I usually blog Matthew Ball's Metaverse Primer on Thursdays, but this new exposé by freelance UK journalist Quintin Smith (Wired, Edge, Eurogamer, Kotaku) is important viewing now -- and is just as important if not moreso for the future of the Metaverse, and whatever it becomes.
In his report (watch above on his People Make Games YouTube channel), Smith delves deeply into the ways ROBLOX monetizes user creators on its massively popular platform -- many or most of whom are minors -- with mechanics that he deems so exploitative, he compares them at one point to the infamous scrip that abusive companies used to "pay" its workers.
"For me," as Smith puts it to me, "the most egregious part of the whole story is the platform's minimum withdrawal amount of 100,000 Robux, which equates to $350 US when a developer withdraws it. If you take into account Roblox's cut of 30% of every transaction on the platform, it means a developer needs to have taken 143,000 Robux from its users before they're allowed to withdraw it as actual cash."
In practice, Smith goes on, this tends to lock ROBLOX creators into the system: "The cost for users to buy 143,000 Robux is around $1430. So your game needs to have raked in $1430 in Robux before you, the developer, receive so much as $1." (Also, a ROBLOX developer can only cash out if they have a $5/month premium subscription.)
As I've noted before, user creators in Second Life earn as much revenue in total from the platform as Linden Lab itself. And Second Life's user base is mostly adults, while ROBLOX's user base is primarily under 18.
"If you accept that we need to treat minors who are doing a job better than we treat adults doing the same job," says Smith, "that's just abhorrent. Especially when you consider the platform is encouraging kids to come and work for them."
He tells me he reached out to ROBLOX the company about his report, but received no reply.
Then again, even as ROBLOX enjoyed a speculator IPO earlier this year, few if any reporters have explored the company's monetization policies:
"For me personally," he tells me, "it was impossible for me to get my head around the scale of ROBLOX's success until after the $40 billion IPO. Due to its popularity among kids and the opaque nature of the platform, you don't realize just how popular this game is by letting them try to make games. But with regards to the press examining the IPO, I think people didn't bat an eye because what ROBLOX is doing is entirely legal.
"Kids love to pretend to be adults, that's the foundation of countless role-playing games on ROBLOX, and the company is more than happy to oblige." (And notably, one of the few kid creators successful on the platform refused to speak with Quintin on the record, for fear of repercussions by the company.)
Government regulators in the US and EU have been looking into tech companies with monopolistic practices and other potentially abusive issues.
So what would Quintin Smith tell them, if they asked him about ROBLOX?
While allowing that he's not on expert on the topic, Smith answers, "I'd probably point out that big tech companies are currently exploiting the digital sector faster than governments seem to be able to regulate it.
"It just feels like we're the guinea pig generation that will have to suffer all the worst excesses of tech companies before we learn that we can't let them do whatever they want."
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