Protectionist deities vs. the economy of fun: ownership of virtual possessions

Do players in online games have a right to their virtual possessions? As discussed by Erin Hoffman in an essay the matter is a legal quagmire. Real money is involved, people have assaulted each other over virtual thefts, China now recognizes people's right to their virtual property while the US does not. As virtual worlds become ever bigger business the legal issues surrounding virtual property will become more important - both directly in court, and indirectly in shaping what kinds of worlds will be profitable or even possible. But from an ethical standpoint, do we have a right to virtual property?

While we are used to think of property in terms of tangible goods, much of our private property is already virtual. Most of our money resides only in the banking system and is never converted to cash. The contents of our computers include both virtual possessions of great personal value (the photos of families, that half-finished masterpiece) and importance (passwords, years of incriminating/interesting emails). Games often find their level 70 wizard, with a complex set of social relations and in-game backstory, to be among their more cherished possessions.

Clearly it is not the non-physical aspect of property that is problematic: we have a consistent legal and moral framework for dealing with someone pilfering from our savings accounts. In the case of the online games the problem is that the virtual objects (1) reside within the databases of the game company, (2) the end-user license agreement (EULA) the game clicked through (most likely not reading the dozens of pages of legalese) claims ownership of the virtual content for the company, (3) the gamer can handle the virtual possession in a matter very similar to a real possession inside the virtual world.

(1) is not much of a legal or moral problem since most social systems have long recognized claims of title for things not in one's direct possession. The problems with the remote nature of the object have more to do with privacy than ownership. There is also the issue that they (currently) cannot be removed from the server and are dependent on the company to maintain their existence. This does not remove any moral claims on them, but rather puts the gamer in a position of profound vulnerability towards the people controlling the server.

(2) From a moral standpoint the EULA is problematic: it is rarely anybody understands the details of the contract they make. Maybe we have a moral duty to try to fully understand EULAs we sign, but it would be a very onerous duty few people in practice could follow. From a social perspective clicking "I agree" to the EULA seems to be a sign of consent that the gamer accepts that the gaming company holds power over the gaming world. It is not so much signing a legal agreement as bowing down for the (quite literal) deities of the game world. Conflicts about ownership are often first brought to the attention of the game company, in the hope that this pantheon will see justice done. Unlike traditional religions, gamers also know there are other pantheons and gods beside and above their current one: if justice is not done in the game world, it can be sought outside it in the real courtroom. There would likely be many appeals against divine justice in the real world too if a procedure for it was found.

But it is problem (3) that is the most interesting. Virtual objects have a degree of persistence that makes them behave like objects we can possess. While most are generic and fungible, others are highly individual and almost tangible. Of the rights commonly ascribed to property virtual objects commonly fulfill almost all of the four standard rights: the right to control of the use of the property, the right to any benefit from the property, a right to transfer or sell the property and a right to exclude others from the property. The only limitations seems to be that the EULA usually limits selling it outside in-game markets. It is no wonder people think they own the virtual objects: for all practical purposes they do. It is just that they are locked into a world different from the real world, controlled by protectionist deities.


The Liberal Account

Why do we even have a right to property? The classic liberal account argues that we need property to survive and do things in the world, so depriving someone from their property infringes on their life and liberty. Virtual possessions might not yet be necessary for survival, but clearly can enable many expressions of freedom such as entertainment, creative work or social interaction. Hence depriving someone from a virtual possession can still affect them adversely.

From a liberal perspective property rights also serve to stimulate interest in generating wealth.

At its most basic, taking unowned resources and mixing them with work produces wealth that is generally regarded as being owned by whoever did the work (we can leave aside commission work for later). In many games players spend much time earning experience points to make their avatars better or more interesting, perform simple tasks to gain virtual money that can be used to buy virtual goods and band together into quests for rare and powerful items. This has also led to the practice of "gold farming" where the most boring game tasks are outsourced to people who then sell the resulting virtual wealth for real money to players. Most US companies are staunchly against this practice, both because of perceived legal risks and that it detracts from the fun of the game if someone can just buy themselves a great avatar (this is contributing the general US line of not recognizing virtual possessions - if they are recognized, then they can likely also be sold outside the game).

But there is another form of in-game wealth creation, direct creative work. In new games it is increasingly possible for players to design their own objects, giving them appearance and properties. This is extremely satisfying to the gamers, especially when their creations become popular with other people. Many game worlds have internal markets for these objects. Here game companies are increasingly open to allow real-money trades, reinforcing the image that these objects truly are property. Second Life would not have been a commercial success if people had not contributed most of the scenery, clothes, bodies and other goods.

Hence the liberal account of why we need property rights seem to support giving full property rights to virtual objects. If someone plays enough to gain a high-level character or creates a valuable vehicle, they have created value not just for themselves but for the entire community (who find a world where you can become such a character or where you can buy such a vehicle interesting) - and hence valuable to the game company. Even if it was not valuable for anybody but themselves they have still created that value and have a moral, if not legal, right to it.

It should be noted that some virtual worlds accept or are even based on real-world buying, up to and including $100,000 asteroids. The direct tie with the real-world economy seems to strengthen the view that the objects are indeed possessions. While one could imagine an eccentric buying an ethereal and impermanent dream for real money, many of these real-money games involve people doing serious for-profit business. Hence all the traditional real-world arguments for property rights apply (and possibly arguments for taxation and inheritance).

The Socialist Account

Socialists are in general in favor of collective ownership of property or means of production, but in the context of virtual worlds this becomes problematic. There is no scarcity other than what is decided by the rules of the game-world, and this is generally designed to maximize the appeal of the particular world. It is entirely possible to create game worlds where +10 Swords of Dragonkilling pop into existence as soon as they are needed, but it is unlikely the worlds would be very interesting places. Much of the appeal of virtual worlds lie in reducing the real-world constraints (enabling magic, flight and a chance to be a hero) yet not removing them altogether. They are very much a structured kind of play where the existence of limiting rules or other factors contribute to the fun. This means that beyond the fun to be had through pooling resources (for example within a game-guild or by the kudos that accumulates to providers of free services/objects) simple collective ownership of virtual objects is counterproductive.

However, one could imagine the player community holding a collective claim on the ownership of the virtual objects in a game. An increasing number of game companies recognize that the player community is not just a set of passive consumers but very active contributors to the success of a game. In a sense, they are employees paid in virtual gold, starships and adventures for their contribution of community, creative additions to the world and feedback. This is also leading to an increasing recognition of the need for in-game arbitration or even stakeholder representation. There is also no reason why not player-owned co-op games could be created to compete with pure for-profit games.


The economy of fun

The socialist and liberal accounts seem to meet: virtual worlds are not economies of scarcity, but economies of fun. If a world is not fun people will leave for another world (or even the real world). We need virtual property rights to ensure that the games are fun. That doesn't mean they have to work like normal property rights - introducing new variations might actually add to the game (for example, imagine a world where each object's past story was visible, adding to its value, or where the length of a player's stay in the world contributed to in-world legal and moral rights). There are good reasons to tweak virtual economies, but the tweaks have to be transparent and matter to the participants. This means they cannot be hidden in the arcane invocation of the EULA but should rather be part of the everyday reality of the game.

An economy of fun also needs to interface smoothly with the "real" economy (which is, after all, to a sizeable degree about fun too). This is not so much a moral problem as a legal and political problem. Legislators need to recognize that virtual worlds and virtual economies are here to stay, yet follow partially different rules from the real world. Making full property rights of virtual object legally safe for companies and players should be a high priority. It might be a good quest for high-level economists and law scholars.

Further Reading

Halting State by Charles Stross. A very clear exposition of the economy of fun, and its many curious implications.

Where Real Money Meets Virtual Reality, The Jury Is Still Out by Alan Sipress (Washington Post, December 26, 2006; Page A01)

The banking crisis finds an echo in Second Life (The Economist, premium content)

Liveblogging SXSW - Human and Property Rights in Virtual Worlds, see also Jessica Maguire's report

Property Rights in Virtual Worlds by Robert Bloomfield

China now recognizes people's right to their virtual property while the US does not.

There is also no reason why not player-owned co-op games could be created to compete with pure for-profit games.