You probably know that the Olympic Games and Paralympics are taking place in Paris this year, and that Euro 2024 will be played in Germany. But did you know about another major sporting event being hosted in Riyadh, Saudi Arabia during July and August – the first Esports World Cup?
This competition will see esports athletes and clubs from around the world challenging each other in 20 tournaments across games such as League of Legends, DOTA 2, Counter-Strike 2, Overwatch 2, Street Fighter 6 and EAFC 24. They are competing for a total prize pool of $60 million as well as titles such as Esports World Cup Club Champions and player bounties.
Esports are competitions between video gamers and this year’s Esports World Cup illustrates the maturity of an industry that is estimated to be worth more than $200 billion and has some 3 billion players worldwide more than one in three people on earth. Esports was also a medal event in the 2022 Asian Games, held in Hangzhou, China in 2023, and a demonstration event held alongside the Commonwealth Games 2022 in Birmingham, UK. The first Olympic Esports Week took place in Singapore in June 2023 and the International Olympics Committee is now considering hosting the first Olympic Esports Games.
Esports and copyright
IP rights exist in various forms in esports. First and foremost, esports are different from traditional sports in that the underlying game is likely to be protected by copyright. In fact, copyright can cover many aspects of games – from the software code they are built on to the words, pictures and music they feature. In big projects, which might involve a wide range of copyright-protected features with various copyright owners, games developers must therefore ensure that they have a licence or assignment of all the relevant rights.
As esports take off, those involved (including event organisers, sponsors and broadcasters) also need to ensure they have the necessary permissions before sharing or communicating the content of games. If not, they could be infringing copyright. This is likely to be a particular concern where live events are streamed online.
Live-streaming rights to esports can be valuable: in 2020, YouTube reportedly signed a three-year, $160 million deal to exclusively live stream Activision Blizzard’s esports events, which include Overwatch League and Call of Duty League. In December 2023, it was reported that YouTube had signed a new exclusive deal with Call of Duty League for its upcoming season.
In a Recommendation on combating online piracy of sports and other live events, published in April 2023, the European Commission urged effective measures against unauthorised retransmission of live sports events, including esports. In particular, it called on the EUIPO to establish a network of national administrative authorities and promote activities focused on knowledge building. The EUIPO Observatory has published several papers and reports on this topic, including a discussion paper on Live Event Piracy, and together with the Commission organised a launch event in Alicante in October 2023.
Trade marks
Esports developers can also look to trade marks and designs to protect aspects of their games. Names and logos of games can be registered as trade marks, and distinctive characters may be registrable as figurative marks. In the EU, it is also possible to register sound, motion and multimedia marks and these may be of particular interest to games developers if they want to protect distinctive features of their games.
There have been a few EU General Court judgments concerning trade marks for video games. In Case T-700/18, for example, the Court upheld a finding of likelihood of confusion between an EU trade mark application for DUNGEONS for goods and services in classes 9, 28 and 41 and the earlier EU word mark DUNGEONS & DRAGONS for identical/similar goods and services. In that case, the Court held that the relevant public displayed an average level of attention, given, among other reasons, the “mainstream” nature of the video game market and the “disposable” nature of games. It also found that the earlier mark had a distinctive character “which is at the very least normal”.
In Case T-491/22, meanwhile, the Court upheld a finding of no likelihood of confusion between an EUTM application for a figurative mark for a happy figure in the shape of a ball with wide-open eyes, a top hat, straight arms and short legs and earlier EU marks for a figure with a one-eyed, slightly deformed face with one bent arm and another arm resting on a cane. It found that the signs were different overall. That decision suggests there is a relatively narrow scope of protection for trade marks for fantasy figures.
Design protection
Design rights are another valuable form of IP protection for esports. Design rights can be obtained rather quickly and inexpensively and may be relevant for everything from keyboards, controllers and headsets to graphical user interfaces (GUIs).
Indeed, design legal reform is ongoing, and it aims to further expand the possibilities of design protection. One of its aims is to modernise the ways designs can be protected and to adapt design protection rules to the digital age. The newly proposed law clarifies that products such as GUIs, projections, virtual spaces, animations and many other non-physical products can be protected as designs. This will likely be welcomed by the videogame and esports industries and may lead to more design applications in this area.
A plethora of IP rights
One characteristic of esports is the opportunity players have to customise their experience, for example by buying “skins”, adopting a particular name or changing their appearance. Such customisation could result in the creation of new IP rights – or the infringement of existing ones. Partnership agreements and licences are therefore key.As esports grows in popularity, the importance of sponsorship, advertising and endorsements is set to explode – and developers are likely to explore increasingly innovative ways of working with commercial partners. Expect to see more ambassadors and influencers supporting esports, as well as major brands investing. In this context, IP rights, and in particular trade marks, have a critical role to play in licensing agreements. In this fast-developing world, it is even more important than normal to ensure that licences are robust but also flexible enough to accommodate innovations and new business opportunities.
Conclusion
Big improvements in technologies such as virtual reality, artificial intelligence and graphics are likely to further increase the popularity of esports and the profile of esports events and players to the extent that they could rival those of traditional sports. This in turn will drive interest from broadcasters and sponsors. With considerable amounts of money at stake, it is imperative that all those involved in the esports industry pay attention to the protection of IP rights.
The IP landscape in esports is likely to be complex and dynamic. Everyone involved in the industry – developers, organisers, players, teams, fans, sponsors and partners – needs to consider how they are affected by IP issues and consider what steps to take to make sure they are protected. There are big opportunities in this sector, and IP management will be critical to success in both sporting and business terms.