I've been playing the web game Carnage Blender for about a year and a half. It's got a small but very loyal player base, and in-game items sell for hard currency as well as they do in the big boys. But the real secret to CB's success seems to be the game community. CB is the only web game I've seen that incorporates live in-game chat. That leads to real ties between players, and a real sense of community. The strong community sense lets them get away with pretty strong community behavior guidelines (even chat is kept to PG standards). There's no artificial reputation metric, but all player behavior is transparent--not only is everything logged, but every player can see what every other player is doing, so reputation really matters.
After the recent tsunami disaster, the CB community pulled together in a big way. In-game cash and items were donated, and then sold for real currency to donate to disaster aid. In less than a week, over $24,000,000 in-game dollars were converted to almost $200 US, which will be sent to OxFam for disaster relief.
This is even more amazing considering that the game world in which the donations were taken is being wound down in favor of "Carnage Blender 2", which launched at the beginning of the year. CB1's exchange rate, usually steady at US$10 to CB$1M, dropped to about US$4 to the million the previous week, but people stepped right up to buy game cash at higher exchange rates because it was going to charity.
Danielle Bunten Berry once told me that online games have to have two things in order to be legitimate: the game itself has to be solid, honest, and fun, and the community around the game has to gel.
Carnage Blender has both. In spades.
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