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Fraud and its effects on the MMO industry
As the number of people embracing MMOs has increased exponentially over the years, so too has the frequency and scale of fraud related to these games and credit card transactions. Chargebacks resulting from fraudulent credit activity are a growing problem for MMO publishers. Gamasutra has run an enlightening Q&A with Gene Hoffman, Chairman and CEO of Vindicia, a billing and fraud management company with no small amount of expertise in the MMO arena. The interview discussed the ramifications of chargebacks for MMO publishers, such as Blizzard, which sheds some light on the fact that having the dominant industry marketshare comes with a few downsides as well. While not commenting about Blizzard specifically, Hoffman says, "We have noticed across all our gaming clients when it comes to fraud is that the 1% chargeback rate is really a marketing budget. Having your chargebacks too low often means you aren't being aggressive enough on the customer acquisition side." Have a look at Gamasutra's talk with Hoffman, a discussion which ranges from in-game theft to hybrid subscription/micro-transaction business models.
Woman pwns Rogers Wireless in court over fraudulent charges
Note to carriers: don't falsely bill customers -- who just happen to be lawyers -- for $14,000 in charges they never racked up. That's the lesson Canada's Rogers Wireless learned the hard way this week, getting slapped with a $2,000 fine (pennies by Rogers' standards, we know, but a nice little bonus in the customer's pocket) for turning off customer (and lawyer) Susan Drummond's son's phone after she refused to pay 14 grand in long distance calls she hadn't placed (we're pretty sure those are Canadian dollars, but it's still some serious dinero). But wait, the story doesn't end there: it turns out the original incident had taken place in 2005 after Ms. Drummond's phone was stolen out of her house while she was away. Ted Rogers -- as in, "Rogers Wireless" Ted Rogers -- personally got involved after he caught wind of the situation, turning the phone back on, wiping out the bill, and hooking up the Drummonds with a cool $5,000. Ms. Drummond decided to ignore the goodwill gesture, though, and take Rogers to court anyway for breach of contract, where she won. Paying attention here, AT&T?[Thanks, Brian]
