The WoW Token: A Two Sided Coin

WoW token 2I’m having one of those weeks where everything seems to be going to pieces, so I apologize in advance for the late blog post.  Hopefully everything is settling down for next week!

The WoW Token fascinates me.  The token can be bought for real money, sold for gold, bought for gold, or used for game time.  It costs $20UDS and generally sells for anywhere from 20k to 25k gold. And when you break it down, its probably one of the most useful ‘currencies’ in game.

Lets start from the view of gold buying.  When you buy a WoW token from Blizzard for the real money cost, you are basically buying gold. No one in their right of mind would use the token they bought with real dollars because it’s gets you a month of game time for $5 dollars more. The only logical course of action is to sell it.

I know other games have done this before, but to me this is brand new and very interesting. Basically, this has put an official dollar conversion to gold. Before 1,000 gold was a disjointed number with no real life value. Now, that 1,000 gold is worth about $1. True, you can’t just buy 1,000 gold for a dollar (and I would not want to see that happen either) but you can buy 20k gold for $20. There’s a conversion rate, and while conversions are limited they are now possible. I’m very interested to see how this plays out.

The WoW token also effectively neuters an age old problem in the game: Gold Farmers. Why would you pay money for gold from an illegal source when you can do so perfectly legally? True, gold farmers can simply make their rates better than the WoW tokens but they’ve just lost a huge portion of their customers. Now that there is a sanctioned method for buying gold, many people who need gold in a pinch can get some without breaking the rules. All the hesitant or uncertain buyers will no longer need to resort to illegal activities. I’m sure there will still be those who choose to buy from gold farmers, but with the advent of the WoW token that number has gone down.
WoW Token 3On the flip side of the token, one can theoretically never have to pay real money for their WoW subscription ever again.  By buying the tokens of the AH for gold, you can get that 30 days of game-time for free.  And if you have enough money, you can buy enough tokens for months, even years in advance.  So for the cash rich, money poor folk there is now an entirely new option for paying the subscription.

The second option of buying your subscription with gold really appeals to me as someone with limited income.  I currently do not have the gold amassed to buy any tokens, but I have started grinding gold out for those tokens.  In a way, the tokens have almost made more content viable because grinding gold can literally save you money now.  There is more motivation to run old raids, play the AH, and max out your garrison.

In essence, there are now two ways to pay for your subscription: Time or Money.  Do you pay the $15 a month or do you grind the gold.  Depending on which is more valuable to you, you might find yourself paying for WoW in an entirely different way.  I honestly think its an awesome idea to have this option. Either way Blizzard is still getting their subscription fees, but the questions is are you paying it or someone else?

And that’s yet another thing to mention; Blizzard is now getting increased revenues from subscriptions.  Not to make them sound like some evil corporation (because they are definitely better than some other corporations), but Blizzard has cleverly ‘tricked’ their customers.  I say tricked in quotes because we customers know exactly what’s going on, but its still very clever.  For every token bought with real money, Blizzard is getting $5 more on someone’s subscription bill.  They’ve given the illusion of saving money when they have actually increased their own profit.  And yes, those who only buy WoW tokens for gold are saving money, but those who buy WoW tokens for money are paying $20 for the other person’s subscription.  Very sneaky!

I’m no economist, but the whole WoW token thing really fascinates me.  There’s now this whole wrinkle of real life money added to the game, in a very non intrusive but still impactful way.  I will be watching quite eagerly to see what becomes of this!

2 thoughts on “The WoW Token: A Two Sided Coin

  1. Never thought of buying gold from gold farmers, but now with the coin, i started to think about all things i want to buy in WOW, mostly mounts like the yak or the Sand Drake, but i won’t do it, i think part of the fun is to collect gold and buy them.

    Anyway, i’ll buy the coin to add subscription time if i have enough gold, but now the yak is more important 🙂

  2. Another way to look at it….

    Blizzard is asking people with RL money to subsidize another player’s time of $15. In return for the charity, you are getting 20K gold for $5.

    The net effect is still the same, but now Blizz has basically created the ‘give a penny-take a penny’ tray with gold/time.

    Plus on their financial statements, they still see subscription revenues steady at $15 per. However, they are showing profit from gold selling at $5 per. So they’ve now got a profitable vertical market. Which is what the board of directors are looking at.

    Lots of different ways this can be looked at. I’m sure there’s psychological aspects that can be just as fascinating to explore.

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