Monday, September 29, 2014

Home Again

The wardecc finally wore down and safe life is back to normal. The most important part of this is that the POS is back up. It's funny how one can attached to things in a game about virtual spaceships.

Last week Sugar Kyle put up this post wherein she asks what does having a POS mean to you. Since we had, at the time, taken ours down it got me thinking. Why do we have this? Why does it seem like such a loss that some random merc corp pushed us to taking it down?

The easy answer is that having the POS means more efficient manufacturing and research. Getting every edge possible in those fields is important in the small margin world of manufacturing. This is doubly true since margins have decreased in the weeks since Crius was launched.

The main reason we have a POS though is because it IS home. It's a tiny slice of New Eden that is ours. We control that little space in that bubble completely. It ends up being the focus of almost everything our corp does. Even the little chores to keep it fueled (ice mining, PI and such) brings the corp together. It gives us a place to collaborate and help one another on our individual projects. Sure, we could do all that in an NPC station but it just wouldn't feel as unique and personal.

I think things like this are what make EVE compelling. In a game that is advertised as a sandbox it's nice to have your own castle.

Wednesday, September 24, 2014

A Wardecc and an Opportunity

Well, half-way through my first Wardecc. It has certainly been less exciting than I had hoped. The day prior to the decc going live a couple of us got excited, loaded for bear and bought several dozen PvP fitted ships between us. Added the war target to our watch lists and waited for targets of opportunity.

That was last weekend.

Since then, I've barely seen our targets online at all. One dropped corp even. We're the industrialists. We should be the ones cowering in station and not the big bad High Sec PvP corp. We haven't even gotten a chance to try out our Procurer bait fleet doctrine. New Eden can be a strange place.

Turns out our target did log in long enough to take a contract to "protect" an indy corp in the midst of a POCO war with a Low Sec corp. Seems like a poor hire but not my ISK. The Low Secc-ers did reach out to us for intel which we were glad to give and got to talking. The one's we've talked to seem pretty relaxed and friendly. They seem to do a bit of everything and that sort of aligns with our Corp's mentality. Quite frankly it's just nice to chat with people from outside the Corp and get an idea of the larger world. The fact that there may be an opportunity here is an added bonus.

You see, I had been toying with the idea of direct sales of ships. I will admit that I stole the idea from Eve-Uni's PYOS program. Imitation is the best form of flattery, right? The issue is finding customers. Word of mouth seems to be an important part of this game. Especially in the case of contract sales. From the initial conversations they certainly seem interested in our manufacturing capabilities.

They are also all on board to work together to fight our mutual enemy. Which is how I found myself sitting in the station the war target's CEO signed off from in a bait fit Battle Nereus and a Blackbird as a backup as I write this. We just missed the target before he signed off but hopefully seeing a "helpless" indy target in station with him will make him a bit reckless.

So, lesson for today. MMOs like WoW will give you content all day. In EVE you make your own. Keep an eye out for opportunities because no one else will do it for you.

Opportunity Costs

I have always made the assumption that the concept of opportunity costs was one that people inherently understood and incorporated in their behavior. Playing online games has disabused me of that notion.

Now, most people understand the concept on an intellectual level even if they have not seen a definition. Formally opportunity cost is, in economic terms, the opportunities forgone in the choice of one expenditure over others. Informally, it is the cost of not being able to do A if you choose to do B instead.

Now why has online gaming made me think that people do not in fact apply this to their behavior? Well, it started back when I played WoW right after Lich King came out. My main was a blacksmith and I was looking to make some extra gold with that skill. Since the expansion had just come out there was a high demand for the crafted starter plate PvP gear. By comparison, not many people had advanced their blacksmithing skill high enough to craft said gear. So, the price was rather high in the marketplace. I made a tidy profit by buying raw ore from miners sending it over to my alt that could smelt ore and getting the refined metal bars over to my blacksmith to craft the gear where I could easily sell at a 100% markup. At some point, as more blacksmiths entered the market and more people were moving beyond the starter PvP gear, the price dropped but I was still making a profit. Eventually, the price of the gear became less than the price of the metal bars it took to create the gear. Considerably less. Complaining about this in guild chat, one guildmate replied "Well, they might be mining the ore themselves and that is why they can still make a profit."

This is where opportunity cost comes in. Sure, by mining their own ore and refining it then crafting gear they are not strictly losing gold like I would have if I had continued crafting those items. However, the idea that the ore they mined was free is quite false. At that point in the marketplace they could have just sold the ore/metal bars for more than they were selling the PvP gear. In fact, they were actually destroying the wealth they could have been making by crafting. As a big believer in rational markets this drove me crazy.

Fast forward many years to me starting to play EVE. Naturally, as a person that professionally deals with markets and business on a financial level, I was drawn to the rather deep and extensive player run economy of EVE Online. Looking to make some ISK doing manufacturing, since I like the concept of building things, I started to run the numbers on various manufactured goods. I found that many of the popular ships and modules were being made at a loss. This is even calculating with perfect material efficiency.

It turns out that EVE has a similar saying to WoW in that "The minerals I mine are free." This idea is still false in EVE for the same reasons I gave in my WoW example. It doesn't matter how much the raw materials cost you to acquire. The only way to determine profitability is to value them at the price you could sell them at. If more people take that mindset we would be well on our way to a more rational market place.

(As an aside, Eve Cost, is a fantastic tool to gauge profitability of all your industry activities. I highly recommend it.)

Tuesday, September 23, 2014


What is this? Who are you? What am I doing here?

These are questions that I assume that one reading this blog has. I will try and answer these as best as possible, introduce myself and then move on to (what I hope are) more interesting topics.

What is this? 

Well, in short, this is a blog about my, roughly, day to day adventures in EVE Online. My particular interests are in markets and industry. I expect that most of the content will center around the economy in general. I take no responsibility for any off-topic posts. So, you have been warned.

Who are you?

In real life, I am an accountant and financial analyst. So, clearly, in my free time I have decided to do essentially the same thing. But in space.

What am I doing here?

That is entirely up to you. Ideally, you'll be entertained at least somewhat but I make no promises.