Virtual property for real money

The BBC reports a recent sale of a virtual island for $26,500.

The land exists within the game Project Entropia, an RPG which allows thousands of players to interact with each other.

Entropia allows gamers to buy and sell virtual items using real cash, while fans of other titles often use auction site eBay to sell their virtual wares.

Earlier this year economists calculated that these massively multi-player online role-playing games (MMORPGs) have a gross economic impact equivalent to the GDP of the African nation of Namibia.

The virtual island includes a gigantic abandoned castle and beautiful beaches which are described as ripe for developing beachfront property.

[The buyer] will make money from his investment as he is able to tax other gamers who come to his virtual land to hunt or mine for gold.

He has also begun to sell plots to people who wish to build virtual homes.

The Entopia economy lets gamers exchange real currency into PED (Project Entropia Dollars) and back again into real money.

Ten PEDs are the equivalent to one US dollar and typical items sold include iron ingots ($5) and shogun armour ($1.70)

Now the question is why this is any less real than buying an ad on a website–or on television for that matter. As the economists say, something is worth what you can sell it for.

If there are enough people who find playing this game valuable enough, then it has real value—as much value as any other entertainment product—or perhaps anything else that isn't a basic necessity.

Why is buying an island in cyberspace any stranger than buying a Coke?

(via Sharon)