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2007
T-86.5750 Seminar on New Business in Digital Economy
1
User-generated content and its business
Quentin Désert, Antonin Subtil
[email protected] - [email protected]
1
Introduction
Web 2.0 is a silent technological revolution that brings a new way of using the Internet. The
relation between users and websites was completely changed, and now everyone can publish and
share over the Internet without any particular knowledge.
This success story show up during the years 2005 and mainly 2006, and quickly reach the top
visited websites. Not only the big Internet companies, but also computing industry is now looking on Web 2.0 and its new websites. Why so much interest?
User-generated content is also known in computer game industry for years now. Some games
found a second life thanks to user-generated content; others found 90% of their material like
this. What is user-generated content, how can it be in computer games?
User-generated content is a turn-over in many industries, and we will try to have a quick
overview of what it is, who use it, is it legal, and how can we make business with it.
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Content Plan
1
INTRODUCTION .........................................................................................................................1
2
OVERVIEWS ................................................................................................................................3
2.1
OVERVIEW OF WEBSITES ..........................................................................................................3
2.1.1 What is Web 2.0? ................................................................................................................3
2.1.2 Youtube : the video broadcaster .........................................................................................3
2.1.3 Jamendo : discover new musics..........................................................................................4
2.1.4 Flickr : store, search, sort and share your photos..............................................................6
2.1.5 MySpace : blog your own life .............................................................................................7
2.1.6 Lulu: publish yourself.........................................................................................................8
2.1.7 Wikipedia............................................................................................................................9
2.2
OVERVIEW OF GAMES ..............................................................................................................9
2.2.1 What is a mod? ...................................................................................................................9
2.2.2 Half-Life and Counter-Strike..............................................................................................9
2.2.3 Civilization IV and Fall from Heaven 2............................................................................11
2.2.4 Warcraft III and Defense of Ancients ...............................................................................13
2.2.5 The Sims: success story of user generated content...........................................................15
2.2.6 Second Life: social gaming and user generated content ..................................................17
3
LEGAL ASPECTS ......................................................................................................................19
3.1
WEBSITES: WHAT CAN BE UPLOADED? ..................................................................................19
3.1.1 Jamendo: free music.........................................................................................................19
3.1.2 Flickr: share your photos .................................................................................................19
3.1.3 YouTube: creator of litigations.........................................................................................20
3.1.4 MySpace: owner of million of medias?.............................................................................21
3.2
LICENCES ...............................................................................................................................21
3.2.1 Creative Commons ...........................................................................................................21
3.2.2 Free Art license ................................................................................................................22
3.3
MOD’S OWNERSHIP: THE COUNTER-STRIKE CASE ..................................................................22
4
FINANCIAL OVERVIEW: BUSINESS MODELS .................................................................23
4.1
4.2
4.3
4.4
MYSPACE'S ECONOMICAL MODEL: ADVERTISEMENT..............................................................23
FLICKR'S ECONOMICAL MODEL: MONTHLY FEE ......................................................................24
JAMENDO'S ECONOMICAL MODEL: ADVERTISEMENTS SHARED WITH AUTHORS ......................24
WHAT CAN A MOD BRING TO YOU? ........................................................................................25
5
CONCLUSION ............................................................................................................................27
6
REFERENCES ............................................................................................................................28
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Overviews
2.1
Overview of websites
2.1.1
What is Web 2.0?
“Web 2.0 refers to a perceived second-generation of Web-based services—such as social networking sites,
wikis, communication tools, and folksonomies—that emphasize online collaboration and sharing among users.” –
Source: Wikipedia
2.1.2
YouTube: the video broadcaster
2.1.2.1
Presentation of YouTube
YouTube describe itself as an online video provider. It is actually the most popular video
sharing website in the world, and was classified as the 4th most visited website on the Internet.
YouTube was launched in February 2005 by three Paypal employees, and bought in October
2006 by Google for $1.65 billion.
It is a video storage and broadcasting free service. You can see videos from its community but
also share your own.
YouTube
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YouTube allows its users storing and sharing video on its server, using the Flash technology,
but also rating videos, adding comments to these videos… and creating communities. Videos are
accessible by categories, keywords (called tags), and can be imported on personal websites. The
community system allows making comments and grading each video, by being registered to
YouTube.
YouTube also allows playing the videos anywhere on the Web: the service provides HTML
links to use, which include an embedded player. Now it is possible to upload to Youtube from a
phone.
YouTube is now very popular, although it doesn’t allow downloading any video, as it is in
Flash technology.
2.1.2.2
YouTube vs. GoogleVideo
YouTube is not the only video broadcaster on the Internet; its two main competitors were
GoogleVideo and DailyMotion. However, GoogleVideo is no longer updated because Google
bought Youtube and merged both services.
Without getting into too much detail, as the GoogleVideo didn’t live that much, we can note a
small difference between the two services: videos can be freely put on the Web with YouTube,
while they need an agreement on GoogleVideo. This has lead to less videos and then a smaller
community; however this might have prevented the legal problems of YouTube, although
GoogleVideo didn’t set any limit to the file’s size allowed in upload (YouTube limits to 10 min.
and 100 Mo).
Another difference is that GoogleVideo was offering to download the videos for a dedicated
player or iPod/PSP, unlike YouTube.
2.1.2.3
Short selection of videos
- Ask a gay man, shows by one user, with always many answers.
http://www.youtube.com/watch?v=AVESRceJL5k
- Evolution of Dance (Judson Laipply), the most popular video on YouTube (viewed 47.19 million times)
http://www.youtube.com/watch?v=dMH0bHeiRNg
- Free Hugs Campaign (music by Sick Puppies), one of the most popular videos on YouTube
http://www.youtube.com/watch?v=vr3x_RRJdd4
2.1.3
Jamendo: discover new music
Jamendo is a website intended to share music. The aim is that artists can upload their albums
under Creative Commons licenses or the Free Art License; and users are free to listen (in streaming) any album through the website, or download it freely and legally, in mp3 or Ogg Vorbis
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formats (Ogg Vorbis is open source). They are then allowed to copy and share it via peer-to-peer
networks (BitTorrent and eDonkey). Depending on the license, they can even modify it and use
it on commercial purposes (not for every file, though).
Jamendo
The website includes different functionality, such as a rating and recommendation system, a
tag and reviews system, helping users to discover the artists, and the possibility to make donations to artists via Paypal.
Jamendo was launched in January 2005. During the year 2006, more than 2100 albums were
added to its database; almost 3000 albums are available today.
Here is the main functionality of jamendo:
- Music available under Creative Commons license, meaning that artists allow users to listen,
download, copy and redistribute their music, although they keep the copyright
- Distribution via peer-to-peer networks, such as BitTorrent or eMule
- Possibility to review the albums (if registered to jamendo)
- Albums classification by popularity
- Possibility to make donations to artists via Paypal
What are the benefits for the artists?
First, jamendo is a good way to get known. The free distribution of the music implies that a
lot of users will listen to their music, give reviews, and speak around them. Besides, the Internet
is an international platform, offering the possibility to be popular all around the world quite easily.
The artists present on jamendo are given a “personal space” where users can see their details,
go to their official website, see the agenda of concerts, watch some photos, chat about them, give
them financial support…
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As said on the website, jamendo is “non-exclusive”, meaning that the artists are still the owners of their music and can distribute it by any other ways. Besides, jamendo is totally free, and
finally, there is no engagement.
Jamendo is a free way to share music, allowing artists to get known, and giving them choices
on how their art will be used.
2.1.4
Flickr: store, search, sort and share your photos
Flickr is a website that allows its users to, as mentioned in the title of this chapter, store,
search, sort and share your photos. The organization of Flickr creates an online community with
innovative tools, such as folksonomy, defined as a user generated taxonomy allowing categorizing
and retrieving web content, using a tag system (keywords). Flickr is what we can call a typical
Web 2.0 application.
Flickr
The registration is totally free and users can upload as much pictures as they want, using either the Flickr Uploadr tool, the upload web page of the website, email, or other photos software.
Then, they can organize the photos in albums, sorted by themes and with different levels (some
grand themes can group smaller categories). These themes are created using the Organizr, an integrated tool which also allows tagging the photos or changing permissions for the different users.
One of the most interesting points of Flickr is its community. With the huge number of photos uploaded on the website, the community can discuss about almost everything they like, using
photos as a base to start a discussion. This is facilitated by the creation of groups, which can be
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public or private. This means that some photos are only available for some people who can discuss about those photos with each other. Therefore, users that don’t want to have their photos
viewable by everyone on the Internet can restrict access to only people they want. There is also a
possibility for the users to protect their photos copyrights.
A very nice tool of Flickr gives the possibility to “locate” the photos. The website contains a
map; when a user upload a photo, he/her can drag-and-drop it to the map, on the place where it
has been taken. Then people who want can see this map and know where the picture was taken.
They can also see on a world map the different users and where they have traveled (and taken
pictures).
Flickr allows also making several “physical” things such as printing, making photo-books,
slideshow-DVDs, postage stamps, calendars…
Finally, this amazing service creates a community. Users can have “contacts” as friend or family to communicate easily with them, or to be informed by email of what they are doing on Flickr.
Pictures can even be shared with people that don’t have an account (using the Guest Pass feature). Of course, users having access to photos can also comment it and discuss about it.
Flickr map service
2.1.5
MySpace: blog your own life
MySpace is an online social networking website giving for free to its member a personalized
web space where they can have a blog, put photos, music and videos. They can also put some
personal information, making the space look like a website.
MySpace is today the fifth most popular website in the world and launched several versions
specifics to some countries, although users still have access to all the content.
Thanks to the personalization possible on a MySpace webpage, and the possibility to put music, photos and videos, MySpace has been used by several music bands as their “official website”.
MySpace allows defining other users as Friends, with a display of the “Top Friends”, and links
to their personal webpage. The visitors are free to post some comments on the MySpace websites (with the approval of the owner).
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The very good thing in MySpace is the personalization: each personal website looks very different from the others, as the owner can modify HTML and CSS properties (permitting to modify the style). There are however some issues with this: as all the users don’t have a good experience in web development, the results are often not very nice, and don’t respect the criteria for
valid HTML or CSS (defined by the W3C). This means that those websites can encounter some
compatibility problems.
A MySpace personal page
2.1.6
Lulu: publish yourself
Lulu is a service, through a website, to create your own books and to sell them.
“Founded in 2002, Lulu is the web's premier independent publishing marketplace for digital do-it-yourselfers.
It's the only place on the web where you can publish, sell and buy any and all things digital — books, music, comics, photographs, movies and well, you get the idea. We simply provide the tools that leave control of content in the
hands of the people who created the content. You see, Lulu is a technology company, not a publisher.
So you can use Lulu to publish and sell any kind of digital content, and no one here is going to ask you to change
anything. Ever. Your vision is entirely YOURS. ” – Lulu website
From the customer point of view, it is a normal online bookshop, with all the normal details
you can expect, such as a preview, covers, yet without ISBN. But you are not buying a normal
book; you are buying a book created by Lulu’s users, a user-generated book.
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2.1.7
Wikipedia
Wikipedia is an online collaborative encyclopedia.
In Wikipedia, everyone who is registered can edit or create almost every topic, article, or the
encyclopedia. The website has a very large success; it is now worldwide known and was translated
in many languages. However Wikipedia has some issuess: some people are writing false information, and the staff had to restrict some contributions.
Yet it is one of the most amazing, and well-know, user-generated content website, even if it is
not making any real business yet.
Now that we have a large overview of the most popular user-generated content websites, we
can have a look at computer games mods.
2.2
2.2.1
Overview of computer games mods
What is a mod?
A mod is a game modification to find a new way to experience a game. It is not just a new
map to play with; it has its own new rules. Sometimes, it has its own maps and graphics.
A mod is an extension of a game and is usually not made by the game’s developers themselves, but by users. That is why it is often free. However, in some cases, the gaming industry
uses mods to add them on game’s cd or even to sell them.
2.2.2
Half-Life and Counter-Strike
2.2.2.1
Presentation of Half-Life
Half-Life is a first-person shooter computer game, developed by Valve Software and published by Sierra Entertainment in November 1998. It was one of the most popular games in 1999
and 2000.
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In Half-Life, the player is given the role of Gordon Freeman, a physicist working in an underground research center on teleportation experimentations. After an experimentation failure, he
must escape from an extraterrestrial invasion of the facility.
Half-Life won several awards and influenced several games for its originality. With the same
game engine, two add-ons have been released later: Half-Life: Opposing Force and Half-Life: Blue
Shift.
In November 2004, Half-Life 2, the second version of Half-Life, has been released, and an
add-on called Episode One, came up in June 2006. A second one is planned for Autumn 2007.
Since the first version of Half-Life, a level editor called Worldcraft (now known as Valve Hammer Editor) was provided with the game. It allowed the creation of new levels, or even entire
modification of the game engine.
That is how several mod projects have been realized, including the well-known CounterStrike.
Half-Life
2.2.2.2
Presentation of Counter-Strike
Counter-Strike, or CS, is a tactical first-person shooter computer game, which was originally a
mod of Half-Life developed by Minh Le and Jess Cliffe in 1999. It is today the most popular
multiplayer first-person shooter in the world.
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In CS, the players are in the role of either a terrorist or a counter-terrorist, fighting against
each other on a map, choosing their weapons and equipment.
In 2002, there were about 30 000 game servers on the Internet for CS. In 2004, about 85 000
players were playing simultaneously at any time, representing 70% of first-person shooter players
on the Internet. Nowadays, the number of players fluctuates between 150 000 and 300 000, and
the number of servers between 100 000 and 150 000.
Since its first release, there have been several versions of CS: Counter-Strike for Xbox is a
version for Xbox players, released in 2003; Counter-Strike: Condition Zero is a single player version of CS, released in 2004; and Counter-Strike: Source is an upgraded version of CS, using the
Source engine (used for Half-Life 2), released also in 2004.
Counter-Strike
2.2.3
Civilization IV and Fall from Heaven 2
2.2.3.1
Presentation of Civilization IV
Civilization IV is a turn-based strategy game where you own a civilization and raise it through
the different ages of mankind, from Stone Age to nowadays.
In order to win, players have to build cities and troops. And they have to look for technologies, make wars and diplomacy.
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Civilization 4 is the 4th opus, released in autumn 2005, of a well-know saga made by Sid Meier,
which began in 1991. At least from the 2nd, players were able to edit the map where they played
to create scenarios and release them, but Civilization 4 went further, by using an engine combining XML and Python, open to developers.
In Civilization 4, players can create scenarios from within the game, but if they want to go
further, they can also modify a little bit the rules by editing XML files, or they can create a whole
new game by editing the Python engine.
Many additions can be found on the Internet for this game, mainly through fan’s dedicated
websites. These additions can edit the look of one unit, add a complete civilization, add a few
buildings, but there are also complete mods of the game, such as Fall from Heaven 2, which
might be one of the most used.
Civilization IV
2.2.3.2
Presentation of Fall from Heaven 2
Fall from Heaven 2 (FFH2) is not a simple mod made by one developer through a few
changes: it is the sum of many available mods, but it also includes new graphics, new rules… In
fact, the engine is the same as Civilization 4, the main idea is the same, but everything else has
changed.
FFH2 is a game where you own a fallen mystic civilization, and you will lead it through Stone
Age to Medieval Age. You will experience new civilization, new units, new buildings, even new
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religions, but you will also discover the power of magic with wizards and rituals, and be afraid of
the mighty heroic units, with their new competences.
FFH2 is a mod distributed for free, but making a new game on the engine of an existing one
was often the way to make new games in this industry: Users can now do it themselves.
Fall from Heaven 2
2.2.4
Warcraft III and Defense of Ancients
2.2.4.1
Presentation of Warcraft III
Warcraft III is a medieval-fantastic real-time strategic game, developed by Blizzard Entertainment, and including a really light part of role-playing game.
The Warcraft game saga began in 1995 with the first title, Warcraft: Orcs & Humans, which was
basically the same kind of game as Warcraft III; it included big maps where you build you own
camp before a fight with your opponent, but also some small maps where you lead only a few
troops. In this game, you were not able to design any map, but there was a tool to change the
unit’s properties. It was still not modding, though.
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Warcraft 2, released in 1996, improved the graphics, but also added a map editor, which was
massively used by players to create many maps. However, this tool was difficult to use for creating some real scenarios.
Warcraft 3
Warcraft 3: Reign of Chaos, released in 2002, brought a new map editor, more powerful, where it
was easy to edit maps, scenarios or units. In fact, it provided the best of both previous titles. This
tool was and still is used by the community to create and share their creation.
2.2.4.2
Presentation of Defense of the Ancients (DotA)
Defense of the Ancients (DotA) is a user-generated mod for Warcraft III and its expansion
(The Frozen Throne), where players keep only the role-playing part of the game.
They select one camp, join friends of their camp, and then they began to play their own character into the game in some “seek and destroy” mission, but also some “protection” missions…
We don’t know exactly how the mod was done, but yet we assume that it is using the mapeditor and some extra development may have been done.
We discovered this mod through a video-clip of Basshunter (Botten Anna) called “Vi sitter i
Ventrilo och spelar DotA”. If it is interesting, and rare, to see a game in a song, it's even more interesting to see that this song is based on the mod, and not the actual game.
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DotA
2.2.5
The Sims: success story of user generated content
Do you remember girls playing with their dolls, playing being a family? That’s not our age, is
it?
The Sims is a “doll-house” game. You create a family, then a house, and you let the family live
in the house, freely or giving some orders. Your aim? Like in real life: make everyone happy and
reach an upper-class social status.
The Sims is a single-player life simulation computer game, developed by the game designer
Will Wright (creator of SimCity), published by Maxis, and distributed by Electronic Arts. The first
release came up in February 2000, and is now the best-selling computer game in history (about
6.3 million copies). The Sims won several rewards as well.
Since the first release, seven thematic expansion packs have been developed and released:
Livin’ Large in August 2000, House Party in March 2001, Hot Date in November 2001, Vacation in
March 2002, Unleashed in September 2002, Superstar in May 2003, and Makin’ Magic in October
2003. In December 2002 was also released The Sims Online, a variation of The Sims as a MMOG
(Massively Multiplayer Online Game). This online version did not get the same success as the
single player version, though. The second version of the game, The Sims 2, has been released in
September 2004. It brought a 3D environment and some additional features to the first version
(life evolution, and aspirations…). A third version is currently in development. The Sims is also
available for consoles (PS2, Gamecube, Nintendo DS…).
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The Sims 2
So where is the user-generated content in The Sims? In game, the player has to make live the
people of his/her family to allow them to get a big house and plenty of objects. But what if some
advanced players had already made the house of your dreams and can provide it to you? Or if
those players can even provide you some objects that you cannot find in the game?
The interesting thing in The Sims is that everything, or nearly, can be exported/imported in
the game: you can import houses, furniture, or even new characters skins. But all these objects,
how are they created? Just by creative players, using some existing tools (available on the Internet) allowing for instance to clone some objects of the game, and to modify then the textures, or
even to modify them completely, using for example a 3D software such as 3ds Max… And then
they put these items at disposal of players on the Internet, as archive files that users will have to
insert into the game folders on the hard disk.
The result of these tools was a lot of furniture available on fan’s websites, but also on the
game’s official website. And most of time those items are free, because the game is not online,
meaning that there won’t be any balance issue: nobody will be jealous, unless they come to your
own computer to see your Sims…
After a few months, the game company released game extensions, giving new opportunities to
your Sim’s life, but also containing a lot of the user-generated furniture.
The Sims 2
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2.2.6
Second Life: social gaming and user generated content
Second Life (SL) is a game like The Sims, where you play a new life. But unlike The Sims, SL is
a Role Playing Game, where you will have only one character, unique in the whole world: your
own avatar.
SL is a massively multiplayer online role playing game (MMORPG).
The game was developed by Linden Lab, and released as a beta version in 2003. An initial alpha version called LindenWorld was available in 2002 only to “Residents” – the users of SL with content creation experience. Today, there are about 5 million registered accounts on Second
Life.
In SL, players have to learn how to control their avatar, how to personalize it, and then they
are free in a huge world to make their own gaming experience.
Second Life
It is important to note than SL doesn’t have any quest, any “way of playing”, as understood in
RPG. SL is really a “second life”, where you will be able to do almost everything you can do in
real life, having a job included.
As in real-life, you will need some money inside the game to enjoy more than the basics of
life, and there is two way of getting it: by buying it from the game company, or by getting it inside
the game, from others players.
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But why would someone else give me money? Because you can help him with a product or a
service, or because he is nice (but as in real life, hope is free).
Second Life
The important fact in SL about user generated content is that everyone can create objects and
sell them, but some people are better than others, and people will want their creations, or will
rent their services to create some objects.
SL is also a special game: As it is a social game (like many MMORPG), and as it is a more serious game than World of Warcraft … Therefore dedicated to adults; some real brands are doing
advertising inside the game, such as UPS; even some politicians have a showcase, like the French
Parti Socialiste; and one state opened an embassy in the game (giving information online).
But all these brands, politicians or states don’t have time to make their own objects inside the
game, so they pay players to build their buildings, create their promotional objects, etc…
It is important to note that the game company’s business model is to earn money by taking a
small percentage each time someone buy in-game currency, and by offering services (such as
renting an island) in this virtual world. The client is free, and there isn’t any subscription.
Second Life
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After this overview of several computer games mods, we can see in detail the legal aspects
linked to this industry.
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3.1
Legal aspects
Websites: What can be uploaded?
We gave in the previous part an overview of the most popular user-generated websites and
computer games mods. We saw that those websites are filled by the users: music for jamendo,
photos for Flickr, videos for Youtube, and the all three for MySpace. And we discovered mods,
created originally by players. The aim of this part is to define which content can be put on the
different websites, what are the limits and restrictions for each case.
3.1.1
Jamendo: free music
Jamendo allows publishing “free music” under two kinds of licenses: the Creative Commons
licenses or the Free Art license.
Artists can distribute their music with jamendo, choosing the license which will be applied to
it. They can choose one or several Creative Commons licenses or the Free Art license.
Jamendo is therefore dedicated to artists who want to publish their music freely, in order to
be known, and keeping the copyrights. They can receive donations from the users, though, but it
is not a condition and is the user’s choice.
If the author is in a collecting society (a society that manage copyrights), he/her must accept
to publish his/her music under a Creative Commons license, according to its former engagements.
Artists are allowed to put on jamendo only albums, and entire albums, no samples used for
promotion. The only exception is if some tracks (or covers) of the album are from copyrighted
work. Those ones cannot be published on jamendo, so the artist can publish the album without
those tracks or covers (if it is only a few tracks of the album, though)
Artists are also free to remove their music from jamendo, although it will still be available on
peer-to-peer networks. And the existing copies of this music will still be protected by the Creative Commons license chosen. Artists are also free to have, in the future, a contract with a record
company.
3.1.2
Flickr: share your photos
Flickr allows publishing photos under several licenses. The most important point is that the
photos uploaded must have been taken by the user, and not collected from the Internet, or stolen
from other photographs.
Users can choose to upload their photos under one of several Creative Commons licenses, in
order to keep their copyrights. Flickr allows searching photos by each type of license.
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The photos must be filtered by the user uploading it, because everybody may have access to
it: no choking photos can be uploaded, as well as “buddy icons” showing nudity. Photos that are
illegal or prohibited are also forbidden.
Only “photos” can be uploaded on Flickr. That means that it is forbidden to publish for instance graphic elements, icons, smilies, buddy icons, forum avatars, badges or other nonphotographic elements.
Of course, it is forbidden to use Flickr for commercial purposes. This website is intended for
personal use. The uploaded photos cannot be used in order to sell products, services or even the
user who uploaded it.
Basically, Flickr’s users must give themselves the rules of what they can upload or not, respecting all those conditions.
3.1.3
YouTube: creator of litigations
YouTube was the subject of many licensing issues. YouTube allows uploading videos. But
unlike music on jamendo or photos on Flickr, videos uploaded on YouTube don’t necessarily
have to be made by the person uploading it. This fact implies that policies on Youtube are more
complicated than on jamendo or Flickr, where music and photos have to be from the user uploading it.
The other interesting point with YouTube is that the “watchers” can only watch the videos,
but are not allowed to download them. In fact they cannot download the videos as it is uploaded
in Flash format. Some tools were made to download those Flash videos, but these are not legal.
So YouTube has a completely different point of view from jamendo or Flickr. The problem is
that it is very difficult for the users watching the videos to know what they can do with those
videos. The thing is if YouTube had to ask to the person uploading a video to specify the license
of this video, then we could say that it wouldn’t have allowed YouTube having so many movies
trailers or music clips illegally. Therefore, without explicit license, videos are all, by default, under
a classic copyright, so the users can do nothing with it. The problem is that this is not written
very clearly on the website. The Terms of Use web page is very long and looks like a license for
proprietary software.
To limit illegal broadcasting, YouTube limited the duration of a video to 10 minutes, and the
size to 100 Mo. But those limitations are not enough; that is why YouTube signed agreements
with big studios: Warner music in September 2006, then CBS, Universal, and Sony in October 2006.
Those agreements plan that protected content can be removed (thanks to a filtering system), or
can be broadcasted for free, with the condition that the advertising incomes must be shared with
those companies. The Japanese Society for Rights of Authors (JASRAC) is against those agreements,
and obtained the recall of almost 30 000 videos, which were violating the copyrights of 23 Japanese companies.
YouTube can be opposed as another video sharing website called Blip.tv. This website is
more similar as jamendo or Flickr, as each video is uploaded under a license chosen by the person who put the video online. On Blip.tv, users can search videos by type of license, as on Flickr.
And it is possible to download the videos as well, knowing which license is applied to them. As
Linux against Microsoft, the creators of Blip.tv created this project “to become an open YouTube alternative”.
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3.1.4
MySpace: owner of million of medias?
MySpace allows its users having a personal web page where they can put multimedia content
(music, videos, photos) and text. This content can be published under a non-exclusive license
(meaning that the owner is free to have another license out of MySpace on the content), without
any copyright (MySpace don’t have to pay the users for using the published content). If the
owner removes the content, the license ends.
When someone uploads a media on his/her MySpace web page, he/her stays the owner of
this content. Every right associated with this content cannot be violated. For the users watching
the content, they have a limited license, allowing them to display it only for personal use and on
the MySpace website.
The Terms of Use displays a list of forbidden content, including choking, violent, erotic content, or content that can violate personal information about certain people. Commercial use is
also forbidden.
MySpace is owned by Fox Interactive Media. According to the Terms of Use, if a user publishes any content on MySpace, he/her authorizes implicitly an international, complete and without royalties license, implying that MyScace.com is authorized to use and modify this content as
they want. A huge number of people are registered on MySpace, and a lot of them are musicians,
graphic designers, photographs… Only a few of them knows that their works published on
MySpace are the ownership of Fox Interactive Media.
3.2
3.2.1
Licences
Creative Commons
The Creative Commons (CC), a non-profit organization, contains several licenses. A CC license can combine a selection of the four conditions, which are:
- Attribution (by): Content can be copied, distributed, displayed and derived, but the
name of the initial author must be mentioned
- NonCommercial (nc): Content can be copied, distributed, displayed and derived, but
only for noncommercial purposes
- No Derivative Works (nd): Content can be copied, distributed, displayed, but not derived (only verbatim copies can be performed)
- ShareAlike (sa): Content can be derived and distributed, but only under the same license
that governs the original content (same CC options)
The version 2.0 of CC licenses proposes six contracts, mixing the conditions described above:
- Attribution
- Attribution, No Derivative Works
- Attribution, NonCommercial, No Derivative Works
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- Attribution, NonCommercial
- Attribution, NonCommercial, ShareAlike
- Attribution, ShareAlike
The aim of the CC licenses is to guarantee copyrights protection of an artistic work, with free
circulation of this work’s cultural content, allowing authors contributing to a “works heritage”
accessible publicly.
3.2.2
Free Art license
The Free Art license is the English language version of a French “copyleft” license called Licence Art Libre, for works of art.
Copyleft is, in opposition to Copyright, the possibility given to the user by the author of a
work under copyright to copy, use, study, modify and distribute this work, with the restriction
that the work must keep the same conditions of using, even in modified or expanded versions.
The Free Art license, using this copyleft principle, authorize the user to copy, distribute and
modify a work, or to exploit it (freely or not), with the condition that it must be possible to access to the original work to copy, distribute or modify it.
This license is often compared as the GNU General Public License for works of art.
3.3
Mod’s ownership: the Counter-Strike case
In order to understand the legal aspects of Counter-Strike, it is necessary to know a little bit
of its history.
Half-Life was developed by Valve, a small American computer games company, and released
in 1998. Minh Le, a young student in computer science in Vancouver, discovered this game in
1999, and a little while after, Valve decided to publish for free a part of the Half-Life’s source
code, allowing the development of mods. Minh Le (in collaboration with Jess Cliffe) decided to
create Counter-Strike, the now popular mod of Half-Life. The aim was just to have fun; they distributed the first version for free on the Internet. They didn’t expect a success; however, word of
mouth implied a huge number of gamers downloading and playing Counter-Strike. The mod requiring Half-Life to play with, Valve got also advantage of its success, as a lot of players bought
Half-Life in order to play Counter-Strike. Minh Le released then several versions of the mod.
In 2001, Counter-Strike was the most popular game of its category. And Minh Le was contacted by Valve. They proposed to pay him for continuing working on Counter-Strike, which he
accepted.
Since this time, Valve has the ownership of Counter-Strike. The mod was still free though,
until the adoption in 2004, with Counter-Strike 1.6, of Steam, a content delivery, digital right
management, multiplayer and communications service and platform developed by Valve, replacing the legacy WON. Since the arrival of Steam, it is possible to get Counter-Strike for $10 from
Valve, without having Half-Life.
Since the end of 2004, Valve is selling the new version, Counter-Strike: Source, based on the
Half-Life 2 engine, for $20 (without having to buy Half-Life 2).
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After those legal aspects, the last part of this paper will show a financial overview of usergenerated content.
4
4.1
Financial overview: business models
Myspace's economical model: advertisement
We would like to begin by a small comparison of MySpace and similar services and products.
Some blogs widely used are made with Dotclear, which is a free product (it is a software that
you have to install on your own pages), with Over-blog, which is a non-free service, and with
MySpace, which is a free service. This is to show that you can blog for free, but you can also pay
to blog, and what you get is different. As Dotclear is a free open-source product, you don’t pay,
and you don’t have any advertisement, but you must provide all the environment and technical
support, while MySpace is free with advertisement, which allows it being a service providing everything.
Then we can say that advertisers pays to see your blogs online, and they hope you will have
success, to share it.
As said above, MySpace uses the advertisement to keep its service alive and make benefits. A
lot of blogs means a lot of users (u), and each user has its small community (c) coming to his
blog; then MySpace can sell some space to advertisers, saying that the potential view (v) is:
V=Σ(u.c)
But then by providing some more tools, like “friends list”, they can argue that a part of this
community ( c’ ) will check some similar blogs linked to the first one, and this many times (x).
They should also assume that there is always people ( p ) coming on their website to discover it,
so they can argue for potential views. Which makes:
V = Σ ( u . (c + x . c’)) + ( x+1) . p
The idea for MySpace is to maximize V, in order to sell the advertisement at a higher price.
How can they increase their views?
They can use u: more blogs, then potentially more communities, and in order to do this, they
should provide more functionalities than their rivals. But keeping the service free is also a good
idea, because price is always a barrier, even more for the younger people, which are one of the
most active communities of the social-Internet. By being enough attractive, they can also try to
turn the blogger’s friends (c) into new bloggers.
They can also improve x, the number of blogs seen after the first one. In order to do this, the
most used systems are “friends-list”, but also “same topic”, comments with link to the writer’s
blog… In YouTube, you also have the “video-answer” and “made by the same producer”.
And finally they can make advertisement for their website, to raise the p number (visitors
coming to see the website), and try to turn them into bloggers.
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In many cases, the idea is to be attractive, and to keep the leadership into innovation. An example of innovation on MySpace: they now provide a free audio player, so you can share songs
you like with your blog’s visitors…
Another thing about advertisement and visitor is that MySpace uses localized adverts: if you
surf from Finland (even with a French computer) you will see advertisement for Finnish companies. The idea is to display the proper ad to the proper visitor, still in order to raise the advertisement prices, due to their efficiency.
To sum up with MySpace, they sell advertisement spaces thanks to the blogs, and they need as
more visitors as possible to rise the prices (or show more advertisements), and therefore they
need a lot of blogs and innovation.
4.2
Flickr's economical model: monthly fee
While the other services we are discussing here chose to rely on advertisements, Flickr is a
beta service relying on two user accounts: a small free one, and a paying one.
We didn’t see any advertisement on the website, but there might be some.
Flickr offers two accounts, with the same functionality, but the small account sets some limits:
the free account has only a small disk space, a small upload size allowed per month, while the
paying user has everything unlimited.
The cost of this subscription is only $2 per month, which is nearly nothing for one user. But it
is paying, and this is a psychological barrier.
However Flickr also sell to user “cool stuff” with images from the site: it is its second way of
earning money.
How can we analyze this?
First, they try to attract as much people as possible, and make them use the service: this is the
reason of the free account.
Then they try to turn people in paying-users. For this, they set low limits to the free accounts,
while the paying-users have no limits for a very small price.
There are many website to print photos, and Flickr wants it too; even if they sell a very few
pieces, these pieces are highly profitable. However I believe it is still less revenues than the paying-guests.
To sum up, Flickr appeals users, and the developers try to get them paying with small prices
for no limits.
4.3
Jamendo's economical model: advertisements shared with authors
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Jamendo is dedicated to make money, but not from the music you can get on the website,
which is mostly always distributed under Creative Commons.
Jamendo use advertisement to make money, and has the same kind of logic as MySpace to attract more artists, more listeners, and so have the advertisement seen much more times.
However, the big difference is that Jamendo is sharing its revenues form advertisement with
the artists. The reason may be to attract more artists by promising to earn money, yet they will
still share their music for free.
The money in jamendo
“Example:
An artist made 2.000 page views in January 2007. The sum of all the page views for the registered artists was
50.000. Hence the artist accounts for 4% of these page views in January 2007. If the Jamendo advertising revenue
is $2000 for this month the artist will earn $40 euros on the $1000 jamendo shares.” – Jamendo.com
Actually, Jamendo made 946,42€ in January 2007, and give 50% to the artists.
However, not all the artists in Jamendo earn something: they have to register to a special program, saying they want to earn money, otherwise they will not be considered. It is also said on the
website that for people that don’t want to earn money, they can still subscribe to the program
and give the funds to a non-profit third-party.
Jamendo is free, uses Creative Commons and shares the ideas of open creation, but still it is
trying to make money, yet involving its users, unlike MySpace.
4.4
What can a mod bring to you?
We talked of computer games moding, but is there any relevant business to do with it?
In the Half-Life/Counter-Strike case, it was a huge success: The mod allowed the game to
survive much longer and really increased the sales.
In the Sims case, the user-generated content allowed to create extensions, and then reduced
the extension’s costs. It saved money, and creates sales too. It was a good deal.
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Yet these are the too cases we know. In many games, the mods are not good enough to be for
sale, or the user-generated content is too poor, (or can be found too easily for free), to create a
business on it.
However, if you cannot make a business on it, you can still integrate it in you game. Map editors, tools, customizable object, ability to create object are good factors for sales.
Yet you should consider the difficulty of each action, and customizing is easier than creating
an object, which is easier than creating a good map, still easier than creating a mod. This is the
drawback of some game’s editor such as the one included in Arcanum (first RPG with a scenario
editor), followed a few months after by Neverwinter Nights, yet with a better tool but still not
used by the community.
To sum up, moding is a good thing, giving opportunity to make content, which is good, but it
will not always be used, not always be successful: users are lazy, so it should not be easy.
2007
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5
Conclusion
User-generated content is a reality brought by web 2.0, but also by games including more and
more customization tools. However these services or tools don’t always have clear legal rules,
neither proper business. But this is changing, businesses are growing, lawsuits are giving ways to
set rules…
It is a growing business. That is really the idea we should keep in mind about user-generated
content. It will be a business as none as ever been before, mainly funded by advertisement and
relying on making new communities.
For sure, this will not reduce the Internet-addiction.
2007
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6
References
Our references were mainly websites or web pages, as the major party of the information we
found was on news websites, on the official websites of the services (being users of most of
them) or computer games/mods (we tested most of them), or on various websites. We found as
well quite a lot of resources in French.
1.
Web services:
YouTube: http://www.youtube.com/
Jamendo: http://www.jamendo.com/en/
Flickr: http://www.flickr.com/
MySpace: http://myspace.com/
Lulu: http://www.lulu.com/
Wikipedia: http://www.wikipedia.org/
2.
Web pages about web services:
http://www.onesque.net/blog/index.php/post/2006/12/17/259-comparatif-qualiteservices-de-video-en-ligne-youtube-dailymotion-vpodtv
http://www.infos-du-net.com/actualite/dossiers/14-video-partage-internet.html
http://www.zdnet.fr/actualites/internet/0,39020774,39364875,00.htm?xtor=1
http://www.infos-du-net.com/actualite/dossiers/13-videos-internet-partage.html
http://www.lexpansion.com/art/1.0.150387.0.html?xtor=RSS-3
http://framablog.org/index.php/post/2006/10/21/Bliptv-versus-YouTube
http://www.futura-sciences.com/fr/sinformer/actualites/news/t/high-tech/d/videoyoutube-veut-offrir-tous-les-clips-du-monde_9500/
3.
Games/mods official or nonofficial websites
Half-Life / Counter-Strike:
http://www.valvesoftware.com/
http://www.sierra.com/landing/home.html
http://www.steampowered.com/v/index.php
2007
29
http://www.steamgames.com/v/index.php?area=game&AppId=240
Civilization IV / Fall from Heaven 2:
http://www.civiv.com
http://www.civfanatics.com/
Warcraft III / Defense of the Ancients:
http://www.blizzard.com/war3/
http://www.dota-allstars.com/
The Sims:
http://thesims.ea.com/
http://www.aroundthesims2.com/index.html
http://www.thesimsresource.com/
http://www.simfreaks.com/icon.shtml
http://www.welldressedsim.com/
Second Life:
http://secondlife.com/
http://search.ebay.com/second-life_W0QQfromZR40
4.
And the actual games/mods that we tested for most of them.

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