Virtual Property, Rights, Riots and Governance

“Virtual property” popularly refers to virtual goods – items purchased for use or display within virtual worlds, online games, and social networking platforms (like Facebook). The term could equally apply to other cyberspace assets, like land in Second Life or Entropia. Even items acquired through the investment of time or expertise (rather than a specific currency exchange), like my Sea Turtle. If you use such simple definitions, property does not influence rights or governance: The virtual environment doesn’t substantively change anything in law. Contracts can still control the relationship between the people and organisations involved. Copyright still protects the underlying electronic and creative concepts. What’s all the fuss about?

The utopian ideals of some of the early internet pioneers are long since forgotten. More recent debates about the rights of avatars have been steam-rollered under “the tyranny of the End User Licence Agreement” (quoting Andres Guadamuz – although perhaps such an agreement is still more democratic than a unsigned contract with society). So who cares? Continue reading “Virtual Property, Rights, Riots and Governance”

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Systems of Curse and ZAM

The World of Warcraft ecosystem saw the final “big fansite” acquisition this week, with MMO-Champion bought by Curse Inc. Big meaning something that attracts millions of users each month. Curse have been using some of their $11 million of venture capital to buy up a variety of gaming fansites, including many popular WoW sites. But MMO-Champion is significant for 3 other reasons:

  • Corporate deal, not the “founder buy-out” traditionally commonplace among gaming fansites. MMO-Champion was previously owned by Major League Gaming, already a multi-million dollar enterprise (by comparison, $46 million funding).
  • Completes a duopoly (2 dominant businesses) in the core World of Warcraft “fansite” market – Curse and ZAM. While there are other large businesses and specialist niches on the fringe, none of those appear to be growing into the core WoW market.
  • Exposes an intriguing driver of this market structure: Systems costs – the underlying technology and support costs. Intriguing because these were crucial in determining the market structure of far more traditional sectors of the economy, like groceries.

This article analyses the latest acquisitions and discusses the unseen importance of systems costs. Continue reading “Systems of Curse and ZAM”

A Strange Game

Deathwing. So it happened again. The player client software for the latest World of Warcraft expansion, Cataclysm, leaked into the public arena long before it was intended to become public. Again, because this also happened with the previous 2 expansions. A third leak is beginning to look careless.

WoW.com’s (unofficial) explanation of this “failure of secrecy” ironically fails to explain most of reasons behind the Cataclysm leak. Perhaps because the politics are rather too Machiavellian?

This article discusses the relationship between the game developer and its “fansites”. It uses the Cataclysm leaks to try and explain the underlying politics. The article questions why Non-Disclosure Agreements continue to be used, when they are worse than useless. Finally, it ponders the risks of such apparently one-sided relationships.

I’ve tried to present a fair and balanced analysis, which raises some important issues that aren’t getting discussed, and should be. Obviously, I can’t know everything. Continue reading “A Strange Game”

Poor Gina

Comments on my original WeeWorld article continues to provide a fascinating insight into tweeny online society. Not just that so many people think I can help them, when I cannot. But that users are now as likely to be concerned about “stolen” user accounts, as they are about the social injustices of paying for points:

“Hi my name is Gina… I’m nine years old… I brought a prepaid card then some one hacked me for no reason… The username is *****… I used a fake e-mail and I don’t know how to get it back =[ Can you help me? PLEASE!”

I removed the 200 redundant characters Gina had added to the final word, that conveyed the true extent of her desperation. Literate, for such an apparently young US citizen, she also reveals some child-like confusion in causality and logic. Not that most adults could solve her problem: A “recovered” password can only be sent to the email address associated with the account – yet to receive the message, the email address cannot be fake. Further help is locked away on forums which can only be read by users who are already signed in. Signed in, using the password they can’t recover…

For a 21st century child, this is much closer to a science-fiction nightmare than adults might think: Inadvertently being locked out of a part of society by the flaws of an infallible machine. A part of society, because this stuff genuinely matters – often as much as traditional “playground” relationships. Substantial time (and often Dollar money) is invested in a user’s account. Huge networks of friends are built. The ability to start again, or start again somewhere else, is poor consolation indeed.

We can argue that having one’s virtual avatar hacked into is a “rite of passage” into the digital economy. A necessarily painful lesson that, long-term, will make adult activities such as online banking much safer. After all, this is only a childhood game, isn’t it?

Yet Gina’s short plea contains a lot of unpleasant truths, that adult society seems reluctant to address.

This article explores how the law, as experienced by the generation practically born online, differs from law as previous generations have learned it. Worlds where everyone is at least 13 years old, even if they aren’t. Where wrongs are not righted, because they’re not in the contract. And copyright legitimises a new, almost feudal social structure. A selective, but slightly unnerving, insight into a generation that may grow up to believe that law is for something else, because it so obviously isn’t for them. Continue reading “Poor Gina”

Animal Farm

Pandaren Monk We finally have some reliable figures for the commercial value of “minipet” micro-transactions in the game, World of Warcraft. Specifically, the sales of just 1 item: In November and December 2009, at least $2.2 million worth of Pandaren Monk pets were sold. 220,000 at $10 each. We know this because “50% of the purchasing price” was donated to charity, and “more than $1.1 million” was donated (via WoW.com).

Over 220,000 sales to a market of about 4-5 million potential customers (only active WoW players can use the minipet, and the pet does not appear to have been sold in China or Taiwan). Roughly 5% of potential customers spent $10 on an ostensibly useless vanity item: A small pet that follows you around, looking cute.

Like most virtual goods, the cost of making and selling this pet is marginal: Primarily some additional art and marketing time, all built on the back of existing systems (store, staff, world). The first 2 months of Pandaren Monk sales will have made contributions to Blizzard’s profits of about $1 million. That’s only around 1% of the business’s turnover in that 2-month period. But that 1% is “free money”. Blizzard (-Activision) would be doing a dis-service to its investors if it did anything other than continue to milk this virtual cash cow.

Apply a healthy bit of European cynicism, and it is easy to conclude a scam. Tobold‘s:

“Send me $10, and I promise to send $5 of it to charity.”

Of course, Europeans fundamentally don’t understand US philanthropic culture: The idea that it’s fine to exploit your fellow human and make outrageous amounts of money, so long as you give some of it away in the end. Some philanthropy is able to take a somewhat rational, balanced view of what is good for the world. But there is a tendency to support visually appealing issues, such as charities servicing the needs of children.

The purpose of this article is not to argue that a European, government-centric re-distribution of wealth is preferable to an approach lead by personal responsibility. (I’m not sure it is.) The problem emerging here is more fundamental: That virtual goods are replacing trade-able value with non-trade-able value. Non-trade-able value that, by definition, can not offset inequality in (game) society. Donating part of the price of sales to charity is pure irony. In true Orwellian style, we’re sleep-walking into a potentially broken social structure with the best of intentions.

This article started as a box during my Adventures in the Invisible Tent, but has been expanded here in much greater detail. This article describes what a minipet is, highlights the role of money to balance inequality in society, and explains the problem with virtual goods. Continue reading “Animal Farm”

Nation of Adoration

World of Warcraft’s seasonal holiday events temporarily reduce player interest in fishing. It’s always been the case, but the decline in fishing seems to be becoming more extreme over time:

Decline in Fishing Activity due to Holiday Events

The graph’s y-axis is the percentage decline in page views at El’s Extreme Anglin’ from the 7 days before each event, to the first 7 days of the event. Pageviews are a good proxy for overall angler interest. El generates hundreds of thousands of page views each week, so even small changes are significant. The x-axis orders events by date, from January 2008. The axis isn’t scaled correctly to show time, but holidays are fairly evenly distributed throughout the year. Events are shown by green dots, with a shortened date (month and year) and the name of the event.

The data is expressed as a percentage of the previous week, because while interest in fishing “waxes and wains” from year-to-year, changes week-to-week are normally minor.

All the events included last at least 7 days. Where one holiday runs concurrently with another event (for example, the “Lunar Festival” and “Love is in the Air” often clash), only the first event in the sequence is included. Interest in fishing also changes dramatically in the month new content is added, so events that clash with major fishing patches have been excluded (Noblegarden 2008 with patch 2.4, Hallow’s End 2008 with patch 3.0.2, and Noblegarden/Children’s Week 2009 with patch 3.1). Winter Veil is also excluded: The period leading to Christmas is particularly unusual – first students stop studying and have a lot of time to play, and then many players stop playing to spend time with family. This causes large changes in activity from week-to-week, which makes it hard to isolate Winter Veil in the data.

Only 12 separate sets of data can be compared. There is one out-lier – Midsummer 2008 – perhaps the early stages of Wrath of the Lich King testing may have caused a small traffic spike in the week before? The pattern shown on the graph is not certain. But I’m growing confident that events are increasingly impacting on fishing activity.

But why? Continue reading “Nation of Adoration”

Adventures in the Invisible Tent

Here’s a tent.

Invisible Tent

It’s invisible. But it is. There. Walk forward into the space it occupies, you find yourself within the tent.

Inside Invisible Tent

The tent only exists when one is within it. When outside, we see the world without the tent.

This article explores the implication of this uncanny art form on how we build and use virtual environments. It first explains why this invisible tent is considered to be a software bug. The article explores how our ability to accept the uncanny varies from person to person. It then suggests that the spatial, built, environment is far less important than the social structures that exist within them. This topic contains a lot of images. Continue reading “Adventures in the Invisible Tent”