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Dec 18, 2004

Comments

101.

lvl 100? gratz n phat nu yr 2 u

102.

Most people purchase software BEFORE they have an opportunity to read the EULA, and most retailers won't let you return opened software, so unless we're supposed to guess whats in the EULA or eat the cost of the software without using it, I think Matt's ehtical requirements for use are impracticable. Like Ola, I hardly ever read the EULA anyway, I just click Accept so I can play. Does that mean I contractually agreed to the EULA? I'm not sure all judges would think so, especially since I have no recourse (returning the product).

As far the immorality of business goes, that is a total can of worms. How many 'jobs' can we think of in this world that are morally unredeeming? If there could only be doctors, policemen, firemen and farmers then the other 99% of us would stay unemployed. People will do what they can do to survive and pay bills, even if its catering to a niche market. I have a great deal of respect for the entrepreneur who can invent a job for himself where there was none before. Going down that road of thinking, how much more 'productive' and 'moral' are the jobs of the developers who created the game in the first place? MMOG's are business endeavors meant to do one thing: make money. How then is what they do cosmically different than what I do? Does their 'right' to make money trump mine, even in areas that do not even compromise their revenue stream? This idea seems arbitrary and arrogant at best. In many ways this resembles a PR war with the MMOG companies owning the biggest soapbox, declaring themselves to be 'good' and anyone they disagree with 'bad'. Thinking adults should know better.

103.
Mithra: "Like Ola, I hardly ever read the EULA anyway, I just click Accept so I can play. Does that mean I contractually agreed to the EULA? I'm not sure all judges would think so, especially since I have no recourse (returning the product).
Actually, it does mean you agreed. The test isn't whether you actually agreed, but whether the developer can reasonably rely on your "click" as assent. The point of contracts is to facilitate transacting, not frustrate it.

JC

104.

The thing it all boils down to, for me, is that in-game farming of money and/or items (especially when done by bots) as well as inflation brought about by an increased supply of in-game currency (due to farming), impacts the playing experience of 'normal' players negatively. It is a disruption of game play, as defined by the game design/vision of the developing party, as well the model of game play envisioned by the majority of players. Hence it is commendable when Blizzard/Vivendi cracks down on out-of-games sales. I really hope they hurt the farmers bad - they are leeches. However, I feel that one thing which would help a lot would be a harsher stance towards buyers. The buying party is funding disruption of game play, and should be punished.

105.

Barry hit the nail on the head when he specifically pointed out that the thousands of guild 'twinking' transactions that occur in-game are effectively no different than the thousands of other transactions that involve cash. The net change on the economy is zero, nothing is being created or destroyed, just redistributed. It was also mentioned that farming/cheating/powergaming often occur even when there is no secondary cash market, so... your suggestion that eBay is harming the game world... this is an unsubstantiated argument.

We are now making a complete circle.

Did I mention that the longest running MMORPG (UO) is also the most highly commodified? I would recommend scrolling up and reading the rest of the blog.

Happy New Years, everyone. :)

106.

The difference between guild twinking is that it usually involves guild membes sharing existing wealth.

E-bay sales are usually based on massive farming, potentially using cheats/exploits/macros to accelerate the process.

Commodification is, IMHO, not a problem when it is based around players selling existing wealth. The problem is when wealth/items are generated for the sole purpose of out-of-game sales. This is when disruptive behavior appears.

107.

It's quite possible that this has little to do with anything other than Blizzard and Vivendi meeting the obligations in their distribution agreements.

From what I understand, Gamer's Loot was not just selling World of Warcraft gold. They were also bundling World of Warcraft gold with a World of Warcraft account (something they've attempted to do with multiple games). Selling such a package raises a different set of concerns altogether, though it's probably much less interesting for those on this board.

Publishers have very specific business arrangements set up with authorized distributors to get a game out to market. Those arragements are often catered for retailers, as they are still the most important distribution channel in North America. Those agreements could include things like a moratorium on online code sales so that people will initially have to go to a retail store, or a cross-promotion, or having them sponsor some special event (like a launch party). They also provide pricing structures, exclusivity/non-exclusivity items, length of terms, and all of the other glorious stuff we pay our lawyers for.

By providing an account + gold package, Gamer's Loot essentially attempted to skirt these arrangements and undermine the entire retail channel.

Of course authorized distributors like Best Buy, Fry's, Amazon, and CompUSA never really find this amusing, and I'm sure they made plenty of noise when they see unauthorized sales of World of Warcraft being sold online at the same price PLUS packaged with additional content that they couldn't provide. Retail is serious business, and if/when a retailer finds things like this out, they'll be expecting immediate action from the publisher.

Just a thought.

108.

Peder wrote:

The thing it all boils down to, for me, is that in-game farming of money and/or items (especially when done by bots) as well as inflation brought about by an increased supply of in-game currency (due to farming), impacts the playing experience of 'normal' players negatively. It is a disruption of game play, as defined by the game design/vision of the developing party, as well the model of game play envisioned by the majority of players.

I'm with you so far, and I completely agree. Farming in general detracts from the immersive nature of most MMO games, and when a game structure is in place that provides good rewards for low-risk, easy activities, players tend to use that fact to their advantage. The more people who do so, the more pronounced the impact will be.

Farming is a problem... which is why I proposed a relatively simple set of anti-farming changes earlier in the thread.

Hence it is commendable when Blizzard/Vivendi cracks down on out-of-games sales.

I was with you Peder, right up until this non sequitur. Farming occurs whether or not outside sales exist. Farming tends to crop up as a "rational" response by players when there is a distortion in the risk/reward equation within a game. In general, rational players will tend to seek ways to maximize rewards per unit time.

When a game's reward system allows them to generate better rewards by standing in one place doing something easy (like killing mobs that represent no real danger to their characters) rather than doing something difficult and/or risky, then they will tend to take the easy path.

Targeting the out-of-game sales for punishment in this case is like prosecuting only the assault cases committed by brunettes, while letting blondes and redheads go scott free. It's not the fact that they are brunettes that is creating the assault. It's targeting the wrong attribute.

One of the earliest economic lessons I learned was "if you reward something, you'll tend to get more of it". We see that taking place in many MMO games today. Players discover that they get good in-game rewards for farming... and they therefore proceed to farm.

The correct response if you don't want to see farming, is to adjust the game to make farming less rewarding. If you make standard game play the most rewarding in-game path, you'll see people naturally gravitate towards that path and away from farming. Make the system scalable enough to impede even those who try to macro/bot an activity, and you'll fix that problem, too.


Peder also wrote:

The difference between guild twinking is that it usually involves guild membes sharing existing wealth.

E-bay sales are usually based on massive farming, potentially using cheats/exploits/macros to accelerate the process.

Commodification is, IMHO, not a problem when it is based around players selling existing wealth. The problem is when wealth/items are generated for the sole purpose of out-of-game sales. This is when disruptive behavior appears.

This just doesn't hold water for me. Generally, all of the wealth that exists in a game is created... none of it is pre-existing. There are a VERY large number of guilds out there focused on getting "phat lewt" for their members, and every time they go out hunting or raiding, they are generating new wealth out of thin air.

In fact, many of these guilds form precisely because forming together allows them to create loot that none of them had before, and would never have had if they hadn't grouped up together. The guild aspect simply formalizes and makes more efficient the wealth-creation process for its members.

Players tend to want cooler stuff over time, and they will pursue that desire even if there never existed any external markets for resale purposes. That tends to be the nature of the beast when you create a game where player advantages are tied so strongly to the acquistion of in-game items and currency.

Problems of farming, cheats, exploits and macroing/botting are fundamental problems in and of themselves, to the extent that that generate disruptions in the game. They should be addressed as such... as in-game disruptions. They are in-game behaviors that result in problems for other players. I encourage developers to create systems for remediation of these issues, eleimination of these in-game player behaviors, and ideally to address them by altering the risk/reward structures accordingly.

All of these things occur irrespective of whether there are out-of-game sales. Address the root problems, ensure that there is no disruptive in-game behavior, and the existence of external markets becomes irrelevant.

If the problem is disruptive behavior in the game, address the disruptive behavior in the game. If the problem is moral outrage over the fact that you don't like someone else making money, that is an entirely separate issue.

I've commodified various games before, but I have not done so in World of Warcraft... so I don't technically have a dog in this fight. Whenever I have commodified, I have always ensured that my in-game behavior does not represent a disruption to other players. The standard I always followed was to ensure that I created no more disruption to those around me than any other player would have (simply by their existence there and competition for resources).

All of my wealth-gathering was performed in person, at the keyboard. I specifically sought out areas where there were few or no other players, and I happily shared spawn points with others when places became too crowded to hunt alone. I did not kill-steal, hack, packet sniff, exploit, bot or in any other way create a disruption in the games I commodified.

The only difference between my behavior and that of other players was in my motivations for disposing of what I had accumulated along the way. I often traded my stuff away in-game in exchange for cash out-of-game.

As far as I can see, the only real objection other players can level at me (when compared to, say, a twinker's guild) is that I actually made money as I played. I clearly wasn't a disruption, and I didn't generate anything disproportionate in wealth to any other "regular" player. On balance, I probably caused less "inflation" than the average player, since I had a below-average number of hours in which to play.

All I did was distribute that wealth to other players for different reasons than a twinker's guild.

If anyone is going to attack me as a commodifier, let's be clear as to why it is that you are launching the attack. It's not because I was disruptive to the game. I'm sure that that there are plenty of other commodifiers out there who fit the same profile as I do.

If you want to launch against those who are disruptive, feel free. I agree that they are generally a plague on the game. Just don't assume that you are justified when you make the brush that you tar people with arbitrarily wide.

109.

Will Leverett wrote:

From what I understand, Gamer's Loot was not just selling World of Warcraft gold. They were also bundling World of Warcraft gold with a World of Warcraft account (something they've attempted to do with multiple games). Selling such a package raises a different set of concerns altogether, though it's probably much less interesting for those on this board.

Publishers have very specific business arrangements set up with authorized distributors to get a game out to market. Those arragements are often catered for retailers, as they are still the most important distribution channel in North America. Those agreements could include things like a moratorium on online code sales so that people will initially have to go to a retail store, or a cross-promotion, or having them sponsor some special event (like a launch party). They also provide pricing structures, exclusivity/non-exclusivity items, length of terms, and all of the other glorious stuff we pay our lawyers for.

Assuming this is an accurate description of what happened, all of this is fundamentally moot in the face of the First Sale Doctrine. Once Gamer's Loot legally acquired a retail copy of the game, the franchise ends with that sale.

So long as they don't actually install that particular copy of the software, they are free to resell it, give it away, burn it, staple, fold, spindle or mutilate it. They get to set their own price.

By providing an account + gold package, Gamer's Loot essentially attempted to skirt these arrangements and undermine the entire retail channel.

Of course authorized distributors like Best Buy, Fry's, Amazon, and CompUSA never really find this amusing, and I'm sure they made plenty of noise when they see unauthorized sales of World of Warcraft being sold online at the same price PLUS packaged with additional content that they couldn't provide. Retail is serious business, and if/when a retailer finds things like this out, they'll be expecting immediate action from the publisher.

Any such "immediate action" would likely be an antitrust violation. Price fixing is generally illegal, as is market allocation beyond the first sale. The nature of free competition means that there is no such thing as "undermining the retail market".

Gamer's Loot would have made a legitimate purchase in the same way as any other retailer, and is free to set whatever price or bundling arrangements they like (barring, of course, a specifically contracted resale agreement to the contrary negotiated between Gamer's Loot and the manufacturer).

For more info on the First Sale Doctrine, specifically as it applies to computer software, see the associated Wikipedia entry

I could, for instance, buy game time cards and retail copies of the game from my local CompUSA, and resell them for whatever price I liked, or in any combination of other products. I'm not bound to any contractual agreements that CompUSA has with Blizzard/Vivendi in that case, and I would pretty clearly have no contractual agreements to the contrary with Blizzard/Vivendi if I didn't break the seals on the boxes.

Any bundling would represent a value-add on my part, and I'm generally free to set whatever price I like on the bundle. I might create a bundle of a retail copy of the game, a game time card, and a strategy guide I had written.

If other retailers see me offering a better deal to consumers than they do, they are free to lower their prices or offer additional values as well. They are not free to try to intimidate someone out of business because they don't like the retail arrangements they have already made.
That is fundamentally anti-competitive, and antitrust laws serve to protect against such behavior.

110.

Barry Kearns>Generally, all of the wealth that exists in a game is created... none of it is pre-existing.

If you can't get it out of the game, is it wealth at all?

In other words, if it wasn't wealth before someone commodified it, how can they use the fact that now it is wealth to justify their act of commodification?

Richard

111.

Richard wrote:

If you can't get it out of the game, is it wealth at all?

In other words, if it wasn't wealth before someone commodified it, how can they use the fact that now it is wealth to justify their act of commodification?

Personally, I used the term in the sense of the second definition at Dictionary.com, namely "All goods and resources having value in terms of exchange or use".

I'd also include definition 1a as being pretty close, too... "An abundance of valuable material possessions or resources; riches." I'd de-emphasize the material nature, of course. What counts for me is that there is something transferrable which provides benefit to the receiving party. This tends to make the transferred thing an object of utility, and people will therefore assign value to it.

The fact that the utility or even the transfer itself might be constrained to a particular environment doesn't render it valueless, in my opinion. It simply sets a context for the particular value.

In that context, I'd even consider information to be part of that "wealth" bundle. Showing someone how to defealt the Enraged Foozle when they are stuck is a value, and many people are willing to exchange other values in order to acquire the benefit.

For example, I've hired folks in-game to help me past a sticky point in a particular quest, and compensated them for their time and effort. The compensation is typically in the form of in-game currency or items, but that's something that tends to have both value and utility, so I've exchanged value for value.

In the case of commodification, people are simply trading away a value in one domain, and providing for compensation with another exchange in a different domain.

I might give a friend in Star Wars Galaxies 100k units of good-stats iron, and in exchange he gives me a nice full set of leather armor in World of Warcraft. We are exchanging values cross-domain.

The iron couldn't leave SWG, and the leather can't leave WoW. That doesn't make either of them non-valuable. We each assign relative values and determine the utility, and agree that the swap is mutually beneficial.

Why would some constraints on portability lead you to believe that it wasn't "wealth"? If it's transferrable and useful (even within a confined domain), that seems to fit the criteria as far as I can see.

To answer your second question, I think it's pretty obvious that it was wealth before anyone decided to commodify it, by any reasonably useful definition of wealth.

112.

First sale doctrine as I understand it applies to transactions of standalone software, primarily because it was ruled that the simple installation and use of such software does not really need a license. It has yet to be applied to a subscription based online services, which are a different breed and actually make a valid argument for using license agreements. The software in the box is only part of the product - it won't work on its own.

Even if it did apply, Gamer's Loot cannot sell anything that they do not have the rights to. Blizzard's EULA is pretty specific about the resale of in-game content, and the gold had to come from someone who agreed to it.

113.

Will, the World of Warcraft EULA and ToS make it pretty clear that it is the installation of the game client and the registeration of a user account that establishes the assent to the EULA and TOS. It also makes clear that the game itself is clearly transferrable, and that ownership of the game is established as it relates to such a transfer.

Excerpts from the WoW EULA:

"3. Ownership.

B. You may permanently transfer ownership of the Game and all parts thereof, and all of your rights and obligations under the License Agreement, to another by physically transferring the CD-ROM, all original packaging, and all Manuals or other documentation associated with the Game, and by removing from all of your home or personal computers and destroying any remaining materials concerning the Game in your possession or control, provided the recipient agrees to the terms of this License Agreement."

It seems pretty clear to me that the purchaser has ownership of the game... otherwise, how could they transfer ownership?

Gamer's Loot clearly didn't establish a license on the copies they purchased for resale, as they never installed the software and didn't register the associated account.

For a still-sealed box, it then seems clear that even Blizzard/Vivendi is acknowledging that the game is purchased, and can be transferred. First Sale doctrine would therefore apply.

Even if they didn't acknowledge the ownership, I think the relevant precedent in this case is SoftMan vs Adobe (2001). That case makes it pretty clear that it is the use of the software which generates the agreement to the EULA and ToS, and that even if there is a resale prohibition in the EULA, it doesn't apply to parties that never assented to it.

Frankly, I think the whole concept of 'Vivendi is doing this because retailers are pissed about bundling' is a complete non-starter.

The only thing we are left with, then, is the allegation that there is some kind of IP infringement that arises from transferring gold in the game for consideration outside the game.

There are no unlicensed copies being made of any IP, nothing is being extracted or inserted into the database that wasn't already there, all IP remains under the control and possession of Blizzard/Vivendi the entire time, all manipulations of data within their databases are taking place via fully licensed and properly purchased software, which conforms entirely to the coded mechanics that Blizzard/Vivendi put in place.

How can there be an IP violation in that case?

Will wrote:

Even if it did apply, Gamer's Loot cannot sell anything that they do not have the rights to. Blizzard's EULA is pretty specific about the resale of in-game content, and the gold had to come from someone who agreed to it.

My contention is that none of the content is being re-sold, as nothing within the game ever leaves the possession and control of Blizzard/Vivendi.

The only thing being "sold" in this case is a player's decision to cooperate with another player. I fail to see how a player's cooperation or decision to cooperate is somehow Blizzard/Vivendi's intellectual property.

We each "own" our decisions and our considerations, and can therefore "sell" them. In reality, we don't sell them at all... we simply agree to alter our actions in exchange for some form of consideration.

If manipulating the database via the approved and licensed game client (in the exact way that the developers coded it) somehow constitutes an IP infringement, then every player is guilty.

114.

Neither first sale nor Blizzard's EULA, though, permits Gamer's Loot the ability to package that box along with game content such as gold and items.

All content is accessible only via a registered game account created by an individual who accepted the Blizzard EULA and Terms of Use, which is pretty clear on the matter. The license states "You have no interest, monetary or otherwise, in any feature or content contained in the Game." The associated Terms of Use states "You may not exploit World of Warcraft for any commercial purpose" in addition to the long ownership clause included in the mail sent by their counsel. They also publicly stated for the record where they stand on this issue, and that Blizzard owns or has exclusively licensed all content in the game.

Either Gamer's Loot was breaking the license agreement by gathering and attempting to sell the gold themselves, or they had no rights to access it at all.

Also, just because they have not agreed to the license agreement doesn't mean that they can arrange for the sale of the gold. This is the "we just place a buyer with a seller" argument that IGE uses. A EULA is what defines a business relationship between the player and the publisher. Companies like Gamer's Loot and IGE can easily be considered engaging in tortious interference by not only assisting a player in undermining the EULA, but also by profiting from it.

I certainly agree that we own our decisions. But that doesn't absolve us from following the rules that we agreed to, or from the consequences of that decision if it is breaking the rules.

115.

Is the commodification of gold or items taking place in contradiction to the EULA? As it is written, yes.

However, I don't accept that simply because they chose to write the EULA in that manner, that their claims within that EULA should automatically be treated as enforceable.

As we see in the text of the SoftMan vs Adobe case:

Whether contracts such as Adobe's EULA, often referred to as "shrinkwrap" licenses, are valid is a much-disputed question.15 A number of courts that have addressed the validity of the shrinkwrap license have found them to be invalid, characterizing them as contracts of adhesion, unconscionable, and/or unacceptable pursuant to the Uniform Commercial Code. Step-Saver, 939 F.2d 91; Vault Corp. v. Quaid Software Ltd., 847 F.2d 255 (Sth Cir. 1988).

They later commented on public policy questions:

The Court finds that the provisions contained in Adobe's EULA purport to diminish the rights of customers to use the software in ways ordinarily enjoyed by customers under copyright law. Therefore, these restrictions appear to be inconsistent with the balance of rights set forth in intellectual property law.19 Commentators have noted that the arguments for enforcing this balance are particularly persuasive in the context of shrinkwrap licenses because the balance of rights in intellectual property law is already tilted heavily in favor of the intellectual property owner. "The only countervailing forces favoring users are those rights specifically granted to users by federal law. In this context more than any other, therefore, it is justifiable to fear that removing or eviscerating those user rights may bring the whole edifice crumbling down."20

____________________

19 Scholars have suggested that Congress contemplated that parties might attempt to contract out of a first sale right. "Congress was explicit in the context of section 109(a) that it intended for vendors who 'contract around, the first sale doctrine to be limited to contract remedies. The approach of shrinkwrap licenses - to attempt to extend vendor rights by contract while retaining the panoply of copyright remedies - was explicitly disavowed by the Committee Note." Mark A. Lemley, Intellectual Property and Shrinkwrap Licenses, 68 S. Cal. L. Rev. 1239, 1283 (1995) (citing H.R. Rep. 94-1476 (1976) (providing that the parties may contract around the first sale doctrine in 17 U.S.C. 109(a), but limiting the copyright owner to contract rather than copyright remedies if they do so)).

20 Lemley, Intellectual Property, at 1283.


In the case of commodification, I think we have a public interest / public policy question that pertains directly to the scope of what consumer rights a company can "write away" through inclusion in their EULA.

Other court rulings with respect to antitrust violations make it seem pretty clear to me that the ability to engage in commerce and trade, even down to the level of the individual, is a fairly important public policy question... and one of the fundamental reasons that we have antitrust legislation to begin with. I think this is precisely one of the "rights specifically granted to users by federal law" as spoken to by the court.

In short, I think there's a case to be made that writing a customer's commercial interests out of existence in a contract of adhesion via EULA (when there is no IP violation) is a restraint of trade, and might therefore be unenforceable.

And to be clear, an IP violation is PRECISELY what Vivendi is alleging in their C&D. They seem to be using that as a pretense to extort funds from commodifiers, and/or put them entirely out of business. That appears to strengthen the case for a restraint of trade action... it's clearly anti-competitive.

From the First Sale doctrine, it seems clear to me that the act of creating something doesn't give you carte blanche regarding whether or not someone else can make money in association with "your creation".

Freedom to contract is not a perfect escape hatch, either, as we see in note 19 from the SoftMan vs Adobe case that I cited above. You can't simply assert that a contract violation somehow becomes a copyright violation, and have that assertion automatically become reality.

The contention that this behavior is an IP violation is simply over-reaching, in my opinion. I can only hope that Vivendi decides to "pull the trigger" against someone with large enough legal guns that they will fight back.

Perhaps some of the questions raised in the Black Snow case might finally get some resolution along the way.

116.

I’ve had a go at arguing in several of papers that extension of Copyright in game code to things such as virtual objects might abuse of IP under the kind of principles laid down in cases stemming from Morton Salt (334 U. S. 37 (1948)).

There is certainly an argument here, whether it stands up legally is a different matter but I would like to see someone try it.

117.

Hum, speaking for us over at Gamersloot.net, I thought I should set a few things straight:
We Do sell World of Warcraft games and gametime cards, however we never did any bundling of any in-game items, and are actually not (and have never) offered any World of Warcraft in game items or services. Yet.

That didn't prevent VU from sending us a C&D in the first round, and 3 more copies for good measure a couple days ago.

I personally spoke to the Senior Counsel of VU last month, who was appreciative of the fact that we weren't "being bad" however expressed concern over the fact that we were offering the extra service of opening boxes and emailing cd-keys to customers.

Since we haven't installed the game (haven't even had time really!) and bought most of the many copies we resold from Fry's, I firmly believe the First Sale doctrine applies and we should be free to do as we please. Since however we would like to maintain goodwill with VU in general and Blizzard in particular, we modified our text to indicate that we're selling actual copies of the games, available for pickup at our northern california location. And still send a key out for convenience unless asked otherwise.

Regarding the virtual goods issue:

1) I believe it's perfectly legal. The gold isn't really being sold, it's the time spent aquiring it that is (stays VU's property the whole time, they can at any time decide to erase it after all, though -that- could/will raise interesting legal issues at some point). And a EULA asking you to agree that you can't value your time is invalid.

2) If the fact that VU is big is a problem as he can't afford a lawsuit, the seller can just decide to sell a pin's for $10 and give 10 free gold as a bonus with it. Or 2 pin's and 20 free gold. (probably some legal issue with that but worth a try)

3) if that still doesn't do it, setting up a company in China or Russia as indicated will.

4) If enough accounts are banned to make it worthless, business will just go more and more to IGE who can afford the hassle and just crank up the price to cover for it. They'll have all the business anyway so who cares. (not gonna happen though)

The solution? Well, hopefully I'll sit down with a blizzard Biz-dev person to discuss it shortly ;)

118.

Just a question.. Is there any way for the community to bring up a law suit against IGE and other such companies on the basis of the EULA/TOS? I mean if the Game Companies are not enforcing part of their own agreement can we the customers seek legal remedies to see these shrinkwrap contracts enforced?

I am totally for any means that shuts down IGE and all of these companies making profit from others Intelectual Property. They are ruining what is supposed to be a break from reality, by bringing alot of the problems in reality to the mix.

119.

Jose wrote:

I am totally for any means that shuts down IGE and all of these companies making profit from others Intelectual Property.

I'm curious... does anyone know from where and when this disturbing meme arose, that having Intellectual Property means that no one else can profit from it?

It seems to be becoming more pervasive, and I find that unsettling.

From my understanding, the whole idea behind copyright (specifically) is to give creators only a highly limited monopoly with respect to their creations, and that everything that falls outside the bounds of those limits is "fair game".

Ren Reynolds made some excellent observations in his fine paper "Hands off MY Avatar!":

Under US law, the five exclusive rights held by a copyright holder are: the right to make copies; prepare derivative works; sell copies; perform the work publicly; display the work publicly.

and later on in the same paper:

Many jurisdictions have adjudged that there are sound public policy reasons for limiting the control of works and other materials by virtue of the rights granted under various intellectual property laws. If a copyright holder includes terms in a contract which limit or prohibit acts that would otherwise by permissible under prevailing copyright laws; they may, under US law, be adjudged to be in abuse of intellectual property law on a number of grounds: that they are violating the public policy that motivates the law, that the terms are anti-competitive, or they the terms breach anti-trust laws (Elkin-Koren 2001). What’s more anyone claiming an alleged abuse does no have to demonstrate injury as a result of said acts.

The principle that an intellectual property law could not, on the basis of public policy, be leveraged to restrict otherwise permissible acts was established in the case of Morton Salt v Suppiger[18] where the maker of a salt tablet machine attempted to licence the use of their machines to farmers on the condition that only the machine makers salt tablets were used with the machine. Here the Supreme Court ruled that ‘[while the grant of patent provides monopoly rights it] equally forbids the use of the patent to secure an exclusive right or limited monopoly not granted by the Patent Office and which it is contrary to public policy to grant’. Twenty or so years before this in Motion Picture Patents v Universal Film[19] the Supreme Court made the general ruling that that a patent licence could not be used to prescribe a restricted use to the detriment of the public. This case concerned a licence for ‘projecting-kinetoscopes’ which stated that the film projectors could only be used with films that projected film patented by the licensing company, in a very strongly worded ruling the court stated ‘A restriction which would give to the plaintiff such a potential power for evil over an industry which must be recognized as an important element in the amusement life of the nation, under the conclusions we have stated in this opinion, is plainly void, because wholly without the scope and purpose of our patent laws, and because, if sustained, it would be gravely injurious to that public interest, which we have seen is more a favorite of the law than is the promotion of private fortunes’. Here it is interesting that the court took into account the ‘amusement life of the nation’ and did not restrict itself to purely commercial considerations.

While it was in 1968 that the US Supreme court confirmed that the scope of rights in a copyright work is just those rights outlined in the act, stating in Fortnightly v United Artists[20] that ‘The Copyright Act does not give a copyright holder control over all uses of his copyrighted work …If a person, without authorization from the copyright holder, puts a copyrighted work to a use within the scope of one of these "exclusive rights," he infringes the copyright. If he puts the work to a use not enumerated in 1 [section 1 of the prevailing act], he does not infringe’. It was not until the 1990 case Lasercombe v Reynolds[21] that the Supreme Court considered whether there was a defence of copyright misuse based on principles equivalent to Morton Salt. It established that there is, stating ‘since copyright and patent law serve parallel public interests, a ‘misuse’ defense should apply to infringement actions brought to vindicate either right’.

Even the five exclusive rights are further tempered by other considerations, namely First Sale Doctrine and the like.

I can't see how commodification of game currencies falls within the bounds of any of the five exclusive rights, and as we see above, trying to contract around it using the contract-of-adhesion route that many EULAs take might very well be a misuse of copyright.

I think if there is a class-action lawsuit in the making here, it might be in exactly the opposite direction that you're thinking, Jose... the class-action might name all game users who want to commodify as the class, and might name the game companies as the defendants.

120.

I see your points and I understand them.. However, I have been a member of the MMO community for over 11 years now. I have seen it from its infancy as far as Graphic stages to the jugernaut that it is today. What concerns me is that this type of practice(selling ingame content for RL cash) deters from the spirit of fair play and the Vision or goal whatever you want to call it of the Game Creators.

In essence these games are of competitve nature correct? I dont play them that way but they could be viewed as that. So the game creators have a set of rules that must be followed to allow balance in the sense of even ground for all parties involved.

In my own humble opinion, if there is no law that can Prevent ppl from taking advantage of someones intellectual property in this way, then one should be written. Especially when most of the MMO Community stands against these sort of antics.

Unless we get rid of these types of Companies, the MMO genre will continue to deteriorate and the quality of the games will suffer, the general user experience will suffer aswell, since the Ingame Economy something these games thrive on will be crippled by the Sale of ingame Items and Currency for Dollar Bills.

Barry if such a lawsuit as u describe at the bottom happens, you rest assured that 90% of the player base you see today will most likely not take part of it. Commodification is the worst thing that can happen in MMOs, I am happy enough paying for my monthly subscription I dont want to have to spend hundreds of dollars to stay competitive in these games. Thats not what MMOs were intended for. Thats not what Game Developers want, and contrary to popular Belief Game Developers care alot about making their game successful, they care more for that than for the Money. I should know I am one.

121.

Jose> I am totally for any means that shuts down IGE and all of these companies making profit from others Intelectual Property. They are ruining what is supposed to be a break from reality, by bringing alot of the problems in reality to the mix.<

While I strongly agree with you on the negative effects of out of game sales, I'm rather dismayed to see it framed in intellectual property terms. To me, the issue is one of fair play, of sticking to the rules of the game. Would anyone seriously argue that having the money to buy a second chess set gives you the right to play with two queens? Why should having out of world money give you the right to play with items in WoW your character couldn't otherwise obtain?

I've no idea though how the to me "obvious" right of game masters to set the rules of the game would be expressed in legal terms. Intellectual property perhaps isn't the right vehicle to express that "right".

122.

Jose wrote:


In essence these games are of competitve nature correct? I dont play them that way but they could be viewed as that. So the game creators have a set of rules that must be followed to allow balance in the sense of even ground for all parties involved.

It would be easier to "buy" this sort of argument if we didn't see rampant twinking, particularly guild twinking, occurring even in absence of an external market.

We lost the sense of "even ground" as soon as developers wrote code (and by extension, rules) which allowed one character to gift massive amounts of competitive power to another character who had never "earned" it.

Such a practice fundamentally wrecks the competitive landscape for any player without such benefactors who will heap largesse upon him or her. If anything, the formation of an after-market is a logical and efficient counter-strategy for those who lack as large of an in-game social network as others.

The competitive advantages from guild twinking should not be underestimated, either. A co-worker of mine left our guild in order to join a guild focused on "powerleveling" a few days ago. He didn't know any of these people, and after joining he has had many rare bind-on-equip items (not post-use discards) given away to him... items he would not have received otherwise.

He's been levelling much faster since joining that guild of strangers.

Commodification simply makes that sort of process more economically efficient. You're acquiring unearned power from strangers there, too... you're just being a bit more explicit about the compensation the other party receives.

Unless we get rid of these types of Companies, the MMO genre will continue to deteriorate and the quality of the games will suffer, the general user experience will suffer aswell, since the Ingame Economy something these games thrive on will be crippled by the Sale of ingame Items and Currency for Dollar Bills.

Again, this is a fundamental mis-identification of the root problem. It's not the fact that dollar bills are being traded that "disrupts" the in-game economy, since nothing in the in-game economy is being created or destroyed as part of that transaction.

If you're talking about farming and twinking being disruptive, then fine... address those problems instead. I've offered counter-farming solutions above, and I'm sure hundreds of other people have good ideas on ways to make farming a disincentive rather than the highly-rewarded practice it often is today. Games tend to get more fun along the way, IMO, as a nice side effect.

Barry if such a lawsuit as u describe at the bottom happens, you rest assured that 90% of the player base you see today will most likely not take part of it.

The size of the class is not generally at issue when it comes to deciding the underlying legal issues.... instead, it tends to affect the size or distribution of awards.

I'm vastly more interested in seeing some the questions that are currently in "legal limbo" resolved, than I am in seeing any particular set of people get huge paydays out of it.

Commodification is the worst thing that can happen in MMOs, I am happy enough paying for my monthly subscription I dont want to have to spend hundreds of dollars to stay competitive in these games.

I disagree, precisely because of the mis-identification I pointed out. I think it's the twinking/farming combination that is horribly disruptive to MMOs... and those can be addressed fundamentally in the game without having to attack commodification per se.

Thats not what MMOs were intended for. Thats not what Game Developers want, and contrary to popular Belief Game Developers care alot about making their game successful, they care more for that than for the Money. I should know I am one.

Please don't make the logical mistake of assuming that because you are a game developer, you can accurately speak for all game developers.

You clearly don't... and the best counter-example to that is the fact that I'm a game developer as well.

I care greatly about the games that I've created (as well as the ones I'm still developing), but if it comes to a choice between two lists of developers (List 1: Highly popular but unprofitable, List 2: Highly profitable but not popular), I'm certain as to which list I'd choose to be on.

Game developers are hardly as monolithic as your statement would imply. Let's avoid descending into a battle of competing "argument from authority" logical fallacies, shall we?

123.

Hellinar wrote:

Would anyone seriously argue that having the money to buy a second chess set gives you the right to play with two queens?

It gives you the ABILITY to do so. I've done so before without buying a second set (pawn promotion), and I've also used multiple queens from more than one set before in higher handicap games.

Would you support chess manufacturers enclosing "license agreements" which prevent people from playing chess with "their" pieces in some configuration other than what they envisioned?

Why should having out of world money give you the right to play with items in WoW your character couldn't otherwise obtain?

It's a straw-man argument. It's obvious that people CAN obtain those items otherwise... all it generally takes is time, or someone else willing to simply GIVE that item to your character. Some will do it for free, some will want something in exchange.

I'm not aware of anything that you can acquire from a commodifier, that can't be acquired in some other way. In-game currency is arguably the easiest thing of all to obtain... it's generally a function of time. Get your guildmates to give you stuff, and sell it off for in-game currency.

Of course you can "otherwise obtain" these items via methods other than commodification... if you couldn't, then commodification not only wouldn't be a problem... it would likely be impossible within that game!

The ability to "gift" value to other characters is a pretty major prerequisite to commodification arising, after all.

124.

First the EULA isnt a legal standing agreement.

Second selling in game currency for example is trademark infringement and to a lesser degree, copyright infringement.

Even if the seller made the point that they are "selling their time" it is still illegal because they are still trafficking things that they do not own wihtout permission.

Even if you never signed the EULA it still falls under USC 17 trademark laws. You cannot try and make a profit on anything that you yourself do not have trademarked without the permission from the company that owns the trademark.

Regardless ALL people have to agree to read and sign the EULA when they install the game. This gives them even more of a right in court to enforce their trademark laws, because people cant say that "We didnt know they didnt give us permission".


Im kind of sick of hearing about this and all of the people who dont think it is illegal. www.cybercrime.gov has all the copyright and trademark laws as well as software laws etc.

If your a US citizen and you cant interpret the law your probably in trouble. Or your just trying to defend your MMO currency business.

Hope this clears it up. And I dont think Blizzard a HUGE company would have amateur lawyers who dont know what they are doing. This is not a difficult case at all for them to win.

125.

Jose> I am totally for any means that shuts down IGE and all of these companies making profit from others Intelectual Property. They are ruining what is supposed to be a break from reality, by bringing alot of the problems in reality to the mix.<

Interesting comment. This part:

"shuts down IGE and all of these companies making profit from others Intelectual Property"

I think I can safely assume that the writer means without the permission of the IP owner.

How would this not apply to copyright lawyers? Ok, let me rephrase that, how would this not apply to copyright lawyers for those accused of copyright violations? They are profiting from the copyright of the IP owners, aren't they? If those copyrights did not exist, they would have the income and profit.

Or a case closer to home, how does this not apply to literature professors? Or to media critics? Or to writers acting as game reviewers? Or writers of strategy articles?

Unless these can be distinguished somehow, I think we've already established that one CAN profit off someone else's copyright or other IP, albeit indirectly. And there are "Fair Use" laws.

So it's not clear cut, it's a case of exactly where the line is drawn (or where the fuzziness that become gray area begins). What we're differing on here in many cases is where to draw that line, not that one does exist somewhere.

The IP owners want the line to scribe a circle as widely as possible. The public interest may compress that significantly, and those who seek to profit along the edges may press inward even more.

126.

And now I find this from Google as an example of the unauthorized use of the IP of others... and in this case it's clearly for profit too, and could be detrimental to those piggybacked upon:

http://www.thetwowayweb.com/2005/02/22#a272

127.

I want to see this practice stopped period!!! It ruins the gaming experience for those of us who play fair, I don't care how you slice it. Im seriously thinking about starting up some kind of petition to get the politions to start looking at this. It amazes me how some people who are too lazy to get a real job use this as an excuse for one.
And that Im selling my time BS, give it a rest. We need to put a stop to these companies now. If Sony hadn't let it run rampant it probably wouldn't be so bad.
I honestly and truly think it is time for those of us who are sick of this practice to start complaining to our representatives and such. I have already written to mine and he too thinks it should be stopped.

128.

I want to see this practice stopped period!!! It ruins the gaming experience for those of us who play fair, I don't care how you slice it. Im seriously thinking about starting up some kind of petition to get the politions to start looking at this. It amazes me how some people who are too lazy to get a real job use this as an excuse for one.
And that Im selling my time BS, give it a rest. We need to put a stop to these companies now. If Sony hadn't let it run rampant it probably wouldn't be so bad.
I honestly and truly think it is time for those of us who are sick of this practice to start complaining to our representatives and such. I have already written to mine and he too thinks it should be stopped.

129.
Second selling in game currency for example is trademark infringement and to a lesser degree, copyright infringement.

Interesting. Tell me, if I transfer 50 gold pieces from my character's WoW inventory to a friend, and in exchange, he hands me a $20 bill, exactly which of Blizzard / Vivendi's trademarks have I infringed, and what is the precise nature of the infringement? Do you even understand what a trademark is, versus a patent or copyright?

Even if the seller made the point that they are "selling their time" it is still illegal because they are still trafficking things that they do not own wihtout permission.

Where precisely do you find the law which makes illegal all trafficking in "things that they do not own wihtout (sic) permission"?

Even if you never signed the EULA it still falls under USC 17 trademark laws. You cannot try and make a profit on anything that you yourself do not have trademarked without the permission from the company that owns the trademark.

Tell me, in this parallel universe where people always need the expressed PERMISSION of someone who originally created something in order to profit from it (and where trademark laws are part of Title 17 of the US Code instead of copyright laws)... does Spock have a beard?

Because here in this universe, copyright gives holders a sharply limited set of exclusive rights in intellectual property... and only in the parts of that property which are actually copyrightable. There are even a whole list of exceptions to those "exclusive" rights. Anything falling outside those exclusive rights (or that qualifies as one of the exceptions to those exclusive rights) is a 'non-infringing use', and is presumptively legal last time I looked.

That's why used booksellers don't need the permission of the authors to resell the author's books... and why movie critics don't have to get the studio's permission in order to make money from giving bad reviews to their movies... and why I can successfully sell an "unauthorized" strategy guide for pretty-much any game out there.

It's also the reason that I don't need Hasbro's permission if I wanted to sell pictures that I made using a Spirograph (tm) that I bought. Nor could they do much to stop me from profiting if I were making and selling pictures of a decidedly adult nature using one... pictures that they found offensive, for instance.

Regardless ALL people have to agree to read and sign the EULA when they install the game. This gives them even more of a right in court to enforce their trademark laws, because people cant say that "We didnt know they didnt give us permission".

Ah, I think I see now... in the universe you're talking about, because the company created a EULA, they get to create "their" version of "trademark laws" and impose them on anyone using their products.

Have you considered creating an MMORPG where people get to live in this universe? I'm sure it would fit well into the horror genre. I know it certainly gives me the shudders just thinking about it. It would be a wonderfully Orwellian.
Creepy!

Im kind of sick of hearing about this and all of the people who dont think it is illegal. www.cybercrime.gov has all the copyright and trademark laws as well as software laws etc.

Silly rabbit that I am, I usually point people right to the horse's mouth... the United States Code: Main Page of the Government Printing Office. I used that a few seconds ago just to make sure that I hadn't stepped into that parallel dimension you were discussing when I wasn't looking.

If your a US citizen and you cant interpret the law your probably in trouble. Or your just trying to defend your MMO currency business.

And just think of how much more "trouble" you're probably in when you can't even find the laws or understand the terms used in the law... let alone interpret it successfully.

Why, I'll bet they even come and arrest you for "being in trouble" due to discussing things you don't understand in that dimension. I can't wait for that MMO, it's gonna be a real knockout!

Hope this clears it up. And I dont think Blizzard a HUGE company would have amateur lawyers who dont know what they are doing. This is not a difficult case at all for them to win.

Oh, that definitely clears it up. Probably a lot more than you thought. Crystal clear. Yep, you can see right through that.


130.

re: the Google Toolbar AutoLink story that Dan S referenced, I think Daniel Weiner absolutely nailed it in the comments section:

What I find interesting about this discussion is that the people who are against Google's AutoLink feature don't really have strong logical arguments. Instead they have a visceral reaction which boils down to "I just don't like it and therefore it must be bad!"

Then when other commenters respond by pointing to existing tools which allow the user to modify content, the opponents try to draw tortuous distinctions between good tools and bad tools (the latter mostly being ones that allow the tool-supplier to make lots of money).

Ultimately the critics of Google's AutoLink (and other "bad" tools) are reduced to arguing that the content creator's rights trump the user's rights: The user is somehow obligated to view the content the way the creator intended (and in some cases hoped to profit from), and anything which interferes with that is wrong because it's just plain wrong.

That's a pathetically weak case, and it's not going to convince very many people. Users add tools which modify content because they prefer that to the unmodified content, and content creators who can't deal with the situation will just have to lump it. I doubt that users will have any difficulty replacing those few creators who try to shield the "integrity" of their content via DRM and other mechanisms, or who refuse to create at all under such conditions.

How long before we see clickwrap-protected webpages that attempt to force a contract onto viewers which obligates the user to experience the pages "as the original author intended"?

131.

>How long before we see clickwrap-protected webpages that attempt to force a contract onto viewers which obligates the user to experience the pages "as the original author intended"?

Why clickwrap it? Just state in the contract that reading it consitutes agreement. After all reading is a voluntary action. If you didn't want to agree you shouldn't have read it.

132.

Barry Kearn> How long before we see clickwrap-protected webpages that attempt to force a contract onto viewers which obligates the user to experience the pages "as the original author intended"?

I don't know, but we're getting more and more "international" laws that forbids us to by-pass mechanisms provided by the creator. A sad trend which will not only threaten our freedom, ut kill interoperability and establish big monopolies. A disaster for a capitalistc society.

133.

I'm looking to sell my WoW account, it's been difficult since Vero Is Downing all my eBay auctions. In the end though, Ill have to GIVE it away right in game, possibly for in game gold for another character (wonder how legal THAT is!) it would seem that they aren't really STOPPING the characters from being traded but they are simply making us give it up for free, which imo might be WORSE.

Feel free to contact me if interested, its a level 60 Mage with an Epic mount and 300/300 Enchanting/Tailoring =)

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