[MUD-Dev] In Norrath, Tattoine and Rubi-ka, Just What Are Your Legal Rights?

[Vladimir Cole]

Source:

  http://knowledge.wharton.upenn.edu/articles.cfm?catid=9&articleid=856

In Norrath, Tattoine and Rubi-ka, Just What Are Your Legal Rights?

In the country of Norrath, a man must work long and hard to afford
the weapons that will protect him against evil. Fortunately, Norrath
is not a real place. It exists only online to provide entertainment
for the millions of people interested in playing competitive games
on the Internet. What is real, however, is the money that these
individuals fork over to buy the virtual tools and accessories
important to the characters they play. In a new paper entitled, "The
Laws of the Virtual Worlds," Wharton legal studies professor Dan
Hunter and a co-author look at how property laws, legal rights and
even the boundaries between the real and imagined worlds are being
challenged by trading in virtual goods.

<EdNote: Full text below>

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In Norrath, Tattoine and Rubi-ka, Just What Are Your Legal Rights?

It is a town whose citizens strive to build impressive homes in
high-end neighborhoods. It is a tropical island where friends gather
for drinks in the glow of a tropical sunset. It is an
out-of-the-way, but dangerous nation, where a man must work long and
hard to afford the weapons that will protect him against evil.

The town is Blazing Falls. The tropical gateway is There. The
dangerous country is Norrath. None of them are real. They, and more
than a dozen others, exist only online. They have been created by
corporations like Sony as well as by adventurous programmers for the
millions of people interested in playing competitive and social
games on the Internet.

But even though these virtual worlds are nothing more than software
coding residing in banks of computers, what goes on in them poses
increasingly serious challenges to our notions about the nature of
property, the legal rights of players in virtual worlds and even the
presumed boundary between the real and the imagined worlds,
according to Wharton legal studies professor Dan Hunter.

The challenges are there because those who participate in virtual
worlds a group composed of people who are on average 25 years old
and who include an increasing number of women over the age of 30
spend considerable amounts of money. They spend that money for the
right to participate in the virtual worlds. Just as important, they
spend to buy the virtual tools and accessories important to the
characters they play their avatars and the avatars ability to
survive and succeed in the virtual social worlds and communities.

Moreover, a major trade in these virtual goods has cropped up in the
real world. Players who have an overabundance of virtual goods
because they play their games exceedingly well sell their overstock
on eBay and other Internet auction sites. So do non-players who have
gotten their hands on the rights to these virtual goods. The result
of all this is significant. We are creating new categories of
property that are valuable without understanding what it means or
what the implications are for our understanding of the nature of
property, says Hunter.

Virtual games have been around since 2,500 B.C., when people first
gathered around a board to pretend they were in the land of Ur,
according to Hunter, who recently co-authored a paper entitled, The
Laws of the Virtual Worlds, with Philadelphia attorney F. Gregory
Lastowka. What is different in todays Internet-dominated world,
however, is that virtual worlds have taken on the trappings of real
economic orders.

In some virtual worlds goods, land and personal property are amassed
through labor, by carrying out tasks or meeting challenges. In other
worlds players charge their credit cards to buy online currency to
spend within their virtual worlds. That could mean buying property
to build a house, to change an avatars hair style or to own a magic
board that will whisk the avatar around the virtual world.

The economic activities going on in these real worlds are so
life-like and expenditures so intense that at least one company
running a virtual world has hired an economist to help it avoid the
sort of hyperinflation that would destroy the game. For that matter,
Hunter says, Edward Castronova, an economics professor at California
State University at Fullerton, studied the economics of the virtual
world Norrath and found that the exchange rate between its currency
and the U.S. dollar is greater than the exchange rate between the
dollar and the yen. If Norrath were a real country, Castronova
found, its gross domestic product would be greater than Bulgarias.

Virtual economies are spilling into the real world, in part because
there are players who dont have the patience or ability to amass the
goods required to succeed in their virtual games. They have learned
that they can turn to eBay and other online markets to buy what they
need and take it back into their virtual worlds to further their
aims. That can mean spending $50 for a million Star War Galaxies
credits, $22 for a magical sword for engaging in successful battles
in Diablo, or $9.50 for 10,000 thousand copper ingots for use in
Ultima Online. After a sale is consummated in the real world,
purchaser and seller step back into their virtual world where the
goods are handed over. In some cases the transaction takes place
within the boundaries of the virtual world because its developers
have made provisions for such transactions.

It is even possible to buy an avatar and all it has amassed, though
that is considerably more costly. They sell for as much as $25,000,
Hunter says.

This economic interaction between the virtual worlds and the real
world is so pervasive that many sellers are making some very serious
dollars. Probably 25 of these guys are making a six-figure income,
Hunter says. One guy out there is reputed to make more than a
million bucks a year.

And as if that were not proof enough of the
virtual-worlds-real-world melding, a now-defunct company found the
profit potential alluring enough to set up computers in a building
in Tijuana and pay Mexican laborers menial wages to sit at the PCs
to play Dark Age of Camelot around the clock. The company then sold
the commodities and credits that the players-workers amassed online
for very real American dollars.

Although the Internets virtual worlds increasingly take on
real-world economic trappings, raising the groundwork for property
related disputes, the mythical goings-on are also being tinged with
real-life social issues, rife with their own potential for
conflict. That is not surprising, Hunter says in the paper he
co-authored with Lastowka, given that human players become deeply
vested emotionally in their avatars, thereby developing very real
expectations about having meaningful human and constitutional rights
within the virtual worlds they frequent.

While an avatars owner may be perfectly comfortable killing the
avatar when she grows sick of it, she may feel genuine anger when a
higher level avatar decides that player-killing is fun, and uses her
avatar for target practice, Hunter and Lastowka point out in their
paper, adding that emotions roil especially deep when sex is
involved. Residents of virtual worlds commonly complain of sexual
harassment when their avatars are propositioned by others and
involuntarily grabbed or kissed. While those sexual violations are
carried out only in a programmed code, the resulting anger and
humiliation are very real to the people involved. The owner feels
the injury because she has projected herself into an avatar body.

The participation of millions of people in virtual worlds also is
likely to spawn quarrels between the players and the games
developers, Sony and Microsoft, which Hunter and Lastowka call the
god-corporations.

Studies show that for many virtual world participants their lives in
those worlds is psychologically important, for a few they are
fiscally important, and for several thousand individuals, their
virtual lives are claimed to be more important than their real
lives, according to Hunter and Lastowka.

If a virtual world collapses goes offline for reasons beyond the
control of the developers, players might feel bereft, yet may accept
their financial losses. But Sony, says Hunter, could choose not to
continue (maintaining a virtual world). They could just say we are
sick of this, we are not making enough money or there is too much
whining going on.

In that case, players are likely to react more forcefully in the
real world because they are committed to the notion that what
happens to their avatars has legal significance. Hunter and Lastowka
write: At some stage there will be a tipping point where avatar
lives may present real legal issues. For instance, how comfortable
would you be, if in the near future, you lived, worked, and invested
within a massive corporate-owned virtual world in which you lacked
any meaningful legal protections or control over the shape of your
environment?

Hunter says that it is likely that many property disputes between
players, between players and eBay entrepreneurs and between players
and the god-corporations could be settled according to conventional,
real-world contract law. But he also points out that we cannot
assume that all of the property or the constitutional and human
rights issues arising in virtual worlds can be settled that way.

For starters, the developers of virtual worlds are going to have to
think more creatively about solving disputes inside their worlds,
Hunter believes. Today, if a player feels she has been wronged
within the game by another player and complains to the developers,
they may just throw some virtual money at her so she can buy
something she needs within her virtual world, say to make the
problem go away. But eventually, Hunter says, virtual world
developers may have to create virtual legal systems to deal more
effectively and realistically with the disputes that arise within
their worlds.

And lawyers and judges in the real world also will have to pay
attention to issues arising out of virtual world conflicts, and
adjust as well. We need to recognize that a large number of people
are making significant amounts of money, says Hunter. And, as more
and more people are investing more and more money and get returns on
their investment, we will see more litigation and situations where
our courts will be confronted with these problems.

Published: September 24, 2003
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