Price of Plex - Market intervention Required from CCP

Communications Center General Discussion
64

I’m with him. I think you are over-extending economic ideas to apply in places they shouldn’t.

If you described what is going on here - people giving CCP real money for virtual tokens only useful to play a video game - to someone who had no idea of what Eve Online is or that it has a virtual economy, I doubt they’d accept your view that more virtual goods per dollar = more utility/demand or more PLEX sales. I mean, if you substituted PacMan for Eve, and told the naive observer that if the arcade owner reprogrammed their machine to give players six lives for a quarter instead of the standard three, that this would result in the player putting more quarters in, they would probably laugh at you. More lives = more playtime between quarters = less profit for the arcade owner, not more.

Yes, there is probably some more complex psychology here that might entice some players that have completely bought in to Eve as reality to spend more, but honestly, I can’t see how you can be so sure that is the general case. There must be a significant number of players who will now need less PLEX to play this completely discretionary and imaginary passtime in they way they want and will not buy more PLEX to exchange for ISK, rather less as they get more ISK for their dollar. It’s far from certain to me that more ISK per dollar is going to always increase PLEX sales for CCP.

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65

This. I don’t think my analysis is correct, I just think it’s as correct as people affirming other “theoretical” things. Teckos should learn to read the posts especially

66

Yes, I too believe in Giffen goods.

Suppose the conversion of RL money and ISK is 1 to 70 million. Now suppose it becomes 1 to 100 million. Basically the price has gone down. To see this, to get that 70 million when the exchange rate has changed then I only need to spend 0.7 of RL currency not 1. The law of demand suggests that people will want more of this good given the decrease in price. What you are suggesting is that people will not only not buy more, but when the good becomes more expensive players will buy more. That is demand increases as price increases. One of the criteria for this to be the case is that PLEX are actually an inferior good. That is, as my income goes up I’d buy less PLEX as a percentage of my income relative to the percentage increase in my income, that is as my RL income goes up I’d buy even less PLEX. Further, there are no close substitutes…which is not true in that a subscription is a very good substitute. Lastly, that PLEX expenditures constitute a substantial part of the players income.

This is just nuts. But go ahead and believe it if you want.

67

This makes no sense if you view PLEX as quarters used to play a video game. ISK isn’t even a good at all - it is an imaginary token only useful in a make-believe world. They have no real value and are only a chit in game that exists as a shared delusion enabled by a world-wide communications network.

I’m totally fine with accepting that perhaps, just perhaps, real-world economic ideas may not fully apply to something that has no real value, or maybe widely-varying values, to players. In fact, 99.999% of humanity would assign PLEX a value of exactly zero and never give you a damn thing for one no matter how much ISK you said they were worth.

At the very least I would need to see some data that Eve players actually internalize the value of ISK like they would real-world items and that they assign any real value beyond whatever entertainment utility it has at the moment, and on the surface, there is no strong reason to me why one imaginary ship should necessarily be more entertaining than another. I think you are way out on thin ice here trying to shoehorn real-world economic ideas into such a contrived and artificial situation.

But hey, believe what you want. Without CCP sharing some data they are unlikely to for business reason, this will remain just an academic discussion.

68

They aren’t just quarters to play video games though. That is the problem.

And it does have real world value, despite whatever CCP says. If it didn’t you would be playing the game, you wouldn’t be posting here. The game wouldn’t exist.

69

No, i’m sure there’s plenty of people who are willing to pay if the price of plex was cheaper

70

Don’t play to PLEX, peasant.

Pay $15 and play the game and watch your need to PLEX vanish.

#SeparateSubsFromPLEX

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71

No it doesn’t, at least to most of the world. PLEX and ISK are useless if you don’t play Eve, don’t have a computer or network connection, or just don’t care about CCP’s virtual game world anymore. Grab some random people on the street and explain your views on how ISK or PLEX are something important to you that you view as any other good and will buy more the amount of imaginary ISK you get for your cash increases and you will be the odd man out, considered by most to have a skewed, if not just straight-out bizarre value system. And they will laugh at you if you offer to sell them some ISK for their real money.

At best, most of these randos will view PLEX and ISK as pre-bought credits for a video game arcade or tickets to an amusement park: discretionary entertainment expenses essentially worthless the moment you hand over your cash. I can see how lowering the real-world cost in such a situation would drive demand (and CCP does this with PLEX sales), but not how the adding more imaginary and/or purely fun items on the other side of the transaction is necessarily going to increase demand. It might if more ISK made the game more fun somehow (or let you play longer which it doesn’t as game time per dollar is completely independent of the ISK:PLEX ratio), but that is a pretty dubious assertion given how much ISK is in the game currently and how stagnant or even declining the activity metrics are.

That said, I don’t know what the correct value of PLEX:ISK should be for maximal demand and profits for CCP. Maybe it was 500M ISK per 500 PLEX or maybe it is 5B for a month’s game time. But I am highly skeptical an ever-increasing ISK per PLEX rate would translate into ever more PLEX sales for CCP indefinitely as your model predicts. ISK and fun/entertainment are only loosely connected, and it is entertainment that is what CCP is ultimately selling, not ISK.

72

I have said it before and I’ll scream it from the rooftops again,

Your best ISK/hour will be flipping burgers at McDonalds, always has been, always will be.

If you want PLEX prices to drop, then go shoot krabbers out in null to lower the injection of ISK into the economy.

Now excuse me while I make myself ISK rich by buying inflated PLEX :stuck_out_tongue:

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73

Most of the world think the (insert almost any paper currency here) has no value. The only way things have value is if another person also sees value. Take sports trading cards, they likely have less value than ISK does to most of the world.

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74

So what? This is true of a great many things.

In other words, they have value to EVE players.

Then why are you here? You should quit. There is no value as soon as you hand over your cash you are wasting your time and money.

Exactly! That is because prices are not determined by an individual or by a plan…prices are an emergent property of the market process–i.e., of human action, but not by human design.

It wouldn’t, nor have I claimed otherwise. I am arguing about your claim about a positively sloped demand curve with respect to price. According to you PLEX sales should go up when the ISK price goes down all other factors held constant. According to you, if 500 PLEX = 2 Billion ISK and I need 4 billion ISK I will buy 1,000 PLEX. And if the price goes down to so that 500 PLEX = 1.5 billion ISK I should buy 1,333 PLEX. That I should go from spending $40 IRL to spending to almost $50.

Compare this to what I’m saying…

Scenario 1. 500 PLEX = 2 billion ISK. Now the price goes up to say 2.5 billion might I still buy 1,000 PLEX and pocket the difference for use at a later date? Note I am still out $40, but if I think there could be a price decrease in the future, That extra billion now, could come in handy in the future. People are forward looking.

Scenario 2. I normally rat for ISK for PvP (or whatever) now I find out that 500 PLEX = 2.5 billion ISK. I was unwilling to buy at 2 billion, but the 25% increase means I can have plenty of ISK and more time to do other stuff in game I find more enjoyable than ratting.

Both of these point to a downward sloping demand function for PLEX.

And entertainment has value. Look at movies, books, sporting events, music, plays, and yes video games. There is a crap ton of money involved in these things. Clearly they have value.

Excellent! Yes. Fiat money only have value because we all believe it has value. Fiat money has no intrinsic value. Hell, ISK has more value in the sense that people are trading something real for it…time.

Or comic books. How about stamp collections. Various forms of memorabilia. And I can’t figure out how anyone can actually eat acorn squash…looks like baby poop.

75

I am one of those whales.
I have subscribed all the time I played and also bought the plex many times!
I dont do much PVE!

As for now… I see the game going more and more towards timers and less player activities.
Even nullsec grinders got whipped with the last update! :slight_smile:
I have unsubscribed.
o7

76

The value of a modern fiat currency is based on the value of the economy that backs it, together with the ability of the issuing government to generate income, its ability and willingness to manage the financial system, and the processes and practices that keep the government from damaging the economy and financial system.

ISK and RL money are different in important ways. PLEX and RL money are also different in important ways, despite there being unlimited PLEX available to buy for a set price in RL money.

“You don’t have to understand (RL) money to earn it or to spend it”.

77

Wouldnt it be better for CCP/PA to make ingame plex cheaper ?? People would have to buy more plex with RL$$$ to buy the same stuff they do now. If i can spend say 100bucks of rl cash now to buy plex to buy a titan ( example ) yet if plex was say half the price i would have to spend 200 bucks rl$$ to buy same titan yes ??

78

Explorer Girl

CCP can’t directly control the PLEX/ISK price.

They can control the PLEX/RL money price, but the prices of PLEX abd Subscriptions are related, which limits their options.

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79

I think I’m going to sell my PLEX!

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80

They have to consider the price of the subscription too, as mentioned. And only X number of players are dropping real cash for PLEX - some of them might be fine with having to spend more real cash but many won’t. Getting twice the dollars for your product might sound nice but not if you start losing customers - and ofc less guys buying PLEX means the ISK price would go up again…

81

They are already intervening. 95% of the ISK in EVE comes from nullsec and by nerfing nullsec anoms (recent patch) they are tackling the major driver of inflation.
The effects will be long term though, dont expect any sudden drops in PLEX price.

That is true, but those unlocks are usually permanant, once you you bought a pack of vehicles/weapons/apparel you can use it forever. The EVE sub needs to be paid every month, often multiple subs, because the use of alts is beneficial in many ways and even promoted by CCP.

82

Speaking from personal experience, and granted this is just subjective based upon myself and my corp.
the increase in plex prices HAS led to an increase in willingness to buy plex for cash.
as a rule, most of the members in my corp are moderately isk wealthy, most of us can afford to plex multiple accounts per month, most of us own at least 1 super, etc. 1b, or even 1.5 isn’t a huge amount of isk for us. but the closer the plex prices have been creeping towards 2b per 500 (or 20$) the more appealing its become.
I know that i’ve been starting to look at plex as a decent way to fast-track some of the projects i’ve been working on. normally i’d never consider dropping 100$ to buy some more cap bpo’s, but dropping 50 for it… thats something I would consider doing, and the closer it comes to that price point the more likely I am to do it… maybe multiple times. and I know a couple other people who have already hit similar “tipping points” where the value of plex starts becoming more justifiable to the cash expenditure.

Those are the “more sales” thats been talked about above, might not be the same whales suddenly dropping more money because the plex prices have gone up, and its probably accurate that as prices increase the whales will spend less. but for more moderate plex buyers (i’m gonna call us dolphins, because why the hell not) some of the dolphins might choose to jump in once the cost-benefit ratio becomes more favorable.

Will there be enough of us to counter-balance the decrease in whale-sales. maybe or maybe not, on an individual basis certainly it won’t, but volume can’t be discounted either.

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83

People who sell plex to fund their game want high prices, people who buy plex to play the game want it lower. The market will always correct himself at some point, until balance is restored between the ammount of ppl buying and selling it. Its the market working

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