If 2021 was the year of growing awareness of a thing called a ‘non-fungible token‘ – NFT for short – 2022 looks like it will be the year of better understanding of NFTs, what you can do with them as representations of goods (real as well as digital), and an appreciation of the power of cryptocurrencies in this Web 3 supply chain.
As more companies start making moves into NFTs – like Selfridges and the Associated Press to name just two in the past month – and as people pile in on independent NFT marketplaces that are springing up everywhere, ensuring you protect your intellectual property rights is something that now should be front and centre of mind.
Of course, this is a view on the respectable side of this burgeoning market where the flip side is pretty ugly, rife with thieving, fakery, plagiarism and spam.
For brand owners, the days are probably gone now where encouraging people to share digital images and video of your product online, freely and with a relaxed approach and little oversight on how they might do that or where, was the norm.
Eyeballs, engagements and clicks were the order of the day.
You can’t afford such a laissez-faire approach any more as others will not only profit from your lack of attention but also increase the reputational risk to you from brand dilution and even damage.
That’s the picture I see with the news that French fashion house Hermès is suing Mason Rothschild, an American artist, for creating digital versions of their Birkin handbags called ‘MetaBirkins’ and selling them on his website as NFTs.
In its lawsuit filed in New York, Hermès said Rothschild was ripping off its trademark, and accused him of being a “digital speculator who is seeking to get rich quick,” according to The Times.
For his part, Rothschild roundly rejected Hermès claims, stating:
“The First Amendment gives me the right to make and sell art depicting Birkin bags, just as it gave Andy Warhol the right to make and sell art depicting the Campbell’s soup cans.”
As Shel and I noted in For Immediate Release podcast episode 222 when we discussed this last week, we wish him good luck with that defence! You can listen to our 11-minute conversation right here:
Whatever the outcome of this lawsuit alleging infringement of copyright, I think we will likely see much more of this as brands step up the pace to protect their intellectual property rights.
“It is certainly still very early days when it comes to the metaverse and corresponding technologies, but either way, as more unauthorized uses come to light, it will not be surprising if otherwise skeptical or hesitant brands opt to enter in metaverse ventures with the aim of amassing stronger rights in their valuable assets and thus, more easily stomp out infringements and control over their images.”
An NFT is a token not the actual asset
There is much misunderstanding about what rights you have on a product when you buy an NFT. You don’t own the product at all. Rather, you own a token (the NFT) that gives you certain rights.
Henrique Centieiro offers a simple explanation:
“Buying an NFT does not mean you own the digital or physical assets it represents unless specified. Remember, NFT is a blockchain representation showing the existence of an asset and not the actual asset. It can be explained better as a certificate of authenticity that a digital record of an asset belongs to you.
“When you buy an NFT, you are paying for a token that represents an asset. The token carries the information of the asset that proves its authenticity and that you own limited access to that digital record. Your token cannot be duplicated, and this rarity is what gives NFT cryptocurrency value.”
And note, you don’t get ownership of copyright. Perhaps this group of would-be NFT millionaires should have done a little more homework.