At the Digital Entrepreneurship conference, I remarked on the rising number of bankruptcies of virtual worlds or companies that develop them (most cleverly illustrated by Woody Hearns' bugzapper at gucomics, here, here, and here). I'm interested in what we can learn about the bankruptcies of virtual worlds.
What I wanted to ask the Terra Nova community is this: Is there anything special that we should think about or plan for when a virtual world goes under?
Questions include:
- Can virtual property be used as collateral for loans, such that secured lenders get first priority in bankruptcy?
- If courts treat users as having merely non-exclusive licenses for software, can users enforce those licenses over the world creator's objection under Bankruptcy Code 365(n)?
- Can virtual worlds use 365(n) to retain rights under licenses governing user-generated content?
- Is there less, or more, of a problem valuing virtual assets than valuing intellectual property in bankruptcy more generally -- on the one hand, we have grey-market economies to provide a value baseline. On the other hand, the world only has value on its own terms: if the world is gone, its assets aren't worth much.
- Is there any reason to treat intangible assets like virtual property differently than, say, a bank account (given that both are more or less contract rights in an entry in an electronic database)?
I value your questions and ideas more than those I've posted above! What catches your fancy about the end of worlds?
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