Governance in Virtual Environments
Nic Suzor
QUT Law School
Institute for Creative Innovation
virtual environments

Multiplayer

Real time simultaneous
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Immersive
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Persistent
suspension of disbelief, not virtual reality
picture:
AlexPGP @
flickr
evolution
picture: kgeiger @ flickr
evolution
evolution
picture: stuartp @ flickr
evolution
AA store, built by Aimee Weber
narrative environments vs social spaces


Game style worlds

World of Warcraft, Lineage (I & II), City of Heroes,
Everquest (I & II), Star Wars Galaxies, etc.

Strong central narrative
Social spaces

Second Life, A Tale in the Desert, Project Entropia,
There, etc.

No central narrative – free form
Who cares about games?
subscribers care about games
mmogchart.com
publishers care about games


market value for MMOs in the West hit $1bn for
the first time in 2006 (screendigest)
WoW accounted for 54%, revenue: USD$471m
http://www.gamasutra.com/php-bin/news_index.php?story=10824
economists care about games

Castronova on Everquest in 2001:
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Nominal wage USD$3.42/hour
GNP per capita USD$2,266
th in the world, between Russia and Bulgaria
 77
Project Entropia, Second Life

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real currencies, real exchange rates
booming virtual real estate business
It's not just about property
Castranova: 20% of Everquest players live in
Norrath and commute to Earth to support
themselves
Not just money!

Social relationships

people live, love, learn in these spaces

play, trade, socialise – no real limit to motivations of
participants
“Virtual worlds are entitled to respect because
real people care about them and come
together in them.”
-- Grimmelmann
What are the rules?
what are the rules?

Governed by contract (EULA, ToS)


Blizzard may terminate this Agreement at any time for any
reason or no reason. In such event, you must immediately and
permanently destroy all copies of the Game in your possession
and control and remove the Game Client from your hard drive.
Upon termination of this Agreement for any reason, all licenses
granted herein shall immediately terminate. (WoW EULA, cl 6)
The virtual world is the property of the platform
owner

a (mostly) benign dictatorship
What are the problems?
near-term tensions

Real Money Trades (RMTs)

Virtual crimes

Virtual liberties

Intellectual property – copyright

Privacy
Tension: Real Money Trades

MMORPGs are boring

Time-poor players pay others to grind for them


money, items, status
Game-based worlds often prohibit RMTs

seen as a breach of the magic circle

potentially harms subscription model – removes
grind, and lowers barriers to exit

players dislike both 'eBayers' and 'farmers'

eBayers obtain benefits without labour;

farmers cause inflation
RMTs (cont)



Blizzard banned 114,000 EU accounts in April
2007
Actively encouraged by other worlds

Everquest, Ultima Online – centralised trading

Project Entropia, Second Life – fluid economy
Selling property of the publisher, or buying the
labour of the participant?
sweat shops, or new economy entrepreneurs?
Fox News – WoW sweat shops
Anshe Chung @ Business Week
who gets to make the rules?
UO farming rig
Internet Gaming Entertaiment
PunkBuster
what happens if the rules change?

Expect virtual environments to adopt a services
based economy


Economy based primarily on artificial scarcity



power-levelling, custom designs, etc
vulnerable to inflation, flooding by platform owner or
participants
Detinue and Conversion of virtual wealth?
Suits against platform owner for unfair
competition?
Question
Should we ever prevent platform owners from
making changes which affect perceived
value?
(Bartle warns that admins must have the power to make
changes)
Tension: Virtual liberties

Freedom of expression

Freedom of the press

Freedom of association

As more of our interactions occur in these
virtual environments, who controls our
relationships?

Public activities in private spaces

Who has rights of exclusion?
Are these places going to be countries or
country clubs?
-- Prokofy Neva, upon being banned
from a 'public library' in SL
Freedom of the press



Anshe Chung, self proclaimed
Second Life millionaire, has had a
lot of publicity over the past year
Second Life's first Property
Magnate
Organised a Q&A session for
CNET in December 2006
Freedom of the press


Anshe claimed
copyright in videos
of the attack, and
made a DMCA
complaint against
reporters
Complaint
withdrawn after
advice from the
EFA that the videos
were fair use
Freedom of the press
Video removed from YouTube
http://video.google.com/videoplay?docid=5387867190768022577&q=Anshe+Chung
Question
To what extent should the press be able to
report on incidents in a VE without being
sued for copyright infringement?
Freedom of expression

Participants unable to
represent their
environments

machinima

game guides (Kopp v
Vivendi)
Image: Tristan Pope
Question
When everything a participant can see is a
digital copyright work, it becomes
impossible to represent their environment
without infringing copyright.
Should we allow people this ability?
Freedom of association
Naked gnome protest
http://www.cesspit.net/drupal/node/491
Freedom of expression – political protest


Protest at Le Pen's Front National's SL HQ
NWN <http://nwn.blogs.com/nwn/2007/01/stronger_than_h.html>
Freedom of expression – political protest


Neighbouring land used to erect protest signs
NWN <http://nwn.blogs.com/nwn/2007/01/stronger_than_h.html>


And the protest degenerates into days of violence
NWN <http://nwn.blogs.com/nwn/2007/01/stronger_than_h.html>
Community reactions



SL Left Unity group “will be manning a protest
[...] until FN go or are ejected. Wherever
fascists are we will ensure they get no peace to
corrupt and lie to decent people.”
"With this persons we can't debate or ignored.
We can't because it's not acceptable."
"They're a bunch of losers, [...] We're gonna
tighten security and come back." - FN Officer
Wolfram Hayek
Fantasy Westward Journey
http://www.zonaeuropa.com/20060709_1.htm
Fantasy Westward Journey
http://www.zonaeuropa.com/20060709_1.htm
Fantasy Westward Journey
Around 10,000 protesters
http://www.zonaeuropa.com/20060709_1.htm
Fantasy Westward Journey




High level alleged ringleader
locked up in a permanent
prison, guild disbanded
Playing for 2 years, leader of
a top-five guild, spent
AUD$6500+ on points and
equipment
Avatar name translates to
“Kill the little Japs”
Guild name to “The Alliance
to Resist Japan”
http://www.zonaeuropa.com/20060710_1.htm
Question
Examples demonstrate the power of protest in
virtual environments
If it weren't for issues with server load, do we
have an obligation to allow non-violent inworld protests?
Virtual liberties – discrimination

Tired of intolerance, Sara Andrews wanted to start an in-game guild
which was friendly to lesbian, gay, bisexual, and transgendered
players:


“OZ is recruiting all levels, but especially 50-60s! [...] We are not
"glbt only", but we are "glbt friendly"!”
Response from Blizzard:

Please remember that it is up to our sole and absolute discretion
whether or not to allow certain types of language in the game.
While some language in and of itself may not be offensive, it may
incite certain responses in other players that will allow for
discussion that we feel has no place in our game. As such, I am
afraid that I am unable to reduce, reverse or otherwise amend our
previous decision.
Question
Blizzard changed their mind and apologised.
Is this a situation where we would have
expected the law to intervene to prevent
private censorship?
Tension: Virtual crimes




Fraud?
online
gaming?
tax evasion?
Money
laundering?
Virtual crimes

Extortion?

Griefing?
http://www.secondlifeherald.com/slh/2005/01/extortion_anshe.html
Question
Who decides when an action in a virtual
environment is a 'crime'?
Should criminal law ever regulate purely
internal actions, or should these be within
the control of the platform owner?
How do we decide what to do?
Evaluating potential approaches
Essential tension:
allowing virtual environments to develop
vs
regulating to protect legitimate interests
Solution
If you don't like it, leave...
Limits to a contractual solution



EULAs and ToSs are one-sided
Virtual worlds are designed to encourage high
switching costs
Play is constructed in a way that benefits the
subscription model
“if you don't like it, leave”?

right of exit dependent on low switching costs

high switching costs important for continued
subscriptions

Very difficult to leave an environment which is
designed to attach you

property, status, social relationships
Evaluating potential approaches


In the next few years, courts and legislatures
will be asked to make decisions in these
matters
The decisions that will be made will shape the
development of future virtual environments
The wisdom to know the difference
How do we know when to regulate and when
to let these realms develop for themselves?