Welcome to Jester's Trek.
I'm your host, Jester. I've been an EVE Online player for about six years. One of my four mains is Ripard Teg, pictured at left. Sadly, I've succumbed to "bittervet" disease, but I'm wandering the New Eden landscape (and from time to time, the MMO landscape) in search of a cure.
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Monday, November 14, 2011

Pic of the Week: TANSTAAFL

For some of you, though, all the resubs have a dark side, and here it is:


That's PLEX prices in Jita over the last 90 days.  As you can see, they'll almost certainly soon be spiking over 500 million ISK.  The smaller markets are having no trouble keeping pace.

Easy likely cause, too: some of those people that say they're resubscribing aren't.  They're using the bankrolls they amassed over five or six years of play to buy several PLEXes each.  Average volumes were slowly edging upward toward about 15% higher volumes... right up until the price increases started depressing the volume again about ten days ago.

The effect may or may not have been emphasized by speculators: the nearly double-size spike in volume a month ago is interesting.

The question is what impact this is going to have on the casual EVE players that rely on hand-to-mouth PLEXes in order to keep playing.  I've certainly seen more than one player saying they had "three days to grind up a PLEX" or like statements.  And there's a lot more of this type of player than there are resubbing bitter-vets.  If the market doesn't stabilize, EVE could lose more players than it gains.  This obviously isn't something that CCP wants, so I guarantee you they're looking at these numbers very closely.

DrEyjoG has said in the past that if need be, he would manipulate the PLEX market if CCP felt that PLEX prices were going out of bounds.  He hinted at one of the summits this year that this hadn't happened yet, but has also said that if it did happen, he wouldn't share that information.  It's probably low-risk, but it's something you'll probably want to keep in mind if you're looking to jump into the market yourself.

But of course, it means there's another way of looking at those spikes, one last month, one in September: the tin-foil hat way.  ;-)  Given that both of them quickly resulted in reduced PLEX prices, one could speculate that CCP has already engaged in market manipulation... and that it didn't work.


P.S. TANSTAAFL = "There ain't no such thing as a free lunch."

19 comments:

  1. You might want to take a look at the dates that Power of 2 and the PLEX sale happened. I think those two account for the volume spikes...

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  2. I've already given up on my scanning alt because I can't afford him with Isk, his sub ends next week, won't be able to get that isk for him in time....

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  3. This is good for no one, high plex prices means everything else inflates... it was bad enough when I was looking at a Vigilant and it was worth a plex all on its own. Now theres very little chance of me plexing my account with the way prices are...

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  4. I think it's pretty obvious what has happened.

    CCP gave everyone a scare this summer as EVE almost spiraled into oblivion. Things seem to be turning around now, but one of the securities of buying PLEX for EVE has been that EVE appears to be a game with a very concrete longevity. No one wants to drop a couple hundred bucks on a game that's a year away from a death rattle.

    If this winter expansion is successful, I think you'll see PLEX prices trend downwards.

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  5. When I am not raising cain in Delve & Omist I am a financial analyst and this is an interesting chart. The price spike on the 13th shows some indications that this has peaked and we may see some pull back in prices.
    The first indicator that this is a top is the wide range of prices, the PLEX sold that day. We are talking about a 60 million ISK spread from lowest to highest. Another point of concern is the low trading volume, as illustrated by the bars at the bottom. So prices varied wildly, volume of PLEX traded dropped by half the previous day.
    My opinion is that we have reached beyond market equilibrium. I forecast those who see what PLEX prices have done will begin to flood the market to take advantage. This will create a glut of PLEX and drive the prices down as fast or possibly faster than they went up. My advice to PLEX buyers is to wait as long as possible to take advantage decreasing prices. ISK sellers if you haven't already taken advantage of the current prices then don't. You missed the boat already.
    Sorry for the long comment.

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  6. I've always felt like that Plex was ruining the game for quite sometime, in way while it does help neutralize ISK farmers in another way it helps them. But it also monetarizes ISK, so instead of a worthless ingame currency now it has an actual exchange rate out of game (I'm not talking about Icelandic ISK mind you).

    Now, I know for a fact that PLEX or GTCs will never be removed from EVE, but the fact that it seems like more and more people are now relying on them is a worrying fact, compounded on the fact that of bad economy as is which making me think a resurgence of subscribers could mean that CCP might not be able to close the income gap their currently find themselves in. Which leads me to think that CCP will inevitably have to lay off more workers, in December.

    The fact that this is spiking, is leading me to wonder how long it take before it becomes a bubble and when will that bubble pop.

    P.S. CCP economist may be smart, but he really doesn't have a clue at EVE Online economy.

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  7. This worries me, because I have a few absolutely fantastic alliance members who can play basically due to PLEX. I've heard people say "don't play what you can't afford to pay" (hurrhurr funny) but after a while you come to rely on a system that does let people play "for free". I wonder if this keeps going, and stays at a high point (doubt it, but still!) if corps will ask if their members have solid subscription funding. May not matter too much for members in a large corp, but director roles, or small corps that need every member ... I could see it happen :|

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  8. The only way to manipulate the market is to introduce PLEX at prices below those listed on the market and continue to do so until the price "clears" to a new equilibrium. Icelanders ought to know exactly what kind of dedication that takes since in effect PLEX is an international currency fixed to $15. Selling PLEX directly by CCP effectively deflates PLEX relative to dollars but remember it deflates PLEX relative to a subscription as well. If they would push the price too low it would save accounts but encourage people to move out of subscriptions. Welcome to the world of central bank monetary management.

    I would argue that if they don't find a way to give players a way to spend large sums that get removed from the system (NEX anyone?) then they will have a substantially hard time managing the swings that resubs can have. Imagine what a goonswarm interdiction would look like if you financed a trillion ISK into large scale PLEX manipulation?

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  9. @Kael: good points, but you can ignore the half-size volume bar at the end of the chart. I pulled that screen-cap this morning, half-way through the EVE "trading day."

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  10. Oh goddammit. I just sold a couple of PLEXs in October. Been nearly a 15% increase since then. :(

    Well, whatever. I suppose I have reasons now to undock and make some money, rather than buying hanger baubles and ship spinning.

    I'm not sure if this is going to have a terribly great effect on subs. On the one hand, uh, price mechanism broseph. Demand will fall and supply will rise and yadda yadda we will find a new equilibrium somewhere closer to the land of happy. On the other hand... I'm not sure how flexible demand and supply are in this case. PLEX buyers are, by all accounts, a captive market, and sellers are, well, £20 is kinda pricey for an impulse purchase. Most of the time. Well, often. Sometimes. (Alright, so I tend to just spend money until there's none left).

    Just had a nasty thought. When I buy PLEX it's because I have something specific in mind; pirate hulls, turning a 1 bil mission setup into a 2 bil mission setup, etc. If I can buy less PLEX to get the job done, well, I will. Obviously higher prices will bring in new suppliers, but now I am wondering if the supply curve here is maybe inverted. That could be... unpleasant.

    Any willing stat monkeys want to pull PLEX volume/price numbers and try and graph PLEX entering the game vs. real isk value?

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  11. rah rah RAH! RAH! R.A.H.!

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  12. You can't assume what the paying subscription numbers based on the PLEX price. The two aren't linked.

    Also, someone that subscribe with a PLEX is not financing CCP. It is the person that bought the PLEX that is financing CCP.

    There won't be a total lost of subscription because of the increase in PLEX demand; there's just too much demand. If people stopped playing, the price demand would go down and the price as well, and then it will balance somewhere.

    It's more likely that this will increase CCP's income as some people who can afford the game but pay with PLEX because they can might decide to pay for their subscription, which will again, lower the PLEX demand.

    So, unless this is a bubble made entirely by speculator and that the PLEX consumption has gone down since that rise, then the PLEX market is fine and will balance out.

    The big loser here are the people that can't afford the 15$/month and can only play through PLEX. They probably have bigger problems though, so good luck to them.

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  13. I have reliable intel saying the plex market is being manipulated. Its also quite obvious. Take for example the Tash-Murkon region. I passed through checking plex prices. they were at 450m. 2 hours later somebody said something about crazy prices. I looked again and somebody purchased every plex on market and put one up for 550m. Coincedence? I think not

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  14. My theory is, people stopped buying supercaps for $$$ before the winter nerf. That reduced the PLEX supply.

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  15. Yeah, the PLEX price is manipulated beyond belief.

    Too many entities in this game have moongooed themselves into the stupid-rillions of isk and are now oh-so-metaing the unwashed masses.

    Though it´s ok, they can have their griefer high and I can try out the myriad of other (free)games out there. :P

    Sux to be you CCP.

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  16. When trying to correlate CCP's income from subscriptions/PLEX, keep in mind: 30 days out of a PLEX brings more $ to CCP than 30 days out of a subscription.

    The reason for this is exactly the risk involved, since a player with a subscription is a little less likely to stop playing (thus stop paying) than one that relies on plexes.

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  17. IMO, additionally the pure ease and grindability of Incursions with a VERY low risk/isk ratio adds to the demand on PLEXes. You can grind a PLEX in a day or two even if you only have a semi-decent Incursion grinding fleet. I met several people who make several billion isk per week just with sitting in a Logistics and grinding Incursions. And of course those people don't bother spending IRL money on the game if they can get PLEXes so easily... And those might also be people who ususally bought one or two PLEXes extra for IRL money to get a quick hold on ISK.

    I may also be horribly wrong there, that's just my experience... The felt amount of players in Incursions increased considerably in the last 1 or 2 months and so did the PLEX prices...

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