OK, let's talk about the industry changes announced so far.
Between the refining change announced last month and the overall sweep of the industry changes announced by CCP Ytterbium a few days ago, a number of you want to talk to me about this. And most or all of you that want to talk to me about it have one thing in common: you do your manufacturing in high-sec or low-sec. The latter group are mostly solo capital producers. You guys, by and large, are particularly angry.
And yeah, make no mistake: I totally get why. Most of the advantages that are being touted, particularly in refining, are mostly going to benefit null-sec. Refining will be more efficient in null-sec than can be managed in high- or low-sec and though we haven't seen the full sweep of the changes for manufacturing, it's a pretty damn good bet that manufacturing is going to be cheaper in null-sec as well. Particularly since -- *shudder* -- it's CCP Greyscale working on that. "Expect costs ranging from 0% to 14% of the base item being produced for the most extreme case," Ytterbium says.
That's pretty freakin' significant since as I covered a couple of years ago, once you take out the materials costs today the "COGS" -- cost of goods sold -- for most manufacturing in EVE typically runs less than one percent, the vast bulk of that in station taxes. Manufacturing costs are insignificant to the point of being something industry players ignore entirely. Once summer comes, industry players will no longer be able to ignore those costs. Players that live on industry would be idiots not to pass those costs directly to their customers, and players that live on industry are definitely not idiots. Most of them know their profit margins down to the fraction of a percent. I know I sure do!
Therefore, what Ytterbium is saying is that every single little thing in EVE is about to become 5-10% more expensive. Some things will be 14% more expensive. And those items built in high-sec will be on the higher end of that curve, while the items built in null-sec will almost certainly be at the low end of that curve. And the bigger and more expensive and more reliant on minerals the item is, the bigger the benefit is going to be to build that item in deep null-sec. As I said, the low-sec capital producers are particularly annoyed.
What this naturally means is that goods built in null-sec and shipped to Jita will have a significant cost benefit over goods that are built in high-sec and shipped to Jita. Furthermore, the tendency is going to be that the further away something is built from Jita, the lower the cost of that item is going to be and the higher the profit margin that manufacturer is going to realize. The systems nearest Jita are almost certainly going to end up being -- either through dev intention or player action -- the most expensive places to do industry.
This is absolutely, totally going to flip high-sec industry and trade on its head. Hell, it's even somewhat possible that we'll even see multiple major trade hubs grow out of this change. Sooner or later people might start getting bored with all that logistics, say "screw it" and start selling their stuff in high-sec entry systems closer to where those things are being manufactured. If Burn Jita is too successful this year, this possibility actually becomes slightly more likely.
And in the midst of this, the people who are making their living doing the bulk of their manufacturing in high-sec -- and I include myself among this number -- are going to be the most trodden on: we'll be paying the most for minerals, we'll almost certainly be paying the most for manufacturing. That is going to make our margins on a lot of products razor thin... where we're able to sell these items for a profit at all. I suspect there are some items for which manufacturing in high-sec at a profit is about to become impossible!
"Jester," some of you are saying, "make CCP understand this!"
And here's the simple fact of the matter: guys, they do understand this. Hell, they haven't said so -- if they had, it would be NDA -- but I suspect that's the goal of the exercise. Greyscale in particular has for years been the champion of the philosophy that doing some activities in some areas of space should completely suck and you would be dumb to do those activities there. In the past, the goal has been to make living full-time in null-sec directly correlate with higher player income than living in high-sec. I can easily see industry warping off in that direction come summer.
Did I raise a major objection to this at the Summit? Call me a traitor if you must, but no I did not. Because in the long-term grand scheme of things, this view of EVE is the correct one and it's more healthy for the game.
Now, I might object on other fronts. For instance, I'm personally of the view that there are vast swaths of null-sec that are much safer than high-sec because they happen to be either full of friendly pilots 24/7 or somewhat more often are simply empty of another living soul. As a result, a good bit of null-sec manufacturing is about to become ridiculously profitable while at the same time being ridiculously safe. You do your manufacturing, you pile everything into a jump freighter, and you jump all of it nearly directly into Jita (or wherever). You can add the JF fuel to your COGS confident in the knowledge that even with this expenditure, your profit margin is still probably going to be higher than if you did the very same manufacturing in high-sec.
But as I keep saying, the safety that I feel in null-sec is something that should be addressed in a rebalance of how sovereignty works and the mechanics of null-sec. It's one of the ways in which I feel null-sec is broken. I might shift uncomfortably in my chair and wish that CCP would address that before they addressed the industry expansion. But CCP Seagull showed us all a picture last Fanfest of a giant star gate being built in space. To get to her vision, EVE needed a Crimewatch-level rebuild of industry and it looks like over time we're going to get that.
So, there's likely no stopping this train.
In the meantime, all that I can tell you high- and low-sec manufacturers is what's good for the goose is good for the gander. There are dozens and dozens of PvE-, mining-, and industry-focused corps in null-sec now. Sure, they're mostly called "renters" and sure, I think the whole rental mechanic in EVE is more than a little bit dumb.
But it certainly isn't stopping industry players from taking advantage of the coming changes by sticking your manufacturing alts in these renter corps and taking advantage of these new industry tactics yourself once they come along (assuming they do). After all, in the end you'll be well paid to do so and it will continue to be the safest way of making money in EVE Online. And isn't that why you got into industry in the first place?