Summit Summary: Impressions from the VGBA conference at gamescom

This year’s gamescom saw the 4^th edition of the Video Game Bar Association’s European Summit, an already traditional occasion for in-house and outside counsel in the video games industry to network, learn and share experiences. This year’s summit saw such diverse topics as copyright reform, GDPR implementation, loot boxes, age rating and deal trends in e-sports.

Digital Single Market and copyright reform

After a keynote from MEP Axel Voss summarizing the current status of legislative initiatives in the digital single market, the first panel, including Mr. Voss, fellow MEP Tiemo Wölken, Ann Becker from ISFE and Jan Bernd Nordemann discussed the challenges of copyright in a digital environment. Nordemann pointed out that “upload filters”, subject of controversial debate in the European Parliament and on the panel, have been recognized for certain situations by German courts for a decade, and that legal policy in an IP context needed to be honest about the fact that it necessarily protects minorities (the owners of coveted IP rights).

GDPR Implementation

In his keynote "Hooray, we survived GDPR Day! Here's what happens after 25 May," Marc Störing, reported on his experience in advising companies on GDPR compliance. He described an increased workload in the first months of 2018, but after 25 May, in his experience, there was no "big bang", as some had feared: no penalties from data protection authorities and hardly any warning letters. Regulators are finding it difficult to keep pace with the increase in requests, which is why Störing raised the question of a loss of credibility in data protection regulation due to a possible enforcement deficit. He reasoned that this could also influence the acceptance of and compliance to upcoming regulatory changes, such as a new e-privacy regulation.

In the following panel entitled "Achievement Unlocked: Implement GDPR", three in-house counsel responsible for GDPR implementation, Rafal Kloczko (CD Project Red), Dary Firsava (wargaming.net) and Willy Duhen (Activision Blizzard) discussed their experiences with GDPR in various areas. Concerning the implementation of and compliance with the rights of data subjects, questions were raised mainly about identifying the data subjects who wanted to exercise their rights and the clearest and simplest way to understand the requests and provide all the necessary information. Panelists regretted that up to this point there was no common standard in the industry on what personal information should be shared and how requests should be managed. With regard to the cheat fighting, GDPR compliance was considered problematic, as tools to detect cheating use personal data and the right to deletion could allow cheaters to make a fresh start which could make cheat fighting considerably more difficult. Data protection impact assessments on the other hand were not perceived as disturbing, but as an opportunity to understand the data flow in the company and to work on privacy by design. Different experiences have been made regarding the management of employee data and the activities of the supervisory authorities in the respective countries of interest of the companies.

Content & Monetization

A truly international panel then discussed current content regulation and monetization trends in games: Juliette Auverny-Bennetot (Sweden), Paul Gardner (UK) and Nicholas Plassaras (California) talked about communalities and divergences of “gambling” definitions and their application to loot boxes. The panel agreed that in most jurisdictions, the biggest challenge may yet be market acceptance, and compliance with general rules on in-app purchases, such as the EU withdrawal right for digital content. Of course, a conversation about content regulation would not have been complete without some comments on recent developments in Germany, where swastikas and other anti-constitutional symbols can now be shown in video games at least under certain circumstances.

eSports

In his keynote "Broadcasting in eSports", William Deller gave an overview of the differences between broadcasting of traditional sports and esports and the expected developments in the respective areas. He highlighted the main differences, i.e. the absence of underlying IP in traditional sports, which is a single broadcast, primarily linear product based on rigid territorial or platform exclusive licensing. esports however, do have significant underlying IP in games (e.g. character depictions, scene design, music) and usually include multiple broadcast products (team stream, player stream, main tournament stream, fan stream), with a more open approach to licensing. Nevertheless, both forms are approaching: Traditional sports are moving online and esports are moving towards linear TV. Age restrictions and product placement are just two areas in esports which will then need more attention to meet the legal requirements.

The summit then concluded with a Fireside Chat about "Deal Trends in eSports" between eSports lawyers and industry insiders Jas Purewal and Ryan Morrison. As a very interesting development, Morrison noted right at the beginning that eSports talents would finally start to see their own value. Regardless, it still seems questionable whether eSports will be able to capture the broad market in the future. Due to the complexity of the games, the general public may not be interested in watching eSports. The majority of viewers can be found in Asia and among people under the age of 20 currently. However, the fact that eSports events today are not only broadcasted via online streams, but in some cases also shown on TV, ensures a greater awareness of eSports. Therefore, the eSports sector, which has so far primarily been supported by hardware suppliers, has also found sponsors in the food industry (e.g. Coca Cola and Pringles). But according to the two lawyers, eSports are still missing some really big sponsors. Purewal and Morrison also criticized that contrary to their expectations there has not been any major investment event in the eSports industries of Europe and the USA in the previous year. One of the reasons they cite for this is the supposed short lifespan of games relevant for eSports. Nevertheless, Morrison is still confident, eSports will be the future of entertainment.

Many thanks to our trainees Anna-Lena Beckfeld, Alina Betzemeier, Vera Eickhoff, and Marie-Yeun Thomas for their contributions to this report.