Posts tagged economics
Upon a cursory review of Google’s Notice of Removal to Federal Court which contains a summary of the Complaint filed in Santa Clara Superior Court, it seems the Plaintiffs’ central claim is one of unjust enrichment. They didn’t get the benefit of the bargain with Google through their purchase of gold from the in-game store or from the secondary market, which they claim Google and Slide, Inc. promoted or at least encouraged. Said another way: Google got something for nothing and the Plaintiffs want their money back.
But there’s more. If you look at item three in paragraph five, the Plaintiffs want the game to stay online: they seek “an injunction barring Defendants ‘from terminating the SPP gaming application as announced in September, 2011.” Not only do Plaintiffs want their money back, they also want to keep playing SuperPoke! Pets. Presumably they’ll turn around and buy more gold once the game’s back online.
You’d have to review the Complaint to see all of their causes of action to try and recoup their virtual-bucks for a better idea of how this is going to shake out.
In 2011 Google acquired social games maker Slide for approximately $200 million. Only a few months later, as part of their 2011 spring cleaning, Google decided to shut down all but one of Slide’s existing games including SuperPoke! Pets. Player outrage was impressive following Google’s announcement, and today we learn that it was not empty: a class action lawsuit against Google has been filed.
Although the lead plaintiff,Christalee Abreu, says she spent more than a thousand dollars on virtual gold, the class action represents thousands of people across the who purchased gold and/or subscribed to a $4.95/month VIP subscription with the total “amount in controversy” exceeding $5,000,000 - a sum that is credible given that there were at least 7,000,000 users of the SPP site just before Slide sold out to Google.
Not versed in law, I cannot evaluate the claims Abreu makes but it is interesting to consider the long-term contracts that virtual currency might imply. When an app or service goes under is their an obligation to refund the currency? Should virtual currency be treated as bonds or debt? I imagine these products receive similar treatment to gift cards, but what happens if a Facebook currency catches on as a standard? At what point does the currency graduate from gift card to currency?
Over here in tech-land, I found myself talking about virtual goods, the success of games like Farmville, and companies like Zynga. How ironic, I thought, that people spend hours tending to virtual farms while we spend billions helping feed the hungry.
This morning I gathered some data and crunched the numbers. I’m assuming that the daily users of Zynga games play 30 minutes a day for this thought experiment. My previous experience with online gaming suggests this is a very conservative assumption.
Simply put, if we could turn those small bits of the day (but on a stupid large scale) into minimum wage worth tasks, we could pay for the entire Food Stamp program and then some. (And this is just Zynga. I haven’t even factored in Yahoo, Playfish, SGN, … )
While I’m sure my numbers err in some way, this thought experiment confirms a thought for me: the greatest challenge of our time, and what could pull us out of this economic muck, is the sustainably* monetization of down, boring hours, and the reluctant leisure time of the under-employed. Crack this nut and you’ll make untold fortunes and save the economy…
* I say “sustainably” because the answer lies beyond virtual goods and Netflix subscription trial offers.