Each week Mark Methenitis contributes Law of the Game on Joystiq, a column on legal issues as they relate to video games:

Despite the relatively small amount of time I've had to play them, I've so far enjoyed Fable II's Pub Games, especially Fortune's Tower (pictured above). The idea of minigames has been around for ages, but Pub Games adds deeper elements than the norm, as well as pre-release hype for Fable II. Of course, this begs the question: Is this a sign of things to come?

I could certainly see other RPGs following suit, pre-releasing a related Xbox Live Arcade, PlayStation Network, or WiiWare game that interacts with the core game, like a Final Fantasy XIII card game stand-alone. If this becomes a trend, then developers will be looking to the next evolution of this idea. I would imagine the next step would be external games that affect MMO environments; and beyond that, perhaps gambling with real currency. Think of the evolution this way: You start with a game like Texas Hold 'Em, where your play only affects that game, then the next logical step is something like Pub Games, which affects you alone in a virtual environment. From there, the evolution would logically move to impacting a multiplayer virtual environment and, ultimately, to affecting a real world environment, specifically your bank account. It's these last two steps that present some legal issues.

The key fact is that the UIGEA killed online gambling in the US.



As gaming has become a global industry, the legal issues presented become quite complex. Today's discussion will primarily be from the US perspective, where the final evolution I posed would require an actual change in the law. From a US perspective, the concept of using Xbox Live or PSN for gambling is, in short, out of the question under the current laws, assuming they are enforced. Specifically, the Unlawful Internet Gambling Enforcement Act ("UIGEA") would, in summary, act to bar credit card transactions to those services if they were to attempt to provide gambling. The specifics of the UIGEA are probably too complicated to discuss in depth here -- and they aren't terribly interesting. The key fact is that the UIGEA, for the most part, killed online gambling in the US, and this would likely be rolled under that umbrella.

However, the issue is by no means settled. There are, by my last count, close to a half dozen pieces of legislation on the table that either act to repeal or replace the UIGEA with a more concrete, structured approach to legalizing and regulating online gambling. For those who are wondering how Congress can pursue either option, look under the commerce clause. Specifically, online gambling is fairly clearly in the realm of an interstate transaction, given the movement of data in the activity, and so that activity would be within Congress's realm of control, despite the likely outcry from states who have banned casino gambling in their borders. So if and when the law changes, this evolution may become a reality.

The MMO arena, however, gets to be a far more complicated one. Since to date there has not been a console MMO tied directly to real currency, a la Second Life, I'll skip over that potential permutation of the facts. Imagine, instead, a console MMO more like Final Fantasy XI with Tetra Master type tie-in on XBLA. People simply interested in the card game could forgo the MMO aspects all together, given that multiplayer would be a likely element of the card game. Now, let's say that the betting in this Tetra Master game was changed to the MMO currency from the card-based betting system used before.

At this point, the game includes an interactive betting experience with no real value. It's no different than going into debt in Texas Hold 'Em (for XBLA) or Pub Games. While everything stays on this side of the line, there's no potential for problems. There is no restriction on gambling in a completely money-free environment. Things fall into a much grayer area, however, if the money or items in-game are being sold, even if it's not specifically authorized. Think of it this way, if you're betting 1,000 gold pieces on a card game, and you know you can go buy those 1,000 gold pieces on IGE (an in-game currency seller) for $4.00, then isn't that the same as betting $4? Of course, the key here is that you have to be able to "cash out," i.e., resell the gold for some value. The act of gambling essentially goes out the window when there's no chance for you to win a prize.

This still doesn't speak to tournaments, or what the implication of various proposed laws would be based on the skill and chance elements in the tie-in games, but each of those topics is complex enough to be an article of its own. Needless to say, it's likely that this tie-in gambling won't stop with Pub Games, and I'm interested to see how other developers decide to take advantage of the potential links between downloadable add-on games and their primary game. But for the time being at least, those tie-ins have to steer clear of the UIGEA in the US, and tread with caution in other regions like Europe and Asia, which tend to be more open to gambling.


Mark Methenitis is the Editor in Chief of the Law of the Game blog, which discusses legal issues in video games. Mr. Methenitis is also a licensed attorney in the state of Texas with The Vernon Law Group, PLLC and a member of the Texas Bar Assoc., American Bar Assoc., and the International Game Developers Assoc. Opinions expressed in this column are his own. Reach him at: lawofthegame [AAT] gmail [DAWT] com.

The content of this blog article is not legal advice. It only constitutes commentary on legal issues, and is for educational and informational purposes only. Reading this blog, replying to its posts, or any other interaction on this site does not create an attorney-client privilege between you and the author. The opinions expressed on this site are not the opinions of AOL LLC., Weblogs, Inc., Joystiq.com, or The Vernon Law Group, PLLC. As with any legal issue that may confront you in a particular situation, you should always consult a qualified attorney familiar with the laws in your state.

This article was originally published on Joystiq.