WoW Shut Down in China?

GamePolitics reported earlier this month on the battle between China’s Ministry of Culture and their General Administration of Press and Publication over control of the online game industry.   According to reports, the GAPP has banned Chinese WoW operator NetEase from running The Burning Crusade in China, and is requiring that they stop taking new subscriptions and cease current subscription fees. Most previous regulation, including censorship, of the industry has recently come from the Ministry of Culture, and this appears to be a major turf war between the two organizations. The Ministry of Culture has approved WoW in China, launched this September, while the GAPP did not.  For their part, NetEase has issued a press release stating that they believe they are in compliance with PRC law, and doesn’t indicate that they will be ceasing any operations. It also notes that they haven’t had any official “notice” of the ban, and that the announcement came from the GAPP’s website (rather than an official determination.) Earlier in the year, China banned FDI (foreign direct investment) into the gaming industry, and has increasingly cracked down on what it views as an opportunity for the expression of dissident viewpoints and “undesirable content.”

On a related note, I’m putting the finishing touches on a journal article regarding an international framework for protecting human rights in virtual worlds and MMORPGs. With this news, the topic only seems more relevant.  Chinese gamers should be entitled to express dissident viewpoints in a virtual world without fear of censorship, and without fear that their avatars and virtual property will be at risk of seizure or deletion. Similarly, virtual worlds operators should be entitled to profit from their businesses without fear of government crackdowns like this. I’ll post the article here once the publication process is complete.

The NetEase press release reprinted in full below.

NetEase.com Announcement Regarding Statement by the General Administration of
Press and Publication With Respect to World of Warcraft(R)

BEIJING, Nov. 2 /PRNewswire-Asia/ -- NetEase.com, Inc. (Nasdaq: NTES), one
of China's leading Internet and online game services providers, today
announced that the General Administration of Press and Publication ("GAPP") of
the PRC government has posted on its official website a statement that the
current operation of the World of Warcraft(R) in China by NetEase's affiliated
company, Shanghai EaseNet Network Technology Limited ("Shanghai EaseNet"), is
being conducted without proper approval from GAPP. The statement further
indicates that GAPP is returning Shanghai EaseNet's application for approval
and Shanghai EaseNet should suspend charging users to play the game and not
allow new account registrations. GAPP also notes in its statement that it is
evaluating whether to impose administrative penalties on Shanghai EaseNet. As
of the time of this press release, neither NetEase nor Shanghai EaseNet has
been officially notified of GAPP's determination. Shanghai EaseNet licenses
World of Warcraft(R), a massively multi-player online role-playing game, for
operation in China from Blizzard Entertainment, Inc.
    NetEase and Shanghai EaseNet believe that they are in full compliance with
applicable PRC laws and are currently seeking clarification from the relevant
governmental authorities regarding this statement by GAPP. NetEase will
provide further updates on the statement by GAPP as appropriate.
    About NetEase
    NetEase.com, Inc. is a leading China-based Internet technology company
that pioneered the development of applications, services and other
technologies for the Internet in China. NetEase's online communities and
personalized premium services have established a large and stable user base
for the NetEase websites which are operated by its affiliates. In particular,
NetEase provides online game services to Internet users through the in-house
development or licensing of massively multi-player online role-playing games,
including Fantasy Westward Journey, Westward Journey Online II, Westward
Journey Online III, Tianxia II and Datang, as well as the licensed game World
of Warcraft(R).
    NetEase also offers online advertising on its websites which enables
advertisers to reach its substantial user base. In addition, NetEase has paid
listings on its search engine and web directory and classified advertising
services, as well as an online mall, which provides opportunities for e-
commerce and traditional businesses to establish their own storefront on the
Internet. NetEase also offers wireless value-added services such as news and
information content, matchmaking services, music and photos from the Web which
are sent over SMS, MMS, WAP, IVR and Color Ring-back Tone technologies.
    Other community services which the NetEase websites offer include instant
messaging, online personal advertisements, matchmaking, alumni clubs and
community forums. NetEase is also the largest provider of free email services
in China. Furthermore, the NetEase websites provide various channels of
content. NetEase aggregates news content on world events, sports, science and
technology, and financial markets, as well as entertainment content such as
cartoons, games, astrology and jokes, from over one hundred international and
domestic content providers.
    Safe Harbor Statement
    This press release contains statements of a forward-looking nature. These
statements are made under the "safe harbor" provisions of the U.S. Private
Securities Litigation Reform Act of 1995. You can identify these
forward-looking statements by terminology such as "will," "expects,"
"anticipates," "future," "intends," "plans," "believes," "estimates" and
similar statements. The accuracy of these statements may be impacted by a
number of business risks and uncertainties that could cause actual results to
differ materially from those projected or anticipated, including risks related
to:  the risk that Shanghai EaseNet will not be able to continue operating
World of Warcraft(R) or other games licensed by it for a period of time or
permanently due to the position of GAPP or other governmental actions; the
risk that Shanghai EaseNet or NetEase will be subject to penalties or
operating restrictions imposed by governmental authorities in the PRC
resulting from the operations of their online games, including suspension of
their Internet service or other penalties; and other risks outlined in
NetEase's filings with the Securities and Exchange Commission. NetEase does
not undertake any obligation to update this forward-looking information,
except as required under applicable law.
    For further information, please contact:

    NetEase.com, Inc.
     Brandi Piacente
     Investor Relations
     Email: brandi@corp.netease.com
     Tel:   +1-212-481-2050

     Li Jia
     Email: liddyli@corp.netease.com
     Tel:   +86-10-8255-8208

SOURCE  NetEase.com, Inc.

Brandi Piacente, Investor Relations, brandi@corp.netease.com, +1-212-481-2050;
or Li Jia of NetEase.com, Inc., liddyli@corp.netease.com, +86-10-8255-8208

Popularity: 11% [?]

Paltalk Sues Sony, NCsoft, ActiBlizz, Turbine, and Jagex for Patent Infringement

Boston.com (via Ars Technica) reports that Paltalk Holdings, (which patent-savvy readers may remember forced Microsoft to settle a patent lawsuit in 2006 over the Halo series), has launched another round of lawsuits for patent infringement, this time covering a bevy of top name MMOG producers. Naming Sony, NCsoft, Activision Blizzard, Turbine, and Jagex as defendants, the complaint alleges infringements of patents covering “sharing data between computers that are connected together so users see the same digital environment”. The patents were purchased in 2002 from a company called HearMe. Shadows of Worlds.com rising? Paltalk is alleging that any MMO game in which players “have to see the same environs simultaneously” would infringe the patent. More accurately, it seems from the Boston.com article that it involves the process for synchronization between the different player’s screens. Given that presumably Runescape (Jagex), World of Warcraft (Blizzard), and Guild Wars (NCsoft) all use different methods of communications and display, from instancing to open-world MMO, to server-side-only calculations, this seems like a stretch, but we’ll withhold judgment for now.

Popularity: 6% [?]

Five Silliest MMO Lawsuits

Ignoring how terribly passé Top (x) lists are, I have to call this one out for being one of the worst of the bunch. MMORPG.com, which I’ve always considered to be an otherwise decent site, has released an abysmal list of the “Five Silliest MMO Lawsuits“, written by someone with a below-average understanding of the law in general. (Actually there aren’t just five, they include an “honorable mention).

(UPDATE: After receiving my criticism from this article, the author has changed the name from Five Silliest MMO Lawsuits to “Five Memorable MMO Lawsuits”. The factual inaccuracies remain the same, however.)

Here’s the rundown:

• Mythic v. Auran: This one wasn’t even a lawsuit; it was apparently a C&D over a clearcut case of trademark infringement. What’s silly about this, you may ask? The author of the article doesn’t understand what a trademark is. “Mythic coined a term and wanted to hang on to it. I just don’t necessarily understand why they would want to stop other companies from using it. It’s not like they have the idea behind RvR trademarked.” Well, duh. You don’t trademark an idea. The whole point of a trademark is to protect a mark associated with YOUR good from being used by other companies to associate with THEIR good, and thus lose its distinctiveness as being recognizable as yours. When you think of RvR, what do you immediately think of? Mythic games. You think Warhammer Online, or I guess Dark Age of Camelot if you’re old school. To top it off, the author doesn’t understand likelihood of confusion, by way of the line “Even sillier than the time Mythic sued “Mythica” over its name. Mythica was eventually cancelled by Microsoft in 2004.” Yes, god forbid Mythic protect it’s own brand name from another mark that is confusingly similar (to the point of only being 1 letter different).
• Esther Leong v. Square Enix: They don’t even manage to get the first line right on this one. “Looking only back to June of this year, we saw a lawsuit from a lone individual named Esther Leong against Square Enix…”. Except, it wasn’t from a lone individual. It was a class action on behalf of all FFXI players similarly situated. “This begs the question: How many accounts did this woman have?” Facepalm. They also go on to get the merits wrong while having them right in front of their face. “Please, oh please, tell me that this person didn’t file a suit claiming to have not known that there was a fee to play the game, and then not knowing that the company would apply rules to their game and reserve the right to stop letting you play if you didn’t pay your fee.” As a matter of fact, no. They filed suit because Square advertised one fee, then presented another with hidden charges, and made it nearly impossible to actually cancel your account, all while upping your fee if you payed late; as well as a complaint that they were not clearly informed that they did not actually purchase the game (and all ownership rights appurtenant thereto), but a license. “It can’t possibly be that ridiculous, could it? COULD IT?” No. No it wasn’t. 0 for 2 MMORPG.com.
• Kohnke Communications v. Perpetual Entertainment: They don’t even bother to justify this one as being silly: in fact, MMORPG.com straight up admits that it was a cut and dry breach of contract and that Kohnke (now TriplePoint PR) got screwed out of money they were owed. 0 for 3.
• Garriott v. NCsoft: “Jokes aside, the facts around the suit actually see Garriott suing his former company for 27 million dollars in money lost in stock options when, he claims, his firing was internally re-structured to look like a resignation.” Another one where they don’t attempt to justify how silly it is that someone got screwed out of their money. 0 for 4. Not good MMORPG.com. Not good.
• Blizzard v. MMO Glider: Before I go any further, WTF? This is a case that actually had some legitimate precedential value to determine what constitutes copying of data into RAM under the MAI standard. And once again, there’s no justification for what makes the lawsuit actually silly. Glider, under Blizzard’s argument, was costing Blizzard money and not to mention that the broader issue of “Do you own the MMORPG software you buy” was implicated (as it was in the Leong case above). Even the EFF got involved on this one. 0 for 5.
• Finally, Worlds.com v. NCsoft: In the very first sentence “Speaking of bone headedly stupid trademark based lawsuits…” …. this is a patent suit, not trademark. But keep going: “Now, as stated previously, I’m not a legal expert,” (ed. No, really?)  “but this describes the most simplistic and basic workings of an MMO.” Congratulations. You’ve discovered that patents require a description of how things work. Since Worlds.com claims to have been the first to invent the 3d MMO (though there is a dispute as to whether there is prior art), there is nothing unusual about that claim. MMORPG.com then goes on to get the date of the patent wrong, (it has priority dating to 1996, not 2000, though the confusion may have been justified as there are two patents in question here). 0 for 6. Incidentally, we’ll be discussing Worlds.com with Ross Dannenberg of Patent Arcade on our panel at PAX this year.

It’s not unusual for a site to make factual errors in an article. We’ve been guilty of it before too. It IS, however, unusual for an entire article to be wrong both in premise and every single one of the 6 segments that constitute it. Shame on you MMORPG.com. For shame.

Updated: Italicized quotations for clarity, clarified that there are intentionally 6 items on the list.

Popularity: 34% [?]

Blizzard v. In Game Dollar Analysis

Patent Arcade has a case analysis of the In Game Dollar lawsuit, perhaps more well known as Peons4Hire.com. Though the case settled and therefore doesn’t serve as binding precedent, it makes for a good study of Blizzard’s methods that they’d later use in other cases. Also, Virtually Blind (now defunct) has their own analysis here. Thanks again to the excellent Patent Arcade for the heads up.

Popularity: unranked [?]

Blizzard sends C&Ds to WoW iPhone programs

Ahh, I love the smell of Cease and Desist notices in the morning. According to WoW Insider, Blizzard has started to send out notices to all WoW iPhone application makers that utilize Blizzard’s Armory website (a site that allows players to see stats and equipment from their characters, as well as any other), instructing them to take down their apps or else.

A couple of things to note on this action. First, these WoW apps have been on the store for a quite awhile now. With the first ones arguably coming right after the introduction of the App Store 10 months ago. Second, Blizzard’s actions come on the heels of a recent video floating around the web showing that the WoW maker may have an official app coming soon on the iPhone that will allow gamers to actually play the MMO on their phone. Finally, Blizzard already has one official iPhone app in the store, so they could just be trying to uphold their IP rights and clear out any confusion.

In any case, it’s always a little sad having to report on the strong hammer of business taking out small developers not really intruding on the market of the big guy (yet). We’ll keep you posted on further developments.

Popularity: 5% [?]