habbo, you just need to not mind hangin' with the red'n'white.

Developing games costs money. Developing virtual worlds/mmos costs even more money. Building the next Wow is going to be a 50-100M affair. Building a small high-quality 2.5d casual mmo is, what, maybe $1M-$2M (of course, some are hoping to lower that, but that's another story). Blowing a couple million on development of a game title means you are going to have to do a fair number of subs/item-sales to get into the black.

But if you are selling plastic dolls nationwide at Toys-R-Us, and trying to differentiate yourself in a crowded market, then 1-2M is an efficient spend on a differentiating feature.

And if you made $26B last year selling sugar water at a healthy profit, then a couple million bucks is, my guess, a blip on the screen of the marketing budget.

At Casual Connect this year, there was a lot of talk about the big media companies (e.g. MTV/Viacom) coming into the space. What I don't think people grokked though, is that not only will they come in and compete for the same customers, but they may completely upset the apple cart in an effort to get those gamers interested in their IP (and thus watching the shows, buying the dolls, eating up all the hollywood soup and washing it down with a sugary, fizzy dose of free-to-play branded mmo.

"Free" as a business model will certainly mix things up a bit.

Now, back to my analogy.

David Copperfield isn't worried about those videos. They aren't showing us how to make a buick disappear or anything like that. Same goes for WoW. No one's giving away THAT level of experience, so Blizzard doesn't have to worry.

Yet.

Thing is though, that this combination of Christensen effect ("not good enough" creeps up on you until you find that "good enough" is way cheaper than you and nipping at your heels) and big media money are going to make for a volatile and interesting mix in the MMO/VW space over the next couple years.

This is somewhat analogous to the America's Army game a few years back. Giving away a multi-million dollar FPS as a marketing tool, they didn't put Epic or Valve out of business, but there were a few less B-level FPS's sold as a result, I'd wager.

So the thought exercise for you (as I try to bring this in for a landing), is what do you do when your competitors business model suddenly is "free"?

Inside, you find Iron Cajones of +12 Machismo

In the stranger-than-fiction category, this post over at Gizmodo tells the tale of a gamer who was abducted and held at gunpoint for several hours.

The kidnappers were trying to get him to give up his password to his account on GunBound (a korean mmo), thinking they could sell it online for a few thousand bucks.

Of course, they didn't count on the guy having more balls than brains and refusing to give it up. They eventually let him go.

Hey! You got GoPets in my Messenger!

Pretty cool product launch we did today that I thought was worth pointing out here.

If you are running Windows Live Messenger, and you try adding lilypanda@gopetslive.com to your friends list, and then start a conversation with Lily and say "play", you will (after some plug-in install fun the first time around) get an activity window that looks something like this:

GoPets, is a 3D persistent virtual world (some would say 'casual mmo meets tamagochi') with an in-game item sales biz model. Windows Live Messenger is a communications app with an installed base of over a quarter billion people. I'd say that's got some potential, no? :-)

Congrats to the GoPets team and the folks on the Messenger team that made this all happen.

Farming Gold on a Pauper's Margins

An interesting article by Daniel Terdiman (via Alice), in which he interviews Brock Pierce, CEO of Affinity Media, who used to own IGE, the pioneer firm in the area of barter and trade of virtual items.

Business is down, it seems, as pressure from competition, mainly Chinese, willing to live of thinner margins. The money quote:

...as Chinese competitors get more and more sophisticated, they are also willing to accept less and less profit margin. And that means, "they're perfectly happy to accept $20,000 in profit on $2 million of revenue." That, for all you out there without a calculator, is a 1 percent profit margin...

While I'm not surprised that the margins are thin, and that the pioneer in the area is being squeezed out, I *am* surprised that the 'living of 1% margins' idea goes unquestioned (not just in Daniel's article, but in general), when it's a Chinese competitor in question.

Is it feasible? Perhaps, but it often seems to go unquestioned.

Let's take this example. If indeed companies are selling $2M worth of virtual items & currency at only 1% over what it cost them, what other possibilities might exist?

• These competitors may actually be vertically integrated. These might be gold farmers (organizationally, a gold farming factory/sweatshop) that are looking to cut out the middleman. That 1% profit might be over the 5% they had to give up to a middleman in the past.
• They may be living off the float. Not sure what the turn-around time is on cutting checks to sellers, but with enough capital coming through, they could put that money to work during the month it takes them to pay someone.
• Trade off currency exchange rates between China & US.

I don't know that any of these is the case, of course. But it stands to reason that if they are only making one point off of it, there's something else helping pay the bills, cheap overhead or not.

War in the Metaverse

I've written before about my dislike of Second Life (perhaps now that they've open sourced the client someone will fix their crappy renderer), but that doesn't mean I don't find all the happenings therein to be fascinating. This occurrence is no exception.

From Wagner James Au (via BoingBoing), on a French far-right political party setting up shop in SL, and the resulting political protest, which escalated to violence of a very surreal nature.

"And so it raged, a ponderous and dreamlike conflict of machine guns, sirens, police cars, 'rez cages' (which can trap an unsuspecting avatar), explosions, and flickering holograms of marijuana leaves and kids' TV characters, and more. By California time, the battles often culminated at 2am, 3am, and even later into the small hours of the American clock, when Residents in Europe are most active. So amid the exchange of salvos, the chat log was choked over with pro and anti-Le Pen curses, most in French. And when the lag was not too overwhelming to stream audio, the whole fracas was accompanied by bursts of European techno."

(I'm surprised by the lack of flying penii)

It's a fascinating read. Go check it out.