I know what he MEANS I was asking, why WOULDN'T you just set the experience rate to 70% rather than gaining experience 70% of the time. Which is pretty close to the same thing.
There is no logical reason why on any server you would want a player to only gain experience 70% of the time, rather than just gaining 70% of the total experience.
While I agree that the idea itself isn't that good, there are two massively different things occurring.
Imagine for a second on his server, there are not that many monsters that give a lot of exp, and the few monsters that give you a lot of exp, are deep down in a cave.
That means once you have taken the time to get to that monster that gives you a lot of exp, say a demon, you have a chance to kill it and GAIN NOTHING, rather than get a lower amount of exp.
And if it had a long respawn time, that would force the player to wait around, and still have a chance of getting no exp when he kills it.
This system would make camping one monster a bad idea(or a spawn, like say, edron heroes, or the black knight on real tibia), and promote hunting areas that have a lot of monsters in the area, because it would be more likely to gain any exp at all.
I would imagine that his server would also have staged exp rates, so what you suggested would already be doable, this would just be an addition to exp stages, and how it limits exp gaining.
Also, say on his server, fighting monsters is really deadly, with a high chance of dying, if a player actually killed something, and got no exp at all, that would hit harder than just having a decreased gain.
Overall the point would be to cause people to spread out more, and not camp smaller spawns, or single boss spawns.