Rivalrous Consumption and the Boundaries of Copyright Law: Intellectual Property Lessons from Online Games

Abstract

When fantasy and reality collide, what laws should apply? Online fantasy games are spawning real-world markets in which players can trade cash for objects (such as swords with special powers) in the fantasy world. The objects only exist in the game world, typically on a server that is owned by a company such as Sony. Should Sony have the absolute authority to license the game and its objects without restriction? Or should the players, who invest time, effort, and skill into the game to 'obtain' the objects have the right to sell to other players for real dollars? This article addresses whether the fantasy sword is more akin to a book which under copyright law can be sequentially resold, or a digital song download which cannot. The authors suggest that the critical distinction between digital media that needs special protection and other digital items that do not, is the concept of rivalrous consumption (whether for copyright or antitrust issues). In essence, whether a given consumer can sell his or her sword and swing it too.

Keywords: MMORPG, Online Games, Virtual Goods, Virtual Currency, Rivalry, Intangibility, IP, Intellectual Property