At a Gamasutra-attended Diablo III event held at Blizzard's Irvine, California HQ, game design EVP Rob Pardo discussed the game's Battle.net integration -- including a player-driven, real money transaction-powered economy -- and discussed its release date.

While Pardo shared no concrete details on Diablo III's launch, including pricing tiers or release date, he did say, "We're working hard to get to this year, but it's going to be tough. So it either makes this year, or it falls into next year."

What he did discuss in depth is the developer's blueprint regarding integration of its Battle.net service with the game, and also plans to implement an online auction system similar to that in place for World of Warcraft.

Toward the end of a two hour presentation -- most of which was spent detailing franchise lore and demonstrating character classes -- Pardo dove into details regarding the next evolution of Blizzard's online service.

Diablo III will continue some of the Battle.net features incorporated into StarCraft II, including Real ID integration, which offers a persistent friends list and cross-game chat for players to communicate across other Blizzard titles.

He also revealed that as with StarCraft II, a persistent internet connection will be required to play -- in both single player and multiplayer modes. All character data will be stored server-side with Blizzard. When asked about the publisher's stance on online-only play, Pardo responded, "We understand, and we know that there's a group out there -- there are times when I don't have internet either, like when I'm traveling on a flight -- but we believe the positives outweigh the negatives."

Then for the big news. Pardo began by discussing the importance of trading items in Diablo, how it had been done online in Diablo II: via manual exchanges, forum posts, or IRC, and "shady third party sites full of gray market stuff." He said, "We can make it better."

With the Diablo III Auction House, players will have a fully-integrated marketplace that allows them to buy and sell items, gold, and components with real-world currency (tentatively divided into U.S. dollars and euros, among others) in their respective territories. According to him, it's based on the World of Warcraft Auction House, but with refinements. Diablo III's iteration allows for auto-bidding and instant buyouts, smart searches based on class, a shared stash, and secure item transfers.

Pardo was swift to mention that it's not an official "Blizzard Store," but a clearinghouse for players to have an open market to facilitate the trading of in-game items with each other. Players will be anonymous during trades, and there will be restrictions on the buying and selling of goods with real-world currency for those who choose to play in Hardcore mode.

He then outlined initial details of transactions. There will be a fee for both item listings and sales. Should players accept in-game currency, their payment will go toward their Battle.net e-balance, which covers auction items, WoW subscriptions, and pets. Should players decide to cash out their items, a currently-unannounced third-party payment provider will handle the transaction and take a percentage of the sale. There won't be any limits on item trading, but there will be a 24-hour cooling period before players can resell a purchased item.

Pardo intimated that if Blizzard didn't take the steps to bring e-commerce in-house, someone else would step in and profit from it. "Players want this... We could take a harder stance, but with Diablo, we think [the Auction House] will end up being a good thing," he said. The fact that in-game bartering and selling had "become a metagame of its own," in his words, was another motivator for launching the new feature.

When asked if he had any concerns about Diablo III's auctions turning into widespread item speculation, he hinted that the regional breakup of currency would play a factor. "In WoW auctions, you're looking at a few thousand people cornering the market, whereas Diablo's regionalization makes it tougher to speculate. But we'll monitor it closely." He also compared his idea of user-driven item pricing to the iPhone App Store, in which inflated app prices self-corrected as buyers dictated what they would pay for applications.

When asked about the regional breakdown of the shop, Pardo said, "The primary reason why we're doing the Auction House per [real world] currency is for usability, and in some cases, with legality -- it's the easiest way to do it... There are going to be so many items in each auction house in every currency that there shouldn't even be need to shopping around in different currency houses."

He also fielded an inquiry as to how much the implementation of the Diablo III Auction House influenced the design of the game.

"Did we design the game with auctions in mind? That's an emphatic no. It's all just going in the direction of what we want to do with Diablo. What we set out to do is make awesome items. If you were making Diablo III without the auction house, that's exactly the same goal, it's what you'd want to do as a designer, right? That's what we want to do. This just incentivizes what we already set out to do," Pardo said.

One of Pardo's final responses involved the question of how Blizzard would gauge the game's success, be it in higher numbers of auctions or in hours logged playing the game.

"I would find it to be successful if they're having fun doing [either]," he said. "That's always the trick when it comes to the Auction House -- or I could talk about any of the major game systems in WoW.

"What we want is that people can spend their time having the most fun doing whatever it is that they want in the game. What would be bad is if people wanted to play the game with their friends, but instead felt compelled to spend all of their time competing in the Auction House, and that's something that we want to avoid."