Metaverse is a virtual reality world


Metaverse is a virtual reality world in which people are supposed to socialize, play, and work and is composed of online, shared and persistent digital spaces. It is considered as the successor of mobile internet. With the technological developments, our virtual lives and our real lives are getting mixed and intertwined. Metaverse will be the peak of such mixing where people will mostly be involved in living virtual lives. The major contributors to the Metaverse are advancements in virtual reality, augmented reality, distributed ledger system and blockchain. The industries which are most likely to have influence on the introduction of Metaverse are finance, entertainment, education and gaming. Cryptocurrencies are also likely to be heavily used in transactions across the Metaverse platforms. Considering this transformation, there will be new issues and risks for the users, owners and all the players involved in the process. One such issue is that of Intellectual Property Rights, it will be crucial for everyone involved in the process to understand the IPRs associated with the whole setup.

Intellectual Activity In The Metaverse

The transformation from mobile internet to Metaverse will likely result in new opportunities for inventors and brand owners to develop equipments and software such as Automated Reality (AR) and Virtual Reality (VR) devices. Moving further, they will try to enhance user-friendliness and make these devices cheaper and durable. This has a direct relation with Intellectual Property Rights as more patentable inventions will come in the market. Brands providing virtual goods and services and physical equipments shall also emerge resulting in establishment of virtual trademark domain. There will be IP objects both in the virtual as well as real worlds. User generated content will take the platform to the next level. As far as trademarks are concerned, mostly non-conventional trademarks such as sound marks, moving image marks, etc, will be used to distinguish brands. Since entirely new products and services shall come in the market, there will be a need to establish a new category of goods and services such as downloadable virtual goods, retail store services for virtual goods, and online entertainment services. As far as goods such as eyewear and other equipments are concerned they will be subject to patent protection, whereas software related technologies including games shall be copyrightable.

From the above, it can be reasonably understood that general IP issues such as of territoriality, infractions, licensing, unauthorized use, etc, shall continue to occur in the metaverse as is the case with existing virtual platforms. Although the Metaverse aims at providing interoperable, decentralised virtual worlds with seamless switching however, the same is not going to work smooth on account of current licensing structures. Today, the different virtual worlds are operating like locked rooms controlled by single entities, which the users cannot switch easily. Therefore, for any entity wanting to step in the metaverse needs to establish clear IP licensing arrangements with the metaverse platform provider. This gives rise to issues such as term, territory, royalty rates and scope of the licence.

IP Infringement In The Metaverse

 Due to the complex nature of operations in Metaverse it is likely that IP infringements will regularly take place. Moreover, due to the complexity in interactions, it would be difficult to identify the infringers. Therefore, in order to address this situation, new and advanced mechanisms are required to address the infringement. For instance, the sale of copyrighted NFT artwork in the metaverse may have both authentic as well as fake artworks. Similarly, trademark infringement can occur in the buying and selling of virtual products. Patent infringement can also occur in the process of making virtual or physical equipments. Lastly, trade secrets generated or shared via virtual platforms, the most prioritised thing in the Metaverse, will also be susceptible to misappropriation.

The aforesaid risks in relation to trademark infringement can be guarded against by way of a proactive trademark registration system for all the virtual products and services. Regular monitoring by embedded mechanisms can help in identifying the online copyright infringement. Additionally, virtual investigators including humans, Artificial Intelligence, and automated systems can be deployed for ensuring that the infringement of copyiright, trademark, or patent is identified and addressed. 

Managing IP Through NFT

 In case the virtual goods or services of a company exist beyond a single metaverse platform the NFT technology can be used. This technology embeds and establishes rights along with the content, associated with the goods and services. Information such as the descriptions about the relevant product, its ownership history, scope of the relevant rights, etc, are attached. This information when embedded at the point of purchase gives clarity on the authorised and unauthorised uses of the product. Furthermore, this information remains attached to the product throughout its digital lifecycle even when it moves from one platform to another. This is one of the most effective ways of protecting a brand’s IP.

Way Forward

Intellectual Property has really a promising future ahead with the development of Metaverse. Metaverse will bring in new and advanced inventions such as AR and VR related technology, virtual and advanced trademark goods and services, copyrightable software and games, trade secrets, etc. As stated earlier, the same will also be susceptible to newer and more disastrous infringements requiring advanced mechanisms for their redressal. As far as trade secrets are concerned, the current methods such as signing of non-disclosure agreements or limiting access by way of biometric technology will not suffice.

There are challenges for both the Intellectual property law as well as the IPR holders. However, at the same time, this will be an opportunity for IP law to evolve and remain in sync with the technological developments. Availing these new opportunities and becoming compatible with the Metaverse system will be the growing need, and the same will be extremely valuable.

Author: Shawaiz Nisar – a student at Rajiv Gandhi National University of Law (Punjab),  in case of any queries please contact/write back to us via email or at Khurana & Khurana, Advocates and IP Attorney.

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