Basic aspects of IP
IP encompasses a range of legal protections designed to safeguard the creations and innovations of individuals and organizations. The most prominent forms of IP include copyrights, trademarks, patents, trade secrets and industrial designs. These grant protection to rightsholders, meaning a natural or legal person holding the IP rights to a work, whether the author, publisher, or some person or other legal entity to which the rights have been transferred.
As will be described in more detail below, copyrights protect original works of authorship, such as literary, musical and artistic creations, including video games, software and multimedia content. Trademarks, on the other hand, safeguard distinctive signs, symbols, logos and names that identify and distinguish the goods or services of one entity from those of others, playing a key role in brand recognition and consumer trust. Patents provide exclusive rights to inventors for their novel and useful inventions, which span a wide array of technological advancements and processes. Trade secrets protect confidential business information that provides a competitive edge (i.e. formulas, practices, designs, and methods). Lastly, industrial designs protect the aesthetic aspects of products, for instance, their shape, configuration, pattern and ornamentation, guaranteeing the legal recognition and protection of a product's visual appeal.
In this chapter, we will take a closer look at each of these forms of IP and explore their specific applications and importance in the esports sector. In many cases, intangible elements in this sector can be protected by several forms of IP. For example, an esports team's logo can be protected as a trademark and copyright; or a competition's merchandise, which can be protected as an industrial design, trademark and patent, depending on the circumstances. This complementarity of IP rights provides esports stakeholders with an invaluable resource to protect their talent and investment from misuse by third parties.
At a glance, the following table describes the main categories of IP relevant for the esports sector:
IP and the foundations of the esports sector
IP is the cornerstone of the esports sector, not only because it protects and exploits very intensively intangible assets from video game publishers and brands, but also because esports organizers, teams and players generate their own rights. This is, therefore, a two- way street: on the one hand, many rightsholders obtain significant revenues through licensing and merchandising; on the other hand, the collaboration of these stakeholders significantly enhances the commercial appeal of the primary IP involved, such as the games. By working together, they not only increase the visibility and attractiveness of these assets but also drive the overall growth and success of the sector. As the esports sector keeps expanding, having strong IP strategies will become even more relevant to ensure the ongoing success and sustainability of this dynamic and fast-changing field.
Based on existing IP rights, various stakeholders in the esports sector forge commercial agreements that generate revenue from monetization efforts. Usually, even though those revenue streams rely on traditional IP rights (copyright, trademarks, patents, etc.), they are referred to by different, more commercial monickers. For instance, merchandising rights are grounded on trademarks and copyright, while arena rights are basically copyrights.
The table below shows some examples of industry commercial rights, their corresponding revenue streams, and useful insights about their protection.
