The Truth About IP Ownership
Once in a great while, I manage to write something timely… or at least jump on a trend before it’s completely beaten to death. The commentary I posted on Lum and Psychochild’s RMT debate sparked similar articles on other sites, only for us all to be trumped by the Korean National Assembly as they consider making unauthorized real-money transfers (RMT) for game content illegal.
Castronova loves the news. Koster, ever the defender of user-generated content, is less enthused. I say it’s a good first step that has been a long time coming, but the only way such legislation is going to work in the rest of the world is if we begin to understand how intellectual property differs from material goods–and that ain’t gonna be easy.
The reason intellectual property seems like such a foreign concept to many in the Western world is that we come from a culture of ownership. We buy a house, we buy a car, we buy a pair of pants, and these things become ours to do with as we please. But intellectual properties like music, movies, and games don’t work this way. The $15 you spend for a CD or a DVD buys you the packaging and a hunk of plastic, but it doesn’t buy you ownership of the music or movie itself. All you’re paying for is a license to use the contnet within the guidelines established by the owner of the data. You have no legal right to redistribute that content to anyone who has not purchased a license from the content’s owner.
Perhaps this is ultimately why Americans have a hard time accepting microtransactions in MMOs. “Why pay for little bits of content when I already paid for the game? Didn’t I buy the box? Don’t I pay a subscription?” Yes and yes, but you still don’t own the game itself or any of the content within it. Eastern players don’t have a problem adopting the microtransaction model, maybe because they aren’t engrained from birth with the same sense of Manifest Destiny that is so prevalent in American culture. Don’t tread on me, don’t mess with Texas, and all that.
Those who are in favor of RMT in MMOs typically offer arguments focused on the player’s right to do what they want with the content they pay for. Joe pays his subscription fee and puts in the hours necessary to earn gold and items for his character, so why doesn’t he have the right to sell the stuff he acquires, or even the character itself, if he wants to?
Because, under the commercial adventure MMO licenses of which I am aware, the subscription fee buys the player absolutely no ownership of the game itself. The subscriber is paying for the right to use the provider’s servers and content, and even to personalize it within acceptable boundaries. But no degree of personalization gives the subscriber any ownership of the data–even if the subscriber uses it to come up with something unique within that game space.
The content provider is the only one who can set the limits on how the property they own can be used. If they want to allow RMT within specific guidelines, that’s their call to make. This is why, even though the idea of Station Exchange is abhorrent to me on a personal level, I cant’ argue with SOE’s right to set up such a system if they choose to do so. I don’t like it and would never use it, but Station Exchange is an example of a company establishing its own right to govern the distribution of its in-game property while giving the content personalizers a cut.
The IGEs of the world are taking content owned by someone else and profiting from the sale of it without being licensed to do so. It’s no different than someone deciding that they will print and sell Minnesota Vikings sweatshirts without getting a license first. No matter how much time, money, or emotion you commit to the Minnesota Vikings, that doesn’t give you the right to earn a profit from anything connected to that organization without getting permission to do so.
IGE would love nothing better than to become the licensed RMT provider in the MMO space. In fact, they have made contact with MMO makers in an attempt to establish that kind of relationship. But in the meantime, they’re more than happy to brazenly hock their services like a guy selling bootleg t-shirts on a street corner.
There’s lots of talk about what kind of legislation is needed in the MMO space. In my opinion, we need the informed enforcement of smart laws that clearly establish the content provider’s ownership of everything related to their intellectual property. It’s a hard sell to the Western playerbase, because the natural inclination is to see that character and the items earned in the game as the subscriber’s property. It isn’t. Your beloved character, its house, its inventory, and everything related to it is the property of the MMO maker. You can argue that it isn’t fair, but that’s simply how it is, and you agree to that every time you enter the game.
Second Life, in so many ways, is an aberration that cannot continue to exist in its current form. As with Mark Cuban’s point about YouTube, Second Life will eventually have to face the music (literally) for allowing the unlicensed distribution of copyrighted content. Lum’s joke about Suzanne Vega music streams hits the nail on the head; unless Ms. Vega and whoever else owns the rights to her music license the content, streaming her music is a form of theft.
Until Western consumers understand the concept of intellectual property–or have it forced upon them by strict enforcement of laws–RMT and IGE will go right on existing. But be aware: Metallica came off looking like hardasses when they pointed out their ownership of the music they make, and whoever makes the first real efforts to control their IP in the MMO space probably will as well.
Make no mistake about it; somebody has to do it, and it’s going to require a much bigger move than simply banning accounts. This is serious stuff.
“Until Western consumers understand the concept of intellectual property–or have it forced upon them by strict enforcement of laws–RMT and IGE will go right on existing.”
Think it will be more successful than Prohibition and the War on Drugs? Will strict enforcement through tort litigation work better? I’m curious.
Ok very naive question maybe:
Why is it so hard to sue companies that base their business model on illegal RMT and get rid of them?
But the ads from plat sellers seem to get more and more every day, in game and on all kinds websites…
I know the internet is a big place and there are many different countries on earth. But in contrary to adverts from plat sellers I never saw an advert for selling illegal copied music anywhere
Ok very sorry if this is slightly getting offtopic hehe
[...] Recently, Steve Danuser wrote over at Moorgard.com about the topic of the proposed Korean legislation that the only way such legislation is going to work in the rest of the world is if we begin to understand how intellectual property differs from material goods–and that ain’t gonna be easy. [...]
The problem is we need smart legisation, and right now we don’t have it for those reasons you wrote.
And the problem? There’s no way MMOs or anything like that are going to get that legislation directly. When we have Senators trying to destroy the video game industry and regulate it out of existance, there’s no way we’re going to get a bill to protect the IP of it.
Either those Senators will have to change (or rather, be replaced, since we know politicians don’t change) or the IP control will have to established in the courts in other ways and then used by game companies. If the RIAA can use Joe Blow for downloading his Garth Brooks off the internet, then SOE or Blizzard or whomever sure as heck should be able to sue IGE and all those lame-co.’s for first illegally buying their IP and then illegally selling it.
Start small in Civil… and build up a precedent (which is currently lacking in the game world, because it’s not taken seriously. Millons of $ not taken seriously… thats the world we live in… /sigh — but thats another topic). Sue IGE and all the big companies out of existance over time. And ‘straight up’ warn people when they log in the first time (and say once a month) that buying/selling game stuff (except by Station Exlamege, er Exchange) is illegal.
And then start busting the players. “Oh, did you hear? Smashur got a month suspension for selling plat the other day! And you know what? They told him if he did it again he’d be banned for good! Isn’t that crazy?”
It’ll seem harsh at the beginning. But just like Metallica, it takes guts to get out there and say “STOP. This is our property, and you’re stealing.” People didn’t take it seriously, I mean Metallica is rich right? And SOE is rich, right?
Making music isn’t the same as developing and running an MMO. Artists have a creative moment and then sell a recording. MMOG Cos have a constant creative process and have to keep shelling out cash to support and run it. It’s not the same, and illegal IP trading ruins it for both the players and game’s owners. It’s lose-lose for us, win for the lamers unless IP ownship laws and such can come into their own here.
Then, take it criminal.
[...] Two more interesting posts on the everpresent RMT issue, and how it interacts with the microtransaction payment model, from Moorgard and Raph. Raph’s post in particular is very detailed and enlightening (as usual): some very good stuff to chew on there. [...]
The whole concept of IP and ownership reeks of capitalism and greed but this isn’t really the issue I want to debate.
I liked the post about Prohibition and the War on Drugs and I think it’s a good analogy. Too many times people have tried to counter human nature or social circumstances through law and force. Perhaps we need to counter the cause, not the effect?
Currently pretty much all MMOs reward time, not skill. They reward brute force man-hours instead of ability and many activities revolve around tedious, time-consuming acts. All of these processes are created by developers in order to slow progression and provide a “cheap” feeling of accomplishment. Of course someone will be happy getting a rare harvest if it takes them 2 hours…
The whole “buying plate” debate seems to stem from the unwillingness of game developers to change. Instead of looking at new ways to approach the market, design their games, and come up with more dynamic and less time consuming reward systems they merely want to hang on-to their existing methods and put a band-aid on the problem.
I’m not saying I agree with concept of buying-plat because it does create unfairness… but then so does rewarding time. There are solutions out there but I’m positive they will involve fixing the cause, not the effect.
A Very Wii Thanksgiving…
A whole lot of heartburn and 9 hours of driving later, I have returned home from visiting my girlfriend’s parents over the Thanksgiving holiday. Per usual, it was great to visit family and be away in a different neighborhood for a few days, but …
Does the MMO industry have an oversite consortium like the RIAA?
It seems to me like the industry has not put any effort forward as a whole by working together to pursue lawsuits/legislation towards RMT sellers and instead has adopted company specific (Station Exchange, mass WOW banning) means of battling it. I am not saying those are not good moves from a business standpoint, but it smells like a “if you can’t beat em, join’em” solution in some cases, not really sure how legislation is going to be developed for the industry as a whole by people in DC who have a lot worse things to figure out first, when the industry itself can’t even decide/foster a plan of action (at least that i know about, it could be out there I just haven’t seen it myself).
“The whole ‘buying plate[sic]‘ debate seems to stem from the unwillingness of game developers to change. Instead of looking at new ways to approach the market, design their games, and come up with more dynamic and less time consuming reward systems they merely want to hang on-to their existing methods and put a band-aid on the problem.”
I agree with this to a certain extent. The Western MMO model is built around the “OMG we must keep our subscribers forever!” concept. With microtransactions instead of the monthly fee, it doesn’t so much matter. If someone plays for a while, quits, then comes back and spends a bunch of money to catch up to their friends, the developer still wins. The microtransaction model, in fact, suits periodic content updates exceptionally well.
Ugh, it sounds like I’m a microtransaction apologist! :p
“The whole concept of IP and ownership reeks of capitalism and greed…”
But we accept IP ownership as a given most of the time. I mean, most of us would never consider trying to sell sweatshirts with the Penzoil logo, even if there was a huge demand for them. Yet because we invest our emotions into our MMO characters, we somehow think that gives us ownership over some portion of that world.
MMO makers aren’t being greedy; they’re just trying to exert the same control over their IP as companies do in any other type of business. We just don’t have the same emotional involvement with Penzoil that we do with our MMO of choice.
“But we accept IP ownership as a given most of the time. I mean, most of us would never consider trying to sell sweatshirts with the Penzoil logo, even if there was a huge demand for them. Yet because we invest our emotions into our MMO characters, we somehow think that gives us ownership over some portion of that world.”
Shouldn’t I own part of that world I created? Yes the developers created the world and the tools for me to create my character, but it is me that has customized my character and it is me that spent the time building my character. If it was not for me my character would not exist.
The USA was build on people taking the tools and items that others provide and that we legitimately pay for, to create things that we can use and sell if we see fit.
Just because the MMO developer gave us the tools to create should it mean they own the items we create? Should Craftsman have ownership of all vehicles built with its tools?
“We just don’t have the same emotional involvement with Penzoil that we do with our MMO of choice.”
This is because I don’t spent 3 hours a night putting oil into my vehicle. People have this emotional tie because of the time investment. When people put time/effort into anything emotional attachments form real or virtual.
“Shouldn’t I own part of that world I created?”
You didn’t create it. You personalized the MMO maker’s world within the rules made by the MMO maker.
As I said, this is at least how it is for current commerical adventure MMOs in the US. You can agree with that or not, but opinion doesn’t change what’s in the EULA.
“You didn’t create it. You personalized the MMO maker’s world within the rules made by the MMO maker.”
Really….so it must have been the developers channeling through me for all of those hours while I customized my piece of the world.
Like I said before, just because the developers provided me with a unique world and the tools to customize that world doesn’t mean they own my creations.
Craftsman doesn’t own the vehicle created with their tools. Just because the developers created to world we participate in and the rules we live by, should they own our creation?
I’m not a religious wacko, but to parallel the thought the developers our the worlds Gods and our creations (using the tools of replication the developers provide) are the Gods children. Does God extend ownership to his/her children? Or does God provide his/her children a way to live their lives how they see fit and make the proper choices?
“but opinion doesn’t change what’s in the EULA.” And this is why I don’t buy/sell things unless on the SE servers. But just because someone writes a EULA doesn’t make it legal. (Yes I understand that clicking the “I Agree” button you are agreeing to the EULA thus signing the agreement. I am just waiting for some to actually legally challenge the agreement.)
Let’s put it this way.. Hypothetically speaking, say you were legaly granted ownership of an IP, and said IP was given a monetary value. How do you figure depreciation as the game gets older, since some games will be updated more than others, or be more successful than others? What if the game ends up no longer making sense to keep running for business reasons (not financially maintainable)? Then we’d be talking about the virtual eradication of a potentially HUGE amount of IP! Do you expect the pubilsher to pay out monetary value to each content creator in this scenario? No, because this is simply not feasible. MMOGs as we know it would cease to exist simply to avoid this type of event from occurring. Thus, content created within the constraints of the game world *has* to be owned by the publisher of said world. They *must* retain ownership and control of the world and all entities within. The user “uses” the tools provided to them to play the game and create virtual content within the constraints allowed by the MMO maker. This type of virtual content, be it items, characters, or thingamjigs, simply cannot be considered a tangible real “property” outside of the game world in any sort of legal sense. While some think it might make sense to pursue otherwise, it can only end in loss for both MMO makers and gamers alike. Hopefully this makes *some* sense.
“Like I said before, just because the developers provided me with a unique world and the tools to customize that world doesn’t mean they own my creations.”
Until a legal ruling changes things, yeah, it does mean that.
The problem with illustrations and metaphors is that they can be manipulated to suit one’s own interpretation. I prefer not to say “a gaming IP is like…” because it isn’t. It’s close to the way music and movies work, but isn’t exactly like it specifically because of the player involvement you mentioned.
However, the issue of ownership still stands. The game maker owns the database and all the data related to the game. The fact that your actions move around those bits doesn’t mean you own the bits.
Will it change? We’ll see. But if players do end up with actual ownership, all kinds of problems could potentially result.
If it makes you feel any better, you can own all the emotional reaction you have related to what happens to those bits.
I agree with what you are saying Nick, yes they need to own the world that they design, or it would turn into anarchy.
I’m not looking at the character I created as IP, because it isn’t original IP. I see the characters I create more as an Art (which only has value to those that look at it or posses it), and I look at Gold and other items I find as time spent.
Shouldn’t I be able to trade the time I spent to someone else that either
doesn’t want to spend that time or doesn’t have that time to spend? And what I trade it for is up to me determining what my time is valued at (lately not worth much more than a box of doughnuts).
(On a sidebar I think it is quite hypocritical for SOE to say you can trade your characters, items, and coin through one side of their mouth and then go after other people that are doing it, but not the SOE way)
I think the entire concept of selling virtual items isn’t even a matter of IP. Reproducing pennzoil logos and selling them on the street is not the same as exchanging an in-game item in exchange for money.
The key point being the recipient of the goods must also be legally licensed to receive and use such goods. The “seller” isn’t ripping the company’s IP and trying to pass it off as their own, creating their own game with it, or even competing with the company (unless you run station exchange). The analogy of the music CD is an interesting example. If I buy a license to listen to music (IE pick up a CD at a store), I can hop on eBay and sell the disc. I am not claiming ownership of the music. Heck, if I have a copy of Windows XP and lend it to my brother to install on his computer (where he is a licensee of windows XP, but just misplaced his disc), that is OK too. As long as both parties are licensed to use the IP in question.
An EULA can police whether or not you use 3rd party software to play a game since that directly interacts with the environment. It gets really tricky when you start trying to police other types of actions. If my buddy buys me dinner because I powerlevel him all day long or give him that master spell he’s been looking for for months, that would be a similar quid pro quo, wouldn’t it? Where do you draw the line?
I’d also like to note that an EULA can say *anything*…but that doesn’t translate into legally enforceable. You see similar things in rental agreements for apartments, typically meant to intimidate renters from breaking their lease early (IE if you break early, you must pay everything left on it…which is a load of crap since they legally have to advertise and attempt to occupy the property and can NOT charge you for time in which they have a tenant occupying the unit (at least in California)). A EULA could read “you agree to sacrifice your first born on a stone altar after you reach level 20″ … and some people would still click “I agree,” but it doesn’t mean the California court system will be gathering wood and telling you to bring forth the child.
I do think it is important to reiterate that players have absolutely no ownership of items/currency in MMOs. If the company were to close shop, players would not be able to sue over loss of their characters, etc. However, I don’t think it is the same to say that brokering a trade (I believe the term “guaranteed outcome” between two licensed users) is quite the same as a broker claiming ownership of the company’s IP, and I’ll be very interested to see how the matter turns out in courts.
One could argue that trading an in game item for real money is NOT POSSIBLE within the domain of the EULA because the mechanics of the game do not allow for out-of-game items to be placed into a trading window. The other argument would be that virtual items have no monetary value since they do not exist outside of the game; they are not owned by any entity besides the company, and therefore cannot be considered as “IP” being “sold” when a licensed user attempts to broker a transfer to another licensed user. Where is the violation of intellectual property rights when the “property” doesn’t tangibly exist, has no monetary value, is not being removed from its intended domain, is not being represented as property that belongs to an entity other than the company (IE what good is platinum if it isn’t for the game you want to use it in), and is being transferred both to and from persons licensed to use it, both of which can not claim any legal ownership to it?
Hey.. James said exactly what I was going to
He Stolez My Eye Pee
I don’t or have any desire to buy or sell, or buy anything for sale or sell anything that can be bought. I do agree with the above post though. You are not duplicating or replicating anything.. you are merely transfering something to someone else who also must have purchased the right to use it, in order to be able to do so, and what is in fact being transacted for, is the investment of time, skill or whatever, it took to get said thingy.
I don’t like it, but other ideas of it always seem to be to be trying to warp the facts to make the gaming world a better place.
Thumbs up to trying to keep the gold sellers etc out of games, I just don’t agree with the IP premise of the “items and Characters” in question.