Cross-Realm Auction House

Auction House SecretsBlizzard caused an uproar, a little while ago, when Tom Chilton (Game Director) muted the possibility of a future cross-server Auction House. Why this should cause such angst among players, I’m not sure, but I thought I’d explore some of the implications of such a move as a wow player and gold maker.

This post is part of Cold’s Blogging Carnival

Every Server A Market

When players, new to the Auction House, start to trade for the first time they can often be overwhelmed by the many hundreds of items listed on any one day. So it helps to group these items into logical categories which can then be thought of as markets in their own right. I always encourage new players to trade in those markets closely associated with their primary professions. So an Alchemist will probably spend a great deal of time trading herbs, while an Engineer will be trading in ore and metals. After a while, players soon learn the pricing of popular items and what sells and what doesn’t on their server. However, move to a different server and the markets can appear very different. This is because each Realm (server) is a market in it’s own right with no ‘official’ communication between them.

Population Size Matters in the Gold Economy

Blizzard is constantly trying to level out the population sizes across it’s servers, by migrating players off those servers with a high population to servers with lower populations. This not only helps the game response times but balances out the gold economy across the many hundreds of servers in Blizzard’s empire. Population size greatly affects the wow gold economy on any given server in the Warcraft universe.

This is also true in the real world economy where they talk about the liquidity of a market – that is, the ability to buy and sell an item without greatly affecting its price. Small markets, as found in some low population Warcraft servers, will struggle with liquidity and experience wild swings in pricing across many common items. If you play on a low population sever, you have probably experienced this. It’s the reason why some players have great success in some markets and not in others. The Transmogrification market is a good example – it works on some servers and not on others.

Market Manipulation

Another problem with low population servers is the ease with which some players can manipulate the market. In real world markets this is something that governments try to do, but often fail. The classic example is the British government spending billions trying to keep the price of Sterling above an agreed European limit in 1992. Ultimately, the market won and British taxpayers paid the price. Famously, a one George Soros, a currency investor, made billions betting against the rise in Sterling. My kind of trader!

I recently did something similar on a European server, buying up large quantities of Truegold just before MoP, trying to keep the price high until I could offload the lot just before patch day. A risky strategy, but I had some success because I chose a low population server. Unfortunately for the British government, the currency markets in 1992 had a far greater built-in liquidity

Competition is King

Overall, a lack of competition is a bad thing. This is because most players are buyers as well as sellers. On small population servers where I’m a net buyer of an item – say ore – the lack of competition may be a bad thing for me if one or two player control the market and may well collude to keep the prices jacked up (doesn’t happen in the real world, right?). The best thing to do if you’re a seller of an item with high competition is to try to avoid it and in various other articles I’ve explained how to do this.

The Cross-Server Economy

Which brings me to the possibility of a cross-server Auction House. From the above discussion, I think it’s clear that a cross-server Auction House should result in a bigger and more stable Warcraft economy. Not only would markets experience greater liquidity but be less prone to player manipulation. How many time have you heard a player boast on a blog or Twitter that they have ‘reset’ the market for a particular item? Yes, competition would increase across many markets, but those players that learn to master the Auction House Secrets should come out ahead.