Tag Archives: Licensing

How to get copyright permission

How To Get Copyright Permission And Avoid Copyright Infringement

How to get copyright permissionIn part one of our blog post, Can You Take Images Off The Internet And Use Them In Your Blog Posts or Newsletters, we looked at the law relating to copyright in images.

In this second part, we look at how the use of stock libraries and Creative Commons Licences can minimise the risk of copyright infringement, what to look out for when using them, and how to get copyright permission from the owner.  We also cover the new Orphan Works Scheme introduced by the UK Intellectual Property Office, and the Copyright Hub portal.

As we saw in part one of this blog post, it is usually a breach of copyright to use an image without the owner’s consent. Establishing who owns copyright in an image in order to get their consent can be difficult in practice.

A simple alternative is to buy images from stock libraries or to find images available under a Creative Commons licence.

Stock libraries

There are several image libraries out there, as you will see if you carry out a simple Google search. These include Getty Images, Shutterstock and iStock. Libraries such as these contain thousands of images that be used under licence subject to payment of a fee. There are a variety of licences to choose from, depending on your intended use.

If you want to use a photo multiple times for different projects you will need a royalty-free licence, which does not require payment for each individual use. Other types of licence would cover editorial use and there are also rights-managed services that let you choose the rights you need.

The advantage of using a well-known stock library is the huge choice of images and the range of formats and resolutions available. And most importantly, you are protected, (or at least should be protected), against infringement.

iStock gives an indemnity of up to $10,000 if one of their images is found to infringe. You can raise this to $250,000 if you require greater peace of mind. Other libraries offer similar indemnities.

Be careful if you are using an image from a smaller, lesser-known library. Check the terms of the licence to make sure you are properly covered. If in doubt about this, take legal advice.

Creative Commons

Creative Commons (creativecommons.org) helps creative people share their work by offering model licensing terms. (Creative Commons is one of many interesting approaches to permissive licensing. A review of them is beyond the scope of this article.)

Under a Creative Commons (“CC”) licence, some, (although not all) of the owner’s rights under copyright law are surrendered.

An advantage of this type of licence is that the terms are standard and widely understood. As a result, search engines such as Google or Flickr can easily tell you what rights you have to use an image.

There are a variety of Creative Commons licences you can use. A pure attribution licence allows you to use an image commercially, share and modify it, so long as you attribute it to the owner.

A CC BY-NC-ND (Attribution, Non-Commercial, No Derivatives) licence only lets you use the unaltered image in a non-commercial context; you have to give credit to the author.

Like stock image libraries, you should check the terms of the Creative Commons licence for the image you are using.

One danger of using Creative Commons searches is something we mentioned in part one of this blog. What happens if the uploader doesn’t own copyright in the image? Innocence is no defence. You could still be liable for damages despite thinking you have a licence from the owner. If you really must have a certain image, you may have to carry out your own investigation in order to find the actual owner.

Even then you may not be out of the woods. Has the so-called owner assigned their rights? Or, are the rights owned by their employer? Then there are practical considerations. Even if you get an indemnity from the owner, would they have the funds to cover your losses if you tried to enforce it?

The safety-first route for commercial use of images is to get your images from a well-known image library, if possible. This doesn’t always involve a cost.

Getty Images recently released millions of free images. There is a snag though. Their use is subject to restrictions. These include:

  • You must embed the images on your website or through social media using Getty’s own system.
  • Getty reserves the right to collect analytics data relating to your use of the images.
  • You can only use the images in relation to events which are newsworthy or of public interest.
  • You are not permitted to use them for commercial purposes.

Despite these restrictions they are still a useful resource for some people, such as bloggers.

Orphan works

As the name suggests, orphan works are those whose creator (or other owners) cannot be identified.

This might conjure up images of dusty old books, or visuals on the internet that have done the rounds without ever being attributed to a creator. However, the scope of the orphan works scheme goes well beyond this, and applies to tens of millions of UK creative works.

In October last year, the UK Intellectual Property Office (UKIPO) introduced the orphan works licensing scheme, which is designed to:

  • Protect people who wish to use orphan works by granting a licence for their use
  • To reunite owners with their lost works by offering a searchable database
  • To remunerate owners of orphan works should they ever come forward

Of course, these licences do not come free and users will need to pay for the right to reproduce the work. The fees collected are partly to cover an administration charge for running the scheme, and partly to remunerate the owners of copyright work, if they claim ownership in the future.

However, unlike the other licensing models, the UKIPO will need to be satisfied that the applicant has carried out a diligent search to find the owner before they grant a licence to use orphan works.

This could involve contacting a range of artists’ associations, searches through multiple online search engines, checking for watermarks, reviewing stock image libraries, liaising with trade bodies and collecting societies, and making other investigations, such as inspecting relevant museum and other catalogues.

The Copyright Hub

Kick-started by a government fund, The Copyright Hub is a non-profit organisation that runs a web portal to help users and copyright owners request and grant permission to use copyright works.

The idea was to make it as easy as possible to find and license content.  The initiative should help increase revenues for copyright owners, reduce instances of copyright infringement, and provide a useful source of creative materials.

The Copyright Hub also helps to raise awareness of copyright protection and licensing, by:

  • publishing information about copyright through the online portal;
  • offering an accessible platform so users can find out how to get copyright permission; and
  • making it easier to trace copyright content back to their owners.

So, in practice, the aim of both the Copyright Hub and orphan works is to implement Hargreaves’ recommendations in order to make it easier for people to locate and license creative works.

The complexity of copyright

As you have seen, using images downloaded from the Internet online is fraught with danger. While some improvements have been introduced by the law recently, the situation is still complex.

Litigation and the payment of damages is not uncommon. So, the safest course of action is to assume you can’t use an image without the consent of the owner. Even when you get consent, it is sensible to take legal advice to understand the terms of the licence. Alternatively, use a reputable licensing platform.

 

Licensing and franchising

Licensing And Franchising, What Is The Difference And Does It Matter?

Licensing and franchisingRecent comment in the FT illustrates some of the complexities faced by successful brands which have grown through licensing and franchising.  One of the key issues, is how ownership, control and use of the brand can be spread between different businesses.  The FT article, Virgin group: Brand it like Branson, is a fascinating look at some of the hurdles faced by Richard Branson, and provides some revealing information.

For example, the group makes about £120m a year from licensing its brand to other companies.  Some of those companies are publically concerned about the fact that damage to the brand as a whole, could impact their business, and that they have little power to prevent it.  Virgin America, in its IPO prospectus, explains that:

“The ‘Virgin’ brand is not under our control, and negative publicity related to the Virgin brand name could materially adversely affect our business”

The Virgin brand has been valued at roughly £1bn, and is an excellent case study for anyone hoping to grow their business through licensing and franchising.  However, there is little information available to educate brand owners on how these two strategies differ, and overlap.

There is a world of difference between licensing and franchising but it’s not always easy to distinguish between them. In fact, some “licensing” deals are so close to franchising that they blur the boundary between the two.

The distinction matters because franchising involves a number of formalities. Licensing, on the other hand, is less prescriptive as it covers many possible business arrangements. It enables you to make income from all kinds of intellectual property – your know how, ideas, creative output, reputation, patents, trademarks, designs, and so on.  You can license as much or as little of your business as you like.

To understand the difference between licensing and franchising the starting point is to look at what each term means.

Franchising

Franchising is a way to scale a business once it is successful and proven. It involves finding franchisees with the skills necessary to operate branches of the same business. McDonald’s is one of the best known examples of a business that has grown through franchising. (By contrast, Starbucks has grown by opening its own branches).

You can franchise almost any type of business. Under a franchise, the owner (franchisor) retains control of the brand and licenses (that is, grants permissions to) the franchisee to use its successful business model and brand. In exchange, the franchisee puts up the initial capital for the business, helps to promote the brand and pays a licence fee. The franchisor supports its franchisees by providing training, know how, marketing and other resources and skills.

Licensing of intellectual property (IP) is at the heart of a franchise contract.  So, in fact, a franchise includes licensing. Typically, this will cover know how and other confidential information, trademarks, logos and designs, and copyright materials. For some businesses there may be patents, too.

An essential element of a franchise (and one of the features that distinguishes it from a straight licence) relates to the formalities involved in setting up a franchise, and the degree of control the franchisor retains.

A franchise agreement will usually give the franchisor the ability to control how the business is run. For example, if a customer visits a branch of McDonald’s while on a trip abroad, expecting the familiar service they are used to at home, it is important that they should not be disappointed. Any unpleasant surprises due to changes in the business format could damage McDonald’s brand generally, not just that particular outlet. For that reason, McDonald’s franchise agreement contains strict quality control provisions.

Licensing

The essence of licensing (which is also the basis of franchising) is the owner retaining ownership of its IP while granting others the right to use it.  The terms can vary considerably.

Having said that, some licensing can look a lot like franchising. For example, in the 1850s the inventor of the sewing machine, Isaac Singer, sold licences to entrepreneurs to sell his machines in different parts of the USA. He also offered training in the use of the machines. In this case, the IP licensed was a patent, brand name and know how. Strictly, this was licensing, but it is so similar to what we think of franchising today that some people even consider Singer the father of franchising.

A clearer case of licensing is a car wash that has developed a successful process for getting its customers to opt for hot wax and other optional extras. It might license that process to other car wash businesses in return for royalties. These might be payments each month to use its way of promoting the wax, so that more customers buy it. In this example, the IP being licensed is “know how”.

Another example of licensing is a software licence, such as for Microsoft Office. The software is licensed to you – you do not own anything more than the right to use it. The software is licensed subject to strict terms and conditions.

Brand licensing

If you have built up a brand name, one way to scale your business is to issue a licence to a third party to deliver a related product under your brand name. So, a successful fashion designer might license a perfume manufacturer to create a perfume range for its label.

Another option if you have a successful product or brand, is to grant a license to someone to sell your product under their own brand name. An example is the model Twiggy producing a range of clothes for Marks & Spencer. Similarly, a cook such as Nigella Lawson could grant a licence to a company selling cooking utensils and crockery to use her name on its products. An established licensing model is explained in this article involving Disney’s licences to use its characters (and its brand) on third party merchandise.

Luxury brands are highly sought after for licensing, as their brand brings a cachet to the product to which they lend their name. But brands should beware of veering too far away from their market or offering licences too liberally. Pierre Cardin is a classic example of this. By engaging in indiscriminate licensing, it devalued its brand and lost much of its cachet.

Brand extensions that involve licensing your products or services to different categories are more likely to fail. For instance, Harley Davidson perfume proved to be an extension too far. And despite the fact that Virgin has been able to apply its brand to records, financial services, airlines and a variety of other products and services, it failed in its bid to extend its brand to cola.

Conclusion

Franchising is extremely expensive. So, licensing can be a good way to start if you are interested in franchising your business. Rather than diving straight into franchising with all the due diligence and formalities that it entails, you could start by finding a few licensees who are willing to license some or all of your business model. (Although beware that in some countries, such as the USA, and certain parts of the EU where franchising is heavily regulated, you want to avoid calling what is essentially a franchise a licence. It is unlikely to escape the regulators’ attention.  They will look to the essence of the agreement rather than its name).

Whether you are licensing or franchising, the important thing is to protect your IP. Your brand, patents, know how, trademarks etc. are precious assets, which should not be shared casually. The terms on which you grant licences or franchises need to be carefully considered.

You can read more about licensing and franchising, and other issues surrounding brand protection on our website.