Shock Treatment

In my experience nullsec changes some CareBears. They become a different breed than their high-sec cousins. Tougher. More efficient. More wily. More ruthless. Far richer. The best of them will become the great merchant princes of New Eden. - Fiddler's Edge, August 12, 2010

Let's talk a bit about economic shocks.

Most of the time changes in the economic climate are rather gradual, leaving business plenty of time to detect and adapt to changes in the marketplace. Every now and again, however, an economic shock occurs in which something fundamental in the marketplace changes very quickly. The recent bursting of the housing bubble would be an example of this, as would the oil shocks of the 1970s and India's trade liberalization in the early 1990s and the Asian baht crisis in 1997.

When market shocks attack, sudden stresses are put on businesses. Companies that have the wherewithal to adapt, or are well position to exploit the changes, survive or even thrive in the new economic reality. Weaker, or non-competitive companies normally fold or are bought out - their production capacity and market share absorbed by their healthier competitors.

As I've written elsewhere Dominion sovereignty mechanics added a cost component to holding nullsec systems. This made PvP skills alone an insufficient means of holding space. To be competitive under Dominion rules, alliances must manage their space efficiently. Dominion also altered sov warfare mechanics, requiring that alliance actively defend their space against attacks. This effectively reduced the volume of space most single alliances can effectively defend.

In effect, the Dominion changes amounted to a market shock. And fallout from that shock is still driving events in nullsec.   

While it's not happening quickly enough for the game designers at CCP (more on that next time), the Dominion rules are shrinking the size of alliances. The era of the monster nullsec alliance is coming to a close. The cult of personality alliances in particular seem headed for the exits. Atlas Alliance is no more. Against All Authorities' vast nullsec empire collapsed entirely and, though their recovery and return wins them the "comeback kid" award for 2010, they are a smaller and more efficient alliance than they were of old. CVA lost all of Providence and, apparently, the will to take it back. Pandemic Legion has given up holding nullsec sov. IT Alliance, hounded by their enemies, teeters on the edge of the abyss.

'Now wait a minute, Mord,' I hear you saying. 'What about the Northern Coalition? What about the Deklein Coalition? Those are massive alliances. Why aren't they falling too?'

In fact, they're not massive alliances. Setting the Deklein Coalition aside for the moment, the Northern Coalition is a collection of small to mid-sized alliances who originally banded together for the common defense. Looking at the sovereignty maps, the alliances are more or less "right sized" in terms of the amount of space they control given the Dominion paradigm. Originally, many of these alliances were "Carebear" alliances who moved to nullsec and banded together for common defense. That strand of Carebear in their organizational DNA left them well positioned to thrive in the post-Dominion world.

In the highly competitive world of elite PvP, one tends to make enemies. However, as I've pointed out elsewhere, organizational integrity in Eve is dependent upon successful personal relationships. While the Carebears of the Northern Coaliton have learned the joys of PvP, they have a cultural bias toward cooperation which provides them with secure space and is much better for their business and industrial activities. When the Dominion changes were introduced at the end of 2009, the Northern Coalition was, by and large, well placed to adapt to those changes.

As IT Alliance is rocked by internal and external turmoil, there's a good bit of chatter in the forums about what nullsec might look like if IT falls. Much of it involves hand-wringing over the prospect of a "Carebear" nullsec, where everyone is blue to everyone else and we all just hold hands and get along.

Don't worry, it won't happen. For that to occur, the Northern Coalition would have to take on a much more aggressive posture - in effect become like the PvP-intensive alliances that are, to some extent, collapsing of their own weight. In fact, one of the reasons I make a distinction between the Northern Coalition and a Deklein Coaliton that includes both Goonswarm and Test Alliance is that Deklein's policies are much more expansionist. As we've seen, Dominion isn't kind to hyper-aggressive organizations in the long run.

As I anticipated a while back, the Dominion changes ushered in the fall of the monolithic PvP alliance and the rise of smaller alliances that know how to cooperate for the common good. This may mean less PvP in nullsec at a high level, but that isn't necessarily a bad thing. It is a natural extension of the Eve sandbox, people building institutions where none exist in order to further their interests.

CCP builds the universe. We, the players, shape it.