Instead of "micro transactions" how about official "micro player transactions"?

[Llewen]

The think that really bothers me about the "ftp" model and "micro transaction model" is that items that have real impact on game play, such as that *&^%! forged metal tool, were never earned by game play. In my opinion it cheapens the game, and in general is bad for the game. In my opinion "pay to win" sucks in the worst possible way when it comes to an mmo.

However, I don't have a problem with players selling items that have been earned through game play for real $$ to other players. The critical difference is that someone actually played the game to gain the item. The problem with that however is that the publishers of the game are cut out of that market and don't have access to what is potentially a very lucrative source of development dollars and profits to pass on to their shareholders.

So my idea is this. How about an official way of selling in game items for real money? If it was done properly it would be much more secure than someone taking a chance on a third party website, and it could be a real source of cash for EA, and put the horrible ftp and micro transaction model to bed permanently.

What I would suggest is a way of transferring an in game item to an official store. You simply open access a menu in game, choose the option to sell the item in the store, either by auction, or for a fixed value, target the item, and it disappears from your pack. You can set a time limit for the sale or auction, and if it doesn't sell, it returns to your bank box.

If the item sells EA collects a percentage of the sale price, such as 10%, plus a non-refundable transaction fee (something low just to cover any banking fees), and the money is either credited to or subtracted from your account. You can choose at any time to either use the money to pay for your subscription, or have it credited to whatever payment method you have associated with your account.

When a person purchases an item this way, it is deposited in the person's bank box. It would be official, safe, secure, and it would give EA and the developers a cut of the lucrative third party sales market, without turning UO into a "pay to win" game, because someone would have had to earn the items that were being sold, through active game play.

 

[Llewen]

And you should be able to sell anything this way including pets and bags full of cheques.

 

[Tina Small]

I suspect that in the situation you describe, EA might have an obligation under US tax laws to do some sort of income tax withholding on the payment amount "earned" by the player for the transaction. It would be bad enough having to do that for individuals who claim to live in the US, but would become even more complicated if they had to do the withholding for individuals who claim to live outside the US, perhaps because of where EA and/or its servers are located.

As an aside, I seriously doubt that most people involved in "real money" transactions involving UO "items" bother with paying taxes of any kind on the money they earn.

 

[Llewen]

I suspect that in the situation you describe, EA might have an obligation under US tax laws to do some sort of income tax withholding on the payment amount "earned" by the player for the transaction. It would be bad enough having to do that for individuals who claim to live in the US, but would become even more complicated if they had to do the withholding for individuals who claim to live outside the US, perhaps because of where EA and/or its servers are located.

As an aside, I seriously doubt that most people involved in "real money" transactions involving UO "items" bother with paying taxes of any kind on the money they earn.

Well, I would think it would be simple enough to add a sales tax to the total for transactions originating in the US. They do the same thing in the Game Codes store. As for reporting income that would be up to the seller, just as it is with sites like eBay.

 

[nynyve]

I am afraid that this would merely encourage farming.

 

[Tina Small]

Well, I would think it would be simple enough to add a sales tax to the total for transactions originating in the US. They do the same thing in the Game Codes store. As for reporting income that would be up to the seller, just as it is with sites like eBay.

Actually, I don't think it would work the same as eBay at all since players don't actually "own" the items that would be sold. They would be selling in-game items that EA owns. I think the transaction would look more like EA selling the electronic item to the recipient and EA then paying the player who originally had possession of the item a fee for initiating/facilitating the sale. And that is where the income tax withholding obligation would likely come into play.

 

[Llewen]

Actually, I don't think it would work the same as eBay at all since players don't actually "own" the items that would be sold. They would be selling in-game items that EA owns. I think the transaction would look more like EA selling the electronic item to the recipient and EA then paying the player who originally had possession of the item a fee for initiating/facilitating the sale. And that is where the income tax withholding obligation would likely come into play.

I still don't see that being an insurmountable, or even a necessarily all that complex issue. Any decent corporate or tax lawyer could probably figure out the intricacies of the system pretty quickly. And if they wanted to mitigate and spread out the development and infrastructure costs involved they could make it a service that applies to all the mmo's they currently publish. Hell they could even turn it into an mmo item distribution service similar to Steam that could be offered to the developers and publishers of other mmo's.

 

[Tina Small]

Some recent guidance from the United States' Internal Revenue Service regarding tax consequences of virtual world transactions:

Tax Consequences of Virtual World Transactions

Nonresident aliens (i.e., non-US citizens living outside the US) are required to pay taxes on their income from sources within the United States and on certain income connected with conducting a trade or business in the United States. Because EA appears to be a U.S. company and the transactions would occur on its hardware, I think both US residents and non-US citizens living outside the US might have reason to be concerned about income tax issues involved with real money transactions involving one of EA's online games.

Considering how many people probably pay for their subscriptions with game time codes and possibly do not use their real address or even their real name when they set up their subscription, I would be very concerned about the possibility of fraud if I was EA and trying to figure out how to handle both the sales and income tax withholding issues involved in facilitating player-initiated real money transactions.

Can you imagine EA demanding that every customer give them their Social Security number when they register their account, or a US-issued Tax ID Number if the customer isn't a US resident?

 

[Tina Small]

The article at the link below published last month by some US tax attornies might be of interest to anyone wondering about tax issues (especially US state tax issues) arising from virtual world transactions:

http://www.sutherland.com/files/Pub...fa9-939e-d7f51009904c/SALT Article 5.5.11.pdf.

 

[Woodsman]

I am afraid that this would merely encourage farming.

The scripters would definitely go crazy, especially since EA isn't cracking down on them these days.

 

[Llewen]

The scripters would definitely go crazy, especially since EA isn't cracking down on them these days.

This would have no effect on that issue. Scripters have no problem selling their wares now on numerous sites. All this would do is give the developers access to the revenues being generated by the sales of in game goods. And if it was successful enough it might give them the resources necessary to go after third party sites that are violating the EULAs for the products involved.

edit: It would also provide some measure of protection for players from scammers.

 

[Woodsman]

This would have no effect on that issue. Scripters have no problem selling their wares now on numerous sites.

edit: It would also provide some measure of protection for players from scammers.

I cut out a bit of the middle part of your response because those two things are related.

Scripters do face one problem - there are probably plenty of people who aren't going to trust third party websites. If you provide a legitimate means for the scripters to sell to people, their business would increase. It's free money for scripters so there is no reason why they wouldn't abuse it.

And if it was successful enough it might give them the resources necessary to go after third party sites that are violating the EULAs for the products involved.

They have the resources right now. They know about the search engine bots like Tim running around Luna, Zento, and New Magincia and have known about them for months going by threads here on Stratics. They could nail the bots dropping the books for the RTM sites. They choose not to.

 

[Llewen]

Scripters do face one problem - there are probably plenty of people who aren't going to trust third party websites. If you provide a legitimate means for the scripters to sell to people, their business would increase.

Well, there's a flip side to that. They would have you log into your account to use the site, as they do with the UO Game Codes store. Because they will be using your game accounts to process the transactions, your banking information would be linked to your account. It would be pretty easy for them to flag and investigate questionable transactions, and if it came to that, ban not only accounts, but all accounts, and future accounts, which try to use the same banking information.