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  The Regurgitation of ‘Second Life’ IP Issues  
 
 
Posted 2006-06-19 by Tony Walsh
 
 
     
 
With a rapidly-expanding bubble of business interest in the virtual world of Second Life has come another wave of new bloggers. In internet-years, I'm an old hand at writing about Second Life, having consistently published my thoughts about it since April, 2004. So I have to admit I'm feeling a little "been there, done that" about many of the posts I've been reading over the last few months from business-bloggers. It's the same feeling I got when the rest of the world caught on to blogs a few years ago.

At least some of these business-bloggers are regurgitating important issues. Jeremy Pepper asked yesterday "What are the implications in a virtual world in regards to trademarks and copyrights?... We all see how YouTube has both handled and mishandled copyright rights, but how is it going to work in a virtual world, where people make clothes and other items to sell to others." Robert Scoble added "I see brands being attached to lots of things inside Second Life. I like that, but in most cases it's not being done by the trademark owners...I can see how this will end up in court sooner or later."

In February, 2005, I wrote "It's no secret that Second Life is rampant with intellectual-property infringements--it's just ignored...Linden Lab's Second Life has an advantage over web sites, however--the virtual world is not nearly as easily-travelled and referenced as the rest of the internet...Second Life is currently teetering on a foundation comprised of both original and illegal building-blocks. By taking a more active role in the fabric of its virtual reality, Linden Lab can only increase its durability."

Since I wrote about trademark and copyright infringements a year and a half ago:
  • Outside business-interest in Second Life has dramatically increased.
  • The virtual world's active population has increased.
  • IP infringements seem as popular as ever.
  • Residents still don't know or don't care about the law.
  • Linden Lab has moderately stepped up efforts to selectively remove trademarked material from Second Life with a "shoot first, ask questions later" approach.
Basically, the only thing that's really changed here is that the stakes are higher. Real businesses are coming to Second Life, and despite Linden Lab's hamfisted efforts to clean up, there's still a mess of infringement going on. One of these days, it's going to bite Second Life in the ass.

[Update: Read further thoughts on these issues from Mark Wallace of 3pointD.com]
 
     
 
   
 
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  12 Comments  
 
   
 
Comment posted by SLHamlet
June 19, 2006 @ 11:58 pm
     
 
How exactly will infringements "bite Second Life in the ass"? A DMCA message is linked right on the official homepage:

http://secondlife.com/corporate/dmca.php

"Linden Lab will respond to copyright violations that fall under the restrictions of the Digital Millennium Copyright Act (see below for links to DMCA text) via removal or disabling access to the alleged copyrighted material. Reasonable and good faith efforts will be made to contact the Second Life resident with notification that the reported item was affected."

So when an IP rights holder contacts LL and makes a valid DMCA complaint, they yank the material. That seems like a similar policy to YouTube, and that service seems to be thriving just fine, despite rampant instances of copyright infringement (which also get yanked when a complaint is filed.) I ain't a lawyer, but sure seems to me their ass is covered. Am I missing something?
 
     
 
     
   
 
Comment posted by Brace
June 20, 2006 @ 4:09 am
     
 
Yer missing the part where the residents who choose to play by the rules and NOT snag use RL designer's lables and logos and whatnot - get shafted because everybody knows that the copyrighted stuff sells much better.

A bit slightly off topic, but integral to the problem. Its a little to much barndooring and CYA-ing for my taste.

How hard is it really to yank all that stuff outta the code - clean house and start being PRO-active instead of reactive?

oh wait its just not FUN enough to make onto anyone's BLOTTD

(someone please find and hand me my eyes - I just severely rolled them all over the dang place)
 
     
 
     
   
 
Comment posted by Tony Walsh
June 20, 2006 @ 9:25 am
     
 
Hamlet, there are lots of way to get bit in the ass, many of which don't involve legal wranglings. I can't predict "exactly" what will happen, but I can make some educated guesses.

As you know, the DMCA handles copyright, not trademarks. I've read enough reports from residents about how LL deals with DMCA complaints to believe such complaints are sometimes handled inconsistently, selectively, and/or inordinately slowly. This might result in creators producing less content, or might diminish outside business interest in SL.

I'm not a lawyer, but I bet the DMCA wouldn't be enough protection against the MPAA. Imagine if someone were to mount an awareness campaign, targeting the MPAA, about the many Hollywood movies which are shown in SL? The MPAA seems pretty sensitive these days about losing box office sales or rentals due to internet-based technologies. I'm not sure negative attention from a powerful industry group would help Linden Lab. I wonder if 20th Century Fox would have promoted its latest X-Men movie in SL if it knew you could watch entire 20th Centure Fox movies in Second Life for free or a nominal fee.

Then there is LL's poorly-crafted and executed trademark policy. I can imagine the outrage and uproar that would ripple through the Second Life community if someone spent a couple hours a day Abuse-Reporting content for legitimate infringement. If Linden Lab could keep up, which I doubt, there would be reams and reams of items yanked from the grid. Bye-bye, entire Star Wars themed island of Dantooine. Bye-bye entire businesses based on knock-offs or copies. Of course Linden Lab should remove infringements, but much of its world is built on infringements. Is it any wonder why LL isn't more aggressive with policing?

As Scoble explains, "I can see how this will end up in court sooner or later. Why? Cause trademarks must be defended or else the trademark owner loses rights to them."

As Brace points out, some resident content-creators have a hard time competing against branded items. Culling infringements will help prevent backlash from resident businesses.

So the way I see it, LL isn't doing enough to clean up its act, and this will hurt the company's business. The reason I'm comfortable making this prediction is that the barriers to entering SL are lower than ever before, and there's a raging business interest in SL as a new marketing platform. That kind of attention can cut both ways.
 
     
 
     
   
 
Comment posted by Prokofy Neva
June 20, 2006 @ 10:17 am
     
 
Even someone with as weathered -- jaundiced -- eye as I have reading the police blotter has noticed that lately, LL has stepped up the prosecution of trademark violations:

Date: Wednesday, June 14, 2006
Violation: Terms of Service: Trademark Violation
Region: Key West
Description: Using Apple registered trademark on items.
Action taken: Warning issued.

Date: Friday, June 9, 2006
Violation: Terms of Service: Trademark Violation
Region: Bora
Description: Selling trademarked items (Apple, iPod, Microsoft, etc.).
Action taken: Warning issued.


Let's say they take it further than issuing the official warning, and go to the next step -- 3-7-14 day bans or closures. The people merely have to pass their created items to their nearly-created alt -- the new registration system allows for creation of accounts without any credit card or cell phone ID presented.

This is going to be like trying to herd cats.
 
     
 
     
   
 
Comment posted by csven
June 20, 2006 @ 3:53 pm
     
 
The competition with native SL brands is the part that I find most distasteful. People who find it amusing to misappropriate a trademark apparently don't realize that they're hurting the competition they should be supporting. Not unexpected when people don't give much thought to the full measure of their actions.

And Prok's comment on herding cats is a good way to describe what I was thinking.
 
     
 
     
   
 
Comment posted by SLHamlet
June 20, 2006 @ 4:59 pm
     
 
Zero, a lot of your speculations don't seem to be borne out by actual reality (so to speak). As you know, the big media corporations are the most proactive about aggressively protecting their IP and trademarks, and those companies are Sony, Disney, Viacom, Vivendi, and Newscorp. At the moment, there's significant official presence in SL of both IP and trademark from-- Sony, Disney, Viacom, and Newscorp. (And I think it's naive to assume they just don't know about IP rights concerns.) Again, it's why I brought up the comparison to YouTube or for that matter, other Web 2.0 sites like Flickr or MySpace-- those sites are rife with IP and trademark violations, but they all seem to be *thriving*, and despite being much bigger, the major media corporations haven't shut them down-- rather, they now *depend* on them to promote their content.

So again, the question is: since those companies haven't exactly been bitten in the ass by this issue, why would Linden Lab?

Also, I have to ask about this point, which maybe we can discuss in more detail at Friday's event at Berkman Island:

> Of course Linden Lab should remove
> infringements, but much of its world is built on > infringements. Is it any wonder why LL isn't
> more aggressive with policing?

First, what do you mean by "much"? I'm in-world something like 20-30 hours a week, and I gotta say, the amount of potential and blatant infringements with outside companies' IP seems extremely small, proportionally speaking. I'm not a lawyer, so that's just a layman's evaluation, but considering the millions of objects existing now and the hundreds of thousands of new objects created every week, I'd have to guess it's actually a tiny number. What constitutes "much" to you?

More key, are you implying that Linden Lab depends financially on infringement, and so is *intentionally* lax on enforcement? That's actually a very serious charge to make. Is that your contention?
 
     
 
     
   
 
Comment posted by SLHamlet
June 20, 2006 @ 5:02 pm
     
 
(Whoops, forgot to mention Time-Warner in the big media pantheon-- which, of course, also has a presence in SL.)
 
     
 
     
   
 
Comment posted by Tony Walsh
June 20, 2006 @ 10:13 pm
     
 
Prok, I've noticed the stepping up of IP policing, too. I find it telling that it seems to correspond with the increase in outside business interest in SL. My interpretation is that LL knows it has to cover its ass, else said ass gets bitten.

Csven, I just want to make sure I understand -- are you basically saying that residents should make the best non-infringing products they can in order to be able to compete when legitimate outside brands enter the world?

Hamlet, with respect, I can't help thinking that part of the reason you're here is because you are a "metaverse partner" for Rivers Run Red, the marketing firm that's brought some outside business into SL. You have a vested interest in Second Life being a hospitable place for outside business. I'm not at all keen on folks coming here to evangelize their platform of choice, products, or services, but I'm giving you the benefit of the doubt. This being said, I'm soooooooooo not interested in this discussion with you. I don't have the kind of time these days to research a careful, data-laden reply, and it only seems like you're interested in addressing my weakest points while ignoring my stronger ones, which diminishes my interest in responding seriously to you. You are welcome to take this as a sign that I have no solid arguments to make, in which case, please declare victory and move along.

You asked:
"...since those companies haven't exactly been bitten in the ass by this issue, why would Linden Lab?"

I don't think YouTube users sell videos through YouTube, and I'm pretty sure MySpace users aren't selling the content they've stolen via MySpace, either. I don't know about Flickr. It is not uncommon to find Second Life users selling illegal content or leveraging brands illegally to sell content. That seems like ass-bite material to me. Whatever ass-bite means. Anyway, your line of reasoning is flawed. It's not logical to suggest that since something hasn't happened to YouTube, MySpace, or Flickr, it won't happen to Linden Lab.

You asked:
"What constitutes 'much' to you?"

More than "a little bit" and less than "bazillions," pick whatever makes you happy. In my opinion, there's enough infringement going on that if every illegal item was yanked out of Second Life right now, your virtual world would be substantially crippled.

You asked:
"More key, are you implying that Linden Lab depends financially on infringement, and so is *intentionally* lax on enforcement? That's actually a very serious charge to make. Is that your contention?"

I'm not sure you're qualified to be waving terms like "very serious charge" around. I'd take time to craft a more considered reply, but, like you, I'm not a lawyer.
 
     
 
     
   
 
Comment posted by Ordinal Malaprop
June 21, 2006 @ 2:37 am
     
 
It's my observation/theory that the initial people that corporations have involved in looking at new technologies, the scouts as it were, generally don't care much about IP violations unless they're specifically fraudulent. If some young Sony scout goes into SL and sees somebody selling prim clones of a Vaio, they'll probably just say "cool, free advertising". The corporations won't pick people with too conservative at attitude to investigate.

It's when the project starts to get noticed by people who *do* care that you'll start to get notices about trademarks etc, when, say, the hip young team make a project plan which gets up to higher management, or when something starts getting serious media coverage where this stuff is visible. This will happen to YouTube et al first but it will happen if SL is a success - YouTube has gotten into trouble already about showing clips from TV shows, though it's still hardly rare to see clips.

Personally speaking I think basing a business around selling real-world trademarked items is lazy and unimaginative, but I also hate the irrational attitude that corporations take to their brands and the ridiculous legal powers they've acquired regarding them. I can't see those latter two things going away any time soon unfortunately, no matter that most net users think they are excessive (most people actually, when they hear about them - I remember a law professor telling me that "copyright law is only tolerated because it's not enforced"). Support Playboi or support Playboy? It's a tough call.

Disclaimer: I think I actually have a 17" Powerbook that I built somewhere in my freebie box.
 
     
 
     
   
 
Comment posted by SLHamlet
June 21, 2006 @ 3:19 pm
     
 
Zero, I'm not speaking on behalf or in the interest of Rivers Run Red or any other company, non-profit, or person I have a relationship with, and it's just not cool to insinuate I'm making these points from some hidden agenda. I'm speaking only for myself, as someone who's observed SL and LL's development for over 3 years, and since you've been writing about the same subject for the last couple years, I assume we share the same interest in holding a critical eye on inflammatory or plainly inaccurate statements on them. I'm happy to take the hit when I muff something or go overboard (both of which you've pointed out more than once yourself) and make corrections when warranted. I just hope you're holding yourself to the same standard.

> It's not logical to suggest that since something > hasn't happened to YouTube, MySpace, or Flickr, > it won't happen to Linden Lab.

That wasn't what I said, however. I said if this issue hasn't adversely hurt those companies, what's your argument for suggesting that it will hurt Linden Lab?

Also, it's worth pointing out that unlike those services, Linden Lab doesn't host the most questionable content on their servers-- i.e., movies and music. That content is streamed (not downloaded) from users' servers. I'm not a lawyer, but that seems to be a key distinction that hasn't been made clear in this post so far. At the very least, it's highly debatable if LL is culpable in those cases; seems to me that would be like the MPAA suing Firefox because some people use the browser to watch pirated movies on it.

> there's enough infringement going on that if
> every illegal item was yanked out of Second Life > right now, your virtual world would be
> substantially crippled

By what metric? A quick glance at the 20 most popular places in SL doesn't show anything patently infringing. I see a place called "Barbie" and one called the "Matrix", but even those seem plausibly defensible. A quick glance at today's hundred or so Events listing titles doesn't show anything patently infringing. In the top 10 most popular items of SLBoutique, I see a "Moog" synthesizer listed, and that's definitely questionable-- assuming the creator didn't contact Moog for permission, and creators sometimes do-- but the other 9 items seem totally legit.

So again, by what metric are you saying a removal of infringing content would "substantially cripple" Second Life?
 
     
 
     
   
 
Comment posted by Odysseus Fairymeadow
June 21, 2006 @ 4:32 pm
     
 
Prok, about not being able to kill objects before they are spread to other alts... I'm wondering if LL couldn't just kill or replace the infringing texture if it becomes a problem. If it is possible and it happens, the user would have to re-upload the texture again (which isn't completely free) or start building logos out of prims rather than textures...
 
     
 
     
   
 
Comment posted by csven
June 22, 2006 @ 12:39 am
     
 
"Csven, I just want to make sure I understand -- are you basically saying that residents should make the best non-infringing products they can in order to be able to compete when legitimate outside brands enter the world?"

Yes.

There will come a day when a manufactured product (as opposed to software) will start off in a virtual space and migrate out. That virtual product might be the product of an entirely virtual brand. The RL start-up capital may even be funded by virtual profits. When this happens - and it will happen - the business landscape will not, in my opinion, ever look the same again.
 
     
 
     
   
 
 
     
 
     
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