Reports: IGE Has Been Sold

Has real money trading (RMT) market leader IGE been sold? This became a hot topic with the news that World of Warcraft database Wowhead had been sold for a reported $1 million to Affinity Media (the ZAM Network), which already owns two other major WoW databases, Thottbot and Allakhazam. In early 2006, much was made of the fact that Allakhazam was being bought by Affinity, which owns IGE (note: the buyer was originally reported as RPG Holdings, but acknowledged to be IGE). Similar objections to RMT-friendly ownership were immediately raised by Wowhead users.

But Affinity president John Maffei said that was no longer the case. “At one point, the company owned IGE but it was sold this spring,” Maffei said on the Wowhead announcement FAQ page. “It was a private transaction so we can’t reveal details.” It turns out that a number of forums reported the sale back in April, including F13 and an April 30 thread at the Allakhazam forums, in which site operator Allakhazam says that IGE had been sold a month earlier to John Yantis, an RMT veteran who built up MySuperSales and then sold the company to IGE in 2004.

But others are alleging that ties remain between Affinity and IGE. And if IGE was sold months ago, why was Affinity CEO Brock Media at the Virtual Goods Summit doing an interview with CNet about the eroding profitability of the RMT market?

“Affinity is finding it harder and harder to make the big profits it used to,” CNet’s Daniel Terdiman writes of his dicusssion with Brock. “And that’s because, he said, virtual assets are increasingly a commodity and, therefore, the margins on sales of WoW gold and other virtual goods are rapidly shrinking. In fact, he said, as Chinese competitors get more and more sophisticated, they are also willing to accept less and less profit margin. And that means, ‘they’re perfectly happy to accept $20,000 in profit on $2 million of revenue.’ ”

It’s interesting to see all this intrigue about the ownership status of a major RMT exchange emerge even as the Virtual Goods Summit is demonstrating the growing interest in virtual currency among investors and venture capitalists. Is a corporate-friendly discussion of “virtual goods” superseding the debate and controversy about “real money trading”? Is the entire undertaking being rebranded to appeal to the money crowd? Stay tuned.