Blizzard Awarded $88M Default Judgment Against Unauthorized World Of Warcraft Host

from the seems-a-wee-bit-excessive dept

Slashdot points us to the news that Blizzard/Activision have won a default judgment against the person behind Scapegaming, which ran an unauthorized World of Warcraft server for profit. The court ordered the site's owner to pay "$3,053,339 of inappropriate profits, $63,600 of attorney's fees, and $85,478,600 of statutory damages." The low number for attorney's fees is because it was a default judgment (the server owner basically ignored the lawsuit), so there wasn't much lawyering needed. The high number for statutory damages are because statutory damages in copyright law are insane and totally disproportionate to the actual acts.

The case has some similarities with the Blizzard/bnetd case, which still seems problematic to many. In the Slashdot comments, a bunch of folks have been quick to side with Blizzard, since Scapegaming was a for-profit entity, but at least one user notes that it was only via Scapegaming that he became a subscriber for Blizzard's official World of Warcraft servers:
Played on it a long time ago when it was still known as WoWScape. It was the whole reason I actually started playing on retail, me and a good portion of my friends. Blizzard would have lost out on thousands of dollars from me and my friends if it wasn't for them.... I honestly wonder about how much did Scapegaming make blizzard compared to how much it cost them. Wouldn't be surprised if it did them more good than harm.
It's a good point. I've never quite understood why these companies get so upset about unauthorized servers. It's as if they're admitting that they can't offer service quite as good. Most people want to be on the official servers anyway, and as long as they keep improving the game and offering more value, people will keep coming. Let other servers run -- even for profit -- and use it as a way to recruit more people to the official servers. Suing them out of existence seems pointless.


Reader Comments (rss)

(Flattened / Threaded)

  1.  
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    Ryan, Aug 16th, 2010 @ 2:07pm

    Default Lawyers Fees

    Those are not "small" lawyers fees. Those are the MAXIMUM allowed by law.

    There was only $63,600 in attorney fees because that's what they're capped at, per C.D. Cal. Local Rule 55-3 in a default judgment ($5,600 plus 2% of the amount over $100,000; they used the PayPal amount of $3,000,000 (rounded)): http://www.cacd.uscourts.gov/CACD/LocRules.nsf/a224d2a6f8771599882567cc005e9d79/0d9758b2da1190118825 6dc5005973fd?OpenDocument&Highlight=0,55-3 [uscourts.gov]

    Do not doubt for a second blizzard would of attempted to shove another few million in fees in there.

     

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  2.  
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    Anonymous Coward, Aug 16th, 2010 @ 2:18pm

    If anyone is wonder how exactly they sued the server providers: EULA terms.

    Check the original article for an explanation.

     

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  3.  
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    Anonymous Coward, Aug 16th, 2010 @ 3:18pm

    I've never quite understood why these companies get so upset about unauthorized servers. It's as if they're admitting that they can't offer service quite as good.

    Uh, because they can't, at the same price point.  It is basically economically impossible.  Blizzard must shoulder the dual burden of maintaining and managing a healthy and fun set of servers to play on, as well as the cost of developing the game itself and its expansions (probably in the $100s of millions range for a game like World of Warcraft).  Any "competing" entity that must shoulder only the first burden, without the hundreds of millions of dollars to recoup, will be able to do so at an equivalent or better level at a fraction of Blizzard's costs.  Suing anybody who gets big enough to notice is a decent strategy, because it limits the amount of resources a "competitor" will be able to bring to bear at making a competing server farm.  If a competitor gets big enough to where their server and support quality is equivalent or close to Blizzard's, offered at a fractional price, Blizzard will likely see mass migrations away from their "official" servers.

    Blizzard has a limited technical advantage in the form of workable DRM: there are some parts of the game (boss behaviors, for example) that are not released to the public (that is, they run server-side) and these must be reverse-engineered and emulated by other server operators now.  So this gives them a slight first-mover advantage on new content.

    Let's say it was a free-for-all, and this form of DRM was not effective.  Other companies can run their own servers without fear of prosecution.  What, in your mind, could Blizzard do or offer that these other companies could not do or offer at a lower price?  Good feelings that you're supporting the next expansion of the game, perhaps?  Access to "exclusive official" content? (Just more DRM).  Other than their imprimatur (of questionable value in such a world) and personal access to their developers and other personnel, Blizzard has nothing that can't be copied or reimplemented.  Is their imprimatur and personal access enough to generate the $100s of millions required to develop a game like WoW?  Of course not.

     

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  4.  
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    Greg G, Aug 16th, 2010 @ 3:29pm

    Re:

    Your whole post is economically wrong.

    I'd rather have 1% of 100 peoples efforts than 100% of 1 persons efforts.

    Same goes for Blizzard. 100% of a single company and at a higher price, or just 1% of the community at large creating a better gaming experience at a lower cost.

    Blizzard could just as easily reach out to the community and make the entire game better for everyone involved instead of suing everyone out of existence just because they don't like them and they think they can't profit from it.

    I thought about getting the new Starcraft for my PC, but with the way Blizzard is behaving, I think I'll pass until I can get it on GOG.

     

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  5.  
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    Anonymous Coward, Aug 16th, 2010 @ 3:46pm

    She should get paid

    The fact that this woman was able to tap into a $3,000,000 "donation" driven market should simply entice Blizzard to hire her.

     

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  6.  
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    Anonymous Coward, Aug 16th, 2010 @ 3:49pm

    Your whole post is economically wrong.

    No, it just is unpleasant for you personally.

    Same goes for Blizzard. 100% of a single company and at a higher price, or just 1% of the community at large creating a better gaming experience at a lower cost.

    Blizzard has a thriving mod community that mods the user interface of the WoW client. They are leveraging community where doing so does not undermine their business interests. While you would almost certainly be satisfied paying less to Blizzard to get more, they clearly would not.

    Other games allow more community participation and are successful, but less so. One of my favorite TF2 servers is specially modded and this makes playing there extra fun. Valve got about $15 from me for TF2 a year or two ago. Blizzard gets that from me every single month. Blizzard wins.

    This server I play on probably barely breaks even from donation drives. It also keeps its custom mods to itself. What is their incentive to share the thing that keeps people coming there? Nothing. Unless you have some quid-pro-quo (like the Affero GPL) in place this model simply won't scale. And even then, there is no real evidence that community-based gaming is more lucrative for developers than walled garden gaming.

     

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  7.  
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    Anonymous Coward, Aug 16th, 2010 @ 4:01pm

    WHAT THE FUCK?! 88 MILLION DOLLARS?! Doesn't matter if they ran it for profit. Comon man, $88M!! WTF!

     

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  8.  
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    DigThatFunk(Scottie V) (profile), Aug 16th, 2010 @ 4:08pm

    Re:

    Yes, but, accepting this point would amount to supporting a company protecting its interests and intellectual properties, and we all know we can't have that! I mean, come on, Techdirt. I really, really love you guys and what you do, but when you begin to vilify companies simply protecting their ability to survive, you begin to sound like a caricature of yourselves. As AC here above me put it(much more eloquently, albeit): How are they supposed to allow this, and survive in the long run? Protecting your IP's CAN be the right thing to do, and not merely an evil corporation being greedy...rarely, yes, but it does happen.

     

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    Anonymous Coward, Aug 16th, 2010 @ 4:12pm

    WHAT THE FUCK?! 88 MILLION DOLLARS?! Doesn't matter if they ran it for profit. Comon man, $88M!! WTF!

    It's a default judgment. The other side failed to show up. If this were a criminal case--even for the most minor infraction, arrest warrants , fines, and jailtime would be on the table.

     

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  10.  
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    DigThatFunk(Scottie V) (profile), Aug 16th, 2010 @ 4:16pm

    Re: Re:

    In the short term, Greg G, I think you're correct. But AC's post posits about the long term, hence...what, in the future(Which is usually where most of the profit comes in for the company---is profit just always a curse word around these parts?), is Blizzard supposed to do when all these server farms proliferate because they don't stop them? I think it's true that without the issue of recouping initial losses associated with game development, these unofficial servers get an instant leg-up in that they can charge less and still profit more.

    How can Blizzard even compete with that? You say to "make the entire game better"(which is a stretch in the first place, obviously they're doing something right---only the most popular game, ever, pretty much), which, they CAN indeed do...but it will come at a cost, which they must recoup, which then the consumer whines that they're charging too much. So they drop the price point, remove a few features that were the least cost effective, and then customers whine that they need to make the game better. Gamers(being one myself) are quite possibly the most hard-to-please crowd, worse than comic book nerds, and seem to think that if a company makes money off them, they're evil(but why would any business press on, if money is not being made?)

     

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  11.  
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    Mike Masnick (profile), Aug 16th, 2010 @ 4:28pm

    Re:

    Uh, because they can't, at the same price point.

    Who said anything about same price point? We said they offer MORE VALUE. And they do, which is obvious by the fact that EVEN THOUGH these servers are available out there, most people still choose to use the official one.

    Why? Because they *know* that's the real, authentic version, and it's the version they want to support, and the version where new stuff will happen first, and the version where most of the players will be.

    It is basically economically impossible.

    Other than the fact that this is entirely wrong. See above.

    Blizzard must shoulder the dual burden of maintaining and managing a healthy and fun set of servers to play on, as well as the cost of developing the game itself and its expansions (probably in the $100s of millions range for a game like World of Warcraft).

    Indeed. Which is why most users will want to play it on the official servers. Because the experience is better.

    Any "competing" entity that must shoulder only the first burden, without the hundreds of millions of dollars to recoup, will be able to do so at an equivalent or better level at a fraction of Blizzard's costs.

    You (conveniently, but wrongly) leave out the cost of *getting anyone to know you exist* and then *convincing them that it's worth using your servers*. I wouldn't underestimate that cost. You, instead, ignore it 100%.

    That's wrong.

    Suing anybody who gets big enough to notice is a decent strategy, because it limits the amount of resources a "competitor" will be able to bring to bear at making a competing server farm. If a competitor gets big enough to where their server and support quality is equivalent or close to Blizzard's, offered at a fractional price, Blizzard will likely see mass migrations away from their "official" servers.

    Why? Why would people migrate away? I don't believe that's true.

    Let's say it was a free-for-all, and this form of DRM was not effective. Other companies can run their own servers without fear of prosecution. What, in your mind, could Blizzard do or offer that these other companies could not do or offer at a lower price

    One, it would be the easiest and most obvious servers to connect to -- which would drive a huge amount of business. We've seen this time and time again, where the "official" version gets a lot more traffic, even if others are cheaper.

    Other than their imprimatur (of questionable value in such a world) and personal access to their developers and other personnel, Blizzard has nothing that can't be copied or reimplemented.

    Other players? Faster access to changes and updates? Easier access? All of that is worth quite a bit.

     

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  12.  
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    Anonymous Coward, Aug 16th, 2010 @ 4:50pm

    Who said anything about same price point? We said they offer MORE VALUE. And they do, which is obvious by the fact that EVEN THOUGH these servers are available out there, most people still choose to use the official one.

    And those servers are kept small and out of date by Blizzard's effective DRM and legal team. But that makes no difference, right? People play the official servers out of the goodness of their heart.

    Why? Why would people migrate away? I don't believe that's true.

    Wikipedia notes that some cloned Ultimate Online servers have 60,000 players on them. It is unfortunately difficult to say what the ratio of official to unofficial UO players is; there is very little data. UO has worse DRM and more lackadaisical lawyers, but they're not fully absent--they still represent a smaller limiting factor.

    As far as I can tell, none of these people are reinvesting in the game itself. No major expansions have come out of the free shard community, though they are quick to appropriate the official ones they didn't pay for.

    What accounts for WoW's insane growth and UO's delegation to a sideshow? Probably myriad factors: gameplay, community... dismissing the fact that Blizzard does a far better job of capturing revenue which at least partially reinvests into the game is disingenuous.

    One, it would be the easiest and most obvious servers to connect to -- which would drive a huge amount of business. We've seen this time and time again, where the "official" version gets a lot more traffic, even if others are cheaper.

    Ersatz DRM through exploiting the laziness of your customers. Well, yep, that's a model.

     

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  13.  
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    Mike Masnick (profile), Aug 16th, 2010 @ 4:51pm

    Re: Re:

    How are they supposed to allow this, and survive in the long run?

    Many, many ways. Running the official server, offering new and unique content, being the easiest server to access and use. Etc. etc. etc.

     

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  14.  
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    Mike Masnick (profile), Aug 16th, 2010 @ 4:56pm

    Re:

    And those servers are kept small and out of date by Blizzard's effective DRM and legal team. But that makes no difference, right? People play the official servers out of the goodness of their heart.

    Now you're just trolling. I gave a bunch of reasons why people would use the official servers that have nothing to do with "the goodness of their heart."

    I thought you wanted to discuss this seriously. Obviously, you don't.

    Ersatz DRM through exploiting the laziness of your customers. Well, yep, that's a model.


    That's just insulting. It's not "laziness" of customers. It's providing value and convenience.

    That you don't recognize the difference, well, that's something that you'll need to deal with in whatever your chosen profession might be.

    You clearly are trolling. I'm done responding to you in this thread. If you wish to have a legitimate discussion on this, we can try again some other time, but to make such ridiculous statements suggests you have no such interest.

     

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  15.  
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    Anonymous Coward, Aug 16th, 2010 @ 7:09pm

    Re: Re:

    WoW would not have been created if Blizzard didn't create it. Community sourced games are shithouse generally , especially ones that are attempting to be as complex as World of Warcraft.

     

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  16.  
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    vbevan (profile), Aug 16th, 2010 @ 7:18pm

    Re: Ultima Analogy

    To be fair, the Ultima Online analogy is a good one. Alot of people play on the reverse-engineered shards precisely because they want to play a different rule set, as well as the whole "it's free" benefit. The Ultima shards had populations in the same general realm as the official servers.

    Now, those players may or may not have payed if they had no other choice, but I'm sure that a fair percentage of them would have been on the official servers if no other option was available. Apply that to WoW's subscriber base and it's a significant amount of money.

    Though IMO, if a company makes a game and doesn't want others to profit off their development time ($$$) without having that overhead, that's fair enough. It's not like a book or music, where the product is (usually) finalized and wont change anymore. If you want to do this, write your own software and start a company to market it. Even ad-supported WoW servers (if they exist) are not only taking revenue from Blizzard, they are giving it to someone else. And the getting people to know you exist. That's nothing compared to the ongoing dev cost of the software. And those servers patch days after the official ones do (well, they did when I was on that scene a few years ago).

     

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  17.  
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    Anonymous Coward, Aug 16th, 2010 @ 9:46pm

    @16 your wrong in ways

    no they would not be on offical servers cause if they had tp pay that monthly they wouldnt
    end of story

    the option available is to play free and opensource games that while sucky are free

    blizzard would have been better saying ok heres a free shard , and here's a proprietary one ( add in loads a goodies and make a buck )

    but now a days they are as evil as hollywoods riaa mpaa
    i paid for diablo II , i wont pay for any more of there stuff, nor will i pirate it...

     

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  18.  
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    Anonymous Coward, Aug 16th, 2010 @ 10:57pm

    the option available is to play free and opensource games that while sucky are free


    Sucky?

    I'm offended, have you played FreeDroid(Diablo look a like), Warsow, World of Padman, Tremoulous or Nexuiz?

    0 A.D.?

     

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  19.  
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    Modplan (profile), Aug 17th, 2010 @ 12:57am

    Re: Re: Re:

    Blizzard competes because it's the company that produces new content. That in itself is added value.

     

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  20.  
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    Modplan (profile), Aug 17th, 2010 @ 1:08am

    Re: Re: Ultima Analogy

    For a start, you still have to buy the game to begin with - the extra servers effectively make it more valuable to someone knowing there are those kinds of servers should they want a change.

    I've had a discussion about this elsewhere with someone who is setting out to make a GPL'd game that will have a subscription element, and we discussed all sorts of things that can be done to add to the subscription element to help make it more attractive. One aspect was kind of a cross promotion with merchandising (buy something from a store and you get a months subscription, with a subscription you get a slight discount on items from the store).

    http://ubuntuforums.org/showthread.php?t=1442535

     

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  21.  
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    The eejit (profile), Aug 17th, 2010 @ 2:53am

    It's actually pretty good to see this happening. One of the other things that you didn't note, Mike, was that the person actually made $1mil/year whilst the server was up and running.

    Whilst I disagree heavily with the judgement's punitive damages, I have to agree with the idea that Blizzard are suing because they don't want more servers up at the moment (official or otherwise.)

     

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  22.  
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    Modplan (profile), Aug 17th, 2010 @ 3:04am

    Re:

    Why would they not want more servers up?

     

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  23.  
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    Greg G, Aug 17th, 2010 @ 3:59am

    Re: Re: Re:

    Profit is never a dirty word with me. I'm all for it. But I think by just pissing off your fans that have put up servers because they 1. love the game and 2. don't like RESTRICTIONS imposed on them for any reason, Blizzard would profit in the long term by working with the people that put up the unofficial servers. Give the players what they want and guess what? They're going to stick around.

    I don't know what it costs now.. I don't own WoW (not even a pirated copy) and probably never will, but if I had to pay to play on their official servers, I probably wouldn't unless I had a reason/incentive to continue month after month.

    Dropping the price point is a good start. That alone might bring in more players. 10 players paying $15 gives you $150, if you drop the price to $10, you probably are going to make up the rest with at least 5 more players, and when others see the lower price, they're probably going to join up now as it's more affordable. Guess what? You've increased revenue.

    Removing features (probably the ones people liked) is not a good start. Leave things in unless it's a huge imbalance favoring certain character types, or tweak it so it balances out.

     

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  24.  
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    chris (profile), Aug 17th, 2010 @ 6:35am

    Re:

    Blizzard must shoulder the dual burden of maintaining and managing a healthy and fun set of servers to play on, as well as the cost of developing the game itself and its expansions (probably in the $100s of millions range for a game like World of Warcraft).

    which is why wow players pay twice:

    first, they pay for the game software/expansion - this should cover the cost of developing the game itself and it's expansions. if it doesn't then blizzard made a bad business decision.

    then, they pay again via monthly subscription fees - this should cover the costs of maintaining and managing a healthy and fun set of servers to play on. if it doesn't then blizzard made a bad business decision.

     

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  25.  
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    Anonymous Coward, Aug 17th, 2010 @ 11:40am

    I was waiting for an article that posted a breakdown of the numbers and here you go: http://arstechnica.com/gaming/news/2010/08/the-88-million-server-private-wow-server-op-loses-big.ars That $80+ million in statutory damages actually turned out to be the minimum because the defendant didn't show up in court and thus got slammed with multiple DMCA violations.
    In fact, the statutory damages were low, according to the court. The $200 fine per circumvention is a statutory minimum, and in this case it was multiplied by 427,393 users. "To the extent that this figure appears unreasonably large, Congress has mandated this approach and the Court is unable to deviate from it," the judgment explained.
    So this isn't because "statutory damages in copyright law are insane and totally disproportionate to the actual acts". But rather because of idiotic minimum damage laws with regards to each infraction. So you should probably correct your reasoning. In my opinion, the law should be changed to allow judges to cap the total amount awarded for damages if they deem it to be excessive.

     

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  26.  
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    DigThatFunk(Scottie V) (profile), Aug 17th, 2010 @ 9:34pm

    Re: Re: Re:

    Well, I agree with some of that, for sure, "...offering new and unique content," always a good idea, and as someone already said, one of the finest methods of implementing DRM in a non-intrusive way. But the problem comes in, I think, in that there's only so much that gamers will care about enough to pay that extra service fee per month.

    On the first point, I think that "Running the official server", simply isn't enough for a lot of people. It's almost a moot point, as a lot of gamers aren't honorable enough to play the server, simply because it's "official".

    Ease of access and use is definitely important, but I think that if they don't litigate here, then wouldn't ease of access/use increase for, at least this specific server site, if not all unofficial servers? That's what I imagine they're attempting to impede.

    Now, I agree in that I think Blizzard mishandled this. They would've been much better off seeing this demand for more/different servers, and incorporated this into their current system. But, they must have their reasons, silly or not...and being bad at business decisions doesn't make a company evil, just stupid haha.

     

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