Atlanteknology - Technology News for Atlantic Canada

Property rights in MMOG's (or - You spent $200 on what!!!)

By now you will probably have heard of MMOG’s (massive multiplayer online games). Second Life is an example as is World of Warcraft. Some might scoff and relegate such things to the domain of the nerd and/or the teenage male. This would be a mistake.

MMOG’s such as Second Life are hugely popular, especially in Asia but increasingly so in North America. People have killed people over online theft. There are real life lawsuits underway. Recently a French right-wing political party set up its online headquarters in Second Life and a virtual firefight broke out over it. (The chap at right in the picture is firing a chain gun).

There are people who earn a real life living from what they do in a virtual world. Sweat shops in Eastern Europe employ people to play these games and then those sweat shops sell the virtual characters/equipment for real money.

This is where it really gets interesting. Virtual equipment/characters/stuff = real world money. Something that exists only as a series of ones and zeros is worth real money. Somewhat like patents in the sense that a patent is expressed on paper and yet, aside from the paper, it cannot be held. However, patents can be owned, bought and sold, acquired and disposed of. Why not virtual things?

This is the discussion right now and it is going to have a huge impact on you. No really, its true.

What is the stuff that people acquire in a virtual world? Some of the companies that run these MMOG’s explicitly state in their user agreements that you, the account holder, have no property rights in anything that goes on in their virtual world. Other companies state that you do, and indeed some of them will, for a fee, help you buy and sell things in that virtual world.

I see it all progressing to the point where a virtual sword will have the same substance/value as a real, tangible sword. Virtual real estate will appreciate or depreciate like “real” real estate. The situation is quite similar to the legal wrangling over whether a license is property such that a lender can take security in it or a trustee takes ownership in it if you go bankrupt.

In a recent Nova Scotia case, the courts had to look at this issue in the context of fishing licenses. The regulations under the Fisheries Act of Canada state quite explicitly that a fishing license is not property and no property rights accrue to the holder of such a license. Clearly however this does not accord with commercial reality as fishers buy and sell such licenses for substantial sums all the time. The case, which is on appeal to the Supreme Court of Canada, currently advances the proposition that licenses (like the virtual sword – property which is completely intangible – ie. you cannot hold it in your hand) are property (at least to a certain extent). Sooner or later it will be recognized generally that the same rights will exist in the virtual sword and the virtual real estate.

And where will this leave us? What is going to happen is that a parallel world is going to develop (some would say it is well and truly underway as we speak) and people and businesses are going to spend time and effort to operate in this world (more so than they already do). The virtual world is going to morph and change over time. Currently people generally access it from their desktop or a laptop. However, the technological advances we are experiencing will allow this world to be accessed everywhere and from virtually any device with a broadband connection to the Internet (in the next few years this will include almost all electronic devices and the coverage will be almost global).

Why am I going on about all this? First, because it is interesting. Second because the business opportunities for those who can see the angles will be huge. The people who are making money at it now are pre-adopters. Mark my words – this is going to be big, big stuff.

Canada - No hurry to join the Madrid Protocol

For those of you familiar with the Patent Cooperation Treaty (PCT) – whereby a single patent application can be filed for multiple jurisdictions (to boil the system down to its barest elements), the fact that Canada is not part of a similar system with respect to trade-marks may come as a surprise. Yet it is true.

The Madrid Protocol became operative on April 1, 1996 and allows an entity in a member State with an existing application in process or an already registered trade-mark on file to extend protection to such other members States as the owner wishes. The United States of America, currently Canada’s biggest trading partner, has been a member for 3 years. Indeed, the list of member States is quite extensive. Yet, Canada remains on the outside.

Now, the reasons given for this state of affairs are extensive. Indeed, the Canadian Intellectual Property Office has published articles on the topic (here and here).

The fact remains that Canada is not part of this system and, until it is, the country and its resident businesses are at a disadvantage in comparison to businesses resident in other jurisdictions. Among other disadvantages, a Canadian company that acquires a trade-mark from a company pursuant to the Madrid Protocol must incorporate a company in a member State in order to acquire that particular trade-mark.

The Canadian Intellectual Property Office has, as noted, undergone a consultation process in order to analyze what changes to the Trade-marks Act would be needed in order to allow Canada to join the “club”. However, the federal government has not put the matter on the list of pressing issues. Perhaps the political manoeuvring in Ottawa has kept the issue from being examined in depth.

Hopefully this will be rectified in the future.

Glen Breton - Whisky or Scotch Whisky?

Well, I think I will weigh in on the topic if only from a legal perspective. I have, incidentally, tried, Glen Breton (at the Farmer's Market in Halifax) and found it to be very good.

So, to bring you up to date. Glenora Distilleries of Cape Breton, Nova Scotia filed a trade-mark application in Canada for the mark "Glen Breton" in association with single malt whisky. For some reason it is a "proposed use" application even though the mark has been in use already for a number of years.

Then, the Scotch Whisky Association decides it is going to oppose the application on the basis, apparently, that people will associate Glen Breton with scotch whisky (and being, therefore, from Scotland). The opposition was denied. The Scotch Whisky Association has, however, vowed to appeal (at least according to the press).

Interestingly, no where on the bottle for Glen Breton is the word "scotch" used. So it would seem that the Scotch Whisky Association's principal argument is that the word "Glen" is inexorably linked to Scotland and, as such, reasonable people would assume Glen Breton comes from Scotland. Interestingly the Association provides a link as to importance of the name "Scotch Whisky" but no where in there is the word "Glen" mentioned.

Now of course I entered the word "glen" into Wikipedia and this is the result.

You will see that various geographic places are mentioned, some in Scotland, many not. Also interesting it the fact that the etymology of the word, in relation to a river, is Welsh. Of course Wikipedia is not determinative but it is still interesting.

All of that brings me to the World Intellectual Property Organization and the notion of geographic names and their use to distinguish foods (for example - Bordeaux). Here is an article from WIPO on the topic.

Canada has a list of wines and spirits which are protected. Here it is. Scotch Whisky is on the list. Glen is not.  The Canadian Intellectual Property Office has some good articles (here and here) on the topic of geographic indicators and trade-marks.

I have no idea how this is going to play out. I am not sure that the Association has a strong argument. However, as the old saying goes, nothing ventured nothing gained. I will keep you posted. In the meantime, happy reading.

Blogged to Death

Blogs. Powerful tools in the right hands.

Take this article as an example.

A radio station in California has some hosts who, according to a blogger, say some pretty racy things from time to time. Senator Barack Obama (who may take a crack at the democratic nomination for the 2008 USA presidential campaign) was apparently called a "hafrican" because he is half Kenyan and half white.

So a blogger who calls himself Spocko records bits from some of the radio shows and sends them electronically to advertisers and asks them to pull their ads. Spocko also posts the clips on his blog.

As you can imagine, the radio station is not all that happy and gets its lawyers to send a nasty letter to Spocko's ISP asking it to pull the content. Unfortunately it does.

The whole thing is interesting (to me) because it shows just how powerful the internet can be in terms of being a tool for people who are displeased with something.  In the pre-blog days this issue may never have come to light (at least not in the global sense). The negative publicity the radio station is receiving has got to hurt.  The message is this: If you are a business, I suggest you think long and hard before ignoring customers and their complaints.

The other, more disturbing, issue which emerges from this is the hit to freedom of speech and fair comment. The blogger posted bits of copyrighted material. No question there. But the bits related to legitimate commentary and the ISP should not have (given the facts I am aware of) taken the content offline. One can only hope that, in the future, content providers will not be so forthcoming.

Gimme my sword back! Ownerships of property on the internet Part II

If you are an internet and/or gaming junkie you will know about MMOG’s. If your question is, “What’s a MMOG?” then perhaps this article might not be of interest to you – but it should be.

Why you ask? Because MMOG’s (massive multiplayer online games) are at the cutting edge of a legal issue which has long term implications. The question is this – Are there property rights in equipment/experience/money collected in an online environment?

Last year a Chinese man killed another man for “stealing” and selling a sword the first man had obtained in a MMOG.

A lawyer in the USA is suing the creator of Second Life for suspending his account (he had, according to reports) used a bug in the game to acquire and “in-game” real estate for a profit.

In other parts of the world there are gaming sweatshops where people play games for minimal wages to build up characters and/or acquire equipment – characters and equipment which are then sold for enormous profits.

The phenomenon is not yet as huge in North America and Europe as it currently is in parts of Asia – but it will be. And as it grows, this question will have to be answered. It is interesting also because of the way in which some companies structure their games. Several quite directly state that gamers have no property rights in things which are acquired in game. Thousands of accounts have been suspended for violations of such provisions. Other companies take the “bend like a reed in the wind” approach and structure and regulate the purchase/sale of items (taking a cut of the profits too). It remains to be seen how it all pans out but it will be an interesting story.

For those who do not care to partake in MMOG’s, the ongoing saga has relevance because it will help shape the larger picture of ownership of intangibles (things that can be owned but not physically held) such as copyright etc. The internet is constantly expanding and morphing. Who would have imagined, two years ago, that 3 guys from California would create a phenomenon with lonelygirl15 on Youtube? For those who do not know – it was a video blog/diary created by a girl named “Bree”. Later, after it became enormously popular, it was discovered that the diary was a fake. However, the point is that millions (yes millions) would regularly download the postings and message boards were filled with commentary. All for a few hundred dollars in expenses.

Anyway, enough on that for now. Watch out for developments! It will surely be interesting.

Patent Searching

I found an interesting site that offers patent searching and other patent related services. It is called "Free patents online".

Check it out. If you have any comments on it, please let me know.

Broadband over power lines - Part II

Many months ago I wrote a few articles on the topic on using power line infrastructure to deliver internet services. To recap – several jurisdictions, including the state of Texas, are experimenting with the technology (which has been around for ages).

Then, shortly before Christmas, I attended a luncheon wherein the Premier for the Province of Nova Scotia spoke of his desire, indeed his pledge, to provide all Nova Scotians with broadband access by 2009.

And later still, I listened with interest (and some disgust) as a business person in northern Nova Scotia spoke about the difficulties she is now experiencing as a result of new regulation in the USA with respect to the importation of goods. Disgust not at the red tape (the new procedures require one to fill out new forms which are obtained online) but at the fact her business is not in jeopardy because it takes too long, with her dial up connection, to complete the required forms.

All of this leads me back to power lines. Called broadband over powerlines (BPL) or broadpand, the technology has one great advantage – it is already in place in the sense that most homes are connected to the power grid. Now, I am no electrical engineer and understand there are a number of technical hurdles to overcome (see this great article on the topic from Wikipedia), but it seems to me that if jurisdictions with large rural populations (as in Nova Scotia and Texas) wish to do so, the means exist to provide populations with broadband. Sure, there will be a cost in setting up/upgrading infrastructure, but the benefit to people (including business people) will be greater.

Having said that, more than 50 utilities across the USA are already offering the service according to an article by CNET News. For what it is worth, Google has invested in one of the companies which is delivering the service. According to a May 16, 2006 article I read, the cost to install the necessary infrastructure is now low enough to make it economical to do so.

Is it not time we in the Atlantic region seriously examined this technology?

Patents predicting prosperity?

I understand the reluctance of investors, bankers, and others when they squirm and shuffle their feet at the notion of valuing intellectual property. However, the reality is that that intellectual property is valuable. Perform a search using the Google search engine and you will find out that the value of the Coke brand is estimated to be 67 billion USD. Yes, that is correct, 67 billion. Disney clocks in at 21 billion. The CEO of Coke once said that all of the company’s physical assets could be destroyed and that this would not present a problem as long as the brand survived. (Taken from the Canadian Intellectual Property Office’s website).

All of which is to hammer home the point that intellectual property is becoming more important than “bricks and mortar” ie. buildings, equipment and the like.

Need more proof? Today I read an article in the January 8, 2007 issue of BusinessWeek called “Follow the Patents”. The article discusses the notion of valuing a company’s prospects based in part on its patent portfolio and the number of times the patent portfolio is mentioned by other patents.

A company called “1790 Analytics” generated a list for BusinessWeek in 2005 of its top 15 prospects based on the “Pipeline Quality Measure” and, a year later, 11 of the picks were up substantially. This year, companies such as Polaris are among the top choices – I am not sure on that one in part because the market for consumer discretionary goods is probably not going to be all that robust, But then again, I am not an investment analyst.

The point however is clear (at least to me) - intellectual property is valuable.

If you are a business, learn to protect it and leverage it. You could lose it if you do not. If you are a banker, learn how to value it and take security in it. We will all be better for it.