The Importance Of Identity When Doing Business in Virtual Worlds

Reflection or Disquise?

Reflection or Disguise?

I want to thank Dusan Writer for the inspiration for this blog post.  I read Dusan’s Blog on a regular basis and the text of this blog post is actually my reply to his most recent post entitled: “I Am Not Really Me and I Probably Never Will Be: Avatars and Actual Identity.”

I share my real name/identity via my LinkedIn profile, with those I want to do business with. This type of disclosure is likely more important to people/businesses that are new to virtual worlds, as it allows them to quickly establish their “brands” value.

Doing business without the benefit of legal identities, has the potential to leave you vulnerable to a whole host of problems such as:

  • Contract Enforcement
  • Insufficient Tax Documentation
  • Copyright/IP Prosecution/Defense
  • Non-disclosure Exposure

With respect to contracts; Benjamin Franklin said “an ounce of prevention is worth a pound of cure.” In business, a single business dispute can ruin you. Written contracts are the “ounce of prevention” that can eliminate costly disputes.  Although it may happen in the future, I know of no legal precedents for avatars to execute or defend enforceable contracts.

800lb Tax Gorilla

800lb Tax Gorilla

The tax issue is the growing 300lb (soon to be 800lb) gorilla in the room. It won’t be long before taxing authorities compel the reporting of Virtual World income. I consider it to already be an ethical requirement. If you want to deduct Virtual World expenses, you had better be prepared to identify the recipient, be it a business or individual, of your payments.

Copyright and IP issues are another area of growing concern. What if someone doing work for you “unintentionally” “borrows” IP from another company, goes MIA and the IP owner sues you? How do you subpoena someone you don’t know for your defense?

Protecting your ideas via non-disclosure agreements (NDAs) is another area where real identities are required. If you don’t require NDAs of people who do work for you, you are asking to have your ideas & Trade Secrets stolen.

I realize many of these arguments are philosophically distasteful. I regret that “business can no longer be run on a handshake and a gentleman’s agreement.” Whether we like it or not the reality is that knowing people’s real identities is important in today’s business world, even when that world is “Virtual.”


2 Responses to “The Importance Of Identity When Doing Business in Virtual Worlds”

  1. For those who are interested, an excellent article on Avatars, Publicity and Identity is available at the following link:

  2. *Bites her nails nervously* You’re scaring me Valiant!! But you’re absolutely right. Legality and identity go hand in hand.

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