Devastating price crash in the Diablo III hamburger-dagger market

The market for a virtual hamburger which can be used in as a dagger in a popular video-game plummeted over the last week

Keeping on the hamburger theme, here's a sentence which will make sense to about two of you: the economy of Diablo III has fallen through the floor after a glut of Horadric Hamburgers (a burger which is also a dagger) for sale on the game's real-money auction house pushed the average price from around £90 to just £7.50.

The Horadric Hamburger is a "legendary" item in Diablo III. It's hard to get, and can only be found in a secret level, "Whimsyshire". And yes, it's a Hamburger which is also a dagger. The game provides only the cryptic description:

The Horadrim wandered far and wide to gather the finest ingredients for their feast. Only the lone traveler sent to the Moo Moo farm failed to return. Diablo had laid a trap for the Horadrim, the Hell Bovine, who struck the traveler down before he could gather the final ingredient: cheese.

The problem with the Horadric Hamburger is that although it's classified as an extremely rare item by the game, it's actually a bit rubbish. The game models stabbing someone with a hamburger relatively faithfully. That is to say, it doesn't hurt very much. As a result, no player who is practiced enough to find the damn thing is actually going to use it. It's a bit like a solid gold tennis-racket.

So the natural reaction of all the players was to take this immensely rare, precious, thing which they didn't actually want and use a new feature of the game which debuted last Friday: the real money auction house. There, they could sell their valuable trinket for cash money, and use it to buy real hamburgers which they can eat, rather than stab NPCs with.

Unfortunately, it seems everyone else had the same idea. As PC Games Network reported, three hours after the auction house opened, the burgers were listed at an average price of £87.91, with 12 chancers going for the maximum price of £200. By Tuesday, it appeared that they had realised their folly. Although it's impossible to tell how many sold, the average price had plummeted to just £7.50.

Virtual economies are increasingly interesting to economists, because of the sheer wealth of data they can produce. Valve, the makers of the Half Life and Portal series, recently hired Yanis Varoufakis, who rose to fame analysing the eurocrisis, as their "economist-in-residence". The President of Valve, Gabe Newell, laid out his pitch to Varoufakis:

I have been following your blog for a while… Here at my company we were discussing an issue of linking economies in two virtual environments (creating a shared currency), and wrestling with some of the thornier problems of balance of payments, when it occurred to me "this is Germany and Greece", a thought that wouldn’t have occurred to me without having followed your blog. Rather than continuing to run an emulator of you in my head, I thought I’d check to see if we couldn’t get the real you interested in what we are doing.

The Diablo economy is far simpler than the one that Valve appears to be setting up, but there's still no shortage of teachable lessons. The key one from this story is the fallacy of the idea that goods have some "intrinsic" value. Produce - even a legendary hamburger-dagger - is worth what people are prepared to pay for it. No more, no less. In this case, the labeling of the item gave faulty signals, which convinced sellers that there would be more demand than their actually was. As time went on and none sold, they were forced to cut prices to a more realistic level.

The auction house has now settled down a bit. If it goes the same direction as the auction house in Blizzard's previous game, World of Warcraft, expect to see some very interesting case studies indeed.

A hamburger. Not a virtual hamburger. Certainly not a virtual hamburger-dagger. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

Photo: Getty
Show Hide image

A clinically-approved birth control app is changing the way we think about contraception

The particle physicist Elina Berglund has created an app that is 99 per cent effective. 

Women around the world using the contraceptive pill have long complained to their friends about its perceived side effects – weight gain, acne, mood swings to name a few. Some more recent studies have verified that anecdotal evidence – a Danish study from 2013 confirmed that there was a 40 per cent increased risk of depression for women who were on the pill, compared to those who weren’t.

Frustration around the inadequacy or ill-suitability of certain methods of contraception is rife. One woman, Elina Berglund, decided to do something about it.

Formerly a particle physicist at CERN (and a member of the team responsible for the discovery of the Higgs Boson particle), Berglund co-founded Natural Cycles, a contraceptive app, with her husband Raoul Scherwitzl. Approved as a contraceptive app earlier this year, it is downloadable on a smartphone and relies on a relationship between body temperature and fertility to tell women when they're fertile.

But contraception campaigners have viewed the concept with caution. Widespread use of the pill, condoms, and diaphragms comes after decades of campaigns against reliance on "natural methods" – not to mention the opposition of religious organisations like the Catholic church. 

At first glance, Natural Cycles might not seem all that different from the Vatican-approved "rhythm method", which is based on observing the exact stages of a woman's fertility cycle and avoiding sex during ovulation. This can be, according to the NHS, up to 99 per cent effective – but in reality it is closer to 75 per cent, because "people can make mistakes". 

Users of Natural Cycles take their temperature daily and input it into the app (which costs £6.99 a month). The app then compares the figure to its own dataset and uses an algorithm based on Berglund's days from CERN. It also asks for other data, such as the dates of user's periods and whether they are planning for a pregnancy or not, to create a personalised calendar.

If it’s safe to have unprotected sex, then the in-app calendar will show up as green. If not, the in-app calendar will show up as red. On those red days, users should find methods of contraception if they aren’t seeking pregnancy.  

Menstrual tracking apps are all the rage (there are around 1,000 of them on the current Apple app store). But recent studies have shown that those apps are often inaccurate and lack any scientific basis. 

Natural Cycles, by contrast, carried out three clinical trials, each time expanding the dataset to reduce errors. The most recent, written up in Contraception, involved 22,785 women across 37 different countries in settings that mimicked real life. The co-authors pointed out that in instances of perfect use, one out of 100 women become pregnant accidentally. However, in instances of typical use, seven out of 100 women had the same result.

When Natural Cycles first gained publicity, Berglund pointed out to the press that “now they (women) have a new, clinically verified and regulatory approved option to choose from”. Berglund and Scherwitzl are looking into getting Natural Cycles prescribed on the NHS, like the pill.

So is Natural Cycles the future of family planning? The first thing to make clear is that the app cannot actually function as physical contraception – on “red” days, the app advises users to use a condom if they’re having sex and don’t want to get pregnant. It cannot prevent the transmission of sexually transmitted diseases either. 

Nor is the app really marketed to those who may benefit from the most information about their sexual health – 16 to 25-year-olds, who are also the age group most likely to engage in risky sexual behaviour. 

A spokesperson for Marie Stopes, the reproductive health NGO, said: "Apps to track fertility are a high-tech version of what women have been doing for years with a diary and a thermometer.

"For anyone trying to get pregnant, they might well help. However, if you want to avoid pregnancy, it’s much better to choose a reliable, long-acting modern method of contraception like an IUD or implant. Traditional methods, including tracking fertility, carry a much higher risk of unintended pregnancy."

The app relies on an algorithm, meaning it is only as effective as the data that it receives from users. It is also not free, which may exclude its usage by certain sections of society. A blog written for NHS Choices emphasised that the data collected in all the trials was collected from women who were already signed up for the product, making it likely that they had an incentive to continue with this specific additional contraceptive, as opposed to looking elsewhere. Even so, a third of users who had signed up still dropped out, potentially because of the maintenance required to get results from it. 

All the same, Natural Cycles has 380,000 users and counting. It has received clinical approval to be marketed as a medical device, and it seems to be meeting a need – 70 per cent of Natural Cycle's users come from hormonal contraception, according to Berglund. In her account of Natural Cycles in the Evening Standard, Kate Wills highlighted that the Apple Watch had all sorts of health inputs, but no way to track periods.  All kinds of apps exist to make modern life easier – why has it taken so long for one that addresses a concern for so many women to make its way into the mainstream?

The history of contraception is littered with examples of women being ignored. Early birth control studies vastly underplayed the potentially debilitating side effects of hormone fluctuations on women’s mental health and physical appearance, often treating users as though they were hysterical. Add into the equation the stigma around accessing contraceptives safely and non-judgementally, and it’s easy to see why a relatively painless and private form of contraception might be appealing. 

Natural Cycles may well work for some women – those who are in stable relationships, hoping to get pregnant and fastidious enough to note their temperature every morning. But it doesn’t prevent diseases, requires a steady commitment and – here's the clincher – can't take measurements when you’re hungover as alcohol can affect your temperature. There's also a big difference between the "perfect" use of the app, and the likelihood of pregnancy when used in a "typical" fashion. So long as that's the case, old-fashioned contraception seems unlikely to be swept away by a digital revolution.