PAX'09 thoughts

I did a whirlwind trip up to PAX yesterday, leaving at 5:30 for the 3hr drive up to seattle, and arriving home at around 11:30. Six hours in the car wore me out, but well worth it for what I compressed into the remaining time.

I hang my head in shame and say this was my first PAX. When I was living up in Seattle I had schedule conflicts that kept me from attending the past couple of them. Decided I'd make the effort this year and was glad I did.

Some quick thoughts on the event, with a few topics requiring lengthier posts later.

The event itself: Wow. PAX has grown up. I think the E3 Supernova helped them get escape velocity, and now even with E3 making a comeback, PAX remains a big deal. We'll wait to see attendance numbers, but it felt like a 10k+ attendee event.

If you haven't been, I'd describe it as follows: GDC is the nerdy kid you knew in high school. E3 was his Jock older brother who drove a Chevelle and got all the chicks and gave him wedgies. PAX was the middle brother who listened to GWAR, wore combat boots, played D&D and smoked weed while doing it, and who mom and dad didn't really mind skipping out on the family reunion. :-)

There are panels and other sessions at the event but they aren't the point of the event itself, which is really a mix of game/geek culture celebration, fan-fest, and game companies exhibiting their goods to the hardest of hardcore gamer fans. Oh, and there's a pretty big lanfest and some board gaming thrown it for good measure.

Talks: I only attended two talks and a keynote, but I'd say that the fact that these aren't the main focus of the conference, and the quality is indicative of that. Not that the ones I attended were bad, but the quality varied, showing that it was largely up to the individual moderating the panel. (Vs GDC which scrutinizes talks and speakers to quite a degree).

I attended a panel on 'game developer parents' that had a number of industry veterans who are also parents (and two of whom were former co-workers of mine), who were supposed to discuss issues around games and parenting. I'd say it was 10% that, and 90% anecdotes about their kids, which would be ok except that those were half sage advice and half boasting about their offspring. mildly disappointing.

I attended Ron Gilbert's keynote which was humorous and moving, but not mind-blowing or anything (like say, Will Wright's Siggraph keynote)

I attended a legal issues in games panel, with a variety of legal folk around the industry. Was suprised when they asked "how many people here are lawyers or law students?", and had like 40 people raise their hands! This panel was better run (but not excellently run) and covered a number of timely topics, with the panel offering opinions on each. A few of which were:

• The "Edge" trademark hullaballoo: Tom Buscaglia had to tread lightly around this one because of Langdell's IGDA involvement, etc. The short version of the opinion was that trademarks and copyrights have their place and people have a right to defend them. In this case, both parties have behaved very poorly from the outset and dug themselves into a hole.
• The project Entropia Banking license thing (my question to the panel on this one was what their impressions where, and whether they subscribed to the theory that eventually all MMOs are banks, and regulation is inevitable): At least one panelist agreed with the theory, and two expressed sentiment that the Entropia thing in particular was a good thing, shows games offering more, growing up, etc.
• SW Patents: The usual lawyer-speak about "ya better file 'em!", but Tom B had a good answer to an audience question/comment about SW patents being evil, etc. He made the point that (a) the patent portfolio isn't the problem nearly as much as poor scrutiny of claims at the USPTO, and (b) a patent portfolio is something that can serve as collateral to borrow against with banks, and that Harmonix in particular did so against their patent portfolio and used that cash to survive a tight spot before their big hit. i.e. While there are plenty of examples of patent trolls, this is a counter example of patents saving what otherwise would never have become Guitar Hero.
• First amendment/free speech vs regulating violent games, etc. Good precendents set now with universal defeat of these initiatives across more than a dozen states. Sign of games success and also their growth into a major media. "they join the club of art forms across history that have been feared and attacked in similar ways: movies, rock music, etc"

The show floor:

A mix of exhibitors from the major publishers (EA, Ubi, etc) and HW vendors (Sony, MS, Intel, Alienware) but with a disproportionately high number of indie studios meeting their fans and selling merch. (Twisted Pixel, Dofus, The Behemoth, many others).

Trends:

Cosplay: Wow there was a lot of it. Plenty of galleries online.

Indie Games: Lengthier post on this later, but there's both good and bad here. The "indie game" meme has caught up with publishers, and so they are nabbing up titles whereever they can. Good to see guys getting funded, but this results in muscle put behind these titles and ups the pressure for higher polish etc. As an example the quality of some of the showcase titles in the Xbox Indie games (formerly community games) was fantastic, but these are looking like multi-month, multi-person team titles, and it's not clear that these games can generate the numbers on that channel to justify the investment. Not picking on MS, this is a problem across the board about which I'll post a lengthier piece when I get some time.

Some photos in my next post.

Book Review: Settlers of the New Virtual Worlds

So I've just finished Settlers of the New Virtual Worlds, by Erik Bethke & Erin Hoffman. It's actually both written and edited by them because the bulk of the book is a collection of essays by others.

The book's focus is on the evolving world of MMOs and virtual worlds, and how their progress and evolution is going to demand they transcend the current one-sided state of their EULA's, grant users (scratch that, residents) rights, and discusses many of the issues involved in doing so.

In short, it's a must read for anyone in the games industry - not just in the business of MMOs - and for anyone that is interested in the future of the medium. The book contains many provocative ideas. Not all are great, but that it will spur thought and discussion is reason enough to recommend it.

Among my favorite bits:

• Raph Koster's piece on a declaration of player's rights (borrowing heavily from the 1789 French Declaration of Man and the Citizen and from the US bill of rights).
• Ren Reynolds' piece on issues with claims with virtual property and IP in which he compares with precedents in both US and UK law and shows just how murky the water might be.
• Erik Bethke's opening and closing pieces in which he seems to be putting his money where his mouth is, as he's taken some bold steps with his own EULA, for GoPets, which he runs.

There are some not so good bits as well (I won't name them) but you shouldn't let them stop you from picking up the book.

My only complaint was that there wasn't one of the essays that attempted to tackle the issue of virtual property as a sort of promisory note of service, as I've alluded to before*.

Anyhow, pick it up. Good read.

* One additional thought on the 'promise of service' idea. It's occurred to me in re-reading my earlier post in current economic times, that this is not unlike a sort of derivative. I have to think about that a little before expanding on it.

The Virtual World Taxman Cometh

As aluded to previously, we all knew it was coming.

Raph points us to this: Virtual Worlds News: China Levies 20% Tax on Virtual Currencies

And notes:

[the ruling] seems to apply whether or not the value is cashed out.

(and goes on to note)

However, if the value is not cashed out and taxes are still paid, that could mean (maybe should mean) that the companies are liable if they manage to accidentally delete some of it. In other words, they’re banks.

I commented on his post that non-Chinese MMOs like Wow are probably glad they licensed the right to run servers in that country to other parties. Boggles the mind to think how something like this would apply, be determined, be policed, etc, if numerous countries were to institute similar laws. Thousands of individuals all paying taxes on income incurred in other countries (where the servers reside), and businesses in some cases being run from elsewhere than where the servers reside. Blech. What a mess!

It's already moderately messy to do taxes for, say, stock purchases & sales, if you do anything moderately frequent in the way of trading. Now imagine that on a micro-scale at an accelerated pace. 

As I understand it, in the USA, Internet commerce has been relatively hands-off in the area of taxation; as an incentive to promote growth. However that can't last forever, can it? At some point, growth has happened. Plus, no one is doing VW business in the US only going forward. 

This whole idea of 'countries' is obsolete :-)

$38M Bust in Korean MMO laundering case

"...Korean police arrested a group responsible for laundering money generated by CHinese gold farming from Korea back to the mainland. Over 18 months, the group wired $38M from Korea to a Hong Kong paper company [ed. Mildly ironic] as payments for purchases." (link)

As Raph concisely puts it "...and where it happens on large scales, regulation cannot be far behind."

Precendents...

More legal precendents being set in MMO's/Virtual worlds:

1. Tokyo woman jailed for logging into husband's Maple Story account and killing his avatar (link). I wonder: If she was a noob and did this accidentally, would his have been VW manslaughter?

2. Dutch teens convicted of VW theft after logging into Runescape and roughing him up and taking his virtual items (link). 

The latter of these is particularly interesting. If the game allows "roughing up", then hasn't the victim here subscribed to a PvP portion of the game/world? If not, how did it happen. If so, then hasn't he opted to allow this kind of thing to happen? Seems like if a hockey player were suing for getting checked.

The Scrabulous Solution: An Open Letter to Mark Zuckerberg

The Scrabulous Solution: An Open Letter to Mark Zuckerberg

Dear Mark,

Following last week’s announcement by Hasbro (and later Mattel, who have the Euro rights) that they were pursuing legal action against two developers in India that made Scrabulous, the Internet has been abuzz with the collective worry that 600k people may lose their beloved Facebook pastime.

It would be a shame for all those involved if Scrabulous were to go away. With over six hundred thousand people registered, Scrabulous is one of Facebook’s most popular applications. The outcome of the situation will affect the satisfaction of Facebook’s customers. It will have impact on perception of Facebook as a viable development platform, and on Facebook’s relationship with its developers (indifferent beneficiary, or protective and nurturing parent?). Facebook’s actions here will also send a message to owners of consumer brands and IP owners about Facebook’s respect for their concerns, and many of these companies could well be future advertisers or partners.

Facebook’s actions here will also be highly visible. The Hasbro threat to the makers of scrabulous was widely written about and even covered on national television.

In my eyes there seem to be three courses of action for Facebook, only two of which are viable, and only one of which is a good idea.

The possible courses of actions are as follows:

1. Step in and help the developers in their legal fight against Hasbro. I believe this to be the non-viable path, or at best sub-optimal. They are quite clearly violating Hasbro’s IP at multiple levels, from look and feel to game rule set, to even the questionable porte-manteau naming. Even if you helped Scrabulous win, this course of action would be bad publicity and costly.

2. Do Nothing. This is a perfectly viable course of action. After all, Hasbro’s not suing Facebook, but rather the devs. However, what’s at stake is bad publicity, the possible loss of one of your most popular third party applications, and with it, the loss of a significant amount of customer engagement.

3. Broker a winning solution for all parties. I believe this is feasible, and is the best course of action. Everyone wins, it’s not significantly expensive, and the possible upside is significant.

So what does this winning solution look like? I’ll first lay out the steps involved, and then the benefits for each party.

First, Facebook acquires Scrabulous. That could mean acquiring the developers in which case you get a couple smart engineers to help implement the steps below, but at minimum, you buy the Scrabulous codebase, the servers running the service today, and the player database.
Secondly, broker a deal with Hasbro (& Mattel) where:

• Scrabulous will be updated in two phases: (1) rebranding it as “Scrabble” or “Scrabble For Facebook” immediately, and (2) at a later date a “Scrabble Pro” will be added as a premium subscription service (more on this later in this post).
• Hasbro, with Facebook’s help, develops “Scrabble Pro” as part of the exercise of getting familiar with the Scrabulous codebase, server administration, etc.
• Hasbro takes possession of the codebase and manages the servers, following the launch of the Pro version of the game. At this point, Facebook is hands-off.
• The subscription business (say a 5% uptake out of what by then may be a 1M userbase, at say $25/yr, would make this a $1.25M/yr business at minimum) goes to Hasbro. Optionally, Facebook could have some recoupable amount out of this to recoup engineering costs in helping with the transfer of code and the interim running of the service, but this seems like a nit.

What is the ‘pro’ version of Scrabble and why would users choose to pay the subscription fee? Hasbro would have a better idea what would resonate with their players, but here are some ideas:

• Richer stats tracking (how many bingos and with whom? Pie charts of wins/losses. Avg score per game, etc.
• Scrabble variants (alternative dictionaries, Clabbers, speed-scrabble, etc)
• Better chat functionality
• Tournament private tables/lobbies
• Leaderboards
• Etc

OK, so why is this final scenario on which I’ve elaborated the “win-win-win-win” solution? Let’s recap:

• The developers of Scrabulous get to cash out and/or get employed by Facebook, and are no longer threatened with Hasbro legal action.
• Hasbro acquires one of Facebook’s most successful apps, has a head start on creating a successful subscription games service within Facebook, and acquires a community of 600,000 users.
• Facebook gets Hasbro as a partner, keeps its customers happy, doesn’t lose one of its top apps, and gets a proof point for a business model that other developers and IP holders may choose to follow. The corporate image avoids egg on the face and is seen as helping out the little guy.
• Scrabulous players don’t lose their beloved game, and have a chance to add new features and variants by upgrading.

What’s to lose?

Regards,

Kim “Scrabulous Fan” Pallister

I'll play "litigation" for a bingo!

As Raph points out, Hasbro has finally threatened the creators of the immensely popular Scrabble knock off for Facebook, Scrabulous, with legal action.

Hasbro is generally pretty protective of the Scrabble IP, so I'm surprised this took so long.

Microsoft: Go ahead, party on our game IP

OK, that's a bit of an overstatement, but our esteemed legal eagle and blogger DonkeyXote points us to Microsoft's recently released game content usage rules that are cool because (a) they let the gamer community use game assets for things like fan art, machinema, etc, and (b) because they are written in English, not legalese.

Snip:

We know that people like you love our games and sometimes want to use things like gameplay footage, screenshots, music, and other elements of our games (“Game Content”) to make things like machinima, videos, and and other cool things (your “Item” or “Items”). We’d like to make that easier for you. So long as you can respect these rules, you can use our Game Content to make your Items.

Yes, there are rules, but this is still pretty progressive for a large company. Pretty cool.

Over-criminalizing copyright

I'm giving yet another link to the amazingly-verbose-yet-worth-reading Patry Copyright Blog. This one to a post entitled "over-criminalizing copyright".

Short version goes like this:

He, and an English judge and copyright scholar, agree on the following: Copyright infringement is being treated as a crime, and therefore prosecuted using taxpayer dollars. This is unnecesary, since adequate civil remedies exist. Criminal proceedings should be reserved for large commercial piracy enterprises and the like.

In short, if the RIAA wants to sue teens, they should do it on their dime. Just because it's rampant and difficult for them to sue them all doesn't mean their mom and dads should have to foot the bill for it with their tax dollars.

He closes citing NBC/Universal's general counsel on their efforts to lobby the gov't for stricter IP enforcement and prosecution as an example.

It's interesting that many of these straightforward arguments get lost in the rhetoric that the special interest groups and their lobbyists throw around.

Can casual games industry draft behind poker?

Last month, I blogged about the Poker Players Alliance group that was trying to lobby for changes to gambling law to recognize games of skill as being just that, skill based, and therefore not under the umbrella of 'gambling'.

Today Kotaku points out that a resolution has been introduced into congress to tackle the subject.

The resolution can be found in full here.

Kotaku reads this as being relevant to MMO's, but it's clearly relevant to ALL games. The opening paragraphs of the bill reference Bridge and Mahjong, for example. Skill-gaming business models are currently a viable business model for casual games as well as core games like FPS games and the like. One of the reasons the model has been limited is that it's currently an 'arms length' business model, since many still see it as gambling.

Think about it. When you tell mom you are bringing home your new fiancee, and he/she is a professional poker player, what's mom's reaction? Now change that to professional chess player. You imagined a different reaction, no? Poker has come a long way in terms of public perception, though it still has some air of vice around it.

A societies laws reflect it's values, and vice versa, though generally the laws lag when the values change. If something like this were to become law, it merely reflects the fact that people are open to the idea of games of skill being something that can be an arena for fair competition.

I for one, look forward to watching ESPN's Celebrity Zuma Championship.

World of LastResortCraft?

Ok, I'm not a WoW player, so I don't understand teh mechanics of how all this stuff works.

However, I was surprised to hear (via Raph) that Blizzard is suing a company doing in-game spamming of their gold-farming services.

Normally, going the legal route is a last resort. It would seem that in an in-game scenario, for a game for which (a) Blizzard write the policies & terms of use, and (b) Blizzard and their partners administer the servers, there'd just be an easier and more effective way.

Resorting to the courts, especially in this case where (as Raph points out) the defendant is a company based in China, seems like a real last-resort type of effort.

Students suing SW company for copyright infringement

Yes, you read that correctly, not the other way around.

The Patry Copyright Blog (a good, if thick, read - think 'Copyright equivalent of Freakonomics, written by an attorney') has this interesting story, best summed up as follows:

- A number of schools use an anti-plagiarism software service called Turnitin from a company called iParadigms.
- The service works by allowing teachers to enter students works, where they are compared against a database of 22 million student papers and other resources.
- The student papers are then added to the database. (see where this is going?)
- The students papers are copyrighted works, and the students never granted this software company permission to store a copy of their works for their use.
- A couple of high school students are suing the company for this reason.

Cheeky monkeys. :-)

Sure, the use is a well-intentioned one, but that doesn't matter. The company argues fair use, but their software is worthless without the database and thus they are deriving commercial value from it, and that's not fair use. At least it's debatable.

[update: Looking this up in wikipedia, it appears they've been challenged a couple times before, most notably by some McGill students first. Go Montrealers!]