Today the NYT has an item headlined “Virtual Goods May Be A Blip,” noting the sales of Facebook gifts and the like, and suggesting that despite the surprising sales numbers, there are problems that may undermine growth in this category. “How fast do prices drop when such items are mass produced?” the item asks. “Companies will have to churn out different goods in limited editions just to keep users amused.”
And: “How long can a product with no real-world value stay useful? … There’s the chance that users will realize they’re paying something for nothing.”
All very rational — and like many rational analyses of consuemer behavior, almost certainlly inadequate. I’m not sure what to say about the “price drop” issue, since virtual goods are already incredibly cheap (and frequently “mass produced”), partly because production costs, as it were, are low.
On both the specific issue of variety and limited editions (already happpening) and the more general question of whether such goods have “real-world value” or represent “something for nothing,” see this April 29, 2009 Consumed.