In this article, Schwarz and Bullis discussed the effects and consequences of intellectual property law on online gaming. In online multiplayer games, players collect cash and points through game play. This cash, applicable only in the game, can be traded for objects within the game that might improve the character’s ability or collection items. However, there are now markets outside the game in real life that trade this type of game currency in exchange for real currency. At first glance, the concept seems fair enough: trade different types of monies at rates that satisfy both ends. Yet, virtual currency, and for that matter, all characters, game plays, and settings, belong to the owner of the game server and software. Does the owner of the server own the currency too, or do players who play the game and gain the cash actually “own” the cash?
One must wonder how ownership should be defined in the context of Massive Multiplayer Online Role Playing Games (MMORPG). When one purchases a book, one may legally resell it. This type of ownership does not apply for digital music downloads. Does it apply for virtual currency and fantasy goods? Companies owning the games have formally banned the secondary market of real-world money trading, primarily to retain control of the game characters and also to avoid detraction from the game experience. If real money can be exchanged for aptitude in the virtual game, then the quality of gaming at its essence, where "skilled" players accomplish the most, diminishes.
The authors concluded that virtual goods and currency should be compared to the reselling of books rather than to the distribution of downloaded music. They argued that even though these goods do not exist outside of the online game, they are still goods that are traded from one person to another. When one player sells a sword to another, that player no longer holds the sword. However, digital files such as music can be duplicated infinitely and the original holder still retains one copy. Further, a physical CD of music can be resold because the original owner no longer owns that physical CD. Thus, whether goods are digital, virtual, or real was irrelevant in this discussion. According to Schwarz and Bullis, the tangible and physical nature of the good was the defining and determining characteristic of property.
In this introductory essay for the Symposium issue of the New York Law School Law Review, Noveck explores the role of law in virtual game worlds. In order to develop a foundation on which to base law, it must be acknowledged that cyber worlds are a social community and there is a delicate relationship between the game players and the game creators and owners. This relationship, when extended to ownership, remains blurry and incompletely outlined. Hence, there is growing debate over the application of the real world law to virtual worlds.
Online role-playing games steadily grew in popularity since their mainstream start in the early 1990s. The steep increase in fan base correlates with the acceptance of Internet connectivity as an essential component of the average household. In turn, game companies realized the earning potential of online multiplayer games. By investing in sophisticated game physics and functionality, popular games could lure in users for long-term play.
Virtual worlds, at their core, are social networks and communities. They have traits which mimic human interaction within real-life communities. Property is created, goods are accumulated, and currency is traded. Instead of simply studying the laws of virtual worlds, Noveck suggests study of laws in virtual worlds as a way of learning about how law functions. Virtual worlds do not have written laws which govern player interaction. In fact, they are similar to real-life law in which it is continually revised and developed by new situations and new circumstances. However, there exists a basic constitution which is rarely, if ever, touched. Recognizing this, it may be possible to simulate a fictional law system to test in virtual worlds. This represents an application of virtual worlds towards possible benefit in the real world. These trials show a modern method of applying technology in order to better serve current real-life law models.