TOSing the (word) salad (or why I think the latest Terms of Service update misses the mark)

On Wednesday July 16th the Lab issued an update to Section 2.3 of their Terms of Service. I’ve already provided some feedback on the update and how, thanks to the use of parentheses, it appears to be limited to only addressing the issue of the Lab attempting to sell user-generated content for their own profit; something which is also indicated by the official blog post on the matter being focused solely on that issue as well.

However, there was more I wanted to say on the matter, but which, as an expression of personal opinion, I didn’t want to include in what was essentially a “news” article. So please excuse me if I now take the opportunity of doing so.

I’m actually not at all surprised that the Lab has looked no further than addressing the issue of their selling, reselling or sub-licensing user content. Prior to the update being published, I spent a fair amount of time reading Ebbe Altberg’s forum comments in relation to the Terms of Service and transcribing his statements on the matter at various meetings. One thing that struck me in doing so, was that throughout all of them, he only ever referred to revised the ToS in terms of addressing this singular issue.

Unfortunately, even in dealing with this one issue, the Lab appears to have again managed to introduce ambiguity into matters. In their blog post, they state that the updated Terms now require some nebulous form of “affirmative action” on the part of users in order for the Lab to sell, resell or sublicense their content. But what form is this “affirmative action” supposed to take?

It’s fair to say that the revised Section 2.3 of the ToS doesn’t give any indication, other than perhaps via the very generic statement of, “as permitted by you through your interactions with the Service”, which could mean almost anything.  Even a check on Section 2.4 of the ToS – which the blog post points to as being the basis for the additional language in Section 2.3 – offers little enlightenment. It merely states that “interaction with the service” might be as simple as using the permissions system with any content you place on any Second Life region accessible to any other user. As such, people could be forgiven for taking the blog statement about “affirmative action” as little more than cold comfort.

... Except the ToS doesn't really indicate what such "affirmative action" might be, other than in the most generic of ways

… Except the ToS doesn’t indicate what such “affirmative action” might be, other than in the most generic of ways

Beyond this, why the Lab have persisted in ignoring concerns over the removal of all reasonable limitations on the granting of shared rights to them, remains a mystery. It’s not as if they weren’t aware of any issues on this matter, because at the end of 2013 and early 2014 efforts were being made to put such concerns directly and clearly to them. I know this to be a fact, because I was an active participant in one such group engaged in those efforts.

And if you’re not convinced that the July 2014 update leaves the matter of granting unqualified rights unchanged, then as I pointed out in my original article, you need only look as far as the statement following text which has been added to Section 2.3. It is completely unchanged from the August 2013 version of the ToS, still stating that the Lab might “otherwise exploit in any manner whatsoever, all or any portion of your User Content (and derivative works thereof), for any purpose whatsoever…

Again, no-one is denying that the Lab requires the non-exclusive granting of certain rights in respect of users’ content. That is to be expected and should be understood. Without such rights, Second Life ceases to work. It is simply the extent to which the Lab require the granting of such rights since August 2013.

An unaddressed concen with the August 2013 Terms of Service was the removal of all limitations around the granting of rights to the Lab in respect of user-generated content. extent to which the Lab require users to grant them shared rights to their content. In October 2013, Agenda Faromet suggested how the August 2013 ToS update could be improved - through the re-establishing reasonable limits on the non-exclusive rights granted to the Lab in respect of content - just as had been the case up prior to the August 2013 update.

Agenda Faromet, speaking at the October 2013 in-world meeting about the August 2013 Terms of Service changes, was perhaps the first to clearly bullet-point why a reinstatement of reasonable limits on the granting of shared rights to the Lab in respect of users’ content might benefit the Terms of Service.

Up until the August 2013 update, the ToS had required rights to user-generated content “solely for the purposes of providing and promoting the Service” (see Section 7.2  of the May 2013 Terms of Service). Even allowing for the fact that since August 2013 the Terms of Service have been applicable to all of the Lab’s products and not just Second Life, it is hard for the untutored eye to understand why this language couldn’t have been carried forward in respect to rights granted to the Lab. After all, “the Service” could apply to Patterns, Desura and any other platform the Lab produces, just as much as it applied to Second Life.

And therein lies part of the problem; because the removal of all limitations on rights granted to the Lab appears to be entirely arbitrary, it gives rise to suspicions and mistrust over the company’s motivations. As such, it is a shame the Lab has never really made any effort to clearly express why they believe such a sweeping change assists them in their role as a service provider when compared to the previous, more qualified granting of rights. While it would still be a very poor second to actually working with concerned users to try to amend Section 2.3 to the benefit of all, providing such feedback might at least help in allaying the aforementioned suspicions and mistrust.

Unfortunately, I tend to feel that we’re unlikely to see any further movement on this matter; the Lab have revised what they felt needed to be revised, and it’s not as if they were unaware of other concerns related to recent ToS revisions. As such, and like it or not, we still have a Terms of Service which still has every appearance of being creator / collaboration unfriendly.

And in that respect, when considering the July 16th update, I’m left with a quote from William James rattling around my head:

A difference which makes no difference is no difference at all.

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15 thoughts on “TOSing the (word) salad (or why I think the latest Terms of Service update misses the mark)

  1. Pingback: TOSing the (word) salad (or why I think the lat...

    1. Kira Manell

      I wonder whether it has ever occured to anyone that the Lab may be doing this, preemptively, in case SL is to shut down, due to the advent (and success) of SL2, in which case they might want to sell off SL, ‘lock, stock, and barrel.’ It is otherwise not making a great deal of sense to suddenly insist far more sharply on wanting all-out rights to selling user content for a platform they just indicated has maybe only 5 years left.

      Also, there’s a difference between needing certain non-exclusive rights to user content, so as to be able to operate SL, and not get sued over copyright by users, and insisting on wanting the right to sell their stuff. The former, I’m sure, everyone understands. The latter, IMHO, is a questionable practise, as artists (and pretty much every content creator is, after a fashion) should really not be required to ‘sign away’ more rights to their products than is strictly necesary to run SL and be on legal safe ground.

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      1. Mona Eberhardt

        The “sell/re-sell” clause was redundant; it was covered by the “distribute” right anyway, and it’s really a non-issue: LL sells and delivers copies of our stuff for us, takes a fee, gives us the rest of the money, and gives a cut to whomever else we assign. That’s what it’s all about. I can see a reason for the “sublicence” clause: LL have stopped hosting SL only on their own data centres, and have gone the Amazon cloud route. So, I can see they’ll want to be able to ensure the data centre operators that they can do what needs to be done for them.

        Then, there’s something else that has never been seriously considered by the user base, as those who mention this possibility keep getting shouted down: What if LL actually want to provide more diverse channels for SL content creators to sell their wares? This, however, comes with a big question mark, as to which platforms this content could be meaningful for, outside SL and maybe OpenSim.

        Also, even though certain rights that are essential to the function of SL are rights that certain stock content providers’ EULAs simply make it impossible for SL users to grant to LL, I’m not sure LL should be required to adapt the way a virtual world works to the Medieval and stifling EULAs of services like Renderosity.

        But really, the “in any manner whatsoever/for any purpose whatsoever” clause is very hostile to content creators, and I don’t think the academic community (a “halo” client for any virtual world provider) would appreciate it. LL should have focused on this issue (and maybe the moral rights), rather than insert a (non-)change that “addresses” a non-issue.

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        1. Kira Manell

          “LL sells and delivers copies of our stuff for us, takes a fee, gives us the rest of the money, and gives a cut to whomever else we assign. That’s what it’s all about.”

          There’s a huge difference between LL selling stuff *on behalf us*, and them just selling it, period. There are quite a few (professional) artists/architects in SL, with often fantastic galleries. Basically LL just appropriated themselves a blanket right to sell those ppl’s works. Not so cool when you’re actually an established artist/architect. One world-renowned artist was Tehos, for instance (http://www.digitalarti.com/user/tehos). He used to have an incredible art gallery in SL (Tehos Art Gallery; it’s closed now). You can expect folks like that to never again touch SL with a ten-foot pole, when LL cannot be bothered to respect the artist.

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          1. Mona Eberhardt

            First of all, the very first paragraph of the problematic Section 2.3 recognises that:

            You retain any and all Intellectual Property Rights you already hold under applicable law in Content you upload, publish, and submit to or through the Servers, Websites, and other areas of the Service, subject to the rights, licenses, and other terms of this Agreement, including any underlying rights of other users or Linden Lab in Content that you may use or modify.

            Now, how much sense would it make for LL to recognise that you own your content and then for them to go off and sell it as if they owned or co-owned it? From a business standpoint, would it make any sense? From a PR standpoint, would it make any sense? The way I see it, it wouldn’t.

            Unless they have suddenly decided to destroy their careers, I don’t see this as being very likely to happen.

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            1. Kira Manell

              “Now, how much sense would it make for LL to recognise that you own your content and then for them to go off and sell it as if they owned or co-owned it?”

              I don’t think you fully understand how this works. You’re not literally ‘signing away’ any rights (as in transferring them). You are, however, basically granting LL a series of non-exclusive rights to your works, akin to what the copyright holder enjoys (like, for instance, the right to sell your things). Or, in the words of the TOS,

              “You hereby grant to Linden Lab, and you agree to grant to Linden Lab, the non-exclusive, unrestricted, unconditional, unlimited, worldwide, irrevocable, perpetual, and cost-free right and license to use, copy, record, distribute, reproduce, disclose, modify, display, publicly perform, transmit, publish, broadcast, translate, make derivative works of, and sell, re-sell or sublicense.”

              So, the new TOS essentially makes our retained ownership to the content an empty bottle, as they’re basically saying “Sure, you can remain the owner of your IP stuff, provided we can do everything we want with your work, including selling it.” And for any half-way serious artist, that should be a scary proposition.

              The only question remaining, as Inara indicated, is what the so-called ‘affirmitive action’ may entail. But that may, without further specification, indeed, be as simple as merely using SL (and thus, implicitly and explicitely, agreeing to the TOS).

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              1. Mona Eberhardt

                Still, what’s in it for LL? What does it have to gain from selling people’s products for itself? Let’s see what the consequences would be:

                1. A PR disaster that will forever taint the Lab and any virtual world platform it tries to come up with. This will prevent any meaningful user base growth.

                2. Legal action (perhaps), which LL is guaranteed to lose, adding more damage.

                3. The people involved with the Lab (the Board of Directors, the chief officers, and everyone who has any kind of decision-making power) will see their reputations destroyed forever, and their careers will go down the drain.

                So, what’s in it for the Lab? Why would it take your content, or my content, or anyone’s content and sell it on, without our approval, without us receiving the price we’ve set (after LL has taken its fee)? Why would it say “oh, this thing Kira made? It looks cool. Let’s pull her original marketplace entry off and sell it as our own product?” How much money would it make? Even if it were to go the salami-slicing route, it’d ruin its reputation. Any (if any) profit made this way would be insignificant, especially compared to the catastrophic damage this would cause, if they did so.

                I agree that the “in any manner whatsoever/for any purpose whatsoever” clause is unacceptable, and this is where the really thorny issue is.

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                1. Kira Manell

                  They could perhaps be waiting for the next ‘Van Gogh’ to come along, and make millions off of him. That Tehos guy, btw, is definitely worth millions already. But I agree that it would be a momumentally bad move, on the part of LL, to actual start doing so. The public outrage would be enormous. And no one would ever trust them with any virtual world, ever again.

                  Still (my French is a bit rusty), but I recall that Tehos guy once saying he disliked the lack of control (whereupon he withdrew his work from SL). Even LL not outright selling ppl’s art, losing control over how it’s being displayed, and where, can be upsetting all by itself. Especially when they add “in any manner whatsoever/for any purpose whatsoever.”

                  Personally, I’d like that ‘affirmitive action’ be a stand-alone event (and not be as lame as just using SL), like the signing of a waiver or some such. Then again, what will the consequences be if you refuse to sign said waiver? Will you be refuses access to SL? Or see your work in question removed from it? To me, anything that doesn’t allow the content creator to say ‘No’ to such affirmitive actions with impunity, is really unacceptable.

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      2. Inara Pey Post author

        Leaving aside the legal aspects of whether or not the Lab requires IP rights in order to sell the service, this theory overlooks a few things.

        The first is that the vast majority of Second Life’s IP value doesn’t reside in the content, period. It resides in the server-side code and backend services, all of which is already owned by the Lab, and could be sold at any time. Nor do they necessarily have to sell SL as an operational service in order to leverage that IP.

        The second is that Second Life really doesn’t appear to be a value proposition for a potential buyer. From the outside, it is 11 years old, with a lot of back-end systems and services that have always been less-than-optimal and hard to maintain. It doesn’t scale efficiently, it has a small, closed user-base which has proven next to impossible to grow. It has a less-than-flexible revenue model which is liable to be seen as increasingly unattractive by potential users when compared to emerging competition. It uses a cryptocurrency the Lab are not going to want to release, adding further complications in terms of either licensing the use of L$, or in finding / developing an alternative cryptocurrency.

        All of these points make it an unattractive purchase proposition. And on top of all of them, even the Lab acknowledges that in order to have a product capable of having mainstream appeal and which can leverage mobile technology and emerging VR and AR technologies, it’s better to start from scratch, something which again hardly adds any value proposition to buying SL.

        A third point is that Second Life is really only worth anything if it has a user base which will move with it if sold. The content doesn’t mean a thing without the people to use it. So if, during the period the two are running in parallel, the Lab’s next generation platform does become successful and the majority of SL users opt to switch over to it because it offer better capabilities at a lower cost to them, etc., then SL becomes little more than a playground where no-one wants to play, and which isn’t going to attract new users because everyone else is either running to the Lab’s new platform or to High Fidelity or to whatever else pops-up in the interim.

        As such, any plans the Lab have for Second Life should it reach the point where it is no longer a viable financial proposition, are far more likely to involve repurposing the hardware and infrastructure they own, eliminating superfluous licenses, contracts, leases, etc., and simply binning the rest. And until that happens, then as long as SL is generating revenue that converts to profit for them, it makes sense for them to keep on running it themselves.

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  2. H V

    Last year there were 55,000 users in world at any given time. now there are only 40,000 users.
    LL wont get it, until we all leave SL.

    So: I am looking for a replacement virtual reality company, to replace Linden Lab, as my new virtual reality life. Does anyone know of a good replacement ?

    Maybe “Inara Pey” can start a new blog category, called “In search of Third Life”, dedicated to helping everyone find and move to this other company.

    What do you think ?

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    1. Mona Eberhardt

      You’re starting off with a factual error – not the best way to start your comment, especially when you’re pulling statistics in.

      From Tyche Shepherd’s Grid Survey (http://www.gridsurvey.com/economy.php?page=8) we see that mean daily concurrency for July 21st, 2013 was 43007.3 users; for the entire month of July 2013, mean daily concurrency was fluctuating between 39843.3 users (July 17th, 2013) and 43782.1 (July 29th, 2013), and mean daily concurrency has generally fluctuated between 39500 (or thereabouts) users and 45000 (or thereabouts) throughout the year, with each month being quite similar to the other.

      Two days ago (July 19th, 2014), mean daily concurrency (again from Tyche Shepherd’s Grid Survey) was 43564 users – and 2013’s figures were roughly similar to 2014’s so far. About half an hour ago, when I logged in, there were 49614 users online. These are the real figures.

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