Online gaming’s ‘virtual economy’ a boon to Asia, World Bank says
Published 5:00 am Thursday, April 7, 2011
A World Bank study to be released Thursday finds that the online gaming industry has grown into a $3 billion business that provides living wages to migrant workers in Asia who play games all day, amass virtual currency and sell it to wealthy customers in the Western world for actual cash.
The report also highlights an emerging industry in which companies seeking to boost their brands’ popularity pay low-skilled workers abroad to become their Facebook fans or Twitter followers.
The study, titled “Knowledge Map of the Virtual Economy,” is the World Bank’s first in-depth look at the impact of online gaming and social media in the developing world. Vili Lehdonvirta, a co-author of the report, cautioned that the bank shouldn’t pour its money into the industry, because he said the deal-making violates some of the game publishers’ terms of service and amounts to cheating.
Known as “gold farming,” the game-playing profession took off in the early 2000s with games such as “World of Warcraft” and has evolved into a complex industry.
Low-educated laborers in Asia spend hours each day advancing through levels of an online game, picking up gold, swords and gems that enhance a player’s status. Then gaming studios, which employ the players, sell those virtual goods to online retailers. Finally, the retailers sell those items to more than 120 million players worldwide, many of them in North America and Europe, who are unwilling to play the games all day to gather the items on their own.
The bank’s report indicates that online gaming has a positive impact in Asia because 70 percent of the industry’s revenue remains in the gaming countries, with most of that money going to the gaming studios. Compared with the $70 billion coffee market — in which only a small fraction of the revenue remains in the bean-growing countries — the gaming industry has a “much better development impact,” the report concludes.