Exploitation of IP
Licensing:
- A license is an agreement between you as the IP right owner and another party. It grants
them permission to do something that would be an infringement of the rights without the
license.
- IP can be “licensed-out” or “licensed-in”. You can “license-out” to another company in
return for a fee. You can “license-in” if you want to use another company’s IP to develop
your own business and products.
- The person granting the license is usually called the licensor, and the person receiving the
license is usually called the licensee. There may be more than one licensor or more than
one licensee in a license agreement (GOV.UK, 2023).
- License-in can be a lucrative opportunity for yourself e.g. J.K. Rowling → many people
would license-in from her to be able to produce Harry Potter
o Very good way of making money
- Many scouts who are always looking for next best thing – they will option the rights to
produce something as a film as they would want a first-mover advantage
Benefits of licensing:
- Sharing costs and risks
o E.g. Patents → money investments
o Less risk about your capital, resources, not necessarily always financial risks
- Revenue generation
o If you are licensing-in, you can use the money to produce new products/services
o If you are licensing-out, you can gain more royalties
- Increased market penetration
o Provides you with a foothold in a particular market as that IP was already there
- Reducing costs
- Saving time
- Accessing expertise
- Obtaining competitive advantage
o Especially in context of patents
- Collaboration
Licensing in practice: Music:
- Synchronisation license (or sync license):
o This is specialised for use with visual media, such as TV shows, film, commercials,
news segments, video games and more.
o A license fee can be determined by how the song will be used, where it will be
played, anticipated exposure, experience, and any other royalty rate.
o This license is also common with artists who want to make a music video for cover
songs of another artists’ work
- Mechanical license:
o Used for reproduction of the song in physical form, most often CD’s or soundtracks
o Typically, only relevant to the song itself, and not any videos associated with it
o Extremely common if your release covers of songs that aren’t in public domain
- Public performance license:
o This is very broad and encompasses radio, websites, stores, restaurants, music
venues, nightclubs, and other public spaces
o Usually don’t need to worry about acquiring this license unless you are using a
song for business purposes
, - Master recording license:
o Also called a master use license or master license
o Grants the recipient the right to use the entirety or any parts of the original sound
recording for their means
o Common with compilation albums like “Top 20s”
- Print license:
o Primarily used to reproduce sheet music or lyrics, whether for karaoke,
merchandise, marketing materials, and more
- Blanket license:
o This license allows users to have access to a portion or complete collection of songs
for a flat annual fee, which can be convenient for places that just want background
music like a shopping centre or a café
o It’s less time-consuming to compile all the songs requested, instead of creating a
license for each and every track
How are rights exploited for global events?
Foreign broadcasting rights:
- Copyright and related rights, particularly those relating to broadcasting organizations,
underpin the relationship between sport and television and other media. Television and
media organizations pay huge sums of money for the exclusive right to broadcast top
sporting events live.
Broadcasters’ rights:
- Safeguard costly investments in televising sporting events → they are going to get the
revenue generation from it
- Recognize and reward the entrepreneurial efforts of broadcasting organizations
- Recognize and reward their contribution to diffusion of information and culture
- Advances in technology has revolutionized coverage around the world of events. State
events and sporting events are big media business!
o Consumers are provided with far more choice, and can pay for these services
- U.S. networks paid more than $5 million for the rights to show events surrounding President
Obama’s inauguration in 2009.
- HBO paid $2.5 million, ABC $2 million and MTV over $500,000 to cover inauguration
balls live.
- According to the Guardian, in 2014, NBC paid $7.75bn to receive the broadcasting rights
of the Olympics until 2023
o It is now 7.5 years since NBCU bought US broadcasting rights to the Olympic
games between 2021 and 2032 for $7.65bn (£5.6bn) plus a $100m (£73m)
“signing bonus”, in one of the most important commercial agreements in the
International Olympic Committee’s (IOC) history.
Summer Olympics broadcast revenue (1960-2020):
Licensing:
- A license is an agreement between you as the IP right owner and another party. It grants
them permission to do something that would be an infringement of the rights without the
license.
- IP can be “licensed-out” or “licensed-in”. You can “license-out” to another company in
return for a fee. You can “license-in” if you want to use another company’s IP to develop
your own business and products.
- The person granting the license is usually called the licensor, and the person receiving the
license is usually called the licensee. There may be more than one licensor or more than
one licensee in a license agreement (GOV.UK, 2023).
- License-in can be a lucrative opportunity for yourself e.g. J.K. Rowling → many people
would license-in from her to be able to produce Harry Potter
o Very good way of making money
- Many scouts who are always looking for next best thing – they will option the rights to
produce something as a film as they would want a first-mover advantage
Benefits of licensing:
- Sharing costs and risks
o E.g. Patents → money investments
o Less risk about your capital, resources, not necessarily always financial risks
- Revenue generation
o If you are licensing-in, you can use the money to produce new products/services
o If you are licensing-out, you can gain more royalties
- Increased market penetration
o Provides you with a foothold in a particular market as that IP was already there
- Reducing costs
- Saving time
- Accessing expertise
- Obtaining competitive advantage
o Especially in context of patents
- Collaboration
Licensing in practice: Music:
- Synchronisation license (or sync license):
o This is specialised for use with visual media, such as TV shows, film, commercials,
news segments, video games and more.
o A license fee can be determined by how the song will be used, where it will be
played, anticipated exposure, experience, and any other royalty rate.
o This license is also common with artists who want to make a music video for cover
songs of another artists’ work
- Mechanical license:
o Used for reproduction of the song in physical form, most often CD’s or soundtracks
o Typically, only relevant to the song itself, and not any videos associated with it
o Extremely common if your release covers of songs that aren’t in public domain
- Public performance license:
o This is very broad and encompasses radio, websites, stores, restaurants, music
venues, nightclubs, and other public spaces
o Usually don’t need to worry about acquiring this license unless you are using a
song for business purposes
, - Master recording license:
o Also called a master use license or master license
o Grants the recipient the right to use the entirety or any parts of the original sound
recording for their means
o Common with compilation albums like “Top 20s”
- Print license:
o Primarily used to reproduce sheet music or lyrics, whether for karaoke,
merchandise, marketing materials, and more
- Blanket license:
o This license allows users to have access to a portion or complete collection of songs
for a flat annual fee, which can be convenient for places that just want background
music like a shopping centre or a café
o It’s less time-consuming to compile all the songs requested, instead of creating a
license for each and every track
How are rights exploited for global events?
Foreign broadcasting rights:
- Copyright and related rights, particularly those relating to broadcasting organizations,
underpin the relationship between sport and television and other media. Television and
media organizations pay huge sums of money for the exclusive right to broadcast top
sporting events live.
Broadcasters’ rights:
- Safeguard costly investments in televising sporting events → they are going to get the
revenue generation from it
- Recognize and reward the entrepreneurial efforts of broadcasting organizations
- Recognize and reward their contribution to diffusion of information and culture
- Advances in technology has revolutionized coverage around the world of events. State
events and sporting events are big media business!
o Consumers are provided with far more choice, and can pay for these services
- U.S. networks paid more than $5 million for the rights to show events surrounding President
Obama’s inauguration in 2009.
- HBO paid $2.5 million, ABC $2 million and MTV over $500,000 to cover inauguration
balls live.
- According to the Guardian, in 2014, NBC paid $7.75bn to receive the broadcasting rights
of the Olympics until 2023
o It is now 7.5 years since NBCU bought US broadcasting rights to the Olympic
games between 2021 and 2032 for $7.65bn (£5.6bn) plus a $100m (£73m)
“signing bonus”, in one of the most important commercial agreements in the
International Olympic Committee’s (IOC) history.
Summer Olympics broadcast revenue (1960-2020):
