One Lawsuit to Rule Them All

And so, it begins.

"This letter is to notify you that you are violating the World of Warcraft End User License Agreement (EULA) and Terms of Use (TOU), infringing Blizzard’s copyrights and trademarks, and contributing to the copyright infringement of others."

Patrick at Gamersloot sent us the above extract from the C&D letter they just received from the senior counsel at Vivendi Universal (ie Blizzard's parent company). It goes on:

"Specifically, Blizzard is the owner of the trademarks and copyrights for the computer game World of Warcraft and all related content, including but not limited to all game characters, objects, and artifacts. Section 3 of the EULA specifically provides that “all title, ownership rights and intellectual property rights in and to the Game and all copies thereof (including, but not limited to, any titles, computer code, themes, objects, characters, character names, stories, dialog, catch phrases, locations, concepts, artwork, character inventories, structural or landscape designs, animations, sounds, musical compositions, audio-visual effects, storylines, character likenesses, methods of operation, moral rights, any related documentation, and "applets" incorporated into the Game) are owned or expressly licensed by Licensor.” Similar language is contained in Section 10 of the TOU."

It goes on to say that Gamersloot must stop infringing immediately as well as tell them how much money they made from it. Or else. (Actually, Gamersloot don't sell virtual assets, but presumably others who do have also received the C&D).

The way that the property interests are framed is actually quite interesting. The range of property claimed ranges across copyright and trademarks, and is typically overbroad: Since when do character names attract copyright? Since Blizzard doesn't create those names, how could they be its in the first place? And "character likenesses"? Please. And so on.

On quick reflection (this isn't my considered opinion since all the analysis was done while my son was climbing on my head and insisting on being tickled) I actually think that Blizzard's position is remarkably weak on the copyright and trademark claims. No copying of the works/marks is ever done, and since Blizzard retains control of the assets (they are in its database after all) they have a weak claim on the primary infringement side. And on the secondary infringement side I think it's screwed.

Of course, there's always the trusty ToU: the virtual world contractual equivalent of the 19th Century fairy tales where you agree to give away your first-born child in return for ten minutes of good gameplay. This one will be tougher for IGE and other secondary-market actors to beat, but there's always the doctrine of privity that means that unless IGE signed the contract they can't be bound.

God I love the law...

Comments

[Andres Ferraro]

"unless IGE signed the contract they can't be bound."

Independent contractors.

[Chris Jenkinson]

How are Gamersloot obliged to conform to Blizzard's Terms of Use and End-User License Agreement when they may not even have agreed to them in the first place? That is patent nonsense.

I already refuse to purchase any future Blizzard games due to their handling of bnetd, this isn't making them look any better. Just because you make good games, doesn't mean you can act like an ass.

Chris

[Mike Sellers]

IANAL (just about every post here ought to begin that way, I suspect), but it seems like Blizzard is going to have a tough time demonstrating any actual infringements on its copyrights and trademarks (even if they are as broadly protectable as Blizzard is asserting, which is itself ludicrous -- any characters named "Frodo" in WoW?). Their property never left their system; no dilution of their trademarks or non-fair-use instances of their copyrights are in play here.

This seems to come down to an over-abundant sense of umbrage that someone else would have the gall to make money within a system defined by Blizzard. Someone -- some exec or lawyer -- at Vivedi is thinking with his (almost certainly his) wallet, and not his brain.

[Petrus]

I'd bet money that this wasn't *Blizzard's* doing, but Vivendi's specifically...ditto for Steam, the delivery mechanism for Half Life 2.

People need to remember that game coders and game publishers are two different groups of people. Coders are generally a lot more intelligent, broad minded, and less single-mindedly greedy in my perception. Game *publishers* on the other hand are companies like Vivendi and EA. From what I've seen, they only really do two things:-

a) Provide capital and manufacturing facilities (i.e., large scale CD burning, or paying for an MMORPG's bandwidth and hardware bills) and

b) Make life extremely miserable for as many people as possible.

It is of course only a) which justifies their existence...Unfortunately they are able to use a) as leverage to perform b). The main reason why b) happens is because for some reason that I haven't been able to work out yet, these companies insist on engaging in scorched-earth economics, i.e. they will profit from a given game/process but then whether inadvertently or otherwise will either destroy said process or alienate their userbase, on the grounds that they are of sufficient size/monetary worth that they can get away with doing so without it hurting them financially.

Unfortunately what these companies seem to lack is long term vision. As I pointed out in my post about Ultima Online, the signs of a given entity's demise are often initially very subtle, and to all outward appearances it can continue to be very healthy for a long time...then when it suddenly collapses, people stand around scratching their heads and wondering what happened.

EA and Vivendi (EA in particular) need to begin implementing more sustainable policies if they want to survive long term. By that I mean that they need to stop ruthlessly exploiting their employee base on the one hand, and viewing the consumer as the enemy or as someone to be very precisely controlled on the other. Above all however, they need to stop seeing themselves as invincible, because it is that mentality which fuels the above behaviour. They are not invincible, and if they do not stop behaving in this manner, it will eventually bring about their downfall. Because they are worth hundreds of millions (often billions) of dollars, it is true that it will take a while. But those hundreds of millions (or billions) of dollars are hundreds of millions of *consumer* dollars. Eventually consumers will grow tired of their attitude and buy games from someone else, the market being what it is. Employees (as noted by the EA_spouse) also eventually grow tired of sweatshop environments and tend to seek opportunities elsewhere.

It doesn't need to be this way. EA and Vivendi's behaviour suggest that the one thing they are primarily devoid of currently at the managerial level is creativity...Coming up with new revenue models, and ways to support existing customer behaviour and preferences and make a profit *from* these dynamics, rather than attempting to subvert them. If these two companies can become creative, (rather than simply acquiring other companies consisting of genuinely creative individuals and parasitically bleeding them dry) and learn to do this, they can turn it around. But they need, more than anything else, to recognise that it is necessary for them to do so.

[James Grimmelmann]

Eeenteresting. Veddy eeenteresting. The first thing that jumps out at me is that the first paragraph claims that Gamersloot is "violating" the EULA as a freestanding cause of action, but that the second paragraph in fact seems to back off from that claim. I could see Blizzard trying to raise an intentional interference with contractual relations tort suit, or, (if Gamersloot is directly playing the game as part of its services) straight breach of contract.

But the second paragraph doesn't seem to go there; instead, it seems to be an an effort to say that "of course our IP rights are good, just look at the EULA." That's neither here nor there. If it's a copyright/trademark infringement claim, then the EULA should figure only as a defense, since that's the only license by which the use might be authorized. The EULA isn't a separate offensive tactic.

I can see some Vivendi lawyer thinking "well, the EULA says all these things are our IP rights, so we'd better list it, too." But that's muddled thinking: the point of those terms legally is first to put players on notice that Blizzard makes these claims, and second to estop players from trying to dispute them. But that kind of notice+estoppel won't reach anyone who doesn't actually play the game and agree to the EULA. It also won't turn something that isn't infringement into something that is.

Nota bene: this kind of a lawsuit raises different issues than the Marvel/City of Heroes one does. In particular, it raises quite sharply the question of whether making a game server display content constitutes copyright infringement just because you have breached a term in the EULA by which you accessed the server. This is an extremely delicate legal question: resolve it too strongly in one direction ('no') and you've just gutted the GPL, resolve it too strongly in the other direction ('yes') and the degree of control it gives games over players' out-of-game actions is breathtakingly scary.

The possible copyright/trademark actions that relate to infringements made outside of the game itself strike me as fairly weak. The trademarks are a good case for nominative fair use; the copyrights on many of those things are, as you say, quite thin. Interesting that there's not a dilution claim annexed; it's not noticable more of a stretch than some of the other things they allege. Perhaps it'll be added if this one reaches the level of a complaint.

Fred, as we know, is trying to get CoH players in as intervenors in the Marvel suit; by a similar logic, the contributory copyright infringement claim in this C&D suggests that some WoW players -- the putative primary infringers -- would make for some nice intervenors.

[Will Leverett]

I certainly don't know the relationship between Blizzard/Vivendi and Gamer's Loot, but letters like this are pretty common in any dispute.

It'd be interesting to see the entire letter to see the full range of specific complaints. From what I gather from the excerpt, I can think of a handful of reasons why something like this would be sent, all of which are significantly less insidious on Blizzard's part than it initially would seem.

[Anonymous Helpful Person]

Will - ask and ye shall receive:

" It has recently come to the attention of Blizzard Entertainment, a division of Vivendi Universal Games, Inc. (“Blizzard”) that you are selling and/or distributing World of Warcraft™ (the “Game”) virtual property, such as gold, through “xxx.xxx.com”.

This letter is to notify you that you are violating the World of Warcraft End User License Agreement (EULA) and Terms of Use (TOU), infringing Blizzard’s copyrights and trademarks, and contributing to the copyright infringement of others. Specifically, Blizzard is the owner of the trademarks and copyrights for the computer game World of Warcraft and all related content, including but not limited to all game characters, objects, and artifacts. Section 3 of the EULA specifically provides that “all title, ownership rights and intellectual property rights in and to the Game and all copies thereof (including, but not limited to, any titles, computer code, themes, objects, characters, character names, stories, dialog, catch phrases, locations, concepts, artwork, character inventories, structural or landscape designs, animations, sounds, musical compositions, audio-visual effects, storylines, character likenesses, methods of operation, moral rights, any related documentation, and "applets" incorporated into the Game) are owned or expressly licensed by Licensor.” Similar language is contained in Section 10 of the TOU.

I do not believe that it is in the best interest of either party to become embroiled in litigation in connection with this matter. Accordingly, I urge you to contact me at your earliest convenience to confirm that you will: (1) immediately cease and desist from any further production, promotion, sale or distribution of any products or services bearing WORLD OF WARCRAFT on print, broadcast or electronic media, including but not limited to the World Wide Web, or any other product or service using the same or similar trademarks; (2) confirm in writing that you will cease using WORLD OF WARCRAFT or any similar trademarks on this or other products or services; (3) cease and desist from any further production, promotion, sale, or distribution of WORLD OF WARCRAFT virtual property; (4) cease developing and/or marketing any products or services that infringe any Blizzard’ intellectual property, including but not limited Blizzard’ copyrights, or otherwise violate Blizzard’ rights or the fair trade laws; and (5) forward to my attention an accounting of and all monies received from the sale and/or distribution of such WORLD OF WARCRAFT virtual property or any other Blizzard Entertainment intellectual property.

Nothing contained herein is intended to be or shall be construed as a waiver of any of Blizzard’ rights or remedies, and all such rights and remedies are expressly reserved.

This letter is extended to you as a courtesy. However, unless we receive your written assurances by either fax or mail that you will comply with the above within five days of your receipt of this letter, we will have not other alternative but to review all legal remedies available to us including taking formal legal action to protect our rights. I look forward to your quick reply."

Rod A. Rigole
Senior Counsel

Vivendi Universal Games- http://www.vugames.com : The information transmitted is intended only for the person or entity to which it is addressed and may contain confidential and/or privileged material of Vivendi Universal Games which is for the exclusive use of the individual designated above as the recipient. Any review, retransmission, dissemination or other use of, or taking of any action in reliance upon, this information by persons or entities other than the intended recipient is prohibited. If you received this in error, please contact immediately the sender by returning e-mail and delete the material from any computer. If you are not the specified recipient, you are hereby notified that all disclosure, reproduction, distribution or action taken on the basis of this message is prohibited.

[JPW]

"we will have not other alternative but to review all legal remedies available to us including taking formal legal action to protect our rights."

You'd think they would've already reviewed the legal remedies available to them before sending the letter. I do believe that this is more legal bullying by Vivendi and am most interested in seeing how IGE handles this as they've most certainly received a similar letter.

Is it possible that Vivendi is setting up companies to pay a percentage of their revenues for trading their virtual property? This may be an agreeable compromise for both parties.

[WanderingTaoist]

"If you are not the specified recipient, you are hereby notified that all disclosure, reproduction, distribution or action taken on the basis of this message is prohibited."

I daresay that Anonymous Helpful Person will soon be another target of Vivendi legal bullying for distribution of the cease&desist letter :) Thank God I dont live in the US. Good luck, people, dont give in.

[Matt Mihaly]

Petrus wrote:
I'd bet money that this wasn't *Blizzard's* doing, but Vivendi's specifically...ditto for Steam, the delivery mechanism for Half Life 2.

You would be wrong as regards Steam, at least. Valve makes way more per copy they sell over Steam than via retail, and Vivendi gets nothing for copies sold via Steam.

--matt

[magicback]

C&Ds are probably not a deterrent, but it is a cheap way to slow the erosion of IP territory, built public awareness and then perhaps raise the political priority to the level that lobbying would be cost effective.

[Bruce Woodcock]

"If you are not the specified recipient, you are hereby notified that all disclosure, reproduction, distribution or action taken on the basis of this message is prohibited."

Prohibited by whom? IANAL, but my understanding of the law is no matter how secret such a letter may be, once an outside party gets ahold of it, it's fair game.

Oh no, by posting I just took an action on the basis of that message. So I guess I should edit my post -- but wouldn't that also be taking an action on the basis of that message?

Bruce

[Richard Bartle]

So Vivendi are taking the copyright/IP route. This is SO not how I'd have done it...

There are basically 4 approaches to stopping people from trading in virtual goods:

1) Copyright/IP. This collapses if it's recognised that what is being sold are not virtual goods but a virtual service. "I will pay you $400 for your hat of wizardry" is merely a shorthand for "I will pay you $400 to transfer the hat of wizardy in the inventory of the character controlled by you to the inventory of the character controlled by me". If Blizzard/Vivendi win the IP argument and their rights to ownership of virtual goods are recognised, all it will lead to is a change of words in the eBay auction proposal. If they lose the IP argument, it's open season on all virtual worlds...

2) EULA/ToS. This collapses if the people making the money are not signatories of the EULA/ToS. I guess some argument could be made about their having "agents" doing their work for them, but this doesn't even hold up well for mafia dons ordering hoods to kill people on their behalf, so I don't expect it would frighten off an auction house. What Vivendi could do is take a zero tolerance policy and go after every single person whom they can show to be breaking the EULA. This will mean a lot of bannings, but they'd eventually win.

3) Alter the code. Cap the amount of gold that characters can give away per month. Cap the number of objects that can have their ownership transferred from a character per month. Don't perform account or avatar transfers unless 3 from name, address and credit card details match. This would drive a gaping hole in the commodifiers' activities. However, Blizzard shouldn't have to do that. Creating virtual worlds is, at its heart, an artistic endeavour. Why should an artist who's doing nothing wrong have to change their art because people spoil it?

4) "It's just a game". The traditional way, as practiced in small-scale virtual worlds for 25 years. No EULA, no ToS, you can do whatever you like in the virtual world. So, however, can the developers, and they have access to the code. Thus, if they don't like what you're doing they can eliminate your goods, character, account - anything the code allows. It may be that this approach can't be scaled up, and it may be that consumer protection laws designed for non-game activities interfere if there's no EULA. In the end, though, it comes down to "it's my ball and if I don't want you to play with it then you can't". If that ability were ever successfully challenged, few companies would ever want to run a virtual world - their hands would be tied too tightly.

Given that having no EULA is probably not an option for a large-scale commercial virtual world at the moment, I'd have recommended Blizzard to go for 3) using data mining to find a reasonable capping level, backed up with a zero-tolerance attitude to put petty traders off scaling up their activities. The IP question does need answering, but I don't believe the answers are going to affect the outcome.

Richard

[greglas]

Obvious point, but there is no lawsuit here. There is just a letter that talks about a possible lawsuit unless an action is taken. Such letters are not required to initiate a lawsuit. Like Will noted, the sending of letters making demands and talking about potential lawsuits based on eBaying is not without precedent in the industry, and such a letter might be sent for various reasons.

[James Grimmelmann]

Richard: Copyright/IP. This collapses if it's recognised that what is being sold are not virtual goods but a virtual service.

I should spell out in more detail some ways in which the IP claims could shape up. There are a bunch, and the disinctions are subtle.

First, there's the scenario Richard is thinking of. I, the designer, have a copyright in the way my virtual sword looks and acts. Therefore, it's copyright infringement for you to sell it outside the game without my permission. This is, as Richard points out by making the goods/service distinction, a very tenuous claim. Gamersloot just isn't making copies, so they don't even have to worry about authorization or other defenses. Note also that if you take the "goods" metaphor too serious, first sale will work to shield Gamersloot: any state-law claim for third-party interference with the EULA will be preempted by copyright.

First-and-a-half, there's the same scenario with a trademark claim, instead. This one also falls apart for similar reasons.

Second, there's the copyright claim I sketched in my comment above (come on guys, you've got permalinks in the HTML source, why not expose them?): because someone who eBays is in violation of the EULA, their gameplay causes copyright infringement. Thus, someone who commercially benefits from causing them to violate the EULA and assists them in doing it is a contributory and vicarious infringer. This is a tough one to deal with: it's legally a little novel, and it raises ugly implications no matter which way it comes down. People have started to think more about the problem, but no one has come up with a really convincing analysis yet.

Second-and-a-half, there's the similar claim for trademarks. This one is much harder to make, because few players in the game are even arguably "in commerce." Unusually for trademark disputes, the dilution claim is almost impossible to make; there is possibly a tarnishment way to spin it, but my sense is that it woudl tough. In any event, you'd still need to establish secondary liability, which is itself, I'm guessing, an uphill fight.

Third, you could say that the names of the items, the name of the game, the pictures of the items, and so on and so forth as displayed on Gamersloot are themselves direct copyright infringement. This claim is, as Dan pointed out in the original story, laughably weak because the copyrights are so thin. Pictures might well be copyrightable, but then the fair use analysis actually looks pretty good for Gamersloot.

Third and a half, you could say the same thing with trademarks. I have my skepticism about this one, as I noted in my comment. On the analogy that it's typically not trademark infringement to resell name-brand handbags at a flea market, it shouldn't be trademark infringement to resell virtual swords at a virtual flea market. But then again, if the sales cross borders, there might actually be a crazy importation without permission trademark claim that could turn into one of those classic "where is cyberspace?" arguments. I think a tarnishment / dilution lawsuit might be plausible, but I'd want to see someone work through the logic.

I don't doubt that there are other ways one could run an IP suit to try to shut down a trading site; these are just the ones that have occurred to me.

[Petrus]

Here's a hypothetical scenario...feel free of course to tell me I'm wrong/clueless/whatever as needs be. ;)

Vivendi succeed at intimidating Ebay, Tradespot, and Gamersloot into screening their sites and preventing WoW-related trades. Then, less than 24 hours later, some bright spark takes it into his head to set up a Markee Dragon equivalent, (probably already been done) however he knows he'll have to keep it quiet in order to avoid Vivendi's legal goon squad. To make it less traceable, rather than primarily on the Web, he bases it in an IRC channel, at least in terms of initial negotiations and so on. He'll probably have a small, low-key and obscure web page somewhere. (say an .nl domain, or on Freenet if he has broadband and is really clever)

Because the group is more clandestine, it takes a few weeks/months to build up a reasonable amount of business. They still use PayPal for transactions, they just don't list an accurate reason for the transaction. If PayPal are paying attention, all they'll notice is a small surge in unspecified "donations" between individuals. Wow, the gift culture is really taking off, eh?

Fraud would not be an issue within the group because the self-regulating meritocracy paradigm would apply, i.e., if too many people were defrauded while dealing with this particular group, their reputation would suffer, someone else could/would start a new group which was more honest, and people would use that...thus also meaning that the new group would make money.

Therefore, within probably 4-6 months after stepping on the major sites, Vivendi would find itself faced with an operation that it wouldn't be able to *find*, much less shut down.

[Richard Bartle]

Petrus>Therefore, within probably 4-6 months after stepping on the major sites, Vivendi would find itself faced with an operation that it wouldn't be able to *find*, much less shut down.

And of course Vivendi won't have any of its own people playing WoW undercover, because this is something that used to happen in textual worlds and they haven't thought of it yet?

Richard

[Michael Steele]

Ah... I am pretty amazed at all the suppositions and wild conclusions people are drawing.

Some points to consider:

a. I would be willing to bet the copyright violations to which Vivendi is referring in this letter (it's not a "lawsuit". Doesn't anyone edit these headlines?) are actually on the websites that advertise "WoW stuff for sale". If there are logos or artwork on those sites, it's likely they are there without permission. :-) Take a look at the IGE website and tell me how many copyrighted logos you find on the top page alone. (hint: I found more than a dozen without looking hard) -- Take a quick peek and check my math: dub dub dub dot IGE dot komm.

b. If professional trafficking companies keep game accounts for the purpose of, or to faciliate stashing items or currency for unauthorized sale, then they *are* violating their EULA. As someone who makes a living as professional MMO datamining consultant, I can tell you that MMO operators *do* know where all the transferred stuff is stashed, and what accounts they moved through. Yes, even the currency.
Professional traffickers go to a lot of ridiculous efforts to hide how they transfer stuff after it leaves the hands of players; they keep dozens of free demo accounts using dummy names, they quickly spread items and currency piles out into their mule networks, they move stuff around all the time like drug couriers in "The French Connection"... and all so they can claim EULA innocence.

They are wasting their time; none of that misdirection ever stands up to a concerted effort to uncover it. You can't hide transactions from people who control the physical laws of the world; it's all in the logs. (also, see my notes about ebay below)

c. This letter is the type of legal vehicle that generally gets sent *after* having warnings or discussions with the company/people involved and after they have they thumbed their noses at you. As an industry insider, I have followed the discussions between MMO companies and various traffickers for over a year now. The "Well you can't stop us, so you had better cut a deal with us" and the "Offer you can't refuse" techniques are clearly not winning the traffickers any friends with MMO developers.

d. It is doubtful this letter is part of some effort to 'get in on the action'. Indeed the margins are too thin for that to make much sense given the current business model being used in North America. Nor is it about controlling the actions of players. This is about Vivendi and Blizzard (yes, you can be assured the Developers were in the decision-making process too) keeping control of the *entertainment experience* that they sweated blood to create and that they are selling to their customers. These services are *not* an experiment in free-market economics or in player democracy (despite what fan site flame boards may think). Rather, they are a carefully crafted, delicately balanced (ideally), subscription entertainment service. Anything that threatens that balance, or lets some players get ahead of other players (and here's the important part, kids) outside of the carefully designed, in-game mechanisms will likely be dealt with by the companies that risked tens of millions of dollars developing and operating them.

e. Most of these games were *not* designed to support a large inter-game goods/currency exchange. If these existing games had been designed like some of the popular Asian services that support/encourage/depend on micropayments, then this would probably be a non-issue. But these existing North American MMOs are NOT designed for this kind of thing, and while most players don't mind occasionally buying/selling an item on ebay, exit-poll after exit-poll and countless focus groups have told us that North American players are highly put off by real-world wealth upsetting the 'fair play' balance they expect in our virtual worlds. Again, this is contrary to the vocal ranting seen on player boards, but it's been well demonstrated that such boards are the soapboxes of an *amazingly* small minority of players who hold unrepresentative opinions anyway.

f. You can also bet eBay is completely on-board with this legal letter, certainly in principle, if not in active collaboration on this instance. As eBay's entire business depends on their sterling reputation, they work very hard to make sure there is *never* going to be a news story saying "eBay abets the transfer of stolen goods". As a professional MMO operator, if I were to call eBay's Safety & Trust manager and say that "Joe Player" is selling virtual game goods on ebay inappropriately, you can bet that Joe Player's ebay account will not work the next morning. Strictly on my say-so. And eBay would also furnish information to me about *everything* Joe Player has ever sold on eBay, and all Joe's personal information would be at the top of that email. This is not a matter of MMO publishers bullying ebay; eBay proactively goes to them and offered to do this. Read the fine print on your eBay EULA, folks; eBay cooperates willingly, happily and enthusiastically with all of its security partners (such as every big MMO operator) and with all law enforcement agencies. They have a business to protect too. The fact that Joe Player has sold a few spare EQ swords on eBay in the past and not been banned by eBay does not mean these sales are safely anonymous. It only means Verant (et al) is not *really* working hard at punishing individual players for doing this once in a while. They know they can't stop occasional sales, and don't really care about them. It's the impression that widespread trafficking ('cheating') is wrecking the game balance that the publishers care about.

g. It's also wryly amusing to see all the protestations of innocence by the traffickers about the EULA. Players and professional traffickers alike are fooling themselves if they think Sony, Mythic, NCSoft, Blizzard and Microsoft don't easily track where everything goes... and then watch and record every account used for such tranfers, and then look at every account ever opened with the same credit card number, or the same name, address, phone number or IP block and every variant thereof. They are all cross-referenced, examined, logged and annotated for a judge/jury. Additionally, everything ever sold on eBay to any of those ID's (name, credit-cards, addresses, IP addresses, phone numbers, etc.) is also flagged and put into the 'look at me carefully pile'. This is one of the few subjects on which most MMO operators put aside their traditional rivalries and share too. The logfiles go waaay back too.

h. Finally; it is personally distressing for me to see articles and comments on TerraNova about "MMO companies bullying players" and all the "power-to-the-players" flame posts. This is an academic site dedicated to the study of virtual worlds. Please take "I'm a disgruntled player and The Man is oppressing me!" rants to a fan site and let the professionals and serious students get on with the business of making better virtual worlds.

Bottomline: In my professional opinion, cross-game trafficking of items and currency in virtual worlds that were not designed to handle it is just bad. Professional parasites who are just trying to make a pile of bucks while no one is looking seems too much like the real-world for my taste. As Ted Castronova said in his AGC keynote this year; "This is not part of the dream".

[Hellinar]

Not knowing anything about the law, in any country, I am curious about one point. Would Blizzard allowing others to claim ownership of their swords infringe their right to modify them? That would make a big difference to the designers freedom of action. Suppose one day Blizzard flips the Unique bit on the Sword of Uberness. That wouldn’t effect the average player, with one sword. If anything, their sword is now worth more. But for the trader, who’s mule suddenly has one sword rather than twenty, it’s a big hit. Could the trader sue?

One thing that strikes me about a MMOG like Blizzard’s, is the value of an item comes almost entirely from the context provided by Blizzard. Player effort and skill in obtaining it has no intrinsic relationship to its value. If Blizzard changes the drop rate of the item, or the usefulness of the effect it procs, then the value of the item changes. In the next patch, anything proccing Fear is going to take a value hit on PvP servers. The effect of Fear on players is being reduced. What would happen in this scenario if Blizzard approved item sales? Would some consumer protectin laws kick in?

In Second Life, as I understand it, much of the market value of items comes from the effort of the player designer. So it makes sense to me that Linden Labs would allow item sales, and Blizzard not.

[gamer]

There was more than just one letter that went out, other websites recieved this same letter yesterday/ today. I have also heard that there was over 10,000 accounts banned in china for farming in the past few days. Looks like blizzard is not playing any games! However I seriously challenge them to follow through with their litigation. If a company has the money behind them as well as a solid legal council blizzard may end opening pandoras box. Whats happens when blizzards ruling does not stand up in court? I dont think Blizzard, or any other game company for that matter want that to be the situation. We will see!

[Ola Fosheim Grøstad]

Michael Steele> exit-poll after exit-poll and countless focus groups have told us that North American players are highly put off by real-world wealth upsetting the 'fair play' balance they expect in our virtual worlds.

How do you get this information without asking a leading question? I.e. how do you know that this is the factor that puts them off and that it isn't a scape-goat?

[John Riley]

>>
Players and professional traffickers alike are fooling themselves if they think Sony, Mythic, NCSoft, Blizzard and Microsoft don't easily track where everything goes... and then watch and record every account used for such tranfers, and then look at every account ever opened with the same credit card number, or the same name, address, phone number or IP block and every variant thereof. They are all cross-referenced, examined, logged and annotated for a judge/jury. Additionally, everything ever sold on eBay to any of those ID's (name, credit-cards, addresses, IP addresses, phone numbers, etc.) is also flagged and put into the 'look at me carefully pile'. This is one of the few subjects on which most MMO operators put aside their traditional rivalries and share too. The logfiles go waaay back too.
>>

Well, this certainly sounds impressive. Forgive me though if I don't believe a word of it. Thats a lot of effort to keep those kinds of records and I fail to see how it would be financially viable to go to those lengths.

Also, tracking all this, and especially sharing it without the customer's consent would raise some serious privacy issues and would likely result in more than a few counter lawsuits were it to be used. Just because the customer agrees to a EULA does not mean the company can strip the individuals of all their rights (and for the record, I don't believe any MMORPG EULA has ever stood up in the court of law - so we have no legal precedent to say these agreements actually mean anything).

Lastly, if they are going through so much effort to record anything, why havn't they done anything about it? Shutting down a few high trafficing accounts here and there would cause major inventory losses to the companies that use these accounts (resellers invest thousands of dollars every day in inventory). The margins for these resellers are not that huge that a few sting operations would seriously cause them to reconsider if it is worth operating in a given game. This is honestly my biggest point of confusion in this matter - even without such excessive data mining, these gaming companies have to know who the big reseller accounts are. And yet they do nothing to stop the IGEs of the world from continuing operations - in fact shutting down Ebay auctions simply benefits these private companies even more by funnelling business to them.

[Edward Castronova]

Michael Steel> This is about Vivendi and Blizzard (yes, you can be assured the Developers were in the decision-making process too) keeping control of the *entertainment experience* that they sweated blood to create and that they are selling to their customers.

I can't tell you how encouraged I was by this post. This issue, when discussed in public, seems to get commentary from almost everyone except the Protectors of the Grove, the people who are doing the building/operating. There are some exceptions, but generally, I've been wanting to hear someone lay out the case just as you have.

I agree that the most serious damage here is to the entertainment experience. It is calculable, and certainly non-trivial.

[Lee Delarm]

Steele, Blizzard, and others, I would challenge you to see this legal rambling actually put forth into a court case to have it decided one way or another. Quite obviously you despise those people who are so obviously "ranting" so much that you would take actual legal action against them, and I would love to see the outcome of such a court case.

On another note, I would love to see a rather fair and level playing field, so I would also invite IGE and Playerauctions to financially back whoever you would bring this +10 Hammer Of Legal Righteousness down upon. It's all well and good to make threats and instill the fear of death into the poor little college students or small time start up web host but quite another to go toe to toe with an equal...or someone as legally versed as you.

I would also venture to say the "law" is on neither side currently no matter how many potential examples you show one way or another. And if I remember correctly, law is never set in stone as a good lawyer should know and deals mostly in inconsistancies and interpretations of events.

Good luck.

P.S. I hardly think calling your oponents the equivalent of children or crybabies gives you good PR which you may need in the very near future in case you fail to bring your legal case to light before someone brings one to you first.

[Matt Mihaly]

Michael Steele wrote:
Professional parasites who are just trying to make a pile of bucks while no one is looking seems too much like the real-world for my taste.

While I agree with you on the "professional parasite" bit (and most of what you wrote), I don't see how you can claim MMOGs are not part of the real world. They are no matter how nice it might be to pretend they're not.

--matt

[bruce boston]

Michael Steele> Players and professional traffickers alike are fooling themselves if they think Sony, Mythic, NCSoft, Blizzard and Microsoft don't easily track where everything goes... and then watch and record every account used for such transfers, and then look at every account ever opened with the same credit card number, or the same name, address, phone number or IP block and every variant thereof. They are all cross-referenced, examined, logged and annotated for a judge/jury. Additionally, everything ever sold on eBay to any of those ID's (name, credit-cards, addresses, IP addresses, phone numbers, etc.) is also flagged and put into the 'look at me carefully pile'.

This is basically what we do with accounts that we link to fraud in There.com.

Michael Steele> This is one of the few subjects on which most MMO operators put aside their traditional rivalries and share too.

Besides being illegal to share a customer's credit card info with 3rd parties (outside our bank, the card issuing bank, the card issuer, credit card processor and law enforcement), I think that 'sharing data' would actually violate the basic tenants of our TOS and our commitment to customer privacy. That said, I think its pretty common practice to 'go above and beyond the call of duty' when working with any of the above groups to link individuals to patterns of fraudulent activity.

-bruce

[Mike Sellers]

Edward said, I agree that the most serious damage here is to the entertainment experience. It is calculable, and certainly non-trivial.

Once again we're back to assertions rather than supported statements. We've been over this in some detail in the "Blizzard goes to war" thread that you started. Despite many such assertions there, no one has demonstrated in the least the damage that you say is "calculable" and "non-trivial."

This entire issue still reduces to hard-core players used to one play style, and who have more time than money, being upset at a different type of player with more money than time. Buying items that someone else legitimately obtained in-game isn't cheating, and it's not damaging the game. There is no demonstrable harm to anyone else's gameplay experience. There is no damage to the in-game economy from out-of-game sales (outside of duped-sales, which are in a completely different class).

These objections are all illusory, and appear designed to dress up the underlying antipathy for those who "buy their way in" to a game and those who facilitate such sales. I understand the antipathy from the POV of a hard-core gamer, but I think it's misplaced. Outside of a de minimus trademark violation (for the use of the names of in-game assets on other sites) there is no crime here, no fraud, no cheating, no ruining of an experience. There is a foundational change in who is playing MMOGs and the expectations they have, and that's not going to sit well with the current core crowd (and more than the success of graphical MMOGs has sat well with those who prefer text).

[LMC]

I keep seeing the defense of IGE, etc... defined by such statements as-

1)The devs should design with out of game transactions in mind...

Some games do but the ones that don't should not have to put up with this extra overhead.

2)Out of game selling does not affect the players...

It does affect the players when parts of the world are occupied 24/7 by farmers working for IGE. So should the devs design part of their world just for IGE? "Welcome to the zone of uber-farming! Unless you are employed to farm, do not enter." Commercial farming GREATLY affects pricing and availability of items and access to certain areas of any game.

3)Out of gaming selling is what the player base wants...

He said, she said. I have been in a number of large guilds in EQ1 and EQ2 and can count on one hand the number of people that bought stuff off of ebay or IGE or came into a sudden influx of plat or items mysteriously. From my perspective there is a vocal minority that have a vested interest in keeping places like IGE open. Most arguments I have seen in forums are between a few very, very vocal and strident supporters of item selling and a large number of casual posters that are against it.

4)The EULA will not stand up in a court of law...

Maybe it can, maybe it can't, but the real issue is the design of the game, unless it is feasible to fit in item selling, why should a game have it designed in if it does not fit? And should devs spend all the extra time and money developing that instead of developing content?

I can see the interest in item buying in selling but I wish it was gone. The only people that benefit are the item sellers and people that cannot spend as much time as they like playing the games so the buy their advancement. And if the games are so bad without item buying and selling the games will either be redesigned better or fade away from lack of interest.

[John Riley]

This is basically what we do with accounts that we link to fraud in There.com

Would it be fair to ask how exactly you figure out which accounts are linked to fraud? Most games just ignore the difference between fradulent and mutual consenting transactions because it is too dificult to distinguish the difference. Mike talking about tracking every IP of each transaction and data mining the heck out of it to track and build cases against EULA breakers is a world apart from tracking fraudsters in an attempt to shut them down. IGE may break every EULA in the book, but they are not ripping off their customers.

I think everyone would like to see more action taken against fraudsters, but with no in-game property rights, there is very little recourse people have to fight against this fraud. Its easy to sit there and say that out of game transactions ruin the entertainment experience and should not be allowed, but banning Ebay sales is just an easy target and really is turning your back on the bigger issues. In game theives, scammers and fraudsters run rampant and they are not punishable because it is "just a game". Customers have no recourse because they essentially have to sign away all their rights to play the game and the gaming companies make minimal efforts to protect those rights in return. When you play these games, its every man for himself where the strongest win - and of course the biggest and baddest of them all are the gaming companies themselves who can adjust the rules as they go to always come out on top.

I think the reason this site exists is because a lot of people realize that virtual worlds often go beyond simple entertainment value. The gaming companies don't seem to want to admit this though, which is kind of ironic since they are the ones who benefit most from the stickiness and longevity of a virtual world that continues to draw people in long after the "game" looses its luster. In the end, it is hard to tell what these companies are really working towards - if they truly succeed in getting their lawyers to reduce their MMORPG into "just a game" - they will mostly succeed in just killing off the world they worked so hard to build.

[James Grimmelmann]

Hellinar: Would Blizzard allowing others to claim ownership of their swords infringe their right to modify them?

No. There is a contract between Blizzard and its players: the EULA. Blizzard could easily write a EULA that says "While we will not ordinarily stop you from trading swords or using eBay, we reserve the right to change the properties of items or delete them at any time." I am quite confident that most courts would be willing to enforce such a term against any player who tried to sue Blizzard for nerfing the swords.

"Ownership" and "property" are misleading terms when it comes to virtual worlds. They imply that ownership is an all-or-nothing affair. Either Blizzard owns the sword or a player owns it. That is not the case. Under the EULA term above, the player would have some rights relating to the sword, and Blizzard would have some rights relating the sword. Those rights would coexist quite easily. If I, the player, had the sword taken f
rom me by someone who stole my password and logged into my account, I would have a perfectly good lawsuit against the thief. But I would not have a lawsuit against Blizzard if a game admin deleted the sword.

The above is a very standard lawyerly way of looking at property. We do things like this all the time with property in the real world: if I rent an apartment, both I and the landlord have certain rights that relate to the apartment. As the tenant, I have very strong rights against everyone else in the world to keep them out of the apartment, but much more limited rights against the landlord. And the question of what rights I have there will be answered, typically, by looking at the contract between the two of us.

I think that Dan and Greg probably had this kind of analysis -- the Hohfeldian "bundle of sticks" -- when they talked about the recognition of "virtual property" in their article. Giving players rights against game designers is one way that virtual property could be recognized, but it's not the only way, and indeed, it's one of the less likely.

[Carl Short]

Mike, I don't know you, but I couldn't respectfully disagree more. Not necessarily with the whole statement, but only one part in particular..."it's not damaging the game. There is not demonstratable harm to anyone else's gameplay experience."

I'm a player of games, not an industry professional, I have no axe to grind or agenda to promote other than making my gaming experience more enjoyable. Bear that in mind when I say the following.

From my point of view, the purpose of a virtual world (call it what you will), is to reward those who invest time in that virtual world. Or even simplify this...the purpose of a game is to reward those who spend time playing the game.

If you play Monopoly, you suspend disbelief for some period of time, you...for lack of a better word...game. You work towards the end goal of that game, building monopolies, using only the resources within the game system and your mind. Only in Vegas would you find people playing with real money, and you won't find them buying properties for in-game through out of game means, once the game has begun.

The next step up in complexity...video games...example is any RPG. Time invested gives returns. In order to reach those end bosses, you're forced to spend time playing the game. If you can't invest the time, you don't beat that boss, don't see the ending, and don't save the princess. If you can't beat Aqua Weapon at level 70, you wait until level 80 and try again. You don't find gamers whining about not being able to buy the Exalibur 3000 sword with RL cash, its accepted that in order to get those rewards, you must spend time playing.

Next step in complexity...virtual worlds. Same premise. As a gamer, I realize that time invested gives rewards. Its not a matter of "I have more time than I have money", its a matter of knowing that if I work for something within the ruleset/world/system given by developers, I will eventually be rewarded. My limitations are my ability to understand the system, my patience, and yes, the amount of time I have available.

When you introduce out of game resources into in-game play, you no longer have an equal playing field, unbalanced only by interpretation and time. You ARE doing harm to the game itself, because the game was designed to level the out of game playing field, save those qualities that the game requires to win. In allowing out-of-game purchase of in-game items, you expand the scope of the game, giving priority to those who have the monthly fee and 40 extra dollars per month over those who just have the monthly fee. Except then it becomes 80 extra dollars, or 120 extra dollars.

Plain and simple, as a gamer, I have no desire to see out of game purchasing of in-game items, whether through players, companies, clearinghouses, unless the game is specifically designed for it. Going back to my simplification, when you allow out of game purchasing, you are no longer keeping a fair and equitable system of rewards for those who spend time playing the game, rather you hijack the rewards system, removing all credibility that it might have. And if there isn't a rewards system...why exactly am I playing again?

When you play The Bloody Kasserine, you use the game system/rules to your maximum advantage in order to win. Likewise in Risk, Parchessi, or World in Flames. Is it too much to ask that we limit in-game actions to in-game resources?

While I may disapprove of the legal precedents that these game companies may be setting by attempting to enforce this EULA's and ToU's, I applaud their actions in attempting to keep hard boundaries on the amount and type of resources that may be applied in getting ahead.

Just the opinion of someone who plays, and enjoys games...

[bruce boston]

John> Would it be fair to ask how exactly you figure out which accounts are linked to fraud? Most games just ignore the difference between fraudulent and mutual consenting transactions because it is too difficult to distinguish the difference.

So two quick notes:

1) I agree that There.com has very different problems than your classic MMORPG would have. Even so, I think the basic methodology behind highlighting the cases may be similar. I wont get into the methodology, but datamining is a big part of the solution.

2) Just a personal opinion that I think too many people are looking for a silver bullet here. As far as I can see, in business there is never a silver bullet, and you have to keep using the ammo that you have available.

From what I know about people, there are obvious cases that will stick out in any community of more than 1,000 members. Take the WoW speed hack, my guess is that its possible to look and see the average time that it takes to travel from point a to point b. Or the average time that it takes to do quest A or quest B. If 95% of the players finish in 12-20 mins, and you have a few people doing it in 5 mins, you have an obvious problem.

There is just so much data that is available if the databases are configured correctly. As far as a basic approach, any hack that gives a tactical advantage should show up in a report.

Going forward, my guess is that most games like WoW will (most likely) go with a 'fix the broken windows' style of law enforcement, which is actually a pretty good approach for all non-Prohibition scale issues.
(see: http://en.wikipedia.org/wiki/Broken_Windows) .

That said, in my mind, currency sales are really a design issue (first), and WoW is, if anything, encouraging this type of activity with their current design. I.e. it gets exponentially easier to amass currency as you go up in levels, and, if anything, twinking is encouraged through a number of systems that they have.

-bruce

[Mike Sellers]

Carl said, the purpose of a game is to reward those who spend time playing the game.

Carl, that's a valid POV. As I've been saying, this is the particular POV of the core-gamer, and one that has reigned supreme in computer games thus far.

But as I've also said, things are changing. The market is changing. It's more accurate to say that the purpose of a commercial game is to reward those who pay for it. Regardless of how much time they spend it in. (And note that from the commercial operator's POV, the perfect customer is one who pays but rarely if ever logs in!)

There are many more people who have more money than time, relatively speaking, than those who have time to spend hours and hours playing games. These people with only an hour every few days to play haven't been big into MMOGs for the most part up to now, but that's changing. And as it changes, cries of "cheater! fraud! you're ruining my play because you haven't been here as long as I have!" just aren't going to carry much weight with either game operators or players (other than the die-hard more-time-than-money crowd as we have here -- and apparently at Blizzard).

So I understand your POV. And it seems to be the one underlying all this sturm and drang about out-of-game sales. People keep repeating the same old charges as a way of dressing up their distaste for these new players and how they want to play the game. That's fine; maybe there will be a market segmentation into hard-core time-intensive and everyone else. But threatening legal action over something like this just plain ludicrous. It would be like text game operators threatening to sue anyone who draws a picture of what happened in-game because it "ruins the experience" for everyone else.

[Brask Mumei]

LMC> "1)The devs should design with out of game transactions in mind...

Some games do but the ones that don't should not have to put up with this extra overhead."

I would like to design a rocket ship without taking gravity into account. However, I shouldn't be surprised if the rocket ship doesn't work very well in the real world.

Human nature is human nature. As a designer, it is your *responsibility* to take human nature into consideration in your game design. Early MMORPGs may have underestimated the human nature to trade time for money, so accidently set up the stage for farming, etc.

Modern MMORPG game designers have no such excuse. They have seen EQ. They have seen the harm that Farming can do to certain game designs. It saddens me that they believe the right response is to try and fight human nature.

The question isn't "Can Ebay harm in game experience?" but "Why would we make a game which will be harmed by Ebay?". We know players will ebay for the same reason that we know they will exploit any other loopholes.

My personal hope is that WoW has designed their system so that IGE style gold farms would not cause any gameplay problems, but has gone on this legal rampage for the good PR it seems to generate around disgruntled EQ players.

I would hope the same applies to the speedhack. That is such a well known hack, one would hope they had already thought of it, but intentionally left it open to be able to ban the initial round of users.

- Brask Mumei

[Petrus]

To Mike Steele,

>It's also wryly amusing to see all the protestations of
>innocence by the traffickers about the EULA. Players
>and professional traffickers alike are fooling
>themselves if they think Sony, Mythic, NCSoft,Blizzard
>and Microsoft don't easily track where everything
>goes... and

If this is true, how come trading got as big as it did on UO in particular? Are you honestly going to tell us that that only happened because EA *allowed* it? These companies are people who as you say, do *not* want this type of thing to happen in games that are not designed for it...so I see two possibilities here. Either

1) Although everything is logged as you say, it becomes a manpower problem...the number of people "trafficking" is greater than the number of people a company has to enforce the rules, or

2) The above is not true, not everything IS known about, and at least the operators of early games were blindsided by this activity.

Personally I'm going with a combination of both ideas here. Yes, of course there are syslogs, and yes, of course certain things are known...but personal information can be faked, among other things. As I've stated before, given the nature of the Internet it is *always* going to be possible for people to run trading operations in which all of the details can be known by the company involved, even if they are able to trace the fact that virtual inventory is changing hands from person A to person B. In a lot of cases, I'm guessing that's just about *all* they know about it.

I agree with you that there are certain people who play MMOGs whose purpose in life seems to be to try and ruin things for everyone else as much as possible. These people exist in a number of different contexts, and engage in a number of different activities. Trading is not the only one among them. I believe however that rather then relying on enforcement alone, the way to deal with such people is to create game environments that are sufficiently robust where their stability is not threatened by these activities. I notice that you mentioned that the Asians seem to have come up with a system for coping with this kind of thing...would it be possible that in future games they develop, American operators themselves could possibly integrate this model as well?

I do not believe that it is appropriate that game companies rely on enforcement/jackbooted behaviour *alone* in order to attempt to deal with these problems, but rather focus as I said on incorporating tolerance for things like trading into the economy of the target game. There are times however when enforcement is called for, undoubtedly...as in the case of people like the obscene Evangeline, a user of The Sims Online I was reading about a bit back who set up a virtual brothel. The Sims is a game with a teen rating; I would not be opposed to the idea of the establishment of adult games for such things, but the problem is that I suspect that with people like Evangeline, the entire point of the exercise is to set up such places within environments where it is as inappropriate as possible relative to the context. I do understand and sympathise with the fact that MMOG operators are forced to contend with such people.

You seem to be somewhat more astute than what we expect from the stereotypical corporate suit these days, and it is accepted that operators have as valid a perspective in this argument at times as the players themselves do. However, I wholeheartedly reject the notion that operator companies see all and know all with regards to trading, and that it is for them really in any way possible for them to stop it at all *via legal or enforcement means*. I understand also that it is in your vested economic interest for the player community and outsiders to see operator companies as omniscient, in the way that you have attempted to portray them here. The only problem is that this assertion does not enjoy the support either of logic or MMOG history.

[Ola Fosheim Grøstad]

LMC: Commercial farming GREATLY affects pricing and availability of items and access to certain areas of any game. [...] I have been in a number of large guilds in EQ1 and EQ2 and can count on one hand the number of people that bought stuff off of ebay or IGE or came into a sudden influx of plat or items mysteriously.

So, you are basically saying that tiny minority has a great impact on pricing. That seems to be a bit up in the blue. The following scenario seems reasonable based on what you say:

a) 1% of the playerbase buy 1 mill gold each month
b) the top 9% of the playerbase make 1 mill gold each month on average

How can the additional 10% greatly affect pricing if they are all going for the same goods?

Furthermore, how is selling expansions which provide new and better game-stats different from e-baying? Surely, the main difference is in the wrapping? And if we take it one step further, when a game maker make their core game free, does that mean that the players who bought the game with all expansions suddenly become "e-bay cheaters"? There is a certain lack of consistency in the arguments. Mike Sellers is basically spot on.¨

As a player I am all against games charging for gameplay and buying of items, but that doesn't mean it actually bothers me in-game. Similarily, I find it distasteful that the people in the leader-culture award themselves insanely high salleries, but it doesn't bother me in my everyday life...

[Lee Delarm]

Carl> the purpose of a game is to reward those who spend time playing the game.

What about WoW's system of rest experience where you can store up "double" xp while not in the game itself? By spending time doing something other than playing the game, you gain IN GAME benefits. Just something to think about in that aspect.

As for farming hurting a game (and farming being directly linked to out of game trading), what makes you think people aren't still going to want to be the richest person on a server? What makes you think that people don't want to hold a monopoly on a certain type of item or a rare sword? What makes you think that this must be the only driving goal of every single individual killing a mob repeatedly for their loot?

Farming is NOT going to end with the destruction of third party game sales I'm sorry to inform you. Might it decrease for a short period of time? Sure. Will it pick right back up? Yup. Farming is linked to third party trading, I'm not denying that, but third party trades are NOT the parent of farming. Didn't you play MUDs way back in the day? When people would go to the super elite zone with all the good drops or the high gold drop monsters? I certainly don't remember an industrial real money for game money trade market back then...

I believe farming and a number of other things that contribute to third party sales are a problem in amoungst themselves, a core game mechanic gone wrong, or perhaps right in some cases. Believe it or not, players do crazy stuff sometimes. Feasibly, it might be faster for the player to hit level 60 and then go on raids for money, but for some players they take an alternate route and work up tradeskills instead...or farm a mob...or scam other players...or make a stock market out of the auction house.

In the end, you can't really link any in game occurances, even duping, as a direct cause of third party trading. It all existed before it started, and it will continue to exist even if third party trading is stopped.

[LMC]

Ola: "So, you are basically saying that tiny minority has a great impact on pricing. That seems to be a bit up in the blue. The following scenario seems reasonable based on what you say:

a) 1% of the playerbase buy 1 mill gold each month
b) the top 9% of the playerbase make 1 mill gold each month on average

How can the additional 10% greatly affect pricing if they are all going for the same goods?"

It does have a great effect because if Uber sowrd A is going for 1,000 plat on average but someone just bought 1,000,000 plat off ebay and what the sword quick they have know qualms about spending 100,000 plat on it. Suddenly the going price for the sword is 100,000 plat and out of the reach of most players that do not buy play from ebay.

"Furthermore, how is selling expansions which provide new and better game-stats different from e-baying? Surely, the main difference is in the wrapping"

That is comparing apples to say coconuts! All players have the opportunity to buy the same expansion for the same price and receive the same benefits. Not even in the same league kind of issue. Also it is something the devs have planned for and taken into account unlike the wide variables involved in item selling.

As for farming, will the cessation of 3rd party sales stop it? of course not, but it will stop 24/7 commercial farming. If they are not getting paid real world money do you thing IGE will have 3 characters farming the same zone on 20+ servers 24/7 like they did in EQ?

[Charlie Domino]

"Carl, that's a valid POV. As I've been saying, this is the particular POV of the core-gamer, and one that has reigned supreme in computer games thus far.

But as I've also said, things are changing. The market is changing. It's more accurate to say that the purpose of a commercial game is to reward those who pay for it."

Ok, lets say that's so, and the market should supply the opportunity to spend RL cash to get an advantage. Question: Is there also room for a game in which that IS NOT the case, and Carl's POV is true? After all, there's apparently a market for it!

The answer from the MMORPG industry is invariably "yes, and we are trying to provide that." The answer from those who buy and sell plat & other virtual items is always "no, that's absurd, it's not in human nature." i.e.: what are you, some kind of FREAK for wanting to play an escapist fantasy? I assure you it is not absurd.

It's not the buyers that are the problem insofar as game play... it's the sellers. The ones that go out and farm endlessly. Need a drop for your quest? Kinda hard to get it when some farmer has taken over the camp and unleashes language at you that would make his mommy get out the mouth soap. Want to go grab a nice money-making camp? Sorry, it's camped 24/7 by the professionals (cough, cough, Seblis, pre-nerf). You're in the way of their business--and some will even tell you that.

I don't really have a big issue with buying and selling virtual items--but when it begins to distort the game, when farming plat and items becomes a *profit motive*, then the game experience will suffer. And that, I as a player, take issue with.

[Ola Fosheim Grøstad]

LMC: Suddenly the going price for the sword is 100,000 plat and out of the reach of most players that do not buy play from ebay.

This is only true if the 1% get more money off e-bay than the top N% of the hardcore do AND if the said resource is in really low supply, but if the resource is in such low supply that only 1% can get hold of it, it also implies that 99% of the population was never meant to have it. BY design. IMHO: blame the designers, not e-bay.

LMC: That is comparing apples to say coconuts! All players have the opportunity to buy the same expansion for the same price and receive the same benefits.

Not at all. It is exactly the same issue, and it is from a social/moral point of view MUCH WORSE exactly because a majority DO buy it. What about the poor/unemployed/... players who cannot afford it? They see all their friends move on and past them? They are excluded or have to lower their real life living standard. MMOs basically have a lock-in-and-milk-the-players strategy. How is that different from IGE doing the milking? Is the game provider some kind of neutral innocent entity? Far from it. Players may accept it because it is pervasive in society, not because it is more ethical than farming creds and selling them on e-bay.

LMC: Also it is something the devs have planned for and taken into account unlike the wide variables involved in item selling.

Like there haven't been enough expansions that have upset game balance...

Developers are no saints.

LMC: If they are not getting paid real world money do you thing IGE will have 3 characters farming the same zone on 20+ servers 24/7 like they did in EQ?

Well, if there are 3 farmers for each buyer, then that still only account for 3% according to the "minority buys" theory. You can easily compensate for this by a minor increase in the spawn rate, 1-item-per-character etc.

[Lee Delarm]

I believe some of the arguements here may have been misunderstood (you tell me after reading this). I don't think any of us, one side or the other actively support macroing, botting, or "commercial" farming. These are things we'd ALL like to see removed from the game. What I DO believe (back to the 3rd party side) is that I support the player who spends his/her time to aquire an item, money or character and resell it at his or her leisure.

Farming, macroing, botting will continue regardless of the existance of a third party system, but I don't feign ignorance as to the fact that it contributes HIGHLY to the external market. I DO say that these are flaws inherent in game design rather than effects from a third party system existing.

[Ola Fosheim Grøstad]

Hi Lee, I think some of us are saying that we are seeing symptoms of developers stretching content beyond the expiration date. To some extent bad design, but not only that, also an overall bad approach... Tedious experiences rather than meaningful experiences... Some actors then blame the symptoms rather than the actual design.

For the mass market I think a better and more fun strategy would be to sell a larger set of fun games with better pacing as a subscription package. Then you don't have to stretch the content so much, and you can focus on retention by content rather than treadmilling. Not many have the resources to do this though... :-/ And nobody has the guts to do it :-(.

It works for cable-TV, I think it will come in this market if it reaches the masses...

[ron meiners]

While the context of a gaming experience- such as the integrity of the reward system- has an enormous impact on the individual and the community, and while I'm a purist in terms of creating satisfying, whole, and immersive gaming experience, I don't see these commercial dynamics as easily dismissed. Some, at least, of the reasons we enjoy leaving the prevalent commercialism of our modern cultures certainly have to do with how much commercialism affects so many of our experiences and decisions. But by the same token, these dynamics are clearly very virulent, and keeping them totally outside of a virtual world is problematic at best.
And, truth be told, the explorer in me would enjoy periodic access to experiences I'll never have the time or dedication to "earn" in-world.
One solution, to me, would be to create separate servers. Keep the pure experience unsullied, on one set of servers, but provide monetized experience on others. One side benefit would be the establishment of new communities- Second Life and There (and others, I believe) have shown that genuine satisfying experience can certainly take place for some in a commodified online world.
Might make the whole thing easier to police also, and create more financial success to keep our worlds, and our dreams, alive.

[Matt Mihaly]

Brask wrote:
Modern MMORPG game designers have no such excuse. They have seen EQ. They have seen the harm that Farming can do to certain game designs. It saddens me that they believe the right response is to try and fight human nature.

Designers of modern legal systems have seen past legal systems. They have seen that it is impossible to try and stop people from, say, committing murder. I firmly believe the right response is to continue to fight human nature, which dictates that some people are going to be murderers. I'm not morally equating murder with buying things out-of-game, of course, but the argument that "People are going to do it, so we shouldn't try to prevent it." strikes me as an exceptionally weak one.

--matt

[LMC]

Ola:"This is only true if the 1% get more money off e-bay than the top N% of the hardcore do AND if the said resource is in really low supply, but if the resource is in such low supply that only 1% can get hold of it, it also implies that 99% of the population was never meant to have it. BY design. IMHO: blame the designers, not e-bay."

Your numbers are meaningless, resources are created by design to be limited as part of the game experience. Even if an item is designed to accessible to only 1% of the player base it is good because it was designed that way for balance. So why the bias against devs? They designed a game to be playable without outside economic influences. I know if I was them I would want to control as many variables as possible instead of throwing money away trying to anticipate the external market forces. Should they code for the possiblity of war and terrorist attacks as well?

"Ola:Well, if there are 3 farmers for each buyer, then that still only account for 3% according to the "minority buys" theory. You can easily compensate for this by a minor increase in the spawn rate, 1-item-per-character etc"

I never said anything about 3 farmers for each buyer. What I described is a very common occurrence where commercial farmers take over a spawn or an area and take it out of play for the rest of the player community. Then they hold a monopoly on items from that area and charge several times more than the pre-farmed going price. Increasing the spawn rate will do little to affect the price in most cases and only increase the profits for the commercial farmers.

[Michael Steele]

So... some quick responses.

First, thanks for all the feedback. While I obviously don't agree with everyones opinions on things, I'm impressed by the intelligent dialogue. It's much better than all "the Man is out to screw the player" stuff that this was devolving into earlier.

The various comments about datamining:
> Well, this certainly sounds impressive. Forgive me though if I don't believe a word of it.
> Thats a lot of effort to keep those kinds of records and I fail
> to see how it would be financially viable to go to those lengths.

ROFLMAO! I hope Gordon, Raph and Mark are reading this. The shortest answer: Dude, disk space is $1/Gig.

This is not an "excessive" amount of datamining. This is "remedial" datamining. (It's also all pretty automatic too)

"Why didn't UO do this"; UO and EQ didn't do much professional-level datamining back in the early days. Yes, they were probably caught by surprise. We were all still learning about the difference between designing-a-game versus designing-a-professional-internet-subscription-service. I think we've come a long way in 9 years though.

A side note: When I state things I haven't done myself or seen with my own eyes, I try to put the words "In my opinion..." or "I would be surprised to discover..." or some other indication that I'm not completely confident of my facts.

> I don't see how you can claim MMOGs are not part
> of the real world.

Heh. You are right; I'm one of the last people to argue this point, Matt :-). Of course MMOs are a tangible part of society and of my real life. Not only do they help pay my rent as a dev, but I'm as much an MMO addict as any of us. Let me point out that I simply meant the immersive story of many MMOs is not always congruent with some of aspects of the real world. In an immersive story I can choose to pretend some of the ugliness of the 'real world' doesn't exist, and I (and hopefully other people) try to behave in a manner consistent with the ideals/goals/ambience of the story world. Thus, I can act the role of a noble Jedi or medieval knight without having to worry about things like napalm or discussions on Bush vs Kerry while I'm playing. If we were discussing bringing real-world ugliness into a "Grand Theft Auto" MMO, I'd probably have a different opinion. :-)

> Would it be fair to ask how exactly you figure out which accounts are linked to fraud?

It would be fair to ask, but unwise to answer with any real details. Suffice to say that modern fraud detection is pretty sophisticated and very very tech-savvy. It was certainly a learning experience for me.

We're getting off topic though. This is not about fraud, it's about trafficking in currency/items. I don't consider trafficking in items/currency to be "fraud". I think it's a bad idea for games that weren't designed for it. I think it's a violation of current EULAs. I don't think it's fraud. "Fraud" is the guy in the Ukraine who tried to create a game account using stolen credit card numbers given to him by a hacker in Denmark. (Our suspicions were raised when his card was declined 1,200 times, all using different numbers). The phone number for the FBI's Internet Crime Unit is still near the top of my celphone's rapid dial list.

> Besides being illegal to share a customer's credit
> card info with 3rd parties...

Heh, didn't I speak at AGC about this topic two years ago? My presentation/slides should be on the net someplace.

It is a violation of FTC regulations (worse than violating the law, I assure you) to share certain classes of personal information which you have required from your customers, but those regulations clearly state exceptions for the purpose of credit checks, security, fraud detection or misuse of services. Again, go read the fine print on the eBay EULA. Sharing limited amounts of information for the purposes of preventing misuse of services is not a violation under certain, carefully defined circumstances. Besides, no one casually gives competitors information about their customers.

Here's one that's sure to start a fun thread: For the last several years, MMO operators have discussed putting an entry into the credit reports (TRW, et al) of subscribers who they ban. Credit reports can have 'misuse of services' entries. This would allow other operators to deny a person access to their service if they are a known troublemaker. In the end, nothing came of it because, like filmakers, most MMO developers are really storyteller who *want* people to experience their worlds. Despite all the posts about how they are all just out to screw the players, most MMO devs are waaay too busy to bother addressing any but the most aggrevious problems with legal actions.

Why is trafficking unbalancing? Simple: Because the developers spend lots of time/money creating game systems and content. *Which* content/code they choose to spend their money creating depends on how rapidly the game design intends people to gain wealth/experience. Messing with that rate (by letting many players get far ahead of others out of sequence) changes the way the entertainment is supposed to unfold. Game developers find themselves forced to respond to changes in their virtual world that have been wrought or magnified by an outside company. Small amounts of trafficking by individuals; fine. Large changes to the economy and to the levelling curve; not fine.

Finally, there is the ethical question about why should MMO operators try to stop trafficking in their games? Simple: Because the designers want to.

They spent millions making the world, and they sweated blood to launch it, and they are crafting a particular set of entertainment experiences, for which people (hopefully) pay them. They get the ONLY say-so about what is permissible and what is not.
Sure, they can design for a wide set (almost infinite perhaps) of player interactions, but they get the right to set limits if they so choose. Should there be games where trafficking is allowed and encouraged? Absolutely! I'm working on one now! I hope others are too. But should an outside company decide when to screw with a game just so they can make more money? Should MMO developers have to spend time and money to change to their games to prevent this meddling? My opinion is still 'no'.

...and if you were to ask an outside company to stop meddling, and they refuse and then blatantly use your logos to advertise their business? And when they continue effecting the way *your* world unfolds just to suit *their* business needs? Is sending out a nasty legal note really an overreaction? If that tactic is not successful, then the alternatives generally involve limiting what the players can do in the worlds, to the detriment of all. Large scale trafficking operations should *ask* permission, and only operate in worlds where they are welcome.

[Andres Ferraro]

Michael,

"MMO operators *do* know where all the transferred stuff is stashed, and what accounts they moved through."

So some know (which is more than likely), some other publicly state their opposing position, yet -paradoxically- the set that intersects the means and the motives doesn't seem to have stopped the largest sites.

The only conclusion I can draw is that either the sets are not comprised of the major players, the means are not tuned well enough, or the motives are not that clear-cut; Otherwise decisive action based on clear motives using near-perfect information would have yielded an immediate end to the activity in that gamepsace.

[Mike Sellers]

Mike said, For the last several years, MMO operators have discussed putting an entry into the credit reports (TRW, et al) of subscribers who they ban. Credit reports can have 'misuse of services' entries. This would allow other operators to deny a person access to their service if they are a known troublemaker.

I'm going to go out on a limb and say that this seems like a great idea. At least one worth exploring in detail in terms of the overhead and legal ramifications. MMOGs are becoming sufficiently integrated into pop culture that this could be a real service -- and more to the point, a major deterrant to serial griefers.

Regarding item sales: Messing with that rate (by letting many players get far ahead of others out of sequence) changes the way the entertainment is supposed to unfold.

If the rate at which items or gold are acquired is a serious balance issue then the items should be un-tradeable in game at all. If there are level or class restrictions and those are met in a trade, then the item is by definition not unbalancing the game as intended. Further, it's not like those selling items -- even item farmers -- are finding or creating them faster than the designers intended. So there's really no rate or sequence or other form of game unbalancing going on here, or at least none that's outside of the balancing control of the designers. Again, this really seems to come back to the player perception problem of "hey you got that without spending a hundred hours grinding for it like I did."

[John Riley]

Michael, I'm honestly confused then. How do all of these trading companies continue to operate if the gaming companies have so much information about them. Why are they just not shut down? Cancel the accounts, ban IPs and CC#s - report these people to the authorities and kick them out of your games. When they try to start up again, repeat the process. My skepticism does not come from doubts about whether tracking such things is technically possible, it comes from the lack of results from game companies in dealing with them. A quick look around will find that all the usual sites still are stocking Warcraft gold across all 88 servers, and of course they are buying it too in case you have extra. Since Blizzard announced so publicly that they were going to shut down Ebay auctions the listings there have approximately doubled - there are now 2900+ listings. These types of threatening letters and the condemning press releases are not going to change anything if the gaming companies are not committed to follow through on them.

I understand your point about not wanting devs to have to code and design games around outside markets, but in order to do that they have to be diligent about policing their games and keeping these people out.

You claim that game companies have come a long way in the past few years, and yet the new big budget blockbuster games like Warcraft and EQ2 have many of the same problems that were readily apparent in all of their predecessors. The gaming companies might have made some improvements, but companies like IGE have made even larger strides - they are more organized and agressive than ever. The profits they bring in probably even exceed that of some of the smaller gaming companies. They run fan sites, they run ebay clones, they advertise through every internet medium available and they employ armies of botters to farm gold... AND they have great customer service that is available at your beck and call 24/7. They have gone beyond the hobbyist making an extra buck to professionals whose lively hoods depend on these games. The problems are not getting better, they are getting worse.

[Ola Fosheim Grøstad]

LMC: Your numbers are meaningless, resources are created by design to be limited as part of the game experience. Even if an item is designed to accessible to only 1% of the player base it is good because it was designed that way for balance.

I am not sure what you mean by balance in this case. You mean it is critical for the system that this 1% get to a level of "uberness" that the other 99% will never get to? Maybe that is the way the treadmill works, but it still isn't a good strategy for fun (for the majority).

LMC: I never said anything about 3 farmers for each buyer. What I described is a very common occurrence where commercial farmers take over a spawn or an area and take it out of play for the rest of the player community.

This can only happen if the designers make a spawn campable, and it also makes a lot of assumptions about how the looting system works etc.