Currently, I am in New York attending the New York Law School/Yale Law School conference on videogames and the law (The State of Play: Law, Games and Virtual Worlds).

This morning's panels is a discussion by founders of two of the most interesting MMORPGs, There.com and Second Life.

Philip Rosedale, founder and CEO of Linden Lab, creators of Second Life, had a very interesting announcement at this conference.

One of the most interesting things about Second Life is that the world is created by its users. They build and script many (if not most) of the models in the system. Second Life has been one of the leaders in such user-centered creativity.

The announcement is that there has been a change in the terms of service for Second Life. Second Life users will now be able to retain intellectual property rights in the things they develop for the MMORPG. Indeed, you will be able to actually transfer, buy and sell these copyrights in the real world. The new EULA does not yet seem to be available online yet, but this is very interesting.

UPDATE 0910 ET

There.com mentions that they have a dispute resolution process for copyright violations in their world. For example, There.com members create virtual clothing that they "sell" to other members using Therebucks. Some complaints have arisen that some sellers see other members wearing clothes they designed but did not sell. Other members of There, apparently, are selling "knock-offs" - so There.com runs a dispute resolution system. How it relates to existing copyright law is not clear.

Second Life expects, with their new EULA, that real world courts may have to resolve these issues.

UPDATE 0935 ET

In response to an excellent set of questions from copyright expert Yochai Benkler, Rosedale notes that they hope to embed Creative Commons licenses into their new system of copyright.

Prof. Benkler was skeptical about the purpose of embedding copyright law (which is a mess) into these virtual worlds ... why not enable a better system for sharing?

UPDATE 1100 ET

New Terms of Service are up.

A brief excerpt (but read the fine print):

5.3 Participant Content. Participants can create Content on Linden's servers in various forms. Linden acknowledges and agrees that, subject to the terms and conditions of this Agreement, including without limitation the limited licenses granted by you to Linden herein, you will retain any and all applicable copyright and/or other intellectual property rights with respect to any Content you create using the Service. . . .

UPDATE 1105 ET

Read the Linden Lab press release: Second Life Residents To Own Digital Creations. There is a quote from Larry Lessig:

Linden Lab has taken an important step toward recognizing the rights of content generators in Second Life. As history has continually proven, when people share in the value they create, greater value is derived for all. Linden Lab is poised for significant growth as a result of this decision.