Friday, November 04, 2005
A ticking bomb
There is a totally unremarkable article in USAToday on virtual jobs, about people earning money designing stuff in Second Life, or gold farming in World of Warcraft. Nothing in there you haven't seen before. Thanks to articles like this one, more and more people are now aware not only that virtual worlds exist, but also that money is made in them. And I can hear a bomb ticking somewhere in there.
Where there is money, there are taxes, there is legal issues of property, there is crime, there is the whole bunch of real world complications that people tried to escape from into a virtual world in the first place.
If 100 gold in World of Warcraft are worth $15, and over the year you "earned" 10,000 gold in WoW, without selling them, do you have to pay income tax on $1500 of additional income? And if you sell them, do you have to pay sales tax in addition to income tax? If a bug in WoW erases your 10,000 gold, is Blizzard liable for the $1500? If one day Blizzard decides to shut down WoW, and all players on all servers together own 1 billion gold pieces, is Blizzard liable for $150 million? If a player dupes WoW gold, can he be prosecuted for counterfeiting? If he dupes a million gold and sells it to many different players, has Blizzard the right to delete the duped gold? Who exactly commited what crime in this situation, and who is liable for what damages?
There are a million questions like this that spring up as soon as you assume that virtual items have value and you can earn real money with them. And sooner or later the bomb will blow up, because the current situation where game companies pretend that virtual property has no value, even if they trade it themselves, can not last.