Blizzard of Money: Steep fees on all auction house transactions in Diablo III

The virtual goods market is big. Consider this: The seamy underworld and legitimate businesses selling in-game goods—from fancy mounts to ride through fantasy worlds all the way down to fluffy scarves for penguin avatars—generated $9 billion in sales in 2011. The research firm In-Stat expects that the virtual goods market will nearly double over the next two years, ballooning up to $15 billion by the end of 2014.

Blizzard’s games, including World of Warcraft, it’s secret successor known as Project Titan, and this month’s Diablo III, will be a significant part of that growing pool of money. Unlike World of Warcraft though, Blizzard has made plans to keep from letting independent entrepreneurs make all the bank on their games’ desirables. Diablo III players will have to share a hefty chunk of their profits on goods moved through in-game auction houses.

Blizzard announced last summer that it would allow players to sell their in-game goods for real world cash, but it would also take a cut of each sale. A FAQ posted on the studio’s website on Tuesday specified just how much Blizzard plans to take: 15% of every withdrawal of cash stored in their servers. Put another way, if you earn $150 from selling items in Diablo III’s auction house and then move that money to your bank account, you’ll have to pay Blizzard a $22.50 transfer fee.

That’s not all though. There are also sales fees in addition to the transfer fee. Commodities—including crafting goods like pages, recipes, dyes, and gems—will carry a 15% sales fee. Unique items like weapons, accessories, and armor meanwhile will carry a flat $1 sales fee.

So to break it down further, say you sell $150 worth of commodities in the auction house. Blizzard will first take $22.50 from that total, leaving you with $127.50. Try to remove that money from the game account into your own bank account and you’re left with a mere $108.37. That’s a steep price to pay for doing business in Diablo III.

Intrepid businesses that plan to work around Blizzard’s system by using outside payment systems are in for a rude awakening. Blizzard’s FAQ reads: “Note that the process of sending proceeds to a third-party payment service will be subject to applicable fees charged by Blizzard and the third-party payment service. Also, any proceeds from the sale of items in the real-money auction house that have been sent to the player’s Balance will be not be transferrable to the third-party payment service account.”

The virtual goods black market has proven adaptable in the past though, so it will be interesting to see how Blizzard’s systems will be circumvented. Diablo III is less model for the future of virtual economic control and more of a test bed for Titan, the company’s next MMO.

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