Philip Rosedale on His Plan to Protect IP Rights of High Fidelity Users Through Blockchain Registration

Right after announcing High Fidelity's plans to mint the virtual world's own blockchain-based currency last week, CEO Philip Rosedale announced equally ambitious plans to protect the IP rights of user-created virtual goods in HiFi through blockchain technology:

When someone buys your sunglasses from you, you create a digital certificate (basically a proof-of-purchase) that officially states that they now own a pair of your sunglasses. Minimally, this certificate points back to the original registered asset, is signed by you as the creator, and is also stored in the public blockchain with a key that can be used by the new owner to prove that they own it (or to re-sell it to someone else). So there are now two ‘official’ documents in the blockchain — the registration of the original design for the asset, and the certificate proving that a copy of it is owner by the buyer.

Read the whole post here, as there's a lot more details. I asked Philip to answer some questions it raises, such as real life lawsuits and how they plan to verify that virtual content registered in High Fidelity isn't violating a pre-existing trademark or copyright in the real world --- and he just sent his replies:

How would your system protect items with multiple rights owners? To take your example, how would a pair of virtual sunglasses with a frame designed by one creator which uses virtual glass textures designed (and registered) by another creator be registered?

Philip Rosedale: Great question. When someone registers an asset, they will also have the ability to specify a fee (HFC$ or %) for including it in derivative works.  When someone else registers a new asset, they can include a previously registered asset in their filing.  And this will carry over to the marketplace, so that if someone sells an asset containing other works, those fees will automatically be paid whenever the new work is sold.  

If High Fidelity becomes successful, there will inevitably be real life IP infringement lawsuits that some users file against each other (as they do in SL). How do you envision your system being used in RL court battles?

PR: I think that public information such as when an asset was first registered will be useful on those real life legal disputes.  

You mention the HiFI team will conduct a "review that the proposed asset is [not] too similar to other registered assets (or RL trademarks or copyrights)". How is doing such a review going to be scalable, especially when HiFi grows?

PR: We will build tools that will automate inspection, for example finding similar models or textures to a submission.

As with pretty much anything Philip does, I see a lot of impressive ambition, while also wondering if the execution will be as feasible as he suggests. For instance, is there really a way to automate the inspection of virtual items against millions of registered IP assets and trademarks which exist in the real world? (The US government has already received about 250,000 just this year alone.)

Beyond that, I wonder if it's even necessary for a virtual world to have its own currency with real life value or property rights with real life protection mechanisms. Minecraft has neither of those, but that didn't stop the world from attracting nearly 125 million users.

Image from Wired UK's profile of High Fidelity

Comments

[Chic Aeon]

Just noting that Cloud Party used the multiple rights model and it worked well -- on a small scale anyway. Creators of "full perm" items sold those rights and were automatically credited with currency of the realm when the person buying their product sold something made with it. Percentages varied and were decided on by the full perm seller.

So that part of the plan has already been tried.

I am happy to see High Fidelity working harder on the IP rights issues. When I was there in early Alpha stage --- along with a big group of SL and OS creators, many left quickly (me included) when they discovered how very insecure the platform was.

If they can actually get some real protection in force then they may be able to attract more creators.

[Medhue]

Although what Phillip is talking about is very interesting, I have yet to see or hear how this stops someone from actually taking and using the asset. Nothing Phillip stated stops anyone from grabbing the asset from the webpage and using it in any world, besides HIFI. So, HIFI created a system that forces us to unsafely put assets on webpages, but those assets will only be protected in HIFI. Maybe I'm missing something here.