Virtual Objects in MMORPGs: An Economic Assessment of Legal Protection Issues in Germany

Abstract

The recent growth of Massive Multiplayer Online Role-Playing Games (MMORPGs) such as World of Warcraft has given rise to many economic as well as legal questions. The assignment of (intellectual) property rights to the licensee as well as to players is an important issue, legal discussion has to address.

In MMORPGs players experience the provided virtual realities through an avatar. This character can be customized under certain restrictions before playing, e.g. his appearance, race, gender as well as during the game, e.g. by equipment of armors or weapons. These virtual objects as well as the game currency have to be gathered by killing monsters or trading with other players. Despite converse Terms of Service players and newly founded enterprises sell their avatars and virtual items for real money. Hence, Real Money Trading (RMT) has become an important topic (not only) in the German law debates. It has to be clarified, whether customization of those avatars and items means that they also become the players (intellectual) property.

In our paper we consider an interdisciplinary approach. We examine the adaptability of German Law and show which legal problems will arise. On the other side RMT creates some economic problems as well, e.g. with respect to issues concerning the involved parties. We develop a pricing model which assigns different property rights to the players and the licensee according to the players' preferences to solve the arising legal as well as economic problems.

Keywords: Massive Multiplayer Online Role-Playing Games (MMORPG), Real Money Trading, virtual items, (intellectual) property rights, interdisciplinary approach, German Law

JEL Classification: D44, K11, L86