Regulating Virtual Environments


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Presented at the Doctoral Consortium of the Foundation of Digital Games Conference -- Raleigh, NC -- 30 May 2012

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Regulating Virtual Environments

  1. 1. Regulating Virtual Environments Foundation of Digital Games Conference, Raleigh, North Carolina, USA. 30 May 2012 Darryl Woodford, CCi ARC Centre of Excellence Queensland University of Technology / @dpwoodfordWednesday, 30 May 12
  2. 2. Today Key objectives Methodology Why it matters Founding principles Preliminary results: Eve & Gambling Preliminary ConclusionsWednesday, 30 May 12
  3. 3. Key Objectives Original goal of research was to consider how we might regulate virtual environments Because, eventually, they will be regulated somehow...Wednesday, 30 May 12
  4. 4. Dispute Resolution Image: WikipediaWednesday, 30 May 12
  5. 5. Admin Perspective Real world governments Virtual world admins Players Image: IJMCWednesday, 30 May 12
  6. 6. Key Objectives Designers know A LOT about what they intended to happen. Lawyers know A LOT about what the written documents say & how to interpret them. But NEITHER knows what’s actually happening in-world.Wednesday, 30 May 12
  7. 7. Method Original plan: Ethnographic research to understand Virtual Environments & what stakeholders wanted. Began with three environments -- Second Life, Star Trek Online & Eve Online -- eventually narrowed to Eve for detailed ethnography.Wednesday, 30 May 12
  8. 8. Eve is Complex Image: EON MagazineWednesday, 30 May 12
  9. 9. Method As project evolved, it became clear that many of the issues that impacted on stakeholders (automation, dispute resolution, appeals etc) were not new. A comparative with offshore gambling was worthwhile -- a second ethnographic site.Wednesday, 30 May 12
  10. 10. Ethnography Tradition in Game Studies of Participant Observation Ethnography (Dibbell, Taylor, Humphreys etc..) Work throws up as many questions as answers, and often focuses on individual aspects of the experience (co- operative play/design, emotions etc)Wednesday, 30 May 12
  11. 11. Ethnographers... But how do we study what underlies it all? How communities form? What social standards they create? How they enforce them? We need a framework - NORMS...Wednesday, 30 May 12
  12. 12. Norms Norms are “informal social regularities that individuals feel obligated to follow because of an internalized sense of duty, because of a fear of external non- legal sanctions, or both” (McAdams, 1997) Ultimately akin to Ostrom -- what communities use to regulate themselves.Wednesday, 30 May 12
  13. 13. Why it matters: RMT Essentially the exchange of bona fide currency (US$, AUD, GBP) for virtual currency. Impacts upon: Fair Play (Cheating), Design, Economy Balance etc, but importantly has LEGAL IMPLICATIONS.Wednesday, 30 May 12
  14. 14. Real Money Trading To the extent that “It’s just a game” is ever justified, that argument loses validity when real money is WON or LOST, EARNT or STOLEN. If I lose a sword in MONKEY ISLAND I might go back to my previous save; if I lose it in ENTROPIA replacing it may cost $200+.Wednesday, 30 May 12
  15. 15. Gambling Virtual Worlds look a lot like gambling 30% of the time the monster drops nothing. 40% of the time it drops Item A, worth $3 on the market. 25% of the time it drops Item B, worth $4 on the market. 5% of the time it drops Item C, worth $15 on the market. Why is this different than playing a slot machine in an online casino?Wednesday, 30 May 12
  16. 16. Second Life c. 2007 Image:, 30 May 12
  17. 17. UIGEAWednesday, 30 May 12
  18. 18. Second Life 2010Wednesday, 30 May 12
  19. 19. Gambling in LineageWednesday, 30 May 12
  20. 20. More closely...Wednesday, 30 May 12
  21. 21. More closely..., 30 May 12
  22. 22. More closely...Wednesday, 30 May 12
  23. 23. Gambling Some of it certainly *is* gambling. Others are just gambling-like, but so are other things: Day Trading, Trading Cards, MTG: Online But that they’re similar perhaps means we can learn something.Wednesday, 30 May 12
  24. 24. Similarities Geographical Disparity Terms of Service enforcement problems. Potential for disputes -- player vs player, player vs provider. Strength of community: knowledge of mishandled issues travels fast in both environments.Wednesday, 30 May 12
  25. 25. Findings: Eve Online Community agrees: RMT should be prevented. Mining (to the extent people like it at all) should be limited to manual methods - not automated. But somebody always disagrees - defining norms can be difficult.Wednesday, 30 May 12
  26. 26. Not everyone agreesWednesday, 30 May 12
  27. 27. Findings: Eve Online CCP’s enforcement has improved in recent months, but still evidence of it.Wednesday, 30 May 12
  28. 28. Findings: Eve OnlineWednesday, 30 May 12
  29. 29. Regulation Options:Wednesday, 30 May 12
  30. 30. Regulation Options: Governmental:Wednesday, 30 May 12
  31. 31. Regulation Options: Governmental: Player power:Wednesday, 30 May 12
  32. 32. SBR The sportsbook mediator SBR was my chosen comparative; they also deal occasionally with poker & casino disputes. Lots went before: TheRX, Majorwager, TOW, EOG; Forums, Mediation Panels, News & Rankings.Wednesday, 30 May 12
  33. 33. The past More detail if interested but in summary: Forum-based regulation worked for a while, whilst internet & industry boomed. Problems started when they started relying on advertising. Mediation panels lost traction after US F1 GP Dispute w / Olympic.Wednesday, 30 May 12
  34. 34. SBR Model Players submit dispute. SBR attempt to resolve with book behind scenes. Report back to community via news wire. Has evolved over the years. Some disputes are raised in public first (opinion: lower & resolved). Communication now includes forums, video.Wednesday, 30 May 12
  35. 35. SBR Model What hasn’t changed is that this amounts to REPUTATIONAL REGULATION. A negative report from SBR is enough to impact upon your business. Any different from how gaming media covered ‘Greed is Good’ or Mittani?Wednesday, 30 May 12
  36. 36. Preliminary Conclusion Many of the disputes we see in VW’s would not be new to observers from the gambling industry. Automation happens in virtual environments just as it has in poker / video poker / slots / blackjack.Wednesday, 30 May 12
  37. 37. Preliminary Conclusion Code has bugs that allow players to gain an advantage just as sportsbooks have long had code that accepted correlated parlays. Enforcement is not always simple, and over-enforcement is possible. Players need a way to resolve this. “God” argument increasingly losing value.Wednesday, 30 May 12
  38. 38. Preliminary Conclusion The models that worked (and did not) in the offshore gambling industry are worth considering No reason to repeat the same mistakes. Courts an ultimate remedy, but perhaps not the first. Why wait a year vs a week?Wednesday, 30 May 12
  39. 39. Future: #tweetfleetWednesday, 30 May 12
  40. 40. Future: #tweetfleetWednesday, 30 May 12