Video game maker Electronic Arts (EA) is in the hot seat lately for its new “Origin” video game digital distribution platform. Digital distribution platforms like Origin allow game developers like EA to circumvent retail establishments by using the Internet to sell video games directly to gamers as downloadable products, rather than as DVDs or CDs. Origin’s End User License Agreement (EULA) regarding its Origin digital distribution platform not only contractually limits liability to the point where it owes virtually no duties to game purchasers, but it can also “expire” a buyer’s games if the buyer does not play the game for two years. Given that future EA games (including the newly released “Battlefield 3”) will require Origin, contract provisions of this nature are particularly worrying, as EA appears to have found a way to sell games that it does not have to provide and that it can remotely disable at its discretion.
The problem with EA’s EULA is that it makes EA’s obligations largely illusory and highly monopolistic. Hinging on the video game ownership distinctions discussed in cases like MDY Industries v. Blizzard Entertainment and Vernor v. Autodesk, EA can “sell” a “license” to a portion of a video game that must be connected to other portions of the video game, where these other unsold portions are provided by EA via the Internet (and in this case, via Origin) at their own discretion and with wholly different contract terms. EA can thus sell a video game that requires Origin and then, after the purchase, manipulate the availability and nature of Origin such that the buyer is forced to buy more products or otherwise bend to EA’s will. Structurally, this is similar to a company selling a car that requires special gasoline and then providing that special gasoline with numerous strings attached.
Because contracts disclosing such dependencies often come in the form of shrink wrap contracts and typically do not fully indicate the additional terms of service present in EULAs, unwitting customers could easily find themselves purchasing less than they originally believed they were getting. Moreover, in the Origin context and like other digital distribution platforms, because purchasers can’t even sell or transfer what they purchased from Origin if they’re unsatisfied, buyers cannot escape these dependencies and EULA conditions after purchase.
EA’s online software dependence model is unnecessary. Many popular Internet-based video games similar to EA’s Battlefield 3 allow users to enjoy their content without mandatory connection to online software. A notorious hacker group recently provided a patch that allows users to avoid using Origin (which they call “the trojan”) when playing the new game Battlefield 3, essentially providing the unsold portions of Battlefield 3 that allow the game to fully function. Thus, it appears that EA’s Origin platform is demonstrably unnecessary, which calls into question its value in the first place.
Nonetheless, digital distribution methods like Origin – be they STEAM, iTunes, or Netflix – all encourage quick, efficient, and consumer-friendly transactions. Digital distribution systems also cut costs and allow independent movie and game developers to sell their creations to consumers. Thus, as bad as EA’s Origin is, I believe law and policy should encourage similar digital distribution systems to exist so long as they don’t create dependency monopolies. So how do we do it?
The answer, I think, is simple: courts and consumers should not support contracts like Origin’s EULA. Courts should replace Origin-like provisions with provisions that match the reasonable expectations and needs of both parties. Moreover, customers should be willing to vote with their feet and avoid contractually unfair products like Battlefield 3. Though companies like EA should not be forced to provide free downloading services to users indefinitely, they should also not be allowed to create contractual monopolies through which they have unlimited discretion over provision of illusory “licenses.”
Alternatively, another method for preventing Origin-like contract terms would be to prevent companies from selling “licenses” (instead of real products) in the first place. The JLPP will soon be publishing a student note by Charlie Lopresto entitled “Gamestopped: Vernor v. Autodesk and the Future of Resale.” This note provides a phenomenal analysis of the case Vernor v. Autodesk, which has in some respects set the stage for Origin-like contract terms regarding “licenses,” and ultimately argues that Vernor was poorly decided. Would Vernor be overruled, the sale of “licenses” to portions of video games would arguably be inhibited such that users could, in fact, possess what they actually intend to purchase.