WHAT PROTECTION DO WE HAVE IN THE DIGITAL WORLD?
The MTN Group, Africa’s largest telecoms provider announced that it has purchased plots of a digital real estate platform in an article entitled, “MTN PURCHASES LAND IN AFRICA’S FIRST METAVERSE.” The obvious question that one may ask is, “What is metaverse?”
Metaverse is a virtual reality world where individuals can socialize, work, and live with other individuals. It is a virtual version of the real world in which virtual counterparts of real people, places and things exist. Instead of sitting on your couch and controlling characters with a console gaming platform controller, you become the character in the metaverse world using current VR and AR technology combined with a high-speed minimal latency network – fixed or mobile.
The global pandemic has been a driver for the global shift in digital transformation driving businesses and companies to transform their businesses to survive the technological shift. This brought about a change in the way companies and businesses do business to be sustainable.
According to Bloomberg, the metaverse is expected to reach a whopping $ 800 billion by 2024. With the growing acceptance of metaverse, big companies are seeking to establish a presence in the metaverse world. Towards the end of 2021, the largest aerospace company in the world, Boeing, announced that they plan to build an aircraft using virtual designs within the metaverse. In January 2022, BMW launched new models of the electric ix SUV on metaverse. The launch featured a virtual test drive of the electric ix SUV. Explaining the reason for this innovative launch, Jorge Junior (Head of Marketing at BMW do Brasil) said,
“The BMW iX is a smart car, which updates itself automatically via the internet and with features that combines machine learning and artificial intelligence. It is a symbol of a new era of premium mobility. The launch is in line with future generation of automobiles that is redefining the relationship between vehicles and people, so we reproduce and anticipate the launch of the car. With this concept, we thought of an unprecedented dynamic, to explore digitalization and anticipate the experience for customers.”
It is important to emphasize that the move to the metaverse also has potential challenges in the virtual world which may have a real-world implication on a company’s ability to protect, monitor and manage its intellectual property (IP). With some of these challenges will be the application of intellectual property rights in this digital new normal.
Although digital transformation is not a new concept, the obstacles posed by Covid-19 have prompted a rush to adopt it. For some, it's a logical continuation of their company concept, while for others, it's a desperate attempt to stay afloat in difficult conditions. Digital transformation may be a new way to reach customers and offer goods and services, or it may be required for a business to operate when social distancing exists. When a company goes through a digital transformation, it virtually always creates intellectual property (IP) issues.
To minimize these IP risks, big brands have initiated steps towards protecting their IP assets in the virtual world. For example, Nike has filed for trademark registration at the United States Patent and Trademark office for some of its popular marks in order to enter the metaverse. Nike intends to sell virtual shoes and apparel in the metaverse. Another big brand, L’Oréal has filed 17 trademarks across its portfolio that will enter the metaverse. These new trademarks are expected to cover a broad range of digital assets such as media, art, tokens and NFTs – Non fungible tokens.
Trademarks can be words, symbols, logos, designs, or a combination of these things that could be used to identify one’s goods and services. As they are territorial in nature they must be filed in each country where protection is sought. Trademarks are one of the best ways for companies to protect their brands in the metaverse. In 2016, BMW group sued a digital media company, TurboSquid, for marketing 3D virtual models of vehicles. These virtual car models were inputs into other digital contents like video games and that infringed the BMW trademarks.
When considering obtaining a trademark for digital assets, it is advisable to consider classes 9, 35, 36, 41 and 42 in your applications to register the digital assets. Some of the digital assets that can be protected in these classes are (please note that the list below is not exhaustive):
Class 9: downloadable electronic data files (artwork, text, images, audio, NFTs), digital media such as digital tokens, NFTs.
Class 35: provision of a marketplace for the buying and selling of digital assets in the metaverse.
Class 36: financial services for the trading and/or issuance of digital tokens in the metaverse.
Class 41: provision of non-downloadable and downloadable virtual goods.
Class 42: Creation of retail stores in the Metaverse.
With the expansion of metaverse and a fast-changing technological landscape, it is crucial for companies to trademark their brands, goods, and services for the virtual world. Use and misuse of brand names is likely to become rampant as the metaverse grows and this is a major reason why big brands are filing trademark applications to protect their brands in the metaverse.