Blizzard wants to end the 'auction house first, play game second' mentality that they caused. The solution will be "smart drop" items, and reducing loot levels overall.
They acknowledge there's a "sugar high" from buying items on the auction house, because of the instant gratification, but too many focus on it over just playing the game.
Lead content designer Kevin Martens said "it’s not the core fantasy, it’s not the most fun and by the endgame, for a variety of reasons, they tend to check the auction house first and play the game second.”
“That’s not what we intend, and we do want to address that, so the loot system and the enchanting and crafting systems are both intended to cut the legs out from the auction house; to make it unnecessary to go on it to some degree, where the most fun way to play the game becomes the best way to play the game.”
The announcement of an auction house for Diablo III was met with contention from the community, fearing a World of Warcraft economy emerging, particularly with real money purchases - detractors weren't far off the mark.
These new 'smart drop' items dropping from monsters, bosses and chests will be better tuned to your current character. Blizzard are also stemming the tide of rubbish items the serve only to clutter up inventories or just make a mess of the floor. Legendaries will be increased in their number with a greater array of effects.
A new artisan, the Mystic, will be introduced that transmutes items - transferring stats from one to another.
“So we say ‘Oh, you want efficiency? How about efficiency, like Loot Runs, how about you definitely get the best gear from there. Mathematically, that’s the best.’ Then they can stop doing that Alkaizer run in act three that everyone does,” continued Martens. They still exalt the benefits of the auction house as avoiding dodgy third-parties.
"You play the game to have the fun, get the loot,” added lead writer Brian Kindregan . “If you can’t find one particular thing, you craft it. If you can’t craft it, okay, then you go to the auction house.” Blizzard won't simply eject auctions.
"Trading’s not invalid,” said Martens, “it’s just that its been skewed so if you’re a character who’s spending money maybe you’re getting eighty percent of your gear from the Auction House, and 20 percent in game. It should be the reverse at best. It’s more fun to kill monsters. It’s the same thing I said about Loot Runs."
"If you want the best gear, let’s put it in a place in-game where you’re killing monsters.”
Diablo III: Reaper of Souls was announced at GamesCom 2013 and it releases on PC in 2014.