Special Report: Money for make believe

Raphael Rose/World of Warcraft player
"I'm selling a level 60 priest and a level 60 mage."

These characters -- which only exist in the videogame world of Warcraft -- sold on eBay for $400.

Raphael Rose/World of Warcraft player
"I think it's a good amount of money to be making for a game I had fun with."

Raphael's not the only one cashing in.

Chris Kramer, Sony
"It went from a couple of guys selling their characters here and there -- to what's estimated to be a 200 million in sales market.

It's a new underground economy--and it's booming. On eBay, through websites, or in the games themselves. People are buying and selling virtual items for real money.

Chris Kramer, Sony
"A piece of armor, magic weapons, some money. They're exchanging real world dollars for items that only exist in our 3D world."

And it's not just swords and swordsmen that are bringing in the bucks.

"Second Life" is a newly created online world where players can lead an entire virtual existence. Buying virtual property houses, even clothing. All for real world money.

And business is good -- with more than 200-thousand dollars worth of stuff bought and sold each day.

Ralph of Haverhill creates picture frames designed to decorate virtual homes and sells them on Second Life.

Ralph Brown/Second Life player
"People are willing to buy stuff that I build -- it's a real kick."

So why are these items -- that essentially don't even exist -- worth actual real life money?

Gary McGraw/author of Cheating Online Games
"It takes time to develop these items. That's why they have value. Some human invested their time."

Problem is, these underground transactions are often illegal and unregulated--and so it's buyer beware.

Chris Kramer/Sony
"People were getting ripped off right and left."

In response, Sony recently introduced "Station Exchange" -- a website where players can buy and sell items for the Everquest 2 game--with Sony regulating all sales. They believe other gaming companies will soon follow suit.

Chris Kramer/Sony
"It's cut down dramatically on fraud."

As for Raphael, he plans to take the money from his virtual sale...and make a real life purchase of a couch for his dorm room.

(Copyright (c) 2006 Sunbeam Television Corp. All Rights Reserved. This material may not be published, broadcast, rewritten or redistributed.)