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Material gains from virtual world

From CNN's Kristie Lu Stout

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There is big money to be made in MMORPG trading -- out of virtually nothing.
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HONG KONG (CNN) -- Imagine money being made out of virtually nothing being traded.

This sort of economy not only exists in the world of massively multi-player online role-playing games (MMORPG), but it is a thriving business.

Based on an online fantasy world, gamers assume an identity in MMORPGs. At any one time, thousands of people could be logged into the same virtual world.

Where the money is being made is through trading of magic weapons, houses, in-game currencies and even characters -- all of which are virtual.

Players are supposed to acquire wealth and status within the games by their own efforts.

But in reality, players who spend hours in the virtual world slaying baddies and monsters, and hunting out treasure, sell their trophies for thousands of dollars over the Internet to other players, who do not have the time to slog it out in the virtual world themselves.

Hong Kong-based company IGE is one of the biggest dealers in this business, turning virtual money into cold, hard cash -- their revenue is more than U.S.$1 million a month.

Both enthusiastic gamers, IGE chief operating officer Alan Debonneville and CEO Brock Pierce, met virtually.

In the real world, the pair, both 23, realized there was very real money to be made out of a virtual exchange for virtual currency.

They set up their Hong Kong office in 2001, with 50 staff working 24 hours a day, seven days a week, buying and selling virtual currency and other objects in online games.

Pierce explains how the transactions work in the land of Norrath, the setting for Sony's role-playing Ever Quest game.

"An Ever Quest player, for example, wants a magical robe to better equip their magician. They would come to our Web site, select the robe that they want, select 'purchase,' go through the payment process (and) a customer service representative OKs the order."

The IGE customer service representative then logs in as another character, finds his customer at an agreed location in the "virtual world" and hands the purchase over.

The company's customer base is growing, particularly in Asia.

But Brock says there are some major problems within the fledgling business that his company must tackle, including fraud.

"I remember one night back when were first starting up. (We) went to sleep and the next day when we woke up, we had lost US$250,000 worth of inventory. It's not for the faint of heart."

And for those that think his business is built on virtually nothing?

"For most gamers, this is their reality," says Debonneville.


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