Network effect in Diablo 3
http://diablo.somepage.com/popular/
As a human, people have desire to be distinguished and unique from their surroundings. However, in real environment, we are restricted by many factors such as one’s economic status and close friend’s prejudices. Therefore, this network effect to become distinguished in certain environment is somewhat limited. As these limitation and network effects leads to formation of branding in markets which are actively purchased by other people at higher price than its actual utility. In real world, there are too many variables to accurately analyze this phenomenon. However, in Role Playing Gaming environment, these network effects are much easily understood.
In particular, players in Diablo 3, a popular Role-Playing Game, have shown interesting yet simpler dynamics of network effects on economy of the system. Above the link, it shows popular items and skill combinations for the character. These ‘builds’ is renowned for being the most cost effective choice for playing Diablo 3. Certainly, many people choose these builds and also stay on it for a certain amount of time. However, as people starts to play multiplayer mode, it is obvious that people starts to choose other combinations of items and skills to their character. These variations are reflected by calculated statistics of chosen skills. Therefore, even though chosen skill and item sets are not the most efficient way to play Diablo 3, people deviates from those popular ‘builds’ for sense of distinguishing himself from community and more importantly for just fun.
As these different builds starts to develop, the cost of making your character starts to increase by the network effects. As some of the items are absolutely essential to the build, cost of those items becomes relatively high due to sustained high demands. Interestingly, cost of those items starts to drop as popularity of that build exceeds some limit, because as too many people starts to follow the build, the new players starts to avoid making same build. As result, the demand of the item diminishes and cost of the item drops until the cost drops to certain limit where it becomes attractive to people again. During those transition phase, other existing player might change their builds into other builds and cost of those items starts to increase as it becomes popular. Therefore, as a result, these cyclic rise and fall of the popularity couples with economy of the game and the price of certain item over time cycles as a result. This phenomena can be utilized to exploit the cyclic price change of the item and actually make profit by buying when it is unpopular and selling when it becomes popular again.
wk93