Clifford Chance

It's only the start of 2022 but we are already witnessing incredible growth and investment activity in the video games industry, including Microsoft's recent acquisition of Activision Blizzard for a reported US$68 billion – making it one of the largest ever acquisitions in the video games industry.

The video games industry is growing at a rapid pace and is predicted to exceed US$300 billion by 2025. With this in mind, we wanted to create an all-in-one legal guide for those that currently operate in or are considering entering the video games industry with the purpose of providing an overview of the life cycle of a video game – from the early stages of development, past the grind of regulatory compliance, through to the final stages of monetising the product. The result is "Level Up: A Guide to the Video Games Industry".

In Level 1 of the Guide, we took a 'deep-dive' by examining the creation and development of video games, including the key characters responsible for content creation and the various IP and proprietary rights that exist in the UK to protect different elements of a video game.

In Level 2 of the Guide, we take our analysis a step further by discussing AI-generated content and its increased use by developers in the development of recent AAA games. In particular, we examine the legal issues in the UK concerning ownership of AI-generated content and the practical implications for stakeholders looking to monetise such content.

Level Two

What is AI-Generated Content?

There is a long history of Artificial Intelligence within video games. At a basic level, when playing against the computer or interacting with Non-Player Characters (“NPCs”) there is often some AI involved. However, in recent years, AI has been used in games not only to respond to players’ actions but to create new content, with algorithms now capable of building endless random levels, worlds and games from predefined parameters. As the technology continues to develop, it is expected that AI will be used to create more and more content. With the increasing use of AI to create video game content, key stakeholders will need to give consideration to the IP rights that might exist in AI-generated content that can be monetised.

As explained in Level 1, copyright can offer protection over a number of different works that exist within a video game, including the underlying code for the video game as well as images and text presented to the player. Copyright law protects the original works of authors; however, certain issues arise in the context of AI-generated content.

No copyright without an author, no author without human involvement

Under English law, a literary, dramatic, musical or artistic work must be “original” in order to obtain copyright protection. The threshold for originality is low; however, it requires the exertions of a human author. Without a human author, the work cannot be considered “original” under English law and copyright protection cannot therefore subsist in the work. This has significant ramifications for works created by fully autonomous AI as it will not always be easy to determine with certainty who created or made the arrangements necessary for the creation of the work. Accordingly, certain works created by AI may not therefore have an author and both the ownership and subsistence of copyright in that work may be called into question.

English law does contain provisions for the protection of “computer-generated works”, which ascribes authorship to the person who arranged for the work to be created. (Section 9(3) of the CDPA). For instance, if an entire level in a video game was created by AI with minimal input from human creators, then the author of the work for copyright purposes could not be the-AI that generated the various elements that comprise the level, because authors must be human. However, there would be a good argument that the programmers who developed the underlying AI code instructed the AI to generate the level.

As AI becomes more advanced, it will be increasingly difficult to determine with certainty who made the arrangements necessary for the creation of the resulting work. Is it the programmers of the game, or the programmers of the AI built into the game? In some circumstances could it be argued the player themselves made the necessary arrangements? It may ultimately be impossible to identify a human nexus to certain works created by AI; such works may not therefore have an author, and both the ownership and subsistence of copyright in that work will be called into question. 

What are the practical implications?

The above will have significant implications for stakeholders looking to monetise AI-generated content. For instance, the ground-breaking video game “No Man’s Sky” was marketed as having limitless gameplay as new worlds, landscapes and creatures are procedurally generated by AI in a never-ending universe for players to explore. Procedural generation relies on a computer program to design much of the game content, with the developers creating a framework around which the AI designs the content. For example, in the context of designing an in-game creature, the developers create a large library of various body parts that the AI can choose from but it is the AI that freely selects the number and type of body parts to combine to create the overall physical appearance of the creature. The developers will be considered the author in respect of each body part on its own; however, it is debatable whether they would also be the author of the creature that resulted from the combination of those body parts if the AI acted autonomously in its decision-making.

There is ongoing debate by regulators and law makers regarding whether copyright law needs to be adapted to take into account AI-generated works, and on what terms. As the use of AI in video games becomes more prevalent and the complexity and autonomy of AI technology continues to increase, developers may face increasingly difficulties in controlling the use of their games through copyright. Developers must therefore carefully consider how their Terms & Conditions can be used to deal with ownership of AI-generated content by specifying the ownership of IP as between the relevant parties. In addition, as these technologies and the law surrounding them evolve, developers should continue to seek legal advice to ensure their contracts and licences accurately reflect their use of technology and offer adequate protection under copyright law.

Addition Information

 Read Level 1 of the guide, on creation and development.

To access the full guide, please email the Talking Tech team.