Virtual reality technology is changing the face of media as we know it. As companies fight tooth-and-nail to protect the underlying technology through patents (for example, encoders and hardware) and copyrights (for the software), companies should not forget to develop a sound brand strategy that involves trademark clearance and protection.
The adoption of new technology is, in many ways, about branding. If you look at past technology battles like BluRay v. HD-DVD, Beta-Max v. VHS, it is clear that the better technology is not always the one that wins out. By effectively leveraging trademarks, technology companies can help convince consumers to not only buy into a new technology but to also buy into a lifestyle, ethos, and overall feeling invoked by a strong trademark and branding.
Start at the Top – Protecting the Flagship Trademark
Many startups do not have expansive legal budgets. In many cases, every dime and every hour of the day is being spent on developing hardware and code. However, every startup should set a budget to effectively develop and register their trademarks, in addition to other intellectual property. If trademarks are given a lower-tier priority, a company working on cutting-edge technology might see their well-branded competitors get more investor interest, earned media, and other benefits then the company’s technically superior, but poorly marketed, product.
Developing a Trademark in the Virtual Reality Technology Industry
The first thing a company must do is come up with a name. That seems simple, but it can feel impossible. Some companies choose “descriptive” names because they immediately tell the consumer exactly what the company does, like – “Virtual Reality Tech Associates.” This name, in legal terms, is an extremely weak trademark that would be extremely difficult to enforce against a competitor (and does not allow consumers to tie it directly to one company, because it merely describes the goods and services.) A company may eventually gain rights in a “merely descriptive” trademark, but only through years and years of heavy marketing and market penetration. Even then, they will not be able to see a wide scope of protection.
Some businesses choose a trademark that is suggestive of the services, but requires a “logical leap” for consumers to arrive at the goods and services. “Oculus” is a good example of this – the word “oculus” clearly has something to do with seeing, but it takes a significant leap for the consumer to connect “oculus” to “virtual reality headset producer.” Suggestive marks are protectable and strong, but because they still have some connection to pre-existing knowledge that a user has, then the scope of that trademark would still be limited. For example, a company could not likely stop a competitor from discussing how a headset works, by “light entering the oculus of the eye” or something like that.
The strongest types of trademarks are arbitrary or fanciful words or phrases. Arbitrary trademarks are existing words with no connection to the goods and services (APPLE for computers, or GOOGLE for web services). Fanciful words are made up words with no prior meaning (KODAK for film). These are the strongest trademarks and have a wide scope of protection. Consumers have no prior connections to these words and, as such, no competitor should be allowed to come close to using these marks. These are also the hardest to market, however, because consumers do not have pre-existing knowledge or experience with the word or phrase to assist them in making that connection.
Once a business owner comes up with a good trademark, she should come up with two to three backups. One of the biggest rules in developing a protectable trademark is to not fall in love with an idea before it has been fully analyzed by a trademark attorney. Companies should always develop backups that they would be comfortable moving forward with so that they do not expose themselves to avoidable liability.
Clearing and Registering a Trademark
The next step for VR hardware and software development companies is to conduct a comprehensive search of the proposed trademark and have a trademark attorney analyze that search. A comprehensive search will look for any registered or un-registered trademarks that are similar in sight, sound, meaning or commercial impression for goods and services that are related to the company’s goods and services. For VR companies, that would likely include other hardware and software developers and hardware makers, even if they do not directly work on VR technology. An experienced attorney should then analyze the results and provide a letter outlining the risks moving forward. Every trademark will have some level of risk, especially in today’s highly protective and litigious marketplace. If the owner is comfortable with the risk level, then she should proceed to register the trademark with the U.S. Patent and Trademark Office.
Registering a trademark involves dozens of legal considerations in drafting, timing, and content. The benefits of a federal registration are worth it though. By owning a federal registration, the registrant obtains a formal certificate from the U.S. government showing that she is the presumptive owner of the trademark and that the trademark is presumptively valid. To combat those presumptive rights, someone else would have to prove irrefutably that they used a similar trademark before the registrant used her trademark and that it had protectable rights at that time. Also, a federal trademark registration is notice to all other competitors that a company owns the trademark. If they use it after the registrant filed her trademark application, she may be able to seek legal recourse against the competitors to stop any confusingly similar use of the trademark.
A Real-World Example of What Happens When Trademarks Are Ignored
The risks of trademark infringement in the VR world are not simply hypothetical. One of the biggest VR companies learned this the hard way recently, when a jury found Oculus (who is owned by a little company called Facebook) liable for infringing on the trademarks of Zenimax Media Inc., including SKYRIM® and DOOM®. Oculus used these registered trademarks without permission.
Virtual reality (VR) companies are leading the way in a brand new form of media consumption and everyone is racing to come up with the next big innovation. However, strong trademarks and marketing can help set companies apart from their competitors and give them an edge. By having a plan for trademark protection, VR businesses can avoid pitfalls and set themselves up for taking full advantage of their innovative technologies.