Follow Up Poll - Would a billionaire corner a GAH market?

THEDKEXPERIENCE

Yesterday, in an ongoing effort to clean up the continuing global auction house disagreement, I posted a poll simply asking if you believe billionaires exist in ESO (https://forums.elderscrollsonline.com/en/discussion/481373/do-you-believe-that-billionaires-exist/p1) and as of this moment 84% of the 199 answers agreed that there are actually ESO billionaires. Basically 5 out of every 6 people agree, while 1 out of 6 - for some reason - deny the existence of those billionaires.

Anyway, this leads me to part 2 of this survey. Due to the overwhelming lead that the billionaire believers have, let’s for the sake of argument agree for this poll that yes, billionaires in ESO are a real thing. If so, do you believe in a global auction house environment that one of these billionaires would be able to corner the market on some valuable product? If so, why or why not?

Note - In this poll I am talking about the ability to instantly buy up a massive number of a desired product by pressing one button, not literally using an auction.

THEDKEXPERIENCE

Yes, some billionaires would successfully buy up and corner certain vital items.

Sorry about the random question mark in the second poll response. One day I’ll make a poll without a typo.

Also just like yesterday I’m mostly just going to stay out of it from here and let the poll do the talking.

ArchangelIsraphel

Yes, some billionaires would successfully buy up and corner certain vital items.

Yes. I've played enough MMORPG's over the years to believe they would. Honestly, you don't even have to be a "billionaire" in some games to do this- just have more than most of the population, and continue making more by playing the auction house, until you have complete control.

Munkfist

Yes, some billionaires would successfully buy up and corner certain vital items.

Absolutely. A global auction house would make this nearly imminent. It would be far easier to buy up the market and monopolize it.

A global auction house is a terrible idea in my opinion.

VaranisArano

Some players would corner the market on specific items. Billionaires arent necessary.

We know its possible. We've seen them do it in ESO, using TTC, already.

Thing is, a GAH makes it....
1. Easier - its a in game, global item search
2. Less time consuming - you skip the step of going to each guild store to buy the item

So rather than ESO, where a few specific items are manipulated for a short time because its too time consuming to sustain a good time+effort to profit ratio...

A GAH makes it easier and less time consuming to establish market manipulation over multiple goods. So anyone who want to manipulate the market would find it significantly easier to do so.

Elsonso

Yes, some billionaires would successfully buy up and corner certain vital items.

In WoW, these people were my target market for selling stuff. I don't think I sold to other players, just to the middle man players. They bought my stuff almost instantly, mainly because I listed it at half the reseller's prices in order to attract their attention. Addons constantly watched the market and automatically purchased.

Never bought anything from the Auction Hoise, though. Not if I could help it. I knew I was paying way more than it should be.

Urigall

Agreed - there is a risk that those people who don't give a monkey's crutch piece about the player community could well buy up everything. All they would be doing is making a lot of gold, something that seems utterly pointless: ESO gold can't be magically transformed into real life currency. So what would be the game play purpose? What would be the point of accumulating a huge amount of gold if doing so yielded no tangible benefit? One would have to make a deliberate decision to buy up everything. The question of motivation would then arise. Game play advantage? Not persuaded. The riposte of gold accumulation being an end in itself is equally unpersuasive.

We'd also have to look at which items are absolutely essential to game play progression. Those that spring to mind are mats. Mats can be farmed, albeit it's sometimes a royal pita. Some players would stop selling mats anyway, if the mats became too expensive.

There might well be adverse consequences arising from allowing an AH system to run; either alone or in parallel with guilds (I prefer both running together) What we do not know is how the market would change. Might be a real bummer or it might change in ways that no-one can predict with any certainty. The change might go through phases. Initial mayhem, followed by moving towards a new, balance point.

There is a way of looking at this question in reverse. If a global AH system was in operation, some players might object on the grounds that wealthy players would move to "buy up the kiosk market" if a guild system was introduced. As we all know, that would be a scare tactic. The guild system works well because wealthy guilds do not "buy up the kiosk market"

Danikat

No, this is not something that would occur?

Guild Wars 2 has a game-wide "auction house" (although it's all direct sales, there are no actual auctions) and as far as I'm aware it's never been an issue in that game because there's so many people selling items that it's almost impossible to buy up the entire supply of anything important.

It would be relatively easy for a player with a lot of gold to buy all the copies of a rarer item currently for sale, and then re-list them at a higher price. But as soon as you did other people would under-cut you because the buy orders (offers from players looking to buy that item) would make it clear that your price was way above market value and they could easily make a profit while selling it for less than you are.

In fact that's one of the most common complaints about the Trading Post from new GW2 players - that the currently highest buy order and lowest sell order is constantly changing and especially that they put something up for sale and were immediately undercut, so they relisted it (thinking theirs wouldn't sell unless it was the cheapest) and were undercut again, and again and again because other people keep listing the same item for sale.

Now imagine all the traffic in all of ESO's guild stores all going through the same market place. Imagine if all those out of the way traders with lower prices and stocks of 'impossible' to find items that get overlooked are competing directly with the big traders in cities. Add in all the people who currently don't bother trading because the system is such a waste of time and I think you'd see a system very like GW2 where there's simply too much activity for any one person to dominate the market for a specific item.

aaisoaho

Yes, some billionaires would successfully buy up and corner certain vital items.

https://arstechnica.com/civis/viewtopic.php?f=22&t=143089

Here's a guide how to do it. To summarise it for you:
0. select a material you want to control
1. Buy every item of selected type
2. Sell for 5x-10x higher price than you bought them for
3. If you start facing too much undercutting, drop the price to a half and wait for competition to react.
4. When competition drops their prices accordingly, buy them out.
5. Return to your original market price.

Every item bought on your market price allows you to buy more. Thanks to your stockpile, you never really run out and thanks to price dropping strategy, you can buy your competition out of their stockpile to protect your own investment.

Urigall

Danikat wrote: »

In fact that's one of the most common complaints about the Trading Post from new GW2 players - that the currently highest buy order and lowest sell order is constantly changing and especially that they put something up for sale and were immediately undercut, so they relisted it (thinking theirs wouldn't sell unless it was the cheapest) and were undercut again, and again and again because other people keep listing the same item for sale.

This jives with what I was hinting at above: changes that we can't predict. Guess at? Yup. Predict with 100% confidence? I think not. A market that involves a huge number of players, and a huge number of transactions, is a fluid thing. It adapts to changing circumstances, particularly in response to price signals.

While I can see the reasoning behind fears of buying up items, the market isn't a static thing, where its form is dictated by one factor. The market is a process, not an event.

Players might even have to start thinking about selling strategically, rather than list-sell-list-sell ad infinitum. Good thing or bad thing? Ymmv.

tahol10069

No, this is not something that would occur?

I have never seen this happening, never. Not in any game I've played. I find the thought absurd. It's like people think there still would be only 500 people selling and can't imagine how a free market works.

VaranisArano

Urigall wrote: »

Agreed - there is a risk that those people who don't give a monkey's crutch piece about the player community could well buy up everything. All they would be doing is making a lot of gold, something that seems utterly pointless: ESO gold can't be magically transformed into real life currency. So what would be the game play purpose? What would be the point of accumulating a huge amount of gold if doing so yielded no tangible benefit? One would have to make a deliberate decision to buy up everything. The question of motivation would then arise. Game play advantage? Not persuaded. The riposte of gold accumulation being an end in itself is equally unpersuasive.

We'd also have to look at which items are absolutely essential to game play progression. Those that spring to mind are mats. Mats can be farmed, albeit it's sometimes a royal pita. Some players would stop selling mats anyway, if the mats became too expensive.

There might well be adverse consequences arising from allowing an AH system to run; either alone or in parallel with guilds (I prefer both running together) What we do not know is how the market would change. Might be a real bummer or it might change in ways that no-one can predict with any certainty. The change might go through phases. Initial mayhem, followed by moving towards a new, balance point.

There is a way of looking at this question in reverse. If a global AH system was in operation, some players might object on the grounds that wealthy players would move to "buy up the kiosk market" if a guild system was introduced. As we all know, that would be a scare tactic. The guild system works well because wealthy guilds do not "buy up the kiosk market"

For the average player who quests, does group content, does PVP, etc, there's not a huge amount of incentive beyond "do I have enough gold to buy what I need". Those aren't the players who corner markets.

For players who like playing the economy game, who mostly trade, and who enjoy that...actually, gold accumulation, the enjoyment of playing the market, and playing the economy/trading side of the game is pretty satisfying to those types of players.

We already see that type of behavior in ESO, albeit on a much more limited scale due to the time investment needed to corner the market even on very limited rare items. So I think you are incorrect to dismiss market manipulation as "pointless". From a purely gameplay perspective, you might be correct. However, I think that's ignoring the way some players play ESO specifically as a trading/market game. You may not find the incentives sufficiently rewarding to put your time and effort into it, but certainly some players do...and a GAH drastically lowers the amount of time and effort needed to corner the market for players who already enjoy doing so.

ezio45

Yes, some billionaires would successfully buy up and corner certain vital items.

I just really dont want an auction house

Urigall

VaranisArano wrote: »

For the average player who quests, does group content, does PVP, etc, there's not a huge amount of incentive beyond "do I have enough gold to buy what I need". Those aren't the players who corner markets.

For players who like playing the economy game, who mostly trade, and who enjoy that...actually, gold accumulation, the enjoyment of playing the market, and playing the economy/trading side of the game is pretty satisfying to those types of players.

We already see that type of behavior in ESO, albeit on a much more limited scale due to the time investment needed to corner the market even on very limited rare items. So I think you are incorrect to dismiss market manipulation as "pointless". From a purely gameplay perspective, you might be correct. However, I think that's ignoring the way some players play ESO specifically as a trading/market game. You may not find the incentives sufficiently rewarding to put your time and effort into it, but certainly some players do...and a GAH drastically lowers the amount of time and effort needed to corner the market for players who already enjoy doing so.

Maybe there was a hint of the pejorative in what I intended by "pointless" Not intended.

As for playing the market, I'm not so sure there's much involved in terms of sophisticated game play. More likely to be little more than a case of selling enough stuff at the right price. There might be an element of game play involved, but not much. In order to do more than that, a player would have to be able to influence market prices. Can't see how that's possible. It might be possible to a limited extent; say, buying up a lot of a popular item then selling it at a high price.

ESO is rich in potential experience. If some players gain satisfaction in accumulating gold, that's their prerogative. I do find the idea of doing little more than building up a virtual currency rather unappealing though. Maybe players who successfully accumulate a lot of gold also find time to do other things in ESO. None of my business how they play, of course.

ZeroXFF

No, this is not something that would occur?

It wouldn't work, because the normal reaction to increasing price is increase in supply. The new items will be sold below the price "fixed" by the billionaire, but most of it will be sold above the profit the billionaire would be making from sales at his price after tax. So the billionaire has 2 options:

1. Buy stock just barely below his price to make sure his stock is sold, resulting in him buying more than he is selling.
2. Only buy stuff below his break even point, resulting in nothing being sold.

In either situation market manipulation will only be possible for a time. And considering the number of people participating in a global market and the resulting amount of gold and wares changing hands, this time won't be very long.

seratin

It's possible, though making it easier to sell would mean more people selling items so there's a risk there. If they tried and failed because new items kept getting placed undercutting them than they wouldn't be a billionaire for very long.

Linaleah

having played a number of MMO's over the years - the answer is somewhere in between

they will certainly try. they may or may not succeed for a time with items that are somewhat rare. but they will not be able to sustain it for long and they will absolutely NOT be able to do so with common items like basic crafting supplies unless they use bots.

there are 2 basic ways they can try to corner the market.

1. buy up all the postings by people other then themselves and relist. they have to do this 24/7 because by buying up these items, they are creating artificial demand for those items so people farming for those items - are going to double down on farming. this will eventual overwhelm billionaires inventory. and even with crafting mats, this will eventually simply become not profitable. market players like to keep making profits.
2. do like wallmart and severely undercut other people's listings for a while, becasue they can afford to lose gold temporarily, until other people leave the market becasue THEY cannot afford to waste their gold or time. unlike RL wallmart though they might get some farmers to work for them, but not all. eventually they will have to raise their prices back up to the profitable range, at which point independent farmers will see that its worth it to farm and sell again and come back, ruining millionaire's monopoly

all global AH does, is making it easier for people to shop, but also easier to list, which balances itself out. the fun fact about places like WoW is that.. Ah is not actualy global. its per server. so especially on lower population servers - its easier to corner markets by the sheer virtue of having less competition by design. ESO is a megaserver. i'm pretty darn sure that even the busiest wow server doesn't have anywhere near the amount of people that ESO megaserver does. the ONLY thing that is regulating the amount of listings right now in ESO, is artificially reduced amount of competition by requiring seller to belong to a trading guild that has secured a trader.

in other words - AH is not by default some evil much more exploitable system than guild traders are. the main reason I personaly no longer wish for AH to be part of this game is 2 fold. 1. there is a community that has grown and developed around trading guilds. at this point - destroying this community with its network of smaller communities is going to hurt the game more then it will help people who might benefit from more accessible selling. 2. weekly trader bids are THE primary gold sink. and i have no idea how to effectively replace it. no, AH fees will NOT replace the trader gold sink, not nearly as effectively. it will create an inflation that will be far more unwelcoming to newer/more casual players than having to belong to a trading guild to sell is.

Urigall

ZeroXFF wrote: »

In either situation market manipulation will only be possible for a time. And considering the number of people participating in a global market and the resulting amount of gold and wares changing hands, this time won't be very long.

Yes. Markets are dynamic processes, not static events.

I do think some players might buy up as much as possible through an AH system - possibly out of spite in some cases. But that would be an event and markets are processes.

Ri_Khan

Are you trying to establish some kind of anti-AH narrative here? If you don't think there's currently price-fixing and gouging happening with guild trader's, you may be delusional. Economic systems with no regulation always stand to be abused. Of course this would happen if your imaginary GAH didn't implement some way of preventing players from doing it. Any reasonable game developer would take that into consideration.

BigBragg

With Guild Traders being hard coded into the games engine, this is a nonissue.

darkblue5

Yes, some billionaires would successfully buy up and corner certain vital items.

Non billionaires have managed this already and it reverts to usual fairly quick as a rule. GAH won't happen because the game has been designed around the trader system for so long. So the +/- discussion is amusing but pointless.

VaranisArano

ZeroXFF wrote: »

It wouldn't work, because the normal reaction to increasing price is increase in supply. The new items will be sold below the price "fixed" by the billionaire, but most of it will be sold above the profit the billionaire would be making from sales at his price after tax. So the billionaire has 2 options:

1. Buy stock just barely below his price to make sure his stock is sold, resulting in him buying more than he is selling.
2. Only buy stuff below his break even point, resulting in nothing being sold.

In either situation market manipulation will only be possible for a time. And considering the number of people participating in a global market and the resulting amount of gold and wares changing hands, this time won't be very long.

Depends on which stock.

The most effective price manipulation I've seen on PC/NA was for specific items that depend on RNG: specific desired motifs and gear.

When someone went to the effort of buying most of the Minotaur chests and listing them for 150k (when the rest of the set cost 5 to 15k), there's not really a way to increase supply of that item in an amount that will overwhelm their ability to buy and sell for a reasonable profit margin. Eventually, others will increase their price to match, and the profit margin drops off to the point it isnt worth it...but the damage is already done.

That's because from the perspective of the average player, it doesnt matter what the price fixer is doing once everyone else starts selling for below that new price. Let's say the price fixer is selling minotaur chest motifs for 150k and market minded players are selling theirs for 130k. That's still way overpriced, and its because someone decided to manipulate the price. Eventually, demand shrivel at that price, but for a while, an item was out of reach of the average player.

Now, that's what happened on PC/NA under the current system.

Now consider that a GAH makes it easier to do with a wide variety of items, and that there are a lot of RNG-limited items like motifs and desirable gear that its hard to flood the market with in supply. The same thing can and will happen...because the GAH makes it even easier to collect all of an item.

Solariken

Absolutely, I saw it first-hand back in the day with items in WoW.

Numerikuu

Yes, some billionaires would successfully buy up and corner certain vital items.

Me and a small guild of friends used to do just this on Aion (since server faction balance had gone to *** and there wasn't much else to do). Each manipulated the different crafts and their respective materials. God knows how many billions we had between us by the time we quit lol.

Urigall

Ri_Khan wrote: »

Economic systems with no regulation always stand to be abused. Of course this would happen if your imaginary GAH didn't implement some way of preventing players from doing it. Any reasonable game developer would take that into consideration.

Good points.

And what do we mean by "AH" anyway? Doesn't have to be a system where a few players can play the monopoly game, by buying up stuff for pennies then selling it for big wonga.

Even the real world has controls over monopolistic behaviour.

srfrogg23

No, this is not something that would occur?

No. They would buy up all the stuff and relist it, then other people would post more stuff and undercut them. It's actually pretty easy to prevent because everyone has access to the same information and can intuitively drive prices down through competition.

Wait, that sounds exactly like what happened with the PC market because of MM and TTC, except ESO limits competition by making so only the richest players can afford the best sales spots through weekly trader bidding...

Iskiab

No, this is not something that would occur?

They already do. Buying and relisting items happens.

RebornV3x

Yes, some billionaires would successfully buy up and corner certain vital items.

well this is what would happen if we all of a sudden went to a global action house system tomorrow and got rid of guild traders.

consider this in the short term big trade guilds would have tons of buying power now that they don't have to spend tens of millions of gold a week on getting a trader where does all that money go now without the gold sink that is guild traders.

secondly one pro to a global auction house is that over time common items like green, blue, and purple mats, motifs as well as just about everything in the game would be cheaper.

third its no secret that ZOS when it comes to banning bots does not do enough and could care less. For a global auction house to be healthy they would have to go overdrive mode on banning bots and make it clear they are doing so doing it in the background and not telling the community does nothing to deter botters.

now take ZOS laxed stance against bots stuff like Tempering Alloy and other gold mats would skyrocket in price. items could easily be cornered it wouldn't take long to program a bot to auto buy low priced items under a certain price and later resell them for ridiculous prices. a team of programmers could easily corner the market.

last thing to consider just how easy it is to make gold in eso.

jainiadral

No, this is not something that would occur?

I swear, billionaires are ESO's boogeymen.

Increased sales traffic, competition from potentially hundreds of thousands of new buyers and sellers, and probably sheer tedium would stop this from being any more than a short-term phenomenon. Not to mention most auction houses have spam guards against too many rapid searches. Toss in some quantity limits on sales and purchases, and voila! Safeguards against botting and you've got market protection.

barney2525

No, this is not something that would occur?

Especially in this game - NO.

The individual who bragged about buying all the cornflower and then listing it at 5000 gold per - Now I REALLY want the GAH just to watch him go bankrupt.

Once you have committed to That strategy, you MUST continue it on. So now you MUST buy up all the new cornflower, every day, night and day. So all you are doing is Spending Your gold.

The problem is - No one is going to buy Your cornflower at 5000 per. Cornflower is a Free mat. If you need some, you can run over to a starter island and run around for a couple hours. A GAH or Trader system simply makes 'getting' Any mat quicker and easier than spending the time to gather it yourself.

So if someone tries to gouge everybody, all the players will simply farm their own. That happens Now. If you think the price is too high, you just go out and get your own for Free.

Then you sell any extras you want and you Know the 'smart person' cornering the market is going to buy them.

VaranisArano

barney2525 wrote: »

Especially in this game - NO.

The individual who bragged about buying all the cornflower and then listing it at 5000 gold per - Now I REALLY want the GAH just to watch him go bankrupt.

Once you have committed to That strategy, you MUST continue it on. So now you MUST buy up all the new cornflower, every day, night and day. So all you are doing is Spending Your gold.

The problem is - No one is going to buy Your cornflower at 5000 per. Cornflower is a Free mat. If you need some, you can run over to a starter island and run around for a couple hours. A GAH or Trader system simply makes 'getting' Any mat quicker and easier than spending the time to gather it yourself.

So if someone tries to gouge everybody, all the players will simply farm their own. That happens Now. If you think the price is too high, you just go out and get your own for Free.

Then you sell any extras you want and you Know the 'smart person' cornering the market is going to buy them.

Cornflower is a terrible example. As you pointed out, its commonly available. This strategy only works with specific, desired items that aren't readily available for other players to flood the supply.

See my comment above if you want an example that actually happened in ESO with a specific motif piece.