Le Web 08: Virtual Goods
As some of you know, I’m something of an [online gamer](http://www.leafshine.net/). That lead to me really enjoying [Joi Ito’s talk last year](http://www.onemanandhisblog.com/archives/2007/12/le_web_3_07_playin_games.html), and really looking forward to [Susan Wu](http://reality.org/)‘s talk on virtual goods this year.
Of course, Wu, who is a founder of [ohai](http://www.ohai.com/), had to go and deflate me by saying that it wasn’t all about online games as soon as she game on stage…
Hers was one of the short talks so she had to rattle through the ideas quickly. So had a quick go at dispelling that idea that virtual goods are not a valid business model because they’re intangible – so is love, she pointed out, and that’s a pretty powerful motivator… [Tencent](http://www.tencent.com/en-us/index.shtml) in China is selling virtual goods on an IM platform. 66-69% of its revenue is from them. And it had to monetise via virtual goods because there was no ad money.
So, what are virtual goods? They are any intangible asset you can purchase in an online environment that improves your avatars or relationships in there. It’s more than just tools to customise an avatar – there are decorative, functional and behavioural versions of them. [Imvu](http://www.imvu.com/), a chat service, sells better names, for example.
Ideally, virtual goods are tied up with passion, relationship and interaction. 1: VGs are way of capturing passion and interaction. The little gifts you can give on Facebook are a good example: they’re a gift, they’re a social interaction between giver and recipient and they’re a trophy that the recipient can display.
But she finished on something that was to me, a controversial note. She talked about the decision between time and money in an online environment, citing a new mount available to players in [World of Warcraft](http://www.worldofwarcraft.com/) which costs 18,000 gold – that means about 50 hours of play time to earn it. Alternatively, she suggested, you can $300 to buy the gold on the open market. “How much is your time worth?” seemed to be the question. But World of Warcraft is an environment that actually bans the sale of virtual goods, and the market in them is an illicit one. Not an example that helped her case much…
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Liveblog of a panel debate about social media from news:rewired in February 2012