International Considerations of Video Games and Immersive Entertainment

• Author: Ken Cheney
• Pages: 299-346

299

7

International

Considerations

of Video Games

and Immersive

Entertainment

Ken Cheney1

Takeaways

• When residents of different jurisdictions interact or

transact business within or via an online game or other

virtual reality system, intellectual property laws of

multiple jurisdictions can be simultaneously implicated,

and the choice of whose venue and law to use is not

always clear.

• U.S. intellectual property law is generally not applied

extraterritorially; however, various treaties attempt to

harmonize international law.

• Enforcement of some intellectual property rights

involving conduct occurring within or via virtual reality

systems may be analogized to a body of law that has

developed around Internet websites.

1. Ken Cheney is a partner at Morgan, Lewis & Bockius LLP.

For complete author biographies, see the Contributors section of

this book.

INTERNATIONAL CONSIDERATIONS OF VIDEO GAMES

300

• Arbitration or choice-of-law provisions in end-user license agreements

may be used to circumvent some issues. However, these private

agreements are not likely to resolve the myriad of complex international

issues presented by virtual transactions.

Introduction

Among the many difficult issues facing the online community

today, perhaps the one that increases in importance as virtual

reality systems grow is the international scope of law applicable to

interactions between users, and between the users and the own-

ers or hosts (providers), of such systems. While international legal

issues can be extremely thorny in the real world, they can be expo-

nentially trickier in online virtual environments, in which interna-

tional interaction—and commensurately, international trade and

piracy—is limited only by bandwidth.

By their very nature, online game environments and virtual

reality-based systems (or “online virtual environments,” gener-

ally), including virtual worlds created for social interaction, are

configured for international scope. There are countless online

games and social platforms springing up around the globe, many

with more than 100 million active members.2 As of 2017, the global

massively multiplayer online (MMO) gaming market reached US

$26.9 billion yearly, and is estimated to reach US $44.6 billion by

2022.3 At the same time, the virtual world-based game Minecraft

has reached 100 million registered users, with approximately 74

2. Wikipedia, List of Virtual Communities with More Than 100 Million Active

Users, https://en.wikipedia.org/wiki/List_of_virtual_communities_with_more_than

_100_million_active_users (last edited July 26, 2018); Henry Fong, 5 Things You

Need to Know about Chinese Social Media,

FORBES,

Oct. 25, 2012, http://www.forbes

.com/sites/ciocentral/2012/10/25/5-things-you-need-to-know-about-chinese-social

-media.

3. Press Release, Research and Markets, Global Massively Multiplayer Online

(MMO) Gaming Market—Forecast to Reach $44.6 Billion by 2022 (Nov. 15, 2017),

https://www.businesswire.com/news/home/20171115005641/en/Global-Massively

-Multiplayer-Online-MMO-Gaming-Market.

Introduction 301

million active users.4 Facebook boasts a membership of more than

two billion monthly users around the world.5

Virtual reality- and augmented reality-based environments in

general are expanding. Facebook acquired virtual reality headset

maker Oculus Rift to expand portions of its social network plat-

form into the realm of online virtual environments.6 As of 2018,

170 million people have become users of virtual reality, and it is

estimated that more than one billion people will regularly access

virtual reality and augmented reality content by 2020,7 with a pre-

dicted yearly revenue from virtual reality devices at US $30 billion.8

Today, e-sports—professional organized multiplayer video

game competitions, often within virtual environments—is the

thing. E-sports includes all types of games, from established pro-

fessional sports to strategy and first-person shooters. Traditional

global media companies such as ESPN are broadcasting these

virtual sports competitions, and advertisers are quickly buying in.9

More people watched the 2017 League of Legends Mid-Season Invi-

tational than the Super Bowl and National Basketball Association

championship combined!10 As of 2018, e-sports generates roughly

$620 million in yearly branding-related review, split between

4. Craig Smith, 17 Amazing Minecraft Facts and Stats, DMR, July 24, 2018,

https://expandedramblings.com/index.php/minecraft-statistics.

5. Josh Constine, Facebook Now Has 2 Billion Monthly Users . . . and

Responsibility,

TECHCRUNCH,

June 27, 2017, https://techcrunch.com/2017/06/27

/facebook-2-billion-users/.

6. Chris Welch, Facebook Buying Oculus VR for $2 Billion,

VERGE

, Mar. 25, 2014,

http://www.theverge.com/2014/3/25/5547456/facebook-buying-oculus-for-2-billion

/in/3631187.

7. Robert Kendal, VR Stats Every Business Leader Should See,

BOSS MAG.,

https://thebossmagazine.com/virtual-reality-statistics-infographic (last visited

July 26, 2018).

8. Augmented/Virtual Reality to Hit $150 Billion Disrupting Mobile by 2020,

DIGI-

CAPITAL,

Apr. 6, 2015, http://www.digi-capital.com/news/2015/04/augmentedvirtual

-reality-to-hit-150-billion-disrupting-mobile-by-2020/#.VXjT5vlgd2J.

9. Robert Elder, The eSports Competitive Video Gaming Market Continues to

Grow Revenues & Attract Investors,

BUS. INSIDER,

Mar. 21, 2018, http://www.business

insider.com/esports-market-growth-ready-for-mainstream-2018-3-21.

10. Bradmore & Magus, 2017 Mid-Season Invitational by the Numbers,

LEAGUE OF

LEGENDS,

July 10, 2017, https://www.lolesports.com/en_US/articles/2017-mid-season

-invitational-numbers.