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How do brands protect themselves in the wild and untamed metaverse?


By Chris Sutcliffe, Senior reporter

June 4, 2021 | 7 min read

Brands are reaching new audiences and creating virtual showrooms in the gaming metaverse. It’s an incredible opportunity for those willing to take the plunge – but it comes with risks. In this article we examine the copyright and IP issues, and ask where the metaverse might go in the future.

Martin sanchez

Brands want to live in the metaverse – but how do they protect their IP?

Grand Theft Auto V’s open world sandbox is a technical marvel. A living breathing section of California recreated in heightened fashion, with recognizable locations like Venice Beach, the Hollywood hills and wine country all accessible to multiple players online. It has a burgeoning property scene, where players can buy their own apartments, mansions and yachts with in-game money.

But because the GTA franchise is, by design, satirical in tone, sometimes it runs up against copyright and intellectual property disputes with the real-world businesses it spoofs. A previous entry in the franchise, GTA: San Andreas, was the subject of a lawsuit when a strip club in the real world claimed its in-game equivalent too closely matched the reality. While the game’s publisher Rockstar won that case, it set the tone for conversations about potential abuses of the metaverse.

Those issues came to the fore again a few years ago as Fortnite – one of the foremost examples of the metaverse as a concept – ran up against an unexpected piece of copyright law. The plaintiff in this particular case – a saxophonist who went viral for his dance moves – sued the developer of the popular video game Fortnite, alleging that the game featured a virtual saxophone-playing avatar that copied his dance moves. He wasn’t the only one, with the actor Alfonso Ribeiro similarly alleging the game had infringed on his own copyright, though in both cases the courts dismissed the cases.

Those issues are exacerbated by user creation, which is often at the very heart of games that use the metaverse. Wherever there is an in-game avatar and creation tools (let alone more in-depth modding of game titles) there is the potential for a user to knowingly or unknowingly step on the IP of a real company.

In the metaverse of VR chat, for instance, users can choose to wear as their avatar a character ripped from another game, a reproduction of a famous brand mascot, or even stylized 1:1 recreations of real people. This has implications for brands whose IP can be co-opted for use in situations which are clearly not brand safe, for instance the ‘Ugandan Knuckles’ phenomenon where a Sega mascot was co-opted by a number of VRChat users to harass other players.

The question, then, is how brands and individuals protect their copyright as the metaverse expands.


The flashpoint for the metaverse copyright dispute is predicated in part on the monetary link between metaverse and real life. For games which allow users to purchase virtual currency with real money, that effectively creates a tangible link that allows people to generate actual money from virtual items.

Gregor Pryor is partner at Reed Smith. He says: “If video games are going to have their own environment with their own economies and their own currency, then the game engine or metaverse environment – that walled garden – has to make money. You’re creating an environment. You’re allowing people to transact. And you charge a commission for that to happen. We’re definitely seeing metaverse platforms have a real interest in digital currency, and how you deal with regulation.”

That conversation is set to become more complex as the interoperability of metaverses – the ability of a user to maintain their avatar and purchases between those different virtual environments – develops. We’ve seen early experiments in this, as cross-promotion between games like Fortnite and Rocket League is already taking place. It is also incredibly difficult for automated detection of IP infringement in metaverses like VRChat, requiring investment in tech or human moderation to ensure it does not occur.

Pryor argues that the metaverses that are strong out of the gate when it comes to ensuring there is emphasis given to maintaining copyright will ultimately be the ones that succeed: “If you look at the way the generation one platforms (YouTube, Facebook) operate, they’re always under pressure from predominantly music and other rights holders about activity on the platform.

“If you then look at retail environments, like Amazon or eBay, there’s pressure from manufacturers around counterfeit, or piracy, or just fake products.

“All of that can be the learnings that can be ported into the metaverse. If you are a metaverse operator and there’s the capability for infringing activity to happen, I think you will have to implement internal rules and copyright policies and kind of be self regulating.”

None of which is to say that the metaverse is by definition a Wild West of copyright infringement and brand damage. The existing exploitation of the metaverse by brands and artists like Travis Scott, in addition to the willingness of huge brands to exist alongside one another in those worlds, speaks to the power and opportunity of the metaverse.

But as the metaverse becomes more complex, so too will the discussions around IP, copyright infringement and brand safety. Greater interoperability of metaverses will proliferate brand content – legitimate or otherwise – across a vast array of new situations and new platforms.

For more on what the gaming sector’s pandemic-propelled popularity means for marketers, head to The Drum’s gaming hub.

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