Blizzard was awarded $88 million in damages last week from its lawsuit against Scapegaming, a large private WoW server; meanwhile, the rest of the gaming industry is taking new copy protection cues from MMOs

While piracy in MMO gaming isn't as prevalent as in other video game markets, Activision-Blizzard and other publishers remain aggressive in their hunt for operators of rogue, "private servers." Last week World of Warcraft publisher Blizzard made headlines across the blogosphere after the company was awarded more than $88 million in damages in federal court; the complaint was originally filed in October 2009, alleging Alyson Reeves—the defendant and operator of a popular "Scapegaming" private server—broke the company's EULA by hosting the illegal server and selling in-game items for real money via PayPal.

The recent lawsuit is one of the most extreme cases of piracy in the MMO industry; Scapegaming hosted 427,393 total users, with 32,000 to 40,000 players online each day, according to the court order [via THR, Esq.]. But is piracy in MMOs a widespread problem for most of today's publishers? Or is online gaming, by nature, more prohibitive to "digital theft" than traditional video games? Some publishers are taking cues from the cloud-based nature of online gaming, adopting new forms of digital rights management (DRM) for single-player or "offline" games that rely on users' Internet connections to constantly validate their usage rights.

From the perspective of non-gamers and MMO rookies, the recent news fiasco might lead some readers to believe that piracy in the MMO market is running rampant, or that private servers like Scapegaming are robbing game publishers blind. While it's true that private MMO servers almost always have a negative impact on the industry (and we at ZAM would urge players to stay away from them for a variety of other reasons, as mentioned below), it's important to recognize the relative significance of this case, as opposed to the rest.

This is one of the largest of such private servers to be pursued in court by Blizzard; the defendant earned more than $3 million by collecting PayPal "donations" from users in exchange for leveling boosts and epic gear, according to Gamasutra. Reeves failed to show up in court to defend herself last week and Blizzard was awarded a default judgment of $88 million. That total equals "$3,053,339 in profits from the improper private server, $63,600 in attorneys' fees and a whopping $85,478,600 in statutory damages for willful infringement," according to Eriq Gardner of the THR, Esq. column. Blizzard later issued the following statement in response to the ruling:

"Our ultimate goal is to create the best games in the world, and that means we need to protect our games and safeguard our players’ experiences with them. Server emulators that use Blizzard’s IP facilitate piracy and offer unauthorized, inconsistent gaming experiences that can damage Blizzard’s reputation and goodwill with players. We take these types of threats very seriously and will continue to take every available measure to protect our rights globally."

Scapegaming was one of the largest and most popular private WoW servers in 2009 and Reeves was essentially selling in-game content in micro-transaction format, so it's no surprise that her server was at the top of Blizzard's hit list. As Scott Jennings notes in his BrokenToys blog, 420,000 users is huge; the size of most legitimate, "second-tier" MMOs, let alone the player base of a private server. This case is clearly an example of Blizzard setting a legal precedent, similar to its 2008 lawsuit against MDY Industries, retailer of WoWGlider (a utility that allowed players to "bot" and take advantage of other game client mechanics).

Legal actions like these aren't just about preserving a publisher's EULA and proprietary server technology, however; it's also about combating piracy under the broad wings of the Digital Millennium Copyright Act (DMCA), which video game developers and publishers have been doing for years. Historically though, online gaming and MMOs were targeted much less than traditional PC and console games because of their intrinsic nature; the client requires a constant connection to the server, which also validates a user's game license.

But the advent of server emulation, free virtual private networks (VPNs), network tunneling and other technology has increased the accessibility of private servers in recent years, allowing users unlicensed access to MMOs and other online gaming. It's usually a game of cat-and-mouse with the smaller private servers; DMCA takedown notices are sent to the service provider, the server goes down and another one pops up to take its place. Sometimes private servers grow so big and popular that publishers get the FBI involved, as was the case in NCsoft's 2006 Lineage II private server takedown.

In the MMO realm, most community members regard private servers as shady and often dangerous; a back-alley endeavor that isn't worth the risk of getting caught and banned by the game's publisher, or having one's machine infected with malware and other unscrupulous logging software. Many private server invitations and registrations are a ruse in themselves, designed to trick users into providing login credentials and other personal information.

If you're not familiar with the term "private server," it's used—in the context of MMOs, at least—to describe a non-sanctioned server environment that allows users to play online, without accessing the publisher's official servers. Players use them for avoiding monthly subscription fees, gaining access to restricted content, testing purposes and more. Private and emulated servers are also used for other types of games, like first-person shooters and real-time strategy titles (usually for the same reason—to play online for free, using pirated copies of the game).

However, the use of private servers and VPNs to play online games for free isn't as easily-accessible as downloading a BitTorrent file, for example. The technology is becoming a bit more user-friendly for traditional PC games, though. Up until the past few years, those who downloaded pirated copies of games like Left 4 Dead and Mass Effect could only play the single-player campaigns; they weren't able to access the official servers to play online with other people, because the server checks to make sure each player is using a valid license. The emergence of easy-to-use VPN services like Hamachi, Wippien and Tunngle has changed the norm, allowing easier access to third-party servers with pirated video games.