Future EU Gig Economy Laws Must Be Fit for 'Metaverses' of TodayGuillaume Guinard / Sep 10, 2022
Guillaume Guinard is a former research assistant at the Sciences Po Digital Governance & Sovereignty Chair.
On the 9th of December, 2021, the European Commission proposed a directive to improve the precarious status of workers within the ‘gig economy’. Following numerous legal cases across the bloc involving firms such as Uber and Deliveroo, the directive provides clarification regarding the legal status of workers, and what protections these platforms owe them. Absent from this directive, however, are characterizations which include a less well-known yet similarly precarious labor force: those already working in immersive virtual environments.
While the role of these virtual environments in the economy today– and in the imagined metaverse of tomorrow– is still open to debate and speculation, the way business is conducted within current ‘early-stage’ metaverses such as Roblox should garner immediate attention from policymakers, since the current conditions will set precedent.
Roblox and the ‘Gig Economy’
Free to access, Roblox generates revenue by effectively acting as a private regulator which unilaterally sets and enforces the laws which govern in-game transactions, according to a profit-maximizing logic. The platform sells its own currency, deducts a ‘tax’ from each transaction, and determines the wage a player can earn from their labor, all at a rate it determines on its own.
At the same time, the incentives for taking part in this system are all provided by the players, who are responsible for creating the ‘experiences’ (three-dimensional environments) which attract users in the first place. In other circumstances, this power asymmetry might lead users to unionize in an attempt to strike a better deal. Despite 52 million daily active users, most of them probably don’t realize their workplace is exploitative, and some might not even recognize the labor they provide to the platform as labor. Indeed, in 2020, 67% of Roblox players were under 16.
From an outside perspective, the status of ‘Experience’ developers as genuine workers doesn’t seem too ambiguous. In many cases, popular experiences are not a product of a single developer, but rather of a team of individuals brought together by the will to be successful and make money. Roblox incentivizes this by hosting recruitment ads for users to work on projects together on its Talent Hub. Notice the uncanny similitude between the jobs advertised there and any ad for an experienced software developer on a regular job board, besides the fact that they accept “professional” and “responsible” 13 year olds, and pay in virtual currency, as shown below.
Roblox’s Talent Hub itself only serves as an intermediary between players however, and takes no responsibility for what happens within projects. This is because these are mostly organized outside of the platform, as users prefer to rely on other services more suitable for project management and communication, such as Discord servers. The Hub itself thus requires no age verification, has no mechanisms for drafting contracts or securing a guardian’s consent and offers no tools to resolve disputes. Consequently, situations where developers - including children below 13 - are subjected to various kinds of abuse and financial exploitation are rife. A report by the Guardian reveals cases of sexual grooming of children by manipulative teenage bosses, and financial exploitation with project managers unilaterally cutting the pay of developers without any repercussions. Not only does Roblox not intervene for any activity which happens outside of its platform, but posting about the situation on the platform’s developer forum can get a user in trouble for harassing the user who abused them, on top of the reputational risk associated with speaking out against well-regarded developers.
The Roblox Rule of Law
“Make Anything. Reach Millions. Earn Serious Cash.” This was the slogan advertised on Roblox’s website to encourage its users to make their own experiences. Since then, a video by People Make Games denouncing the “exploitation of young game developers” has reached near 2 million views on Youtube. Success stories exist, as in the case of two British teenagers who paid off their parents’ mortgage from games they started making on Roblox when they were 13. This is made possible by the child-friendly tools provided by Roblox which allow anyone to make their own game, as well as charge other users for cosmetic items or privileges in the in-game currency, Robux.
Robux are themselves convertible to real-life currency, such as US dollars, allowing its users to potentially make large amounts of money. Most of the platform’s income is derived from the sale of its online currency, and according to its website around 24.5% of that income is shared with developers who are profitable enough to be allowed to convert their currency into real life money. While the platform might present itself as a way for users to make money to convince them to invest time in creating experiences, it is also in its financial interest to ensure developers take out the lowest possible share from the value they create.
Concretely, in order to get money from Roblox, a developer needs to get users to spend a cumulated 61,500 Robux on their experience, at minimum, which is equivalent to roughly $615 dollars of purchased Robux. This will allow the developer to receive 50,000 Robux after the 30% Roblox transaction tax, which they can convert to $175 dollars. This is why 99.47% of community developers made less than $1,000 dollars a year on Roblox in 2020.
On the other hand, the same year, 32 developers made over a million dollars. This is in part because Roblox deliberately chooses to only show experiences which already have a few thousand users at a given moment on its main page, and the “up-and-coming” section also only shows games that are already popular. As such, it is easier for already popular games to remain popular and maintain a steady income stream than for recently launched games to become popular.
Furthermore, Roblox pays extra Robux to developers whose experiences most successfully convert free users into ‘premium’ subscribers and are best at retaining users for extended periods of time, especially those ‘premium’ users. A premium subscription can be purchased for a minimum of $5 US dollars a month, and it provides advantages such as better rates on Robux purchases and discounts on virtual items. Within individual experiences, a premium account can lift dedicated paywalls, such as access to an area or an item, which developers put in place to encourage users to purchase a subscription.
All of this activity takes place within rules and bounds that are substantially controlled by Roblox, which effectively governs a virtual economy and its labor force.
The EU’s Digital Labor Proposal Fails to Include Roblox’s Labor Force
According to the details of the EU proposal, any company which meets two of the following requirements would be considered an employer:
(a) effectively determining, or setting upper limits for the level of remuneration;
(b) requiring the person performing platform work to respect specific binding rules with regard to appearance, conduct towards the recipient of the service or performance of the work;
(c) supervising the performance of work or verifying the quality of the results of the work including by electronic means;
(d) effectively restricting the freedom, including through sanctions, to organize one’s work, in particular the discretion to choose one’s working hours or periods of absence, to accept or to refuse tasks or to use subcontractors or substitutes;
(e) effectively restricting the possibility to build a client base or to perform work for any third party.
Roblox could be considered an employer of Experience developers on at least four counts:
- (a) the platform determines the level of remuneration of a user by setting rules which define the proportion of Robux a user gets from each transaction, and how many extra Robux a user gets for attracting premium users.
- (b) the platform sets specific rules regarding the experiences users develop, and can unilaterally remove an experience if it does not follow them.
- (c) the platform supervises the performance of users by tracking the user base of each experience, and their ability to attract ‘premium’ users.
- (e) it can be argued that by ensuring experiences users develop cannot be exported and used outside of Roblox, the platform restricts a user’s ability to build a community or make money from their experience outside of it.
As the proposal stands, however, Roblox’s online nature provides it with specific arguments to circumvent the rules. Unlike workers within platforms which monetize ‘real-world’ labor, developers on Roblox do not directly produce labor for a wage. In a statement to Eurogamer in response to accusations of exploitation, the platform emphasizes that it enables its users to enjoy “free tools to create deep, rich, immersive experiences for the community to enjoy,” and that Roblox “teaches the fundamentals of coding, digital civility, and entrepreneurship and has helped many begin their careers in STEM”. As such, users who spend hours creating content for the platform do not necessarily expect or seek a wage.
On the other hand, the platform acknowledges that its user base includes studios focused exclusively on creating Roblox content, but points at the fact that the revenue of such entities has steadily increased in recent years. This narrative ignores the fact that the platform has full authority in determining the conditions under which one may receive real currency for their labour. Additionally, Roblox incentivises users to create content in order to increase their own purchasing power within the platform, while the platform itself benefits from this content in real economic terms. Failing to challenge this logic thus means the platform would maintain the authority to determine who counts as a ‘legitimate’ worker or not, and thus maintain the upper hand over upcoming EU legislation.
As such, while the EU’s proposal has the potential to be a step forward for ‘metaverse’ workers, new challenges brought by the specific mechanisms of online environments mean it could fall short of tackling some of the most exploitative labor practices of today. Given that the proposal was published 10 years after Uber arrived in Europe in 2011, it is urgent that the Commission adapt its thinking to the latest developments of the gig economy by the time this proposal is signed into law, lest it condone another decade of exploitation of the most vulnerable.