Category: crafting

The Big Bad Cartel

You’ve probably heard something about the cartels, as it’s been a hot topic on the forums and Reddit in the past month or so. If you haven’t, I’ll give you a brief introduction, if you have, feel free to skip it and go to the paragraph titled “First things first”. But before all that…

Why am I writing this?

As another Reddit poster pointed out, it’s an awesome thing that we can have these kind of interactions, these kind of stories unravel in our game. Events like these are a really good promotion for the game: articles dedicated to them get posted on gaming news sites, and sometimes even on real news sites. You probably won’t be ashamed to tell your grand kids how you’ve fought in the World War Bee in the future, I know I won’t. Albion will have its own war fueled by space-rich whales some time, I’m sure of that. I’m also sure you’re looking forward to it as much as I am.

But there comes a time when the drama is going a bit overboard and there is an actual threat to the game’s well-being. When you need to stop, lean back and think about what you’re really doing. We’ll talk about this here, and we’ll also touch on the subjects of the economics of plot ownership, player cooperation, division of labor, whales, mafia, propaganda, drama, and all the good stuff that goes with it.

One other reason I’m writing this is to put an end to this topic for myself, as it has been eating away at me for the past weeks and I’d like to move onto other things.

Disclaimer

Before we begin, I’d like to ask this of you: please read the whole thing before rushing to paint me as a troll/shill for one side or the other. As much as that would be cool if it were true, I’m not a spy, Vasort’s alt, secret mafioso or a double-agent. I am, however, a plot owner starting this month, and I am cooperating with the current cartel in Thetford (holding taxes when others do so).

You should take all that I write here with a grain of salt and think for yourself, just like you should be doing when reading anything on the internet. I will do my best to be as unbiased as possible in this position, and try to write this as merely a player passionate about the game and its economic system, explaining my understanding of some of its concepts.

The content of this post is my personal vision of the situation. I’m not claiming to be the absolute authority on the topic or to be able to read other players’ minds (unless stated otherwise).

Expect this post to be quite long, and I will not be providing a TL;DR. It will be this way because I think it’s an emotional topic for a lot of people, and the only way to try and show both sides of the coin to a person through the emotional shield is to walk them through every step of the way. I hope this will provide some food for thought for people who are interested in Albion Online’s economics, politics and drama, and as long as even a single person reads this from start to finish and finds something he hasn’t heard before – I will think of my job as well done.

With the formalities finished, lets begin.

What’s this all about?

Some time ago, way before f2p launch, players in several cities in the Royal Continent decided to band together and stop undercutting each other’s taxes on city crafting stations, coming up with a system that assigns tax amounts to stations depending on their location. This is called price-fixing, and the resulted organisation of players is called a cartel.

Some time after the f2p launch an “anti-cartel” initiative was formed, with a streamer named VOC as the main actor. They have managed to snag a plot in Caerleon last month due to changes to the bidding rules, and set up a Forge with 15% tax. The cartel didn’t react, making said Forge the most used station in Caerleon, with it accumulating over 160 millions of silver in taxes over the month. During this auction cycle it got bought out for almost 100 million silver, with VOC getting half of that sum.

This month one of the anti-cartel initiative members has managed to get another plot, and so they’ve built a Toolmaker station with 15% taxes. The cartel reacted this time, by setting all the other Toolmaker stations at 8%, making the initiative’s station lose almost all of its clients.

Vasort, one of the biggest owners on the Caerleon plot market, has written a post in response to all the backlash, explaining some of his history and motivation (regardless of his motivation for writing this or your views of him, I think it’s worth a read).

This has been the rough timeline for the present.

First things first

If you haven’t already, check out my post titled Division of labor. To summarize: most money-making activities in Albion online are linked together, and players greatly benefit from focusing on a few activities at a time, while making it possible for a whole economy to live and thrive on the combined effort of all the players involved.

These linked activities are highly dependent on each other. If there’s an abundance of Ore gatherers, then Bar prices will drop, making crafting anything from Bars more profitable, in turn attracting more crafters and dropping the price of that gear as a result. Dropped prices will attract more buyers, raising the prices in return, and so on, and so forth.

Now let’s get back to the city plots. A city crafting station is just another “activity”, just like gathering and crafting, right?

Yes and no.
  • Yes, because, just like every other activity, it is done for profit, and the player doing the activity will understandably try his best to maximize the profit from it.
  • No, because it is the only money-making activity where the number of participating players is strictly limited, and the only activity where you are strongly discouraged from dropping or pausing it by they way it is set up in the game. It is also the most inherently risky activity (without forming cartels) and requires the biggest investments by a long shot.

All that not only makes it possible, but encourages people who own plots to band together for several reasons. So let’s try to understand them, as well as why is the cartel so persistent once it has been formed.

Why does it make sense to form a cartel?

As with any activity in the game (or in real life), people greatly benefit from working together. If you form a guild you can take territories, making it safer and more efficient for your gatherers to gather, for your PVE groups to do random dungeons, and for you to craft. Forming a cartel also accomplishes multiple things:

  • All plot owners will have a chance to get their share of profit.

Most people don’t craft much and tend to go to the closest stations at random, while people who craft more tend to go the the cheapest stations. By having different taxes depending on the distance from the city center, but the same taxes on closely packed stations, the cartel accomplishes to satisfy its every member. Remember, these people are trying to make money and not lose it, so they’ll look for a way to be as safe as possible while doing so. Forming a cartel makes buying and maintaining a plot a much safer investment.

  • Security

Big investments need to be either safe or net huge profits. City plots are neither without cartels, but can be both if every owner is a member of one. By stopping infighting owners not only share the profits from crafters of their city, but also don’t try and sabotage each other with auction bids, making it much easier to defend. I’ve heard that with the old bidding system they even helped each other to fend off big targeted bets.

  • More securtiy

If every owner communicates with each other, they can come up with a healthy distribution of station types, where no one is left without customers. Introduction of outsiders to the plot market can force owners to demolish their buildings to switch stations types, which is costly and time-consuming.

Why doesn’t the cartel drop their taxes?

  • You won’t sell the ore you’ve gathered for half it’s marketplace price – people will still buy it for the full price.

Same logic here. People who are crafting aren’t doing this because they are forced to by the game. You can be winning at the game without crafting a single item, and a lot of PVP-focused players don’t craft at all. People who do are doing it to make money, and they are going to be doing it as long as they deem it profitable. The plot owner is just a link in the production chain of an item. If he is eating up too much of the end item’s value – people will find another way of crafting, or even another way of making money. But the owner’s goal is to eat up as big a share of the profit as possible without turning his clients away, just like with any other link.

For example if you’re gathering, you want to sell your mats for as high as possible, but not too high to the point of no one buying them. If you’re crafting, you’ll want to buy the cheapest materials, use the cheapest station and sell for the biggest price. It makes sense to do so and is how every healthy market works.

People can also use whatever stations without paying attention to the tax, even if it is less profitable than using island stations. They are either paying for convenience (no need to make your own stations or search for public islands with stations) or for their own mistakes.

  • Security once again

The owner doesn’t know how much he is going to spend defending the plot next month, especially with the new system. It can be 50m one month and 500k the other, that doesn’t necessarily mean the plot became unprofitable and that the owner has to give it up. By having constant taxes the owner can save up and pull through a bad month or two to enjoy the benefits of plot owning later. It may not be the best business decision for the owner, but people love to attach themselves to objects or places and dislike changes, so it makes sense why an owner wouldn’t want to part with his plot, even if he has to lose some money in the process. And the owners are still just players, they aren’t perfect and you shouldn’t expect them to be.

The last reason comes from my experience and from me talking to various plot owners. It’s pretty simple:

  • If taxes are to be universally dropped, the absolute majority of the player base won’t ever notice it.

The average player doesn’t craft that much and isn’t affected by taxes to any meaningful degree. They will use the closest station when they craft and will never even bother to look at the tax numbers of stations nearby. The whales probably won’t notice too, they’re already crafting with associate fees or on their own stations. Cartel surely can do “the right thing”, they will probably survive on 40% taxes, or even 30%, but what is the point in doing it if pretty much no one will care? This is a game after all, you’re not going to “burn in hell for not being a saint” in it.

So there is really no good incentive for the cartel to drop their fees, but maybe they should be forced to anyway?

Should the cartels be forced to drop their fees?

If you’re not a plot owner yourself – you absolutely should try to force them as much as you reasonably can, but without driving them out of business completely (others will come in their place and you’ll have to do it all over again). The less money plot owners make, the more money you will make on average. But that means you do it with the tools the game provides to you. Crafting on your guild’s territory for example, joining a guild to get associate fees, even making propaganda and sabotaging the cartel by getting one station at the outskirts and forcing them to drop taxes to make it less profitable to you, which can still be profitable in the end once you calculate all the savings from using cartel’s cheap stations and selling your plot next month.

Trying to sway admins by fabricating an outrage, telling new players they have no chance in this game, that they are oppressed and should just quit, is not the right way to do this. People who do this are hurting the game tremendously in the long run. If new players are told they won’t succeed – they won’t even bother to try, and that’s how games die out. I was never told that I’m “getting scammed”, so I crafted on 50% stations for the first month or so, and I’d like to think that I’ve been successful to some degree.

Why is the cartel undercutting people who undercut them?

Because these people are undercutting them. These people aren’t trying to negotiate with the cartel on lowering the overall fees, they silently undercut, which can’t really be seen as anything but a threat from the cartel’s point of view. If someone’s trying to ruin other people’s business, they will retaliate. And the taxes being fair or not have nothing to do with this.

What is wrong with the current plot system

“But Thulgrom, people are still unhappy, are we supposed to just drop the pitchforks and go home now?” you’ll say. Well, let’s look at the plot system and why is it so hard to operate without forming cartels in it:

1) Too little variety between stations.

For example Thetford has 99 spots for stations, but there are only 14 types of stations, and only ~8 of them are decently popular with customers, so usually there are multiple stations of the same type in close vicinity of each other. If the taxes aren’t different, people will go to the closest/at random. If taxes are different though, most stations go out of service and the city will end up with a monopoly again anyway. Having a price-fixing group is the only way for plot owners not to eat each other alive, the only stable state and as such the cartel will inevitably reinstate itself.

Proposed solution: more customization options for stations. Right now all that you can do is build a fence on your plot, which just makes it harder for people to get to your station. I guess being able to do that to other plots would help. If owners could somehow make their stations unique, spend money on them further than just buying a plot and justify the raise in price in that way, there wouldn’t be such a need for price-fixing.

2) Tax is calculated from item value, which is a constant. Food and block prices are not.

So with silver value fluctuations taxes will have to fluctuate as well, and that makes people who don’t know about this unhappy.

Proposed solution: none, it’s an underlying problem with the whole economy system of the game and I don’t see an easy way to change it. The best we can do is to stop fear-mongering new players about how oppressed they are every time taxes go up a bit.

3) New auction system

Actually, I don’t think it’s a problem. It lets people get into the market easier, drives taxes up as defending is harder, but also down at the same time as some plots are very cheap to defend, so it balances out somewhat. However, a popular suggestion of taking the full bid instead of the second highest+1 silver as the winning bid is going to quickly raise taxes to cosmic amounts in my opinion, and the game’s economy might take a huge hit, which can even prove unrecoverable.

Proposed solution: I don’t think this needs any.

4) It is very hard to judge the profitability of a plot without having first-hand experience or direct access to people with such experience

Right now if you want to get into the plot business, you don’t have a much better way of finding how profitable it is other than throwing silver at an auction and hoping to somehow make that investment back. You can monitor the money in the station from time to time, but unless you can be sure if it was or wasn’t taken out by the owner in between your checks, that will hardly be something you can base an investment of 30-100 million silver on. One month of one plot isn’t even that great of an example to base your judgement on. One can only ask people who’ve been doing it for years on multiple plots and hope they are honest when they answer.

Proposed solution: making the stations keep their tax income statistics, then sharing them to everyone who wants to check? I really don’t know a good way of doing this.

How to fight the cartel

If crafters don’t keep the cartel in check, it could easily abuse that freedom to charge completely unreasonable taxes. To reiterate, I believe the tax problem is only being faced by established crafters, it isn’t a new player problem, so I’ll be talking about ways for crafters, and crafters only, to stand their ground. Here is how we can stop them from doing so:

  • Check the taxes. Calculate your profit.

Don’t blindly use stations you’re always using. If you want to craft on industrial scale, you need to know exactly what part of your profit get eaten up by the taxes, and once it gets too big you need to consider options other than crafting on the cartel’s stations.

  • Throw in together with your friends/guild/alliance and buy yourself a plot.

As long as you keep the user taxes up the cartel won’t care. Enjoy your 0% tax. With just a few bulk crafters you will save enough on this to finance another month of auction bidding.

  • Craft on your territories.

You’ll need to be in a guild for this. As long as your guild isn’t too weak, you can always buy a territory (not in Mercia I presume) and defend it.

  • Make friends.

Seriously, don’t make the cartel into your enemy. You’re coexisting in a system where you depend on each other, so if you want to get the best out of this situation you’ll have to learn to make friends, not enemies. I’m not even mentioning that most of these people have been in the business for years, they have the money to outlast you.

Now in this next section I am going to be as biased as possible. Enjoy.

Why do I support the cartel?

Multiple reasons.

  • Right now being anti-cartel has became mainstream, so, being the true centrist that I am I just had to jump on the cartel’s bandwagon.

As for the real reasons, there are four:

  • I came into this business expecting to earn money, not lose it.

I came into this business expecting to experience the plot ownership for myself, as well as collect some actual data on it. If I go against the cartel everybody can already guess what would happen, it’s not interesting for me. Besides, even if they don’t sway and let me have the lowest taxes, the data would still be worthless.

  • Yarlam, the guy running Thetford’s cartel, has been very nice to me before and after I got plots there.

When I asked him for associate fees one month ago (back when I had 10 mil crafting fame), he gave them to me without asking for anything in return. That re-sparked the light of crafting in me and I continued crafting more and more, until I briefly switched to trying out PVP two weeks later. I don’t want to harm this guy for no reason, and I honestly don’t see a good reason for doing so.

  • I want to make people happy for longer than a few days.

As I’ve outlined above, I strongly believe dropping taxes universally will go unnoticed by the majority of the player base, and even those who notice it will forget about it in a week. Having associate fees on the other hand is completely different. It doesn’t give too much of an advantage (50% vs 25% I saved around 1m in taxes on a bulk that I’d profit 10m from), while actually stimulating you to keep crafting and making you feel like you’re winning at the game. And you are.

  • I will not stand for crafters slandering plot owners just so they can steal their piece of the pie.

If you want the cartel to drop taxes – lead the way and show them an example: stop using the Black Market, then start undercutting the gear on the marketplace by huge amounts. You can still sustain your crafting by selling that Soulscythe for 220k, why are you listing it at 300k? You’re getting crafting fame in the process, that should be enough for you, right?

[Everyone disliked that]

If it were up to me, I’d strip all crafting stations in royals from their resource returns and up it in black zones, making crafting on territories the only profitable way of doing it. That would force people to transport the gear and materials through black zones. You’d have to make caravans for that, and it would be worth your time to form ganking groups to rob these caravans. I know most people probably wouldn’t like this, but I’ve played a game that had no safe way of crafting gear, and transporting gear or robbing the caravans was the most fun I’ve ever had in any MMO. I’ll probably write about it in later posts.

Final notes

I’ve decided to leave my opinions of VOC, the anti-cartel initiative and the reasons behind their actions completely out of this post. I’ll just use this little bit of space I have left here to say to them: I love the drama you guys create, but please refrain from pulling admins or new players into this, for the game’s sake.

I previously wanted to delay posting about the cartel until I have some data from my stations, but with all the propaganda, Vasort’s post, and just me being impatient as usual, I’ve finished writing this post pretty much from scratch all in one day, and have decided to let it go up on its own. The data from my stations will be posted after the end of this auction cycle. Excuse me for any typos or mistakes, I’ll try fixing them tomorrow.

Now with this topic out of the way, I’m finally feeling free to do other things I like: crafting and learning new things about the game. Next post will probably be about flipping and all its various forms. I will also be going to Caerleon to try out the Black Market trading and documenting that, as well as looking further into focus points usage.

And until then, good luck on the markets!

Posted on by Thulgrom 5

Judging efficiency

Small post with some info I think a lot of people brush aside.

When judging how profitable a money-making activity is, it almost always needs to be broken up into parts and viewed as separate activities. And once you’re actually doing these activities, you’re benefiting from combining as many of them as possible.

This should be easier to illustrate using an example:

  • You’re buying T4 Planks with buy orders for 180 silver a piece, paying 1.8 silver per plank to set up a buy order. The average sell price for these planks over a week is 200 silver a piece.
  • You’re crafting T4 Bows from the planks you’ve bought, paying 1000 silver in taxes and using 32 planks per bow. You’re selling these bows for 10000 silver, paying 300 silver in market fees.

How much money do you make per bow sold in this example? One might say it’s 9700 (what you get from the sell order) minus 181.8*32+1000, which comes out to 2882.4.

And that would be correct. But that doesn’t necessarily mean we’re making money efficiently on every step of the way. We could be losing money buying planks and then earning more crafting from them, which still nets us profit in the end. If you want to make money, you’d sooner or later have to look at every link of the chain separately, then eliminate the weak links where you’re better off just buying the product off the marketplace.

Back to our example: you could sell the planks for 200 silver (192 after tax), earning 12.2 silver per plank, so you’re earning 12.2 silver per plank bought, and 9700-(200*32+1000)= 2300 silver per bow sold. However, by combining these activities, you’re saving on market taxes as you won’t need to set up sell orders for planks and then additional buy orders for these same planks, meaning you’re making 2882.4 silver per 32 planks bought/bow sold, instead of 2690.4 silver if you separate these activities completely. This comes from saving on market fees, but you will have other reasons to combine activities. One of them is easier realization of the product: it’s often easier to sell completed items, rather than all of their separate parts.

This applies to every activity, be it transporting from other cities, refining materials yourself, growing food on your islands, using laborers instead of selling journals on the market and so on. If its a link in a chain of production, it needs to be evaluated on its own and, if it’s too weak, thrown out for you to spend more time on the strong links, earning you more money per hour in the end.

More about this in the next post.

Posted on by Thulgrom 2

Crafting for profit

Today we’re going to be talking about crafting. We’ll talk about crafting for the normal marketplace for now, not Black Market.

In this post I will try to give an example of how to start making money from crafting with an investment of less than 50k silver. I am based in Thetford, so the example will take place there, using city crafting stations with 50% taxes (far west stations).

We will not be using focus points in this example. I will expand on focus points in later posts, for now just forget about them.

I will assume you have premium already, but even if you don’t, all that’s going to be changed is the market sell fee (4% instead of 2%), so this post should still be useful to you.

Preface/Disclamer

I think the most important thing to understand about market gaming in any online game is that it’s a PvP activity. You’re always competing with all the other people doing it. In Albion, if you chose to craft for profit, your competition isn’t limited to other crafters from your city. You will also be competing with people doing trade runs from other cities and with people selling their loot from dungeons, hell gates or ganks/camps. Don’t get discouraged yet, there’s a place for you in this market machine, just don’t expect that place to fall into your hands on its own.

Do not expect to make much money selling the exact item from the example below. The money making part comes from crafters spreading their attention over all the different gear, and if many people are crafting the same item its price and your profit will drop. Don’t worry though, there are enough items in this game for everyone, just don’t give up after the first unprofitable one you check.

Finding your place

Now with the boring stuff out of the way, let’s make some money!

Market can seem very overwhelming at first, but you will only need to know a small section of it in the beginning. Let’s start by choosing what to craft. The easiest way to do this is to look at your gear. What are you using? Chances are, it costs less to craft than to buy off the marketplace.

For this example I’ve picked T4.1 Light Crossbow. T4.0 gear is very rarely profitable as it generally has low demand and very high supply at the moment. T4.1 gear on the other hand is used extensively in hell gates and by gankers or gatherers, making it very desired and often lost by users on death, raising its price as a result. Let’s check the price for our item:

Note: to get this info you need to click the little arrow near the top right corner of the order window.

Average price isn’t often the best indicator, you’d want to look at the flat lines on the curve to see a reasonable price. By hovering over the graph we can see that people have bought over 30 items for more than 13k silver in the past 18 hours, and the current lowest sell order is at 13.6k, so we can expect to sell our crossbows for 13k a piece in less than a day as long as we don’t craft too many at once.

Now let’s look at the material costs. You can check the materials required by clicking on the items icon in the top left corner of the same market window, then scrolling a bit down:

16 planks and 8 bars, let’s check their prices:

263 * 16 = 4208 silver.

340 * 8 = 2720 silver.

Combine that together and we get 6928 silver material cost of a crossbow.

There’s a formula to calculate the crafting fees for an item, but we won’t bother with it for now. Just assume the taxes will be around 20% of the end product price. 3% of the end price will also go to the market fees, together that will be 13000 * 0.20 = 2990 silver.

Total estimated cost to craft and sell: 9918 silver. Total estimated profit per item: 3082 silver.

Good, now we know this will most likely be a pretty good start, but we’ll need to unlock T4 crafting for crossbows first. I recommend buying T3 materials for around 10 crossbows, crafting them and researching them at the station. That should give you enough fame to unlock the T4 node. If not, buy a bit more materials. This should cost you less than 20k silver.

Now that you can craft T4 crossbows, let’s buy the materials. I’ll buy enough for 10 crossbows, but you can start with even 1 or 2.

36820 + 3900 + 1300 = 42020 for 160 planks, 27200 for 80 bars, or 69220 silver total.

Time to craft

Crossbows are from the warrior’s tree, so let’s head to the cheapest forge in town.

Alright well, I said we’re using 50% tax stations so we’ll use this instead:

Oh. Turns out while I was writing this the fees of all forges except one dropped to 17-20%. We’ll use the only 55% one left instead. Other stations are still at 50-55%.

So at 55% tax the crafting fee is 1980 silver per crossbow, which is a bit lower than the estimated “20% of end price” 2600 fee. So crafting one crossbow will cost us 69220 (total material cost) / 10 + 1980 = 8902 silver.

Sweet! But wait, we also have leftover resources we forgot to include in our calculations. City crafting stations normally return 15% of the materials spent. For simplicity’s sake I’ll just sell these to the buy orders, but you can safely think of this 15% resource return rate as a 15% discount on material costs. Also you will probably get more normal items and less good ones, but that doesn’t affect the price as much as you’d think, especially for lower tier items.

Selling our goods

I sold my leftover resources for 5512 + 3410 = 8922 silver. As for crossbows, I’ll just list them all at 13k, 130k total paying 1300 silver market fee for listing them.

Let’s calculate our expenses now:

  • Materials: 69220 – 8922 (leftover) = 60298 silver.
  • Crafting fees: 19800 silver.
  • Listing fee: 1300 silver.

Total spent so far: 81398 silver.

Once we sell the crossbows over the next several hours, we’ll get 13000 – 260 (2% market tax) = 12740 silver per crossbow, or 127400 silver for all 10. That makes our profit 127400 – 81398 = 46002 silver, more than 50% of what we’ve spent! At this point we have already made back our investment into learning T4 crossbow crafting and can continue making money.

Note that I’ve bought the materials straight from the market. You can make more money if you set up buy orders for the materials, transport them from other towns, or, sometimes, if you refine them yourself. This adds on top of the profit we’ve already made, and I’ll encourage you to research the prices of the materials once you’re comfortable with doing what I’ve shown here.

Now go out and apply all that you’ve learned today to some other gear!

Final notes

I tried to make this example very basic and simple, while having all the math written out and all the steps listed. This is my first try at writing something like this, so please don’t judge me too harshly for any mistakes, inconsistencies or repetitions, but feel free to point them out in the comments.

I will go into more in-depth concepts in later posts, as well as discuss topics other than crafting, so stay tuned. I’ve also excluded a paragraph from this post that I deemed not worthy of inclusion, it will go up as a separate post a bit later. (Update: it is now up)

As always you can contact me in game (Thulgrom), on Discord (Thulgrom#1425) or on Reddit (/u/Thulgrom). Cheers!

P.S: If you need access to associate fees (30-25% tax on Warrior, Mage and Hunter stations) in Thetford just PM me on Discord or send a mail in-game, I’ll add you asap. And if you want to thank me – just use my stations 🙂 (Outdated, don’t own stations anymore as of 26/07)

P.P.S: if you want to follow the blog and get updates when I post new stuff, you can either like the thread on the forums or subscribe with your email/WordPress account by clicking on the menu button in the top right corner of this page.

Posted on by Thulgrom 6