Two of the well-respected gaming blogs in the world, and I regularly read had (“is having” if it goes on) a discussion about the microtransactions, Virtual Asset Sales (VAS) model, and the emerging problems, the new market and the new trend today.

Raph Koster commented on the recent controversy at Second Life and Steven Davis of PlayNoEvil commented to Raph’s last sentence:

I was with you until your final comments. Outside the US, MMOs/online games are moving to a Virtual Asset Purchase model. They are selling you the songs while sitting by the campfire is free (though you don’t get many songs until you pay, to strain your metaphor). Second Life should be the same. Where they have run into trouble is that they do not manage “song creation” / virtual asset creation by their players well so their DRM system is not effective – and has begun to undermine the player-driven economy. Whether it is possible to do so in a system like Second Life is a subject of a different discussion, but “song sales” seem to be growing rapidly as the business model (according to Gamasutra, microtransactions now drive about 50% of the Korean online game industry).

Raph’s response? A long, historical, informational, article.

And I have only a few words to say. In my PoV, they both have good points. The Virtual Asset Sales (VAS) model do work and is very popular outside of the US especially here in Asia-Pacific. Gamasutra’s article that microtransactions (usually consisting of “selling and buying in-game assets or content for $0.25 to $15″) make up at least 50% of South Korea’s $1 billion online games market in 2006, a massive percentage compared to the Western market, is true and is only the ‘minimum’.

When we met and held discussions with the Korean online game developers, marketing experts and business men and women, they all said separately and independently that the Virtual Asset Sales (VAS) model is (again according to them) driving their market beyond 73% and it all started many years ago (gameshogun note: I can’t find my notes to give the exact date VAS model started in Korea).

So I agree with Steven when he reacted to Raph. But on the other hand, I also agree with Raph after reading his response. And this thanks to my experience and the unique market South-East Asia have.

Here in the ASEAN region, VAS is getting nearer to “50%” driving the online gaming industry, as more and more publishers switch their respective “subscription-based” online games to the VAS model (either by hybrid method [ie, subscription with VAS] or pure VAS [ie free-to-play with VAS model]). But the industry is also being measured by the companies “ability” to provide a high quality customer service, from the Customer Support Representatives (CSRs), to the tickets, email responses, the GameMasters (GMs), Community Team (including the forums), and in-game & offline events.

In Korea, this is not the case. As we were told, the way they run their online games in their country is almost similar (if not the same) with how US companies run theirs – GMs do not hold “public appearances” – the major difference with the ASEAN online gaming industry.

Locally alone, here in the Philippines, there are publishers who are favored by the gamers because they are providing a pure VAS model for their games (which resulted to other local online games following their path) but when it comes to customer service, majority of the gamers agree that it is the other company who provides the best customer service, or in Raph’s words “making the campfire experience great”.

Both the VAS model and the “experience satisfaction” of the gamers are the yardsticks in determining who are successful in these industry here in the Philippines and the rest of the ASEAN region. There are those who concentrate on making the gamers experience great, and there are those who will charge their “listeners by the song” (aka charging by the [avatar] item).

And just like the on-going discussion, personally, I still have to see an online game publisher who will be able to “marry” the two yardsticks.

Read Raph’s response entitled Are microtransactions actually the future, because Raph also discussed the Copyright Law, downloading-uploading, user-created content, and other interesting topics. Sad though, he cut his response and didn’t touch on the “trademark” topic. Oh, and RMT (Real-Money Trading), which many Filipinos (Filipino gamers are more Westernize than the rest of the Asia-Pacific region) are not willing to accept and embrace – as an example, gamers view the sudden switch of online gaming to the VAS model as “legalizing RMT” (which is partly true if we will discuss it deeper).

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