I am Sean F. Kane, Esq. and I would like to welcome you all to the Technology Intelligence Group. On this site it is my intent to discuss the legal and business issues that are quickly arising from the convergence of videogames, virtual worlds and the real world. The current market for the video game and virtual world interactive media industry is 8 billion dollars and is expected to grow to over 30 billion in the next few years. The largest one day opening in entertainment history was the sale of "Grant Theft Auto IV" ($310 million in its first day). The more this industry expands the more legal issues are being raised. The industry is advancing technology that is on the bleeding edge and the current legal system is poised to be left behind. At this point there is a dearth of legal voices dealing with video game and virtual world law, which is an area of law that it set to explode in the coming years.
The area of law dealing with video games has been referred to as part of entertainment, IP, technology or even interactive media. Regardless of what you refer to it as there are numerous challenges and a myriad of potential issues. From traditional IP and contract rights to character and music licensing this area deals with various areas of law. Moreover, video game issues are frequently in the news dealing with a panoply of issues. Various states have enacted legislation attempting to outlaw violence or obscenity in video games. Many of the various laws that have been passed have been overturned as unconstitutional, but the states keep attempting to pass different iterations. The storytelling elements of video games have led to its categorization as protected under the first amendment speech doctrine in the same manner as books and movies.
In addition to the market for console, P.C. based and online video games there is an expanding industry surrounding virtual worlds. In the 90s the current state of online MMOs began offering a real-time socially interactive (i.e. social networking) component which was not available on traditional offline console gamming. While these games were originally used mostly as an avenue for play and social interaction, many are starting to be more focused on commerce, research and work related activities. In the last few years MMOs have exploded in usership with some reports stating that 100 million people worldwide are logging on to play in one of the various digital worlds.
Every virtual game world comes with an End User License Agreement ("EULA") which the players must agree to if they wish to play the game. By accepting the terms of the EULA players may waive significant individual rights. The EULA acts like a system of laws for the virtual world creating a "closed world". This "closed world" is intended to differentiate the virtual world as a game not subject to the real world laws and other requirements. Under the general terms of these EULA there is no sense of private property since the virtual world is wholly owned by the designers and builders. Most EULAs insist that any intangible property or artifacts that exist in the game world are the property of the designers and not owned by the players. The players may accumulate them in the course of the game but merely use them by license of the game designer. Under this argument, if we cede legal control to virtual world property to the game designers and EULA we essentially negate the need to look to laws and governmental interference to protect players' rights. The protections the EULA claim to grant to the game designers is currently under attack.
On the other hand "open worlds" like the game Second Life have been designed where the barrier between the real world and the virtual world is much more porous. The creation of these "open worlds" is making the questions of rights and obligations much more difficult to resolve in favor of EULA control. In the "open world" of Second Life individual players retain ownership of many real world rights to their creations in the virtual world. They are considered the owners of certain of the IP involved and created by them and can do with it what they will, so to speak. If the "open world" trend continues and is adopted by more and more game designers then there will be a significant need to regulate and protect the IP ownership.
Since intangible intellectual property of all kinds has real world value and can be relatively easily converted, the question arises as to what legal standard should be applied to the virtual world. The growing commercialization of the virtual world will inevitably subject it to real world laws and regulations as players seek protections for their valuable IP. If virtual world currency and goods being traded have a real world value the courts and government will eventually step in to protect, regulate and tax these digital assets. Moreover, prior decisions (like the Supreme Courts Grokster opinion) and current Acts (like the Digital Millennium Copyright Act) may play a significant role in the outcome of these issues. All of these questions will eventually need to be determined as the virtual systems grow in size, number and membership.
In summary, given the expansive and interconnected nature of the industry I will investigate and oversee the various areas of law involved, including Intellectual property, interactive media, contract law, intangible property; communications, technology, licensing, obscenity, employment, defamation, piracy, constitutional rights, tort liability, and more.
Sean F. Kane
Interesting post. I look forward to checking in often for updates.
Posted by: Anxiety Cures | October 09, 2010 at 05:36 PM