Day 24: Why Diablo 3's Auction House Is a Good Thing

Diablo 3 is getting closer to completion and today a huge new feature has been unveiled. You may have heard about it already. Diablo 3 is coming with an auction house. Let's get some of the details out of the way.

• Players can auction items they find in-game for gold (game currency) or real world currency.
• Only players can buy and sell items in the auction house so Blizzard won't be trying to sell you exclusive or rare items like TeamFortress2.
• Sellers must pay several fees to Blizzard which include: 
• A fixed fee to post items for sale whether or not it sells. (new sellers may waive this fee a limited amount of times)
• An additional fixed fee when an item is sold.
• For those depositing payments into a 3rd party account (undetermined availability at this time) a "cash-out" fee will be applied.
• Players may use the gold or cash auction houses at their discretion. 
• Items may be auctioned at any time in-game and can come from any of your account's characters' storage or your shared storage.
• If your item doesn't sell it'll be returned to your account immediately.
• If you buy an item you'll have access to it immediately and can equip or store it wherever you like.
• Anything you find that isn't "soulbound" may be put up for auction or traded with other players directly.
• "Smart search" will help you exactly what items you want based on character levels, build, etc.
• Items auctioned will have a time limit with which to be sold. Buyers may either bid or buyout the item (like eBay) and either try to get the best price or pay more for immediate delivery.
• All purchases will be anonymous for buyers and sellers.
• Items bought may be re-auctioned after a 24 hour "cool down" period.
• "Hardcore" players won't be able to use the cash auction house but a separate, hardcore only, gold auction house will be available. (For those who don't know, in Hardcore mode death is permanent so upon death you'll lose all your items including purchases.)

I think that's about all the details necessary. Now, some think this is a horrible idea and yes, there are some disadvantages to consider. For instance, integrating cash-based trading into the core game means no more 3rd party mods or mod tools will be allowed. Also, constant internet connection to Battle.net will be required to play Diablo 3, solo play or not. 

The auction house isn't a bad idea. For the most part it's a very good idea and here's why. Diablo 2 created an economy that lent itself to rich players selling items under shady means. To this day you can still find and 'buy' Diablo 2 items off of eBay. This isn't safe or recommended. What's to stop Diablo 3 from turning out the same way? A good way is to add an auction house, here's an example.

When TeamFortress2 added the drop system and very rare items, such as hats, tons of servers cropped up for players to 'idle'. The longer your player idled the more items you would obtain. Since there was no way to trade items this was the only means for collectors to obtain rare items without playing 100s, maybe 1000s of hours. To combat this, Valve tweaked the drop system to improve drop rates but limit the amount of play time where new items could be obtained. A player who could idle for, potentially, 168 hours a week could now only utilize ~10-12 hours a week to get drops. This cuts down the idling but people still aren't getting the items they want. Valve added the Mann. Co store for players to buy whatever items they wanted, including exclusive items. In addition, players could trade among themselves.

It's not perfect, the Store prices are pretty high (especially since the game itself is free, now) and there's technically nothing stopping people from selling their precious hats on eBay but it seems to be a fair enough balance to keep players playing and paying exclusively in the game. Why wouldn't an auction house for Diablo 3 work just as well if not superior?

It sounds like a great idea to me to centralize the game's economy in a safe, fair environment. In fact, it makes me wish TF2 had an auction house as well except for the fact that Valve's game is free and Blizzard's game isn't. I wouldn't mind seeing people putting their hats up for sale in an auction house with Valve getting a cut of sales. It sure as hell would clean up all those trading servers that have cropped up to accommodate the dead idle servers.

That being said, Blizzard's approach isn't perfect either. These unspecified transaction fees sound suspect, for one there's too many of them. A fee to post an item just discourages involvement and experimentation with the market, especially since unsold items quickly expire and would need to be posted again for another fee. If they're worried about the auction house becoming overrun with bad sales then just do what Glyde.com does. When you post an item for sale it shows you the current market price (i.e. the lowest available buyout) and only the lowest priced available item is visible to buyers. Given that there's sure to be lots of permutations of the same item it may not be very effective but it's an idea at least. Also, a fee to transfer cash from Battle.net to a bank account? Really? Activision using ATMs to handle purchases?

Anyways, think about it. Compared to 'always-on' internet requirements...the auction house is a great idea.