Esports – opportunity for video game developers

In part 1 of our blog on the global rise of esports, we focussed on legal issues affecting the industry, including player contracts, governance and sponsorship.

Part 2 focusses on copyright issues raised by esports, how they differ from conventional sports and how video game developers and publishers can commercially benefit from these relatively new issues.

Copyright in the game or match

When a conventional sport is played (eg an AFL or English Premier League match), there are no obvious intellectual property rights in the players’ performance of the sport, unlike with some musical or dramatic performances. Recording the match on your phone from inside the stadium or arena may contravene your ticket’s conditions of entry. However, you are unlikely to infringe a third party’s copyright, unless you capture copyright material (eg background music).

Unlike conventional sports, there may be copyright in the underlying video game of an esport. Video games are not protected as a whole but they usually include copyright protected material, such as the:

software in the game, being a computer program, specifically protected as a literary work;
script in the game, protected as a dramatic work;
visual elements deemed to be moving pictures, protected as films;
sound effects and in-game audio, possibly protected as musical works;
lyrics to songs in the game, protected as literary works; and
audio recordings in the game, protected as sound recordings.

The Copyright Act 1968 (Cth) grants the copyright owner an exclusive right to use, and authorise others to use, that copyright in certain ways (eg the exclusive right to communicate the copyright material to the public). If a third party:

runs an esports tournament for a video game; and/or
streams a video game being played (eg on Twitch or YouTube),

without the video game developer or publisher’s permission (depending on who the copyright owner is), they may be infringing the developer or publisher’s copyright.

Helpful to video game developers and publishers?

As seen above, conventional sports have limited intellectual property in the actual game or match being played. However, there is substantial copyright protection in video games, which provides video game developers and publishers opportunities to commercially exploit copyright in their games.

By creating competitive, organised tournaments for their own video games (eg an esports tournament), or by licensing a third party to organise a tournament for them, video game developers and publishers can:

generate revenue through licence fees, including in consideration for a third party being granted the right to stream the games being played at the tournaments; and/or
use the tournaments as part of their overall marketing plan to generate further interest in their games and receive advertising revenue from sponsors.

If you are a video game developer/publisher or are considering organising an esports tournament, get in touch with Bespoke’s Intellectual Property team for assistance with conducting an IP audit of your video game and preparing licence agreements for esports events.