There's a very interesting article over at The Escapist that looks at the issue of property rights in virtual worlds. It's a great summary of a couple of the touchstone issues (if you haven't heard about the landmark Bragg v. Linden Lab case, it's worth taking a few minutes to brush up on what's going on). The heart of the question is this: Who owns virtual property? Does your character in an MMO own his or her own gear? What about the stuff you build in virtual worlds like Second Life?

One thing I really dislike about the piece is that the author blurs the lines between ownership of virtual property (my in-game epic sword) and DRM issues (like the recent Spore fiasco), when I see them as two very different topics. Let's just focus on virtual items, because I think a few things need to be addressed...

Cans, Open! Worms, Everywhere!

If you ever bother to read the license agreement that precedes the login screen to most online games, the majority of companies stress that in-game items and currency have no monetary value and shouldn't be (for example) sold on eBay. Companies aggressively act to shut this down (with the possible exception of Sony Online, which built its own auction system). A lot of times gamers simply chalk this up to greed without really thinking about it -- but why do companies do this?


Let's run a thought experiment and say that you do own your virtual epic sword of double damage. It's yours, and you're allowed to sell it. It has monetary value. Technically, a series of Bad Things(TM) can now happen:

1. Because your sword has real-world value, you should technically report it as earnings come tax time. Did you earn $4700 worth of lewt while raiding this year? Some of that money belongs to the government.

2. Wait a second, acquiring the sword was based on a random-drop loot table, and you pay a monthly fee to play. That means every time you kill a boss, you're technically gambling. All your local gambling laws now come into play.

3. Uh oh, one month later the game developer decides that swords of double damage are overpowered and ruin the game. The item is "nerfed" to only do 20% more damage instead of 100%. Suddenly it drops in value. But you had 20 of those swords on the auction house! You've just taken a huge financial loss! Can you now sue the developer?

I agree that all of this sounds ridiculous, but these are the logical consequences of associating real-world value to your in-game items. It's hairy. It's ugly. And it saps the fun out of the game while removing control of the game world from developers.

So needless to say, companies like Blizzard don't want to open that can of worms. They aggressively go after people selling in-game items for currency. They ban gold farmers. There are both legal and gameplay reasons to do so.