The Auction House in Diablo III Stirs Controversy in Korea. Causes Media Storm About Alleged Denied Rating

Giuseppe Nelva October 1, 2011 4:00 AM EST

The flames of controversy are burning bright in South Korea over the Auction House that Blizzard plans on including in Diablo III (about which Chad wrote an exhaustive beta impressions article), and that will allow players to purchase and sell in-game equipment and items for real cold hard cash.

Earlier this week the representative of the Grand National Party Shim Jae-chul (that goes by the rather funny nickname Clean Shim), submitted to the Korean National Assebly a report from the local Game Rating Board, about MMORPGs and the effects of real money trade.

The report said that when a game delivers virtual items based on a random probability, like the loot dropped by monsters in a MMORPG or similar online game, and those items can be exchanged for money, the game is considered a form of gambling, and should be denied rating in accordance to article 1 of the Gaming Industry Promotion Law, effective in South Korea since last July.

The local media interpreted the report as an attack aimed against Blizzard’s upcoming feast of hack and slash mayhem, and alleged that the game would not be rated by the Game Rating Board. In South Korea an unrated game cannot be released, so a denied rating from the GRB would effectively result in a ban of the game.

As you may have guessed by the fact that gaming-related problems are discussed at the National Assembly, South Korea is a nation of gamers. On top of that, since Starcraft is considered on the same level as a national sport, Korean gamers tend to be rather fond of Blizzard. Diablo III is a massively anticipated game between the local gaming community, so, quite obviously, the reports about a possible ban caused a veritable media-induced storm of the century of the likes of what would happen if they banned soccer in Italy or baseball in the US.

This prompted the GRB to issue a statement, clarifying that the report delivered to the National Assembly did not single out any game, as it included only generic descriptions of the mechanics involved in real money trading, MMORPGs and possible gambling issues. They also specified that Diablo III had not yet been submitted for rating by Blizzard and that the Rating Board cannot take any decision on a game that they haven’t even seen. Finally, they clarified that a game cannot be denied rating unless the gambling issues are obvious.

While the storm seems to be temporarily averted, the question remains open. The ownership of in-game items itself is a legal gray area, and the whole matter can definitely cause problems when Diablo III will finally be submitted to the GRB. The Chinese MMORPG Zhu Hou Online was denied rating for the Korean market for the same reasons last year, and may prove a dangerous precedent.

This without even mentioning the fact that Diablo III can definitely be seen as dangerous competition for the Korean Gaming industry, that generates enormous revenues and, as a consequence, pays a sizable slice of the nation’s income as taxes. Political interference in the rating of the game isn’t that unlikely, and the media storm that happened this week may be a sign of things to come.

Of course Blizzard might just remove the real money-driven tier of the Auction House from the game’s Korean release (and I personally doubt that the game would be any worse if that were to happen), solving the problem at the root and forcing Korean gamers to do simply play the game to get their phat loot. I’m quite sure they wouldn’t mind too much.