If you visited Microsoft's Xbox One Pre-Order Product Information you may have noticed three items in particular amongst its various requirements and restrictions:

•You must accept Xbox Terms of Use (including Xbox software terms and game license terms), Microsoft Services Agreement, and Xbox One 1-year limited warranty. Some games have additional license terms. •Terms include binding arbitration with class action waiver to resolve disputes. •Additional requirements will apply.

The German consumer advocacy group The Federation of German Consumer Association has filed an official complaint against Valve Software for its Steam's end-user license agreement because it does not allow consumers to resell digital content. The European High Court ruled last year that digital content games can be sold. The complaint against Valve filed with the German courts is directly related to that ruling.

Forbes is reporting that Electronic Arts has changed the language of the "End User License Agreement" (EULA) users have to agree to in order to play SimCity. Players, who are already peeved that the game requires an "always-on" connection in order play even single-player, took issue with some wording in EULA for the SimCity Beta.

Earlier this week Germany's Federation of German Consumer Organizations (or vzbv) called on Valve to explain the changes it made to the Steam end-user license agreement back in August. The vzbv found that the changes Valve made to its EULA were unfair to consumers and that Steam had no mechanism for allowing its users to trade games per a recent European High Court ruling. It required Valve to respond by September 26 to their insistence the company change its policy "restricting access to content based on the forfeiture of signing the new EULA."

Earlier this month, the European Court of Justice ruled that game publishers cannot stop European consumers from reselling their downloaded games.  Not only that, but a publisher may have to facilitate such a transaction by allowing the recipient of the sale to download their “used” copy from its website.

Oh yeah, they’re going to love that.

An article on Ars Technica details how an automatic update to Cisco routers added cloud support that required users to agree not to download pornography and copyrighted material. Luckily the article also describes how to roll that update back to an older version of the firmware so you can go back to using web-based router management.

The European Court of Justice has made a ruling that could cause lots of problems for publishers in Europe. The highest court in Europe has ruled that game publishers cannot stop European consumers from reselling their downloaded games.

"An author of software cannot oppose the resale of his 'used' licences allowing the use of his programs downloaded from the internet," the ruling read. The Court said the exclusive right of distribution covered by a license is "exhausted on its first sale".

The Entertainment Consumers Association (ECA) has issued an action alert asking ECA members and the general gaming public to contact their local representatives to find out if the terms of many End User License Agreements (EULA) are actually legal in their respective states. Find the Action Alert below:

As reported by Rock, Paper, Shotgun, some astute Escapist forum users have noticed an interesting clause in EA's Origin End-User License agreement that basically give the company carte blanche to collect and use data from your PC. From section 2 of the EULA:

In a complaint filed on October 4 (thanks GameSpot), Blizzard Entertainment has targeted a trio of men, accusing them of creating and selling hacks for the Blizzard game StarCraft II.

Filed in the U.S. District Court for the Central District of California, the complaint names Michael VanKuipers (aka “Perma” or “Permaphrost”), Michael Simpson (aka Matt Cooper, “Cranix,” or “Cranyx) and John Roe (aka linuxawesome). 10 “John Does” are also named.

A story on the Cheat Happens website alleges that Blizzard is banning users who cheat in StarCraft 2 while playing the title’s single-player element.

The website hosts a variety of “trainers” for the Blizzard game, which can grant unlimited ammo and/or other special powers and attributes to players trying to advance through the title’s single player campaign. The site claims that some banned users had their Battle.net accounts suspended, while others saw their CD keys disabled.

One Cheat Happens user named gm0ney received a 14-day suspension for using an “unauthorized cheat program.” While he admitted he was “prepared for it,” gm0ney added, “I’m surprised they took such a blind step without doing some research into the games played.”

You may have recently heard of a court decision out of the Ninth Circuit involving horror stories about EULAs banning the right to resell games. There has been a lot of misinformation and fearmongering surrounding the case, with people shouting how it is the end of the world. It really isn't, and I'd like to take the opportunity to go over the actual decision, as well as the existing law behind it, to explain why this will have minimal, if any, effect on gamers.

Background on First Sale

A judge’s ruling earlier last month that Craig Smallwood’s lawsuit against Lineage II maker NCsoft could continue (a suit in which Smallwood claimed he was addicted to the game), could have an impact on End User Licensing Agreements (EULA).

A lawyer at Princeton’s Center for Information Technology Policy named Steven Roosa took to his blog (thanks Slashdot) to discuss the Smallwood case, using the headline “A Software License Agreement Takes it on the Chin.”

Roosa detailed NCsoft’s attempt to stop the lawsuit by using Section 12 of its User Agreement, which is entitled “Limitation of Liability.” The judge eventually only partially granted NCsoft’s motion to dismiss.

Roosa wrote:

Sony’s latest firmware update (3.30) for its PlayStation 3 beefs up some of the console’s trophy attributes and prepares it for 3D gaming, but the End User Licensing Agreement (EULA) contained some wording that alarmed UK website Thinq.

A Thinq author actually read through the whole EULA, which is dated December 10, 2009, and expressed concern over Section 3, which refers to Services and Updates. The passage is included below:

The Entertainment Consumers Association (ECA) has debuted a new online presence aimed at educating consumers about such issues as digital content distribution, license agreements, virtual property and piracy.

The Gamers for Digital Rights web presence includes a glossary of terms and concepts, a Facebook Group and the ability to sign—and comment on—a DRM and End User Licensing Agreements (EULAs) petition to the FTC.

Jennifer Mercurio, ECA Vice President and General Counsel, added:

The importance of this issue is mounting, as we move from a packaged goods model, where we own what we buy, to a digitally-distributed model, where we may have a license for what we buy.

As part of its drive into the issue, the ECA also announced the hiring of Robert L. (“Beau”) Hunter, IV as Digital Rights Consultant. Hunter joins the ECA after serving as Manager for IP Enforcement with the Entertainment Software Association (ESA).

FULL DISCLOSURE DEPT: The ECA is the parent company of GamePolitics.

Brett Schenker, Online Advocacy Manager for the Entertainment Consumers Association, circulated the following to ECA members on Friday.

You don't need to be an ECA member to sign the petition that Brett mentions, so feel free to check it out:

Over the past year we have witnessed a growing concern among gamers about the issues of increasingly invasive Digital Rights Management (DRM) and End User Licensing Agreements (EULAs). 

The FTC is holding hearings on the issue of DRM and EULAs. Read the ECA's statement, sign the petition and comment about how consumer rights are being diminished.

The ECA respects the careful balance that must exist between the content community and the customer, and we agree that piracy is an ever-present challenge for the trade; at the same time, consumers must be protected from crippling DRM and murky EULAs.

Now's the time to weigh in with your thoughts about DRM and EULAs.

We acknowledge that these are weighty and topically-important issues, without easy solutions, and we are pleased to see the FTC providing a forum for thoughtful discussion of the matter.  We wanted to give you, the consumer, an opportunity to express your opinions on DRM and EULAs, which will be delivered to the FTC.

FULL DISCLOSURE DEPT: The ECA is the parent company of GamePolitics.

Last week was a busy one for Entertainment Consumers Association President Hal Halpin.

On Wednesday Hal was in Seattle to serve as a panelist on the Federal Trade Commission's much-anticipated town hall meeting on digital rights management (DRM). From Seattle it was down to San Francisco for the Game Developers Conference. At GDC Hal was interviewed by - among others - Ben Kuchera of Ars Technica and spoke at length about the needs of the game consumer in relation to the game industry's desire for DRM and those pesky End User License Agreements (EULA):

We suggested a few things to the FTC, one of which was we'd like to see DRM disclosed. So when people go to the store and buy the packaged good, the PC game, they'll see something on the front of the box saying there is DRM inside, and to what degree it will be invasive.

The second thing that we recommended was that EULAs get standardized, so again, rather than have 30 or 40 types of agreements, there would be one standard one for all different types of computer games. People go into the store, buy the game, open it, and they can no longer return it... by standardizing the EULA, consumers will have the confidence to know what it is they're agreeing to before they buy the product.

That didn't go over so well. There was a room of attorneys that kind of gasped when we suggested standardization. One panelist commented that the EULA really were there as consumer information, and that was the one and only time that the FTC jumped in and said 'wait a second, this has nothing to do with consumer information, this is purely IP protection...'

Hal also spoke about the coming shift to digital distribution and how this will affect the game consumer:

The transition from disc-based media to digital media... it's essentially going to remove the "purchase to own" out of the equation, replacing it with purchasing a license. That's how PC games are now... That paradigm shift, it's very important for us to get out ahead of it, so with DRM and EULAs, so we can say these are what consumer's rights are, and have an easy way to identify that in the purchasing process...

One of the reasons it's important to get EULAs standardized and DRM disclosed is that when you talk about different [delivery] systems like Steam... there are still controls in place. While it's not SecuROM, it's another form of DRM, it's just in a different way. Consumers need to understand that...

 

Some [game] publishers... feel that the vocal minority of consumers who spoke up about Mass Effect and Spore represent the 'pirates' and in doing so fanned the flames for a much larger percentage of consumers who now feel like they're not being listened to. A dismissive attitude from the industry probably came back to haunt them in sales...

FULL DISCLOSURE DEPT: The ECA is the parent company of GamePolitics.
 

Writing for UK newspaper The Guardian, author Cory Doctorow offers an eminently sensible fix for those confusing, consumer-unfriendly End User License Agreements:

Here's the world's shortest, fairest, and simplest licence agreement: "Don't violate copyright law." If I had my way, every digital download from the music in the iTunes and Amazon MP3 store, to the ebooks for the Kindle and Sony Reader, to the games for your Xbox, would bear this – and only this – as its licence agreement.

"Don't violate copyright law" has a lot going for it, but the best thing about it is what it signals to the purchaser, namely: "You are not about to get screwed."

Cory also finds irony in the approach which content rights-holder take on the copyright issue:

The copyright wars have produced some odd and funny outcomes, but I think the oddest was when the record industry began to campaign for more copyright education on the grounds that young people were growing up without the moral sensibility that they need to become functional members of society.

The same companies that spent decades telling lawmakers that they were explicitly not the guardians of the morality of the young – that they couldn't be held accountable for sex, drugs and rock'n'roll, for gangsta rap, for drug-fuelled dance-parties – did a complete reversal and began to beat their chests about the corrupting influence of downloading on the poor kiddies.

Ditto for the video game industry. As GamePolitics has reported in the past, game publishing lobby group ESA hopes to takes its anti-piracy "education" program into elementary schools.

From the Federal Trade Commission to Entertainment Consumers Association President Hal Halpin, there is a sense that End User License Agreements are increasingly problematic for consumers.

But a woman named Anne Loucks has found an entertaining - if legally suspect - solution. But then again, EULAs themselves seem a bit legally suspect.

When presented with a EULA, Loucks has her cat, Simba, agree to the terms. She has even created a rudimentary physical apparatus for Simba to employ in the EULA acceptance process:

As Simba is not a legal entity, I don't really know how kitty's agreements would stand up in court, but I like to think he would be responsible for any breaches of contract, assuming the agreement is even enforceable. After all, he is not even of legal age, at least in human years.

First, we must create a way for Simba to push the button. I created a cardboard platform with a long thin protrusion for pressing the spacebar, which is sufficient to activate most onscreen buttons after you TAB to place the focus on them.

Success!! He presses the button of his own free will. Admittedly, he was coerced and rewarded, but really, nobody forced my cat to step on the button and become party to a software license agreement. At the very least, we know he was not under duress.

The download begins and I have personally agreed to nothing.

Via: Slashdot

FULL DISCLOSURE DEPT: The Entertainment Consumers Association is the parent company of GamePolitics.

Do you pay attention to the fine print when you install a game or other software on your PC?

Me neither.

But in many cases, End User License Agreements (EULAs) stack the deck against consumers.

In his Law of the Game on Joystiq column, attorney Mark Methenitis speculates that the Federal Trade Commission may decide to weigh in on the EULA debate in order to protect the interests of game buyers.

In Methenitis's view, the FTC has three possible courses of action:

• requiring that EULAs be written in plain language, not indecipherable legalese
• mandating that EULAs be dropped entirely in favor a consumer information checklist devised by the FTC
• a hybrid of these two

Mark sees potential revenue opportunities for the FTC in EULA regulation as well (hit the jump for the update).

So, who actually owns your MMO avatar's high-end gear?

Not you, according to the fine print for most online games.

End user license agreements (EULA) and real money trading (RMT) were among the topics debated by a panel at this week's Austin Game Developers Conference (AGDC), reports Worlds in Motion. Panel members included game designer Raph Koster, Scott Hartsman of Ohai, attorney S. Gregory Boyd, author (and "EA spouse") Erin Hoffman as well as moderator Erik Bethke of GoPets. Boyd and Koster made some key points in relation to player ownership of avatar gear:

Boyd: Couple of reasons [why the player doesn't get to own in-game items]. The first is liability. If I want to cancel someone’s account, I don’t want to have to pay the person the value of that sword. Second I don’t want to compensate them or own up to anything when I nerf that sword for balancing reasons...

Koster: All of these things are ultimately just bits and bytes in the database... I’m just fine with saying ‘yeah, that’s SOE’s sword. Damn straight!’ Where it starts getting a little weirder is that those databases are all a log of a player’s experience. In any place but gaming, something like your quest log should be protected by privacy laws... If you really want to know what’s the cutting edge of this, I’d look at China. Because their government has stepped in and said ‘I don’t care what your EULA is, here are the new rules.’

While libraries and church groups are increasingly turning to video game events in order to attract teens, such get-togethers may have copyright implications, according to the School Library Journal.

Check out this Q&A posted yesteday:

Q. Lots of school and public libraries are hosting gaming tournaments, featuring popular video games like Guitar Hero and Madden Football. Since these games are intended for home use, isn’t that similar to purchasing a movie and showing it to a large audience?

A. Everyone seems to be asking that question! Video games come with licensing agreements, and before purchasers can play the games, they must agree to their terms. The video-game licenses that I’ve seen are strictly for “personal, noncommercial” uses—not public ones. So when libraries host gaming programs, they’re violating these agreements. Yet, lots of libraries are doing just that—and they’re getting away with it. And some are even charging an admission fee to attend these events. What gives?

 

My guess is that video-game distributors never anticipated their games would be used publicly. So when their lawyers drafted the licenses, they simply used language commonly found in software contracts...

 

Librarians can: (1) continue to offer video-game competitions and let the chips fall where they may; (2) contact the rights holders and ask if their licenses can be modified to accommodate your programs; or (3) email the rights holders and tell them you’re opting out of the portion of the contract that allows only home use—and unless they tell you not to, you’re planning to offer gaming tournaments.

GP: It's a fascinating question. Game publishers would look like big meanies if they tried to enforce this, of course. On the other hand, I believe that Internet cafes pay for some type of multi-user license for some online games.

UPDATE: A well-informed video game industry source dropped GP a line, offering some insight on this story:

For motion pictures, schools, libraries, and other institutions get licenses to exhibit the movies. It's pretty straightforward and no-one seems to have a major problem with it. See http://www.movlic.com/ and http://www.mplc.org/aboutMplc.php.  I'm not aware of similar services for video gaming. Probably should be.

Does anyone even bother to read those End User Licensing Agreements (EULAs) that come with games and other types of software?

Maybe you should.

ECA president Hal Halpin, in a column for GameDaily, worries that game publishers have exploited EULAs to the detriment of game consumers:
 

EULAs are a real and tangible problem... Quite simply, they're out of control... these contracts have become so unwieldy that they regularly infringe on consumer rights. Many would likely be unenforceable in a court of law. Others, consumers would be shocked to find out what all of that fine print actually meant.

The reason for the EULAs existence is sound. Certainly no reasonable person would expect the creator or seller to lose all of their rights in a sale. But neither should a consumer...

I propose that we form [a] working group to address this problem... It needs to be an open and inclusive process... There's no reason to think that we couldn't standardize the EULA and create one contract that all developers, publishers, retailers and consumers know, understand and respect. The implications would be broad and the downside negligible...

PC Magazine has more on EULA madness.

Full Disclosure Dept: The Entertainment Consumers Association is the parent company of GamePolitics.