Elder Game: The Case Against Auction Houses

This Blog Post was part of the Elder Game blog. It was posted by Citan on September 10, 2012.

Additional Blog entries can be found on the Developers page or in Category:Game Blogs

I don’t have anything against auctions. But in an MMO, an Auction House is shorthand for “everybody sells everything for the lowest price the market will bear.” This is not always good game design.

Guild Wars 2 just got its auction house online, and already the price of crafted items is reduced to the literal minimum, lower than the cost of the ingredients for those crafted items. Crafters have the most fun when they can sell items to other players and make a profit. It’s just not as fun when there are literally millions of crafters competing for customers.

Similarly, Diablo 3 suffers from its auction house. The core experience for most players of Diablo 2 was finding random loot drops, and in D3, the auction house steals the thunder from that idea. (And in this case, the “real money” part doesn’t matter: the non-real-money auction house does just as much damage.)

But I mean, what are you gonna do, not have an auction house in a modern MMO?

Sure! There’s no reason every MMO should have an auction house. Lots of MMOs implement it unthinkingly, because they believe it’s a mandatory back-of-the-box feature. Few MMO developers take the time to think about the ramifications of the feature.

But let’s consider Star Wars Galaxies. No auction house, and widely considered one of the best games for crafters. Coincidence? Not according to Raph Koster, the lead designer (emphasis from the original):

Fundamentally, though, the biggest difference has to do with the basic approach taken. You see, in Star Wars Galaxies we designed the economy to be a game, not a side effect. In particular, the merchant class was created to fulfill the fantasy of running your own business. It had features like decorating your shop because that is part of the fantasy of being a shopkeeper in a world such as that — to build up the equivalent of Watto’s junkyard, or a Trade Federation.

And this meant that above all, one feature could not exist: the auction house.

The point is that crafters don’t inherently get fun from an auction house. It creates a buyer’s market. If players have to go window-shopping among various player-run stores (like they did in SWG), players have a hard time telling what the absolute best price is. Therefore prices don’t rapidly dwindle to nothing, which means crafters get to have fun pretending to be craftsmen. They get to earn pretend money for their pretend items, and everybody’s happy.

Yes, players have to spend more money without an auction house, but who cares? It’s pretend money in a video game. And they don’t even know they could have gotten a better deal. They do not suffer from this, unless the game is so strict with cash that they can’t afford things they feel they have to have… which is a different, but fixable, problem.

Why Games All Have Auction Houses

That isn’t to say auction houses are worthless. They came into existence to fill a need: not everybody wants to spend hours shopping for crap so they can go adventuring. If the core of your game is monster-stabbin’, and yet the success of monster-stabbin’ relies on crafted items, it behooves you to make sure players can get their hands on crafted items. Or else they can’t monster-stab.

Let’s say it even more generally: the transactions that let players play the game on a day-to-day basis should be fast and easy. The transactions for rarely-needed things, for luxury items, or for power-player goods don’t benefit from being trivialized like this.

But over time, every MMO has decided they must have this back-of-the-box feature, and they let you sell any item there. They just slap this feature in and don’t think about what it will do to their game. Remember the auction house in Champions Online at launch? It’s a great example of a perfunctory “we added this because it’s mandatory” implementation. And that’s very common.

This is partly due to our culture of game reviews. Game reviews are too important to screw up or take risks with. (I remember we had to add KvK battles to the Perpetual version of Star Trek Online because the producer was convinced we would take too much shit in the reviews if we didn’t have it right at launch. In other words, it was a mandatory back-of-the-box feature, nevermind that there wasn’t time to add it: we had to cut other stuff. This “had to be in.” Lots of AAA game design happens this way, based on appeasing knee-jerk reactions rather than making the best game possible.)

But I don’t expect my MMO to do particularly well on those game review sites anyway. Or even get reviewed by them. :) And I don’t really see an auction house making a lot of sense for this game.

Alternatives to Auction Houses: Commodities Market

I think it’ll be okay if players have to do some shopping around while playing Project Gorgon. Partially that’s because I expect at least half of players — probably more than half — to do at least some crafting of their own. Making stuff is a big part of this game. And I think players get a lot less upset about having to shop around if they have their own shops to maintain.

The other reason I don’t think it’ll be a problem is that I’ll have other systems that help take the place of Auction Houses. I don’t want players to have to shop around for arrows and health-kits and other stock sundries that they need 50+ per day of. And I don’t want chefs to have to scour the world for rutabagas in order to make their stews. Some things just aren’t worth the hassle of window-shopping for.

So I’ll use the “Commodities Market” model. We added something like this to AC2 near the end of its run. It works like this: certain items are classified as commodities. These are items you collect off the ground, plus simple consumables like arrows and health packs, and so on. You can place these in the Commodities Market along with the minimum price you’re willing to accept for the items.

Players who want to buy them must purchase in bulk. They place an order for 100 of these items at a time (let’s say 100, it’s just an arbitrary number at this point). They also indicate the maximum they’re willing to spend. If their order can be filled immediately, they get their stuff instantly. Otherwise, their order sits around for up to a day until it can be filled. So it’s sort of like a blind auction. It helps keep prices from dropping too quickly, but still lets you sell your trivial stuff in a relatively painless fashion.

(There are several issues that need to be addressed with this model, the main one being that it’s very easy for rich players to inflate the price of things by buying all the commodities for cheap and reselling. I plan to fix that with a draconian measure: I’ll flag items coming out of the commodity shop so that they can never be re-sold in the commodity shop. That will remove market speculators.)

This isn’t quite as convenient as an auction house, but there are other tools I can add, too, like virtual shopping assistants which can search a list of your “favorite sellers”. I also want to do item-request boards (virtual Craig’s List, in other words). Actually there’s all sorts of different stuff we can do, and some of it can be a lot of fun. Although not as trivial as an Auction House, it can at least make the task of shopping more entertaining.

Different Approaches For Different Games: Shocking New Concept!

I wish MMO developers spent more time considering how their world is going to work on a macro scale, but they just don’t. I believe this is a side-effect of the modern design idiom of “thinking in loops” too much: you worry about making the game fun in 30-second intervals, and then 5-minute intervals, and then 15-minute intervals… and it becomes really hard to step back and look at the big picture. Why? Because when you’re optimizing your game to be fun every second of the day, an Auction House is always a win, because you remove all the boring shop-browsing part of the game. But now you’ve missed out on a much bigger type of fun for certain players.

In computer science terms, focusing too much on second-to-second gameplay causes you to optimize for local maxima instead of the global maximum. The fix is really simple, though: don’t focus too much on gameplay loops.

To wrap up: Auction Houses aren’t evil. And they fit some games very well. But the Auction House is a one-size-fits-all approach to handling every type of transaction in the game. And that doesn’t really make sense in lots of games, because we aren’t trying to model a real world economy. We’re trying to make a fun game.

In many games, some transactions should be more valued than others: if every player in the game can collect mushrooms and deer skins (and in this case, they can), then the purchase of mushrooms and deer skins should be painless. If, however, it takes you six hours and tons of money to make a Super Sword of Destiny, you shouldn’t have to compete with 5000 other people who also have Super Swords of Destiny, all dropping the price down below the cost of the raw ingredients! Where’s the fun in that?