Virtual Worlds and the DMCA
Well, it seems that the metaverse is all a-twitter about how Linden Labs, the coding authority behind Second Life, is being sued under the DMCA... but I've heard nary a peep of this case in the usual cyberlibertarian circles yet. I guess the underlying reason may be that this seems like a pretty typical application of that law once one looks past the novelty of the "virtual worlds" element to it: Service providers have to respond to takedown notices by IP holders, and not doing so can get you sued. Voila.
An analysis of the case's legal merits can be found on the Second Life Herald, but I find it disappointingly superficial. Firstly, I highly doubt that a reading of the ToS which implies that individuals completely surrender their copyright protections in Second Life when they upload content would be enforceable. Secondly, even if this were the case, one would have to interpret the infringement by third parties as having been licensed by Linden Labs, which seems like quite a stretch. Third, it wouldn't address the issue of trademark infringement, which is an important part of the lawsuit overall.
I imagine that this dispute will be resolved by Linden Labs agreeing to take a more active role in dealing with knockoff goods in Second Life. The main question is how costly this will end up being, and how those costs will be passed along to Second Life's users. One could actually imagine a trademark registry being relatively simple to add to the client... for example, if a user trademarks a term, it'll appear in a special font when they use it or make an object that uses it, and the font will indicate authenticity. Registration fees could cover the review process and maybe even a little extra. I won't claim that this issue is a no-brainer to resolve (I'd be very surprised if this ideal hasn't been discussed before), but I doubt that Linden Labs has any real interest in allowing for massive trademark infringement to run rampant. Maybe my simple solution wouldn't satisfy trademark-holders, but the nice thing about being able to implement rules and institutions at the code layer is that they can be very costly to circumvent.
As a tangential note, I'm consistently amazed at how issues of virtual world economics will induce even tech-savvy individuals to express disbelief in the notion that virtual goods can have real monetary value to people. It's a stark reminder that subjective value theory really, really runs contrary to the intuitions of most people.