22 Sep 2004

Eve Guardian

 

Pirates spend quite a bit of time telling us they don’t make any isk at pirating.  Many conversations on the GalNet focus on the fact people are simply not willing to pay tolls or ransoms.

 

A toll and a ransom are different things.  A toll will be paid to go through a gate, a ransom can be asked for in a belt, they require different approaches. 

 

Lets deal with tolls.

 

What follows is theoretical and as such is a framework.  There are always going to be pilots that will still be shouting “I’d rather die than give you a single isk, toll gathering scum” as the last rivet of the Apoc pops and he trades it in for a pod. These people are at the extreme of a spectrum that has many shades.

 

It assumes people also have sufficient knowledge to make informed decisions.  That is a considerable assumption, many people do not know how much their ship being destroyed will cost them, so knowing if the toll is fair or not is difficult for them to judge.

 

So with these reservations in mind, lets continue.

 

The pirates argue that ships currently turning up at gate camps are too well insured to be interested in paying tolls or ships ransoms and would rather have the ship blasted from under them than pay.  A service the pirates are happy to do free of charge.

 

But when a lot of pirates talk about “tolls” they really are talking about highway robbery and that is a very different market model and not something we are going to discuss here.

 

Although traditionally pirates have extracted “tolls”, I am going to call the activity a toll booth rather than a gate camp, and the people involved in it will be toll managers.  This is because I do not believe asking for a toll is necessarily exclusively a pirate activity.

 

Pirate corps have the advantage in terms of charging tolls as they are extracting isk from the passerby on the basis they are not going to do something.  If you pay they will not destroy you.

 

So is the extraction of tolls going to be profitable?

 

In all following examples Ship A, is going to be the pilot entering the toll booth and being asked for payment.

 

We assume the toll managers have set up a good toll booth, warp disruptor fields are in place, webifiers are working and they have the firepower to back up their requests.  This will stop an organized Ship A; basically everyone is going to be caught in this.  If your toll booth is not set up to do this, find another business. 

 

Many pilots given even the slimmest chance of escape will try to do so, this will result in them being blown up, which is bad business for a toll manager.  It is vital therefore that the toll booth is basically foolproof and known to be.

 

We can also assume the toll managers have done their homework and set the toll booth up at a suitable location for the activity.

 

Ship A comes in, it’s a Vigil, insured to the hilt 172,500 isk payout on destruction, it cost 51,750 isk to do so.  So the toll managers can ask for 51,749 isk and expect a pilot to pay up.

 

This toll will be paid every time.  If the toll managers ask for more there is a possibility the toll fee will not be paid.  Ask for 100 million isk and few Vigil pilots will pay up.

 

This basic principle works with all ships, so the Apoc can be “tolled” at 33,749,999 isk, which is one isk less than the cost of platinum insurance.

 

We can consider this “base toll” it is the highest toll you can guarantee to get from someone maximizing profits.

 

You can complicate this if you wish by adding the cost of new clone into the mix, consider this “base toll plus” a Vigil pilot may well be on a basic clone, you can assume an Apoc pilot is in need of a higher grade clone.  Again the gate camp is very capable of podding the pilot.  Once Pilot A is in his pod, the toll manager can ask for a “clone toll”.

 

Of course a toll manager can expect to extract higher tolls than these, but he cannot guarantee it.  The Vigil currently has an average market price of 184,000 isk.  There is an uninsured element of 184000 – 172500 = 11,500 isk, which can be added to the base toll making it roughly 62,000 isk.  This is something to keep in mind, but I will not continue with as an idea to keep things simple.

 

Ship owners that bump into the toll booth with less than platinum insurance should be willing to pay more but the toll manager is not going to know that, it would be the same with a pilot with implants.  That is the same when setting any price, there are always others willing to pay more, but are not going to tell you (if they have any sense).

 

All this assumes the pilot of Ship A is not going to alter his activities and just keep going back and forth through the toll.  Clearly he is not, the Apoc will go through once and the pilot will be going back and forth through the gate in a much smaller ship and therefore lower toll.

 

Many will choose not to go through the gate in the really high tolled ships at all and will go through in a small ship with a collection of BPC's if they have factory facilities the other side of the toll gate, and if they do not, someone will and they will be making the high tolled ships as fast as they can to keep up with demand.

So it is clear the toll gate manager cannot ask for the “maximum” level of toll for extended periods of time as pilots will alter their travel plans over time.

 

The ship can be tolled on the basis of what class it is, or if you wish to get fancy you can differentiate between ships within a class.  This follows the normal pattern of toll structures.  It has the advantage of being quick and simple and often in these things that is a very good idea.

 

But there is an option to expand this, “toll plus”.

 

In “toll plus” it is not really the ship being tolled at all, it is the “base toll”  + the contents which is being tolled.  The “base toll” has been defined as 1 isk below the cost of platinum insurance for the ship.

 

And it is only the contents that can be identified that can be successfully tolled.  You might think the hauler has some Megacyte in its hold but unless you know it is there it cannot be successfully tolled.

 

For example, Ship A arrives at the gate toll.  Toll manager assumes it has 1 million units of mega in the hold.  So naturally asks for a high toll.  Ship A is empty, the pilot laughs and the ship is destroyed.  This is going to happen a lot if the toll manager makes this cargo assumption each time.  This results in the number of ships destroyed will be seen by elements that do not like that sort of behavior and suddenly the toll manager is looking at a fleet of ships not interested in listening to what he has to say and the toll booth is dismantled around him.

 

That is not good business.

 

So a good toll manager will have each ship scanned as it arrives and set the toll accordingly.  Again he cannot ask maximum value for the items within the hold because at that point the pilot will not care if he lives or dies.  And if he dies the pirate is only going to see a percentage of the items in the hold anyway because much will be destroyed along with the ship.

 

What figure is reached will depend on a lot of factors, the pilot of Ship A wishes to pay nothing, the toll manager wishes to extract 100% of known value.  Negotiation could solve this issue but with each passing second tension tends to rise and mistakes and misunderstanding can occur, none of which will be good for either Ship A or the toll manager.

 

There is no magic formula for this, but the one thing you can be sure of, if people are not paying your tolls it is because you are asking too much.  If everyone is paying your tolls, it is probably because you are not asking enough, but there is a great deal to be said in lower tolls being paid happily than higher tolls being disputed.

 

Nobody likes paying tolls and if it is made annoying enough, you can be sure someone will dismantle your operation.

 

Tolls will fail because the price is too high, the toll booth is not secure enough, they are too fast to blow the ship up.  If they have actually got all these things right it can still fail because the pilot being tolled is ideologically opposed to the whole tolling process or is not fully aware of the facts.

 

Operating a successful toll booth, like any other successful operation, is more about judgment than luck, regardless of what people might imagine.  If it was as simple as sitting at a gate demanding isk, every idiot would do it.