There are many different types of virtual game items used in the online world. One type is an item that is purchased from an online store to then download into the game. Some virtual game items aren’t real items but instead are created solely for fun purposes. Virtual items may differ depending upon what kind of game they were intended for. The intangible items known as virtual goods are found in online games and communities. Examples range from cows and seeds in online social farming games to weapons and potions in multiplayer online role-playing games. In the real world, gamers pay real money to buy and sell virtual goods because they have worth. The legal standing of such commodities is still completely unclear, even though the present annual U.S. market for trading in virtual goods is estimated at billions of dollars, and sales are anticipated to continue growing at a rapid rate. Virtual game items could have four different legal statuses: nothing legal, personal property, services, and intellectual property. I’ll think about each in turn.
No Legal Implications
Many online games’ end-user licensing agreements (EULAs) indicate that the relevant game operators have sole control and ownership of the games and that any virtual things found within the games are of no value or standing in law. Users must agree to the conditions of the EULAs to use the games, and they are non-negotiable form agreements. From the perspective of the game operators, this method is the cleanest because it shields them from responsibility resulting from disagreements about who is the rightful owner of virtual goods. However, it is the most disconnected from users’ expectations and real-world experiences. 2010 saw the sale of a virtual space station for $330,000 and a virtual resort for $635,000. Without an expectation of ownership, it is obvious that players would not spend such vast sums, and billions of dollars annually in total. Additionally, the absence of legal status for virtual products would leave no framework—indeed, a total legal void—for resolving even the most fundamental business problems concerning the purchase, sale, or theft of such items.
From the standpoint of the player, many issues may be resolved by treating virtual game items as personal property. For instance, it could make it clear that buying and selling virtual goods is a legitimate business practice, that contracts for such sales are legitimate, valid, and binding, and that players have a right to legal recourse if such goods are stolen, converted, or otherwise misappropriated, and that virtual goods can be legally given, lent, used as security or collateral for a loan, donated to charity, bequeathed by players, and passed down to their heirs. Insofar as it would offer players a financial incentive to keep playing the operators’ games, such legal treatment could also be advantageous to game developers insofar as it would raise the market value of such games overall. Unfortunately, treating virtual goods as personal property would not solve the issues of virtual goods losing value due to changing the difficulty of acquisition through changes to gameplay or duplication of virtual game items by game operators; (ii) changing or removing virtual items by game operators; and (iii) unauthorized copying of virtual goods through the use of third-party computer programs that exploit bugs or flaws in the source code of online games; (iv) the use of such programs by third parties to play games automatically; (v) game operators suspending or terminating user accounts as a result of violations of the terms of service (such as abusive or offensive communications); and (vi) Game operators discontinuing to operate or otherwise provide support for games as a result of decreased player engagement and/or income, operator bankruptcy or sale, or any other factor.
Services
It has been proposed that virtual game items could be a service offered to players by game developers. Given that virtual commodities do not share many essential characteristics with services, I am dubious about this strategy. Virtual goods and services are intangible, it is true. Most of the time, however, services are time-bound, concurrently rendered and consumed by the buyer, irreversibly consumed by the buyer, and specific in terms of time, place, and other external factors. Most virtual commodities do not share any of those characteristics with services.
Informational property
Virtual goods resemble intellectual property in many ways more than physical goods do. When compared to other types of intellectual property, virtual game items are intangible, can be copied an unlimited number of times without incurring additional costs or material expenditures of time, effort, or resources, and can be combined with other virtual items to create derivative works. Personal property, in particular, is typically tangible, scarce, subtractable (i.e., consumption by one prevents simultaneous consumption by others), and not easily transformable. Treating virtual goods as intellectual property would not resolve the ownership dispute because game developers would continue to assert ownership based on their control over the games, whereas players would assert ownership based on their investment of time, effort, and diligence in obtaining items from the games or money spent on real-world purchases. However, if treated as intellectual property, despite EULAs that state such items are solely and exclusively owned by the games’ operators and users is only given a limited license to use the goods within the games, players may acquire ownership rights under intellectual property law principles if they contribute significantly enough to qualify as a transformative use.
The Law fights to keep up
Virtual game items have been the subject of relatively few lawsuits in the US to date. A case involving the Second Life operator was resolved out of court, and a third case is still pending intending to define the rights of those who buy virtual property in Second Life. As is typically the case, technology advances much more quickly than legal standards, and vice versa. Given the significant financial stakes, it is to be hoped that the debate over the legality of virtual game items will be settled as quickly as possible.
