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Profitability of Video Gaming?

mizchels

New Contributor
Jan 14, 2008
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St. John, USVI
Hi guys. There seems to be such a broad range of good (and some not so good) ideas, jobs, experience and talents here. I have a general question of curiosity for you. A buddy of mine has recently been spending considerable amounts of time playing video games, earning real money and paying real money for various weapons, real estate, etc. He's gotten into it so much that he's devoting less and less time to his business (web development) and his usual social life. He's very excited about it, though, and keeps telling me how there's real opportunities for actual income. He mentions examples of people who own things (weapons, passes, real estate, etc.) that are worth thousands and swears he can make a decent living off of it. I may sound completely naive here--and for this, I am--but do you think that can work as a way of generating income to make a living? If that's a viable option, I would think that some here that are looking for ways to create capital could look into that. Does anyone have experience with gaming and generating a profit from it? Consistently? It seems shaky and lofty since it's trading intangible goods...then again, that's what the stock market is basically about. Would like to hear your two cents! Thanks.
 

Jorge

Bronze Contributor
Oct 5, 2007
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Mendoza, Argentina
I can't seem to find it but there was an article (I think it was here) about someone making lots of money from second life RE.

My brother used to be a Counter Strike "pro" player. He had sponsors and travel to tournaments with all paid, although it wasn't enough to make a living out of it, it was good.

Eventually he got bored and stopped playing at all.
 

CorsePerVita

New Contributor
Feb 24, 2008
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Video games in general no.

Making a game that is addicting that will sell millions of copies and continue to be sold because it's catchy? Yes.

Jorge is right, CS and Second Life are both games that caught on, got big and made money.

So did other cult followed games like "StarCraft" and "Diablo" from Blizzard Entertainment. And World of WarCraft? Wow.

Making games in general is going to be about as good as any other job, but landing a GOOD game with GOOD research and planting it in the hands of EVERYONE is more or less what you'll want ;)
 

RaisingWealth

New Contributor
Feb 12, 2008
52
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Ottawa, Ontario
Well, the question seemed more directed to making money from _playing_ games like World of Warcraft or Secound Life. I would say that like any economy you can make money from it but since they don't allow scripting (automating your character) or multiple accounts (corperations/employees) their isn't really any good way to fastlane your venture.

Also, in the end you are going to run into the problem of what happens to all your virtual valuables when people find a new, better game to play?
 

kurtyordy

Bronze Contributor
Aug 28, 2007
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PA
I can't seem to find it but there was an article (I think it was here) about someone making lots of money from second life RE.

My brother used to be a Counter Strike "pro" player. He had sponsors and travel to tournaments with all paid, although it wasn't enough to make a living out of it, it was good.

Eventually he got bored and stopped playing at all.
I read that, he actually became a millionaire buying and selling SL real estate.
 

John

Contributor
Sep 18, 2007
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There are people and companies who actually do make considerable amounts of real money selling and trading virtual currency and virtual items in games.

The problem with business models based on virtual worlds is that you don't control the virtual worlds or the rules by which they operate. Some companies such as the one behind Second Life are friendly towards players making real money through their game. Others, such as World of Warcraft have rules against it and put a lot of resources into enforcing those rules. Even if you're operating in a game where real moneymaking is allowed, a small change to the game's item or currency system can devastate your business.

I'd advise your friend that if he's making money, not defrauding people, and not doing anything illegal then keep at it as long as you can! However, don't count on it continuing forever, and don't sink a lot of money that you can't afford to lose into inventory, advertising, employees, etc. The economy in a virtual world can change in the blink of an eye with no warning. Business is unpredictable enough in the real world. In virtual worlds it's even more so!
 

CorsePerVita

New Contributor
Feb 24, 2008
44
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28
OH OK! You mean playing the game, getting items and selling them?

EH.... requires too much time and effort and as the games update patches and what not that will change.

Write a book on how to make money in those games and e-book it or sell it and advertise it, WOW players would be on that like a rat on a cheeto.
 

phade

New Contributor
Feb 4, 2008
43
4
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Hawaii
There's always been a market for turning virtual booty into real currency, but there's also massive competition from the many "Game Sweatshops" that employ workers to do this all day. As the name implies, it's akin to making t-shirts locally that your competitor is making in another country for 1/10th the price.

Here's a lengthy article from wikipedia on the practice:

http://en.wikipedia.org/wiki/Gold_farming

and here's an article (albeit an old one) on a guy that made $1.3m, but unfortunately got arrested due to student visa violations in Japan:

http://news.softpedia.com/news/Student-Makes-US-1-3-million-From-Online-Games-Currency-and-Gets-Arrested-41008.shtml
 

kurtyordy

Bronze Contributor
Aug 28, 2007
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The comic strip 'Foxtrot' did a series on this, and I think if I remember correctly the character gave up due to low dollar/hour, but I am not sure.
 

1320Trader

New Contributor
Aug 14, 2007
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Maryland
Im pretty sure there is a young guy on lambopower that made a lot of money (real money) in virtual currency.
 

wildambitions

Bronze Contributor
Read Millionaire Fastlane
Aug 29, 2007
813
118
80
Southern NM
It seems to me that the question posed was can one earn money to live via playing games. Talk to Snowbank. He is, with on-line poker. I would imagine it could be similar. It depends on the plan and the action. Although I don't doubt that it CAN be done, I would agree that it is probably more a capital gain than fastlane.
 

WheelsRCool

Contributor
Aug 12, 2007
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One thing I have read about this virtual real-estate and virtual currency trading, etc...is that right now, the IRS isn't sure how to handle it, because on the one hand it's real money being traded, on the other hand, the "things" being traded aren't real, so keep abreast of that with them.
 

PEERless

Bronze Contributor
Jan 23, 2008
1,469
106
81
There were kids in my dorm in college who played EverQuest constantly, and one sold his character for a few grand in real dough. This is an amazing trend, and I don't know anyone who can predict the direction of virtual economies with too much accuracy.

Let me offer one anecdote:

In 5th grade, a dozen or so of my classmates started trading real stuff for fake money. As the resident artist, I drew the money on notecards. We bought toys and comic books and all kinds of crap from each other...

The rich kid in the class presumably knew a bit more about money than the rest of us. He brought the MOST toys from home and sold us the most stuff. Soon, he had the most fake money. But guess what happened when the school year ended. We had all his toys, and he had all the notecards.

There may (just may) be a day of reckoning where the world wakes up and says, "Hey, that guy's virtual real estate isn't worth anything. Too bad he paid real money for fake stuff."

It might happen. It might not. SOMEONE might make a LOT of money in selling virtual property, but I'll let others try it first.
 

LightHouse

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Aug 13, 2007
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Im pretty sure there is a young guy on lambopower that made a lot of money (real money) in virtual currency.

Yes i wasnt going to mention the site he was one, but he reverse engineered the code to generate players in some game that acted like realy people and gain assets.... not really sure what they have to build to be come valube then sold them by the masses. he also made his own virtual currecey exchange... intresting stuff.
 

John

Contributor
Sep 18, 2007
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Yes i wasnt going to mention the site he was one, but he reverse engineered the code to generate players in some game that acted like realy people and gain assets.... not really sure what they have to build to be come valube then sold them by the masses. he also made his own virtual currecey exchange... intresting stuff.

http://news.bbc.co.uk/2/hi/technology/7314353.stm

Is this the same guy? If so it looks like he's got a rough road ahead.
 

LightHouse

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unicon

Contributor
Feb 23, 2008
211
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36
Peerless

Aside from the game issue, your parallel to what are essentially derivatives based upon a market with credibility is the ultimate in manufacturing value out of thin air while at the same time being thin air.

Got to think about that!!!
 

Andrew

Contributor
Aug 8, 2007
190
41
26
If you are just playing a game, yourself, then your earnings should come out at or below minimum wage. The key is to be able to automate the system -- either through programming or having a "farm" of people sitting in China playing all day long.

As for Second Life, I don't believe the story about the real estate "millionaire", they were basing it off of long term value. It wasn't an issue of her (it was a female) banking a million dollars cash off of selling in-game real estate. There were people running casinos, which I suspect may have been able to make six figures a year, but they were essentially illegal and are no longer allowed.

As for building games, most all require multi-million dollar budgets. The trick is to come in at an entry level and build games that don't require a big budget. Mobile phone games, web flash games, and so on can be broken into with maybe $10k-$20k (all legit, no pirated software.) Success to failure rate is high, so it may be more of a gamble then a business model -- even if you are wildly talented.

There are many other related video game businesses that bring their owners good incomes, skill training, selling cheats (primarily for online games), customized novelty products for PCs and consoles, and so on.

As for the original question, you can make money playing games, but you might be scraping by on $20k a year at best doing it yourself. You need scalable systems to move into the six figures and beyond.
 

PEERless

Bronze Contributor
Jan 23, 2008
1,469
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81
Peerless

Aside from the game issue, your parallel to what are essentially derivatives based upon a market with credibility is the ultimate in manufacturing value out of thin air while at the same time being thin air.

Got to think about that!!!
I'm glad you like my little model. The amazing thing is that there were winners and there were losers AND there was no recourse for the losers. The SEC or FEMA didn't show up to help the guy who'd made the bad decision. I had 20 friggin' comic books, and Mike had notecards. Sad.
 

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