John Smedley is CEO of Sony Online Entertainment (SOE) (makers of Everquest 2 and Star Wars Galaxies), and sometimes serves as a lightning rod for debate in the Massively Multiplayer genre. SOE and Mr. Smedley made the bold decision in June of 2005 to roll out a service that would allow players to trade US currency for in-game currency, items, and even characters. Called the Sony Station Exchange, it has caused a good deal of debate and, it turns out, made the company a nice little pile of money.

Today, SOE is releasing a white paper detailing the first full year of trading; how much was sold, how much they made, and the big bucks individuals can get from selling non-existent coins. Mr. Smedley was good enough to answer a few brief questions about the contents of the white paper, and the future of SOE's Station Exchange service.

Gamasutra: When the topic of the white paper came up, you mentioned that your interests here were possibly 'not what we'd expect.' What does interest you in about this topic?

John Smedley: I'm interested in shining the light of day on this subject. It's real. It's a billion dollar industry worldwide and we as game makers need to seriously work to handle it in-game. There is rampant farming in these games (yes, ours included). I believe we should work to include some element of this in some games, but do a better job of cracking down on it in a big way. I have personally had it affect my gameplay and I think it's very negative. Our goal for getting this information out there is to show exactly what's going on so everyone understands. With this kind of money involved, it's not going away. I strongly believe in the idea of separate servers to allow people that want to engage in this sort of activity to do it.

Gamasutra: What was the reason SOE decided to have the white paper drawn up? Was it internal curiosity, or did you always plan to publish the results? Was there anything in the paper's results that out-and-out surprised you?

JS: We had the white paper drawn up because it's a topic we felt was very pertinent to MMO gaming in general. The biggest surprise to me was the amount of money some of the sellers were making.

Gamasutra: The paper's statement that the opening of the Station Exchange 'was a cause for great debate' seems like something of an understatement. Has there been any appreciable backlash from the playerbase as a result of the SE's opening? Do you feel that opening the Exchange generated some
bad will?

JS: There was a very large amount of debate and controversy when we announced it. It became a non-event when it launched.

Gamasutra: Did the sheer amount of money that has passed through the service surprise anyone at SOE, or was the success of the Station Exchange an assumption from the start?

JS: We always assumed it would be successful. We knew the demand was there.

Gamasutra: Despite the paper's statement that revenue for the company from the Station Exchange was 'not a significant source', $274,083 is nothing to write off either. Given the monetary success of the Station Exchange for both SOE and participating players, are there any plans to expand the service to all game servers? If not, what is keeping you from taking that step?

JS: Absolutely not. We said at the start that we would keep it on separate servers, and we intend to keep that promise. In the future we will include some form of Exchange in some of our games, although we are leaning towards only allowing certain types of non-game impacting items to be sold.

Gamasutra: What is your reaction to the statistics showing some players may be making a living wage off of Station Exchange sales? Is this something that was always intended for the service (as it is certainly not unique among RMT services), and is this something SOE has any intention of restraining?

JS: I will admit the amount that some of these folks were making did come as a surprise. I do think it's cool that a person could put themselves through College by doing this. If it's done on servers where other people choose to participate in this kind of activity I think it's a great thing.

Gamasutra: While the analogy of 'movie snacks' is an apt one insofar as impulse buys go, do you think it is an applicable lens for the service as a whole? How would you respond to some who would take exception to that as an analogy for something they care deeply about?

JS: I don't think it's a good lens for the service as a whole. The author was trying to make a point about impulse buying (at least in my opinion).

Gamasutra: The paper ends on a note that some might consider a bit crass. It reads: "Since the income generated from auctions is predictable, and can be controlled, it may offer new ways to monetize game play. It is already clear that the possibility exists of creating an MMO in which the virtual economy is a core component. This would not work for all game types. But in the cases where it does work, would provide a powerful way to keep subscribers glued to the game." How would you respond to those who might take exception to the concept of 'monetizing gameplay' as a means of 'keeping subscribers glued', when they're just there to have a good time?

JS: Hmm.. well, I would disagree that it is a bad thing. I can forsee a game where there is no subscription but you can use Exchange for non-game impacting items (clothing and such) and perhaps the in-game tailors can make real life profit by selling a uniquely designed outfit. Maybe a person could become very famous for making a special type of shirt with an artistic design on it. To me the idea that an out-of-game economy can exist and people can make money by participating in a game they love is
amazing. However, I have to emphasize that I think it's important we design with this in mind. If it's non-game impacting and just plain cool, I suspect people won't mind it.. and if they get a tangible benefit out of it (not paying a sub-price for example) I think people will actually like it. The key is to design games in such a way that "farming" just isn't possible or beneficial. Make it about creativity. Make that the source of rarity. Then I think we're on to something huge.

Gamasutra: On the other side of the coin, the idea of changing the design of a Massive game as a result of these figures is intriguing. Can you share with us any changes you could see being implimented in future games as a result of SOE's experience with the Station Exchange?

JS: Not ready to discuss at this point, but needless to say it's something we're actively working on.