Study Reveals Consumer Demand and Confidence in Secure, Official
Marketplace for Buying and Selling the Use of In-Game Characters, Items and
                         Coin for Real World Money

    SAN DIEGO, Feb. 7 /PRNewswire/ -- Sony Online Entertainment LLC (SOE),
a worldwide leader in online games, today announced the results of a
12-month study of Station Exchange(TM), SOE's online auction site which
allows EverQuest II subscribers to securely buy and sell the rights to use
virtual characters, items and coin for real money. Launched in June 2005,
Station Exchange's first-to-market product marked the inaugural entry of an
official, sanctioned virtual economy into a Massively Multiplayer Online
game. The White Paper highlights data collected during a 12-month period
covering June 2005 to June 2006.
    The auction site, which has operated since June 2005 on specific
EverQuest II servers, generated player transactions of $1.87 million during
its first year, according to the White Paper published today. Players have
paid as much as $2,000 for the right to use a single EverQuest II character
and one seller earned $37,435 from 351 auctions, according to the report,
entitled Station Exchange: Year One.
    "The Station Exchange White Paper results demonstrate beyond a doubt
that there is a significant demand for a secure, sanctioned online
marketplace where players can enhance their gaming experience by spending
real dollars," said John Smedley, President, Sony Online Entertainment.
"We've found that Station Exchange is providing an excellent ancillary
revenue stream for both SOE and our players. Some of our Station Exchange
players are literally paying for their subscription to EQII, while others
are making significant money."
    Some of the study's other findings include:

       *  Two players each collected over $37,000 from their auction activity
          in the first year.  The top 15 sellers each took in over $10,000.

       *  Characters were by far the most valuable trade category.  The top 20
          character auctions were each for over $1,000.

       *  The highest valued character race was the Dark Elf, followed by High
          Elf and Human.

       *  34-year-olds were the biggest buyers of virtual goods; 22-year-olds
          were the biggest sellers.

       *  Auctions for coin led to a stable, real-money average exchange rate
          for the year of $7.35 for one piece of platinum.

       *  In keeping with the EverQuest II player base as a whole, Station
          Exchange traders were predominantly males, who accounted for roughly
          eight times the spending of females.  However, average spending by
          gender was roughly the same: $63 for men and $66 for women.

       *  Close to 18% of active buyers and sellers were located in northern
          California.  However, the zip code where the most buying and selling
          took place was Levittown, PA.  Northumberland, PA came in second.
          Antioch, TN was a close third.
    While a minority of players were able to derive a significant income
from their sales on the site, many more earned between $200 and $500 per
month after listing and subscription fees. According to White Paper author
Noah Robischon, however, a least some players selling items on the site
felt they got more than money out of their transactions: "The sellers who
provide armor and weaponry feel they are providing a service to players
while elevating themselves to elite status among fellow gamers."
    The study concludes that the vast majority of players who earned money
on Station Exchange did so through the sale of items they quested or
crafted within EverQuest II, rather than by buying items at auction and
selling them at a higher price.
    Buyers appear to use Station Exchange for a variety of reasons, but the
study shows that the vast majority of sales are settled through instant
purchase at a set price, rather than through a traditional auction process.
This indicates buyers are typically looking to fulfill an immediate desire,
such as a particular type of armor needed to defeat an enemy in a quest.
Interviews and anecdotal evidence suggest players also make purchases to
stay aligned with friends who have attained a higher level within the game
or to re-experience the upper levels of play from the vantage point of a
different character.
    Station Exchange was developed to provide players with a secure
alternative to rapidly proliferating third-party markets for in-game
characters, items and coin. These unsanctioned auction sites have given
rise to scammers who often deliver different items than promised or fail to
deliver at all. SOE constantly monitors usage patterns both inside the game
and on Station Exchange to detect fraudulent activity among buyers or
sellers.
    "Station Exchange is one of the most exciting experiments in game
design this decade. For the first time, we have reliable, verified numbers
about the real-money trade phenomenon. Those numbers indicate that this
market is driven by ordinary people, spending ordinary amounts of money,
for ordinary reasons. In other words: as long as the game design gives
people incentive to spend real money on virtual money, they will do so. The
Invisible Hand strikes again. Moreover, the evidence suggests that making
RMT an official part of the game has little effect on whether people do it.
Customer service costs fall dramatically, though. There's just as much
activity, but a lot less fraud," said Edward Castronova, an Associate
Professor of Telecommunications at Indiana University, Bloomington and a
preeminent expert on virtual economies.
    Castronova also serves as director of the Synthetic Worlds Initiative
at IU and is Director of Graduate Studies in the IU Department of
Telecommunications.
    About Sony Online Entertainment
    Sony Online Entertainment LLC (SOE) is a recognized worldwide leader in
massively multiplayer online games, with hundreds of thousands of
subscribers around the globe. SOE creates, develops and provides compelling
entertainment for the personal computer, online, game console and wireless
markets. Known for its blockbuster franchises and hit titles including
EverQuest(R), EverQuest(R) II, Champions of Norrath(R), Untold Legends(TM),
and PlanetSide(R), as well as for developing Star Wars Galaxies(TM), SOE
continues to redefine the business of online gaming and the creation of
active player communities while introducing new genres on various
entertainment platforms. Headquartered in San Diego, CA, with additional
development studios in Austin, TX, Seattle, WA, Denver, CO, and Taiwan, SOE
has an array of cutting-edge games in development. SOE is owned by Sony
Pictures Digital and Sony Computer Entertainment America.
    SOE, the SOE logo, EverQuest and PlanetSide are registered trademarks
of Sony Online Entertainment LLC. Untold Legends is a trademark of Sony
Online Entertainment LLC. All other trademarks and trade names are
properties of their respective owners.

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