Metaverse: Trademarks on the Internet 3.0

If there is one topic that everyone is talking about, it is the metaverse. This term, which seems futuristic, appeared 30 years ago in the science fiction novel Snow Crash (1992), where Neal Stephenson describes a type of collective virtual space, compatible with physical reality, which he calls the metaverse (“beyond the universe”).

To define it clearly, one must understand the evolution of the internet from its beginnings until today and, especially, the role that the user has played within it. At first, the user browsed the internet to obtain content, without being able to influence it directly. Internet 2.0 was a radical change that allowed users to upload their own content (social networks have undoubtedly played a major role). On the Internet 3.0 world, the content will be the users themselves.

What exactly is the metaverse and why are we talking about it in a publication about trademarks?

The metaverse is a network of virtual environments in which anyone can interact with other users and digital objects, through virtual representations of themselves (called “avatars”). It aims to become the ultimate immersive experience in the virtual world in such a way that we not only use the internet, but also become a part of it. It intends to create a complete ecosystem where consumers can work, socialise, have fun, and collaborate with a fully digital identity. Unlike today’s internet, where the experience is always through a screen, the metaverse offers a fully immersive space where all senses are activated.

The metaverse has three essential characteristics:

• Presence: the metaverse eliminates physical barriers and our identity will be represented by our avatar, which will be fully customisable. By means of sound and image devices (such as virtual reality glasses), the user has the real sensation of being in the digital space.
• Interactivity or interoperability: the user must be able to interact both with other users and with the metaverse itself, thus being able to influence objects and individuals. Hence, it will be possible to travel seamlessly between virtual spaces with the same assets, avatars, and digital objects. ReadyPlayerMe allows users to create an avatar that they can use in Zoom meetings through applications such as Animaze. Meanwhile, blockchain technologies such as cryptocurrencies and NFTs (non-fungible tokens) facilitate the transfer of digital assets across virtual borders.
• Standardisation: although the metaverse will take shape over the next few years, we already know that it will be the coming together of several technologies related to virtual immersion. Standardisation is what enables the interoperability of platforms and services across the metaverse. As with all media-related technology (from printing to text messaging), common technology standards are essential for widespread adoption of the metaverse. International organisations such as the Open Metaverse Interoperability Group define these standards.

This future, which many consider to be science fiction, is already a reality and examples can be found in the worlds of fashion, art, music, film, and television. One example: last year Travis Scott brought together more than 12 million viewers who attended a completely virtual concert through the Fortnite game platform.

Although, for the moment, the companies at the forefront of the metaverse are mainly involved in fashion and art, the metaverse has the potential to affect all areas of our lives. For example, Heineken announced on 21 March the launch of a completely virtual beer called “Silver”, which it presented to the world via the virtual platform Decentraland. Johnson & Johnson has launched a line of dressings for the metaverse, presumably for digital wounds. If the idea of a beer or virtual dressings seems strange and more typical of a communication strategy than anything else, it does confirm that the metaverse intends to affect all areas of our lives. Even the wine industry is showing interest in the metaverse, as it offers the possibility not only of creating timeless collectibles, but the NFT itself allows greater control over the distribution of digital bottles, guaranteeing that they do indeed come from the wine estates they belong to, thus certifying their origin.

It is no coincidence that Mark Zuckerberg has changed the name of his company “Facebook” to “Meta”, after announcing that he will invest $10 billion in the development of his own virtual universe. And consumer electronics giant MediaMarkt is about to launch “MetaMarkt”, a series of virtual spaces and experiences that aim to connect with the under-35 crowd.

The intellectual property world is intrinsically linked to technical progress, and we already have some examples: the first controversy has pitted the house of Hermes against designer Mason Rothschild over the latter’s alleged trademark infringement of the famous “Birkin” bag. Specifically, the designer launched a collection of NFTs called “Metabirkin” that is very reminiscent of the model manufactured by the French luxury brand. For the moment, the controversy has not been resolved but the decision is eagerly awaited because it will begin to outline some certainties about sanctions in a virtual universe.

The question is whether the protection granted by trademarks to physical products also covers their digital version, given that these products are used exclusively in the virtual world. When products are “only” downloadable software, are they products as such or do they need specific legal framework? For now, the general opinion seems to agree that the current legislation is sound and works, but that it will need to be adapted to these new situations, specifying more clearly the boundaries between permitted and infringing acts. The metaverse undoubtedly represents a new way of taking advantage of other people’s assets and opens the door to a new type of infringement that will have to be addressed with its own features.

Some internationally renowned brands are already moving ahead and making it clear that the metaverse will fully impact the products we buy and the services of which we are users. Nike has not only started filing applications with the US Patent and Trademark Office (USPTO) but has already announced the acquisition of one of the leading companies in the production of digital goods for the metaverse.

The top fashion brands (such as Fendi, Balenciaga, Louis Vuitton, Dolce & Gabbana, and Gucci, among others) have entered through the front door and, in collaboration with specific platforms such as Fortnite, are contributing their creations so that users of the metaverse can dress their avatars in glamorous clothing. So, if you can’t afford a “Versace” jacket in the real world, you can buy one and wear it in the digital world (if it eventually has a reasonable price). The same is happening with luxury watches: Audemars Piguet, Bulgari, Panerai and Patek Philippe have started to apply for trademarks protecting their flagship watches, also as NFTs.

Therefore, trademark owners who want to operate in the metaverse now must consider how to apply for their registrations and for which goods or services. The trend is to use class 09 (which mainly protects audio-visual and information technology equipment), even though there are voices that foresee an unsustainable saturation of the class that receives the greatest number of applications in general. Thus, given that class 09 includes software-related products, it seems natural to turn to it to cover products operating in the metaverse. There are not yet enough registered trademarks to know exactly how offices will examine these new applications, but what is clear is that if class 09 becomes the catch-all for all digital products, trademark surveillance tasks will be very difficult.

We do not rule out that it would be advisable to protect trademarks also for services in classes 35, 38, 41 and 42, such as online marketplace services, digital collecting or digital auction services; provision of an online community forum for forming and participating in virtual communities; entertainment services in the form of provision of virtual goods; non-downloadable software for use in viewing, monetising, buying, selling, trading and authenticating virtual goods…. A whole universe to be explored.

We are at the beginning of a revolution that will change the connection between brands and their consumers and at CURELL SUÑOL we want to be by our clients’ side to help them in this transition and continue to protect their rights, whether they affect the physical or the virtual world.

Author: Berta Benet Ferré