Product Code Database
Virtual goods are non-physical objects and money purchased for use in online community or . Digital goods, on the other hand, may be a broader category including digital books, music, and movies. Amazon may benefit as digital goods sales jump reuters.com, Fri Dec 23, 2011 11:32am EST Virtual goods are intangible by definition.
Including In-game item Sales of virtual goods boom in US news.bbc.co.uk, 10:32 GMT, Thursday, 22 October 2009 and digital clothing for avatars, virtual goods may be classified as services instead of goods and are usually sold by companies that operate social networking services, community sites, or . Virtual Goods: the next big business model techcrunch.com, Jun 20, 2007 Sales of virtual goods are sometimes referred to as , and the games that use this model are usually referred to as freemium games.
A key revenue driver within social media, virtual currencies are specific within each game and are used to purchase in-game goods. Characters or avatars in virtual worlds own things within the context of the virtual world and users will collect each games' virtual currency to purchase land, supplies and various items used to enhance their status and add points. Some virtual currencies are time-based, relying upon measurement of in-game achievements in order to accrue exchangeable points.
When Iron Realms Entertainment began auctioning items to players of its MUD, Achaea, Dreams of Divine Lands, in 1997, it became the first company to profit from the sale of virtual goods. The World of text MMOs / MUDs – An Interview with Matt Mihaly, CEO of Iron Realms Entertainment playnoevil.com, Friday, September 8. 2006 But it wasn't until the mid-2000s, with companies like Korean Cyworld leading the way, Cyworld ready to attack MySpace money.cnn.com, July 27, 2006: 11:35 AM EDT that virtual good sales became instituted as a legitimate revenue-making scheme.
Virtual goods may continue to be a primarily Asian phenomenon, as between 2007–2010 70% of worldwide sales were made in this region.
Estimates of the future market for these small items vary wildly depending upon who is making the prediction. 2013 sales will be US$4 billion according to one analyst A virtual farm turns new ground for game developers reuters.com, Thu Mar 25, 2010 7:05am EDT and a year later reach 14 billion according to a different analyst. Virtual goods revenue to hit $7.3 billion this year cnet.com, November 15, 2010 9:51 AM PST
In 2010, a virtual space station in the game Entropia Universe sold for $330,000.
The popular, free-to-play video game generated more than $1 billion in revenue across all platforms. This revenue comes entirely from in-game purchases, which — in Fortnites case — offer no competitive advantage to the game.Kaylee Fagan, "Fortnite — a free video game — is a billion- dollar money machine", "Business Insider", July 29, 2018
China outlawed the practice of buying real-world goods with Digital currency in 2009, China bars use of virtual money for trading in real goods PRC Ministry of Commerce, Monday, June 29, 2009 2100 GMT something that had become popular in some parts of the country. QQ: China's New Coin of the Realm? wsj.com, March 30, 2007
Revenue
In 2009, games played on social networks such as Facebook, games that primarily derive revenue from the sale of virtual goods, brought in US$1 billion, and that is expected to increase to 1.6 billion in 2010. Worldwide, US$7.3 billion was made from virtual goods that same year.
Research
In online games, virtual goods could be lost due to some unexpected reasons. This brings problems for service providers as well as purchaser. Encryption techniques primarily used for other purposes may, here too, provide functionality. These may include access control, hash function, encryption, digital certificates, and fingerprinting.
Illicit sale
While many companies have embraced exchanging cash for virtual goods, the practice is forbidden in most blockbuster games, Poor earning virtual gaming gold bbc.com, 01:36 GMT, Friday, 22 August 2008 which derive income from subscription fees. This doesn't deter all players from saving playing time by illicitly buying in-game currency with real-world cash from an alternate source– violating their agreement with the game's operator in the process.
Virtual goods purveyors
See also
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