INTRODUCTION
The term “metaverse” combines “meta,” meaning “beyond,” with “verse,” short for “universe.” It was first used by Neal Stephenson in his 1992 book Snow Crash to describe a virtual world where events happening online impacts the real world and the internet.
Nowadays, the metaverse is a digital space where virtual and augmented realities converge, enabling people to interact, play games, work, and even own virtual property—all through their computers. This is made possible through advancements in technology like virtual reality (VR), augmented reality (AR), and blockchain. The metaverse has evolved from simple online avatars to complex digital environments featuring virtual money and unique digital items (NFTs), impacting various fields. As the metaverse expands, it offers many exciting opportunities and significant challenges. One important issue is protecting intellectual property (IP) in this fast-evolving space. With fast-paced technology advancements it’s essential to find effective ways to safeguard the creative work and ideas of those developing the metaverse.
INTELLECTUAL PROPERTY CHALLENGES IN THE METAVERSE
The concept of a “Virtual Property Law” for the metaverse raises important questions about the suitability of traditional property and intellectual property laws. Traditional property laws manage physical objects and the rights to their use. However, since the metaverse deals with intangible, digital assets, these laws may not be adequate. On the other hand, intellectual property law, which deals with intangible assets and rights, appears more appropriate for managing virtual assets in the metaverse. However, protecting rights in the metaverse is challenging due to it’s a global, digital space that operates differently from the real world.
Here are some key challenges highlighted below:
Privacy and Data Protection: The Metaverse involves extensive collection, processing and storage of personal data, raising concerns about user control over their data. This can conflict with data protection laws like the General Data Protection Regulation (GDPR), complicating privacy assurance. The metaverse’s global span adds complexity, requiring compliance with various regulations, such as Brazil’s General Data Protection Law (LGPD).
Intellectual Property Rights: Different regions have distinct rules for protecting intellectual property (IP). For example, in Brazil, copyright, source code, and trademarks are governed by separate laws. The virtual and decentralized nature of the metaverse makes it hard to enforce these IP rights consistently.
Ownership and Usage Rights: Determining ownership and usage rights in the metaverse is complex. For example, using a trademarked logo in a virtual store without permission could lead to legal trouble for trademark infringement.
Jurisdictional Issues: Its often unclear which laws apply in the metaverse, and resolving legal disputes can be challenging because of it’s a global, virtual space.
Software Patents: Securing patents for software used in the metaverse is challenging. In Europe, it’s tough to patent virtual world simulation software, while in the U.S., it’s easier. These differences could lead to licensing and legal issues as the metaverse grows.
STRATEGY TO PROTECT IP RIGHT IN METAVERSE
The legal framework for protecting intellectual property (IP) in the metaverse relies on several international agreements. The Berne Convention sets minimum standards for copyright protection across most countries, ensuring that creators’ rights are recognized globally. In response to the digital age, additional agreements like the WIPO Copyright Treaty, adopted in 1996, addresses emerging digital environments. An important aspect of the WIPO Copyright Treaty is the Agreed Statement concerning Article 1(4), which clarifies that storing protected works in digital formats—such as NFTs or files displayed in the metaverse—constitutes a reproduction requiring prior approval from the copyright holder. This means obtaining permission is essential before creating or displaying virtual assets based on copyrighted works.
Consequently, brand owners are revising their IP strategies to suit the metaverse’s digital context. This shift is evident in the increasing number of trademark applications that include “virtual” in their descriptions. Companies are focusing on trademark classes 9, 35, and 41 to extend their protection into the metaverse and cover various virtual goods and services.
Here are strategic steps to follow to safeguard your intellectual property (IP) in the metaverse: –
- Register Your IP: Register your copyrights, trademarks, or patents with the relevant authorities in the jurisdictions where you operate. This grants you legal protection and enables action against infringement.
- Monitor for Infringement: Regularly monitor the metaverse for unauthorized use of your IP. This can be done manually or with automated tools designed to detect IP violations. Promptly addressing infringement helps protect your rights.
- License Your IP: Consider licensing your IP to other entities within the metaverse. Licensing can generate revenue and ensures that your IP is used in ways that align with your intentions.
- Establish Terms of Service: Draft a terms of service agreement specifying how others may use your IP in the metaverse. This agreement should detail the conditions of use and provide you with legal recourse in case of breaches.
FUTURE PROSPECTS OF METAVERSE IN IP
The metaverse market is projected to expand at a compound annual growth rate (CAGR) of 37.73% between 2024 and 2030, potentially reaching $507.8 billion by the end of this period. This rapid growth is evidenced by a surge of patent filings for augmented reality (AR), virtual reality (VR), and extended reality (XR), with approximately 390,000 applications currently pending globally. Consequently, innovations related to the metaverse are anticipated to significantly shape the future of the market.
Currently, the US and China lead in metaverse-related patent filings. Innovations in the metaverse are being protected through patents in two main areas: hardware components and software processes. Hardware patents often involve enhanced Central Processor Units (CPUs) for virtual environments and physical devices like VR headsets. Software patents cover technologies such as algorithms and networked systems, including distributed ledgers and blockchain. The growth in patent applications for metaverse technologies is substantial.
According to a study by IALE Tecnología, the number of metaverse-related patent applications has doubled over the past five years, surpassing 2,000. This trend indicates that the expansion of innovative concepts in the metaverse will continue accelerating in the coming years.
IP FILINGS RELATED TO THE METAVERSE BY MAJOR PLAYERS
Sony, Microsoft, and Samsung are leading in filing patents related to the metaverse. Apple has obtained a U.S. patent for a method and device designed to block unwanted interactions in virtual reality environments and has submitted over 5,000 applications for its “Vision Pro” VR headset. In 2022, the USPTO granted a patent to an Indian biomedical entrepreneur for a pioneering digital vaccine that promotes healthy behaviour in the virtual world to influence real-world habits. Additionally, in 2019, Microsoft filed a European patent application for an AR/VR colour correction mask aimed at maintaining colour consistency.
Patent Filings in the Metaverse Across Various Fields
1. Application Number: WO2020229841A1
Assignee: Roborace Ltd
Title: A Metaverse Data Fusion System
The prior art discloses a metaverse data fusion system where a real-world vehicle includes multiple data sources generating sensor data spatially- mapped to a real-world region. A data fusion system is configured to fuse or integrate (i) the spatially mapped sensor data with (ii) virtual data, generated outside of the vehicle or independently of the operation of the vehicle and spatially mapped to a virtual world. This enables a fusion of real and virtual worlds allowing a self-driving car to interact with both physical and virtual objects introduced into its path (e.g. by a test or development engineer) to test the car’s autonomous systems’ response to virtual objects.
2. Application Number: US11372474B2
Assignee: Saec/Kinetic Vision Inc
Title: Systems and methods for Virtual Artificial Intelligence Development and testing
The prior art discloses a system and method for virtual artificial intelligence development and testing. These systems and methods are provided to create training data, validate, deploy and test artificial intelligence (AI) systems in a virtual development environment, incorporating virtual spaces, objects, machinery, devices, subsystems, and actual human action and behaviour.
3. Application Number: WO2018081235A1
Assignee: Wal Mart Stores Inc
Title: Systems And Methods for Adjusting the Display Quality of An Avatar During an Online or Virtual Shopping Session
The prior art discloses an apparatuses and methods for providing an online shopping experience that conserves computing resources. The system includes: a shopping server receiving a user request to view a virtual shopping environment and a control circuit causing the display of virtual shopping images on a user computer to emulate a real-life shopping experience. The control circuit is configured to navigate the virtual shopping environment, the display of an avatar representing the user, adjust the display quality based on resource consumption setting where the avatar is not interacting, and reduce resource consumption when not interacting with products.
Numerous other patents related to the metaverse exist across various areas, aimed at enhancing user experience and providing new opportunities for innovators to protect their ideas with intellectual property rights.
A RECENT CASE ILLUSTRATES THE CHALLENGES OF FILING IP RELATED TO THE METAVERSE
In a recent case of Worlds Inc. v. Activision Blizzard, Inc., the court applied the same scrutiny to Metaverse-related technology as it does to other video game technologies. The key issue was Claim 4 of the patent, which was deemed to involve an abstract idea rather than a patentable invention. Specifically, the court found that Claim 4’s “maximum capacity” filter was essentially an abstract concept similar to real-world crowd control methods, like those used in elevators or restaurants.
The court determined that Claim 4 did not include an “inventive concept” because it merely used well-known technologies and methods—such as client-server networks and virtual worlds—in an ordinary way. The claim did not sufficiently transform the abstract idea into a patentable process, leading the court to invalidate it under 35 U.S.C. § 101 for lacking the necessary inventive concept.
One takeaway from this case is the importance of drafting software-related patent applications carefully to address potential challenges under 35 U.S.C. § 101.
CONCLUSION
Although managing IP rights in the metaverse can be complex, it offers significant opportunities for IP owners. The metaverse is an expanding market for digital goods and services, providing creators with avenues to monetize their work through licensing and sales. It also serves as a platform for highlighting innovations, building brands, and exploring new business ventures and collaborations.
In conclusion, while the metaverse presents challenges for intellectual property law, it also brings exciting opportunities. To protect your IP effectively, it is crucial to register your IP, monitor for potential infringements, explore licensing options, and create clear terms of service agreements. By taking these measures, you can secure your rights and leverage the opportunities within the metaverse.
Given the rapid growth of NFTs and developments in virtual reality, consulting a specialized law firm like Aumirah is highly recommended. Professional legal support will ensure optimal protection for your IP assets, help navigate the evolving IP landscape, and ensure compliance with current regulations. This proactive approach will reduce the risk of IP rights violations and protect our innovations in this dynamic field.
References: – https://www.wipo.int/wipo_magazine/en/
