The thought of somebody using your idea for financial gain is not only frustrating, but can threaten the legitimacy and viability of your own product.
We sat down with Nathan Bilton, Managing Associate at Ward Hadaway LLP, one of the UK’s Top 100 law firms, to find out what IP protection exists and what to look for when starting development.
Nathan is a solicitor specialising in technology and data protection. He has worked with a varied roster of clients ranging from international software houses and telecommunications providers through to small-scale startups and entrepreneurs. He is also one of the mentors at Phase One, York’s Business incubator.
Should I take out an NDA?
As you begin to talk to a supplier about making your idea a reality, you should have a Non-Disclosure Agreement (NDA) in place. These documents allow for the free flow of ideas between supplier and client whilst maintaining clear guidelines on how that information is used and shared.
That being said, confidentiality agreements are only as good as the detail that goes into them. Plus, you have to take legal action in order to enforce them. Because of this, both parties need to have a thorough understanding of what you intend to discuss, what's being protected and what you can and can't use that information for.
It's not massively expensive to put an NDA or a confidentiality agreement together, but it sets the tone for the future conversations and shows that you're taking your idea seriously. Your idea could be worth millions of pounds, an NDA is a basic way of ensuring that it is not stolen.
What are registered and unregistered IP protections?
Registered IP protection is that which is registered and recognised by the Intellectual Property Office here in the UK. Things such as trademarks and patents grant legal protection in the case of imitation or duplication and ensure that the IP is officially recognised as yours.
In some cases, however, where a brand has grown to a level of recognisability, registered IP protections are not as necessary. If there is a certain amount of goodwill attributed to your brand name, this can be defined as an unregistered IP protection.
How Does Copyright Work in App Development?
The first way that you protect software is through copyright. Copyright is an intellectual property right that arises automatically upon the creation of an original work. Lasting for the length of the artists or the creators life plus a predefined period afterwards, copyright does not need to be registered, it applies automatically.
That being said, it is incredibly important that you keep records of your ideas. This could prove to be crucial evidence in the future should anyone cast doubt on your ownership of the IP. The film ‘The Social Network’, which covers the legal cases associated with the breakup of Facebook’s founding team provides an excellent example of this.
How Do Patents Work in App Development?
The difficulty with software copyright is that unlike a book or a piece of music, software is continually changing and evolving. So, in some cases another level of protection is necessary. This is most often achieved with a patent.
A patent protects the mechanics of how something works. A Dyson vacuum, for example, is a product that’s made of hundreds of patents. Patents cover how individual parts of the product (or in the case of app development, modules of code), work. They are designed to provide a thorough description of the inner workings of what makes a product unique.
Unfortunately, patents are incredibly complex, expensive to obtain and take a long time to create and register due to the descriptive effort required. They do, however, offer the ultimate technical protection for applications with complex or unique source code.
If your project functions in a specific or truly innovative way, it may be worth protecting your source code with a patent. If you have created a product with the capability of disrupting your industry, you will find that in time others try to imitate it- including those with extensive budgets and resources. Patents make this much more difficult, forcing them to find a completely new way of achieving the same result.
How Do Design Rights and Trademarks Work in App Development?
Design rights are all about how something looks, rather than the way it functions. If you think about the famous Coca Cola bottle, for example, the shape has nothing to do with the recipe of the drink- which is only protected by a trade secret rather than anything else. The look of the bottle, however, is protectable by design rights and trademarks.
That being said, it's not just a way of thinking ‘we really like the look of this app. We're going to protect it because it looks great’. You need to think about how protection fits in terms of your commercial strategy. Which elements of it are you going to protect? Are you going to use design rights to cover the UI of the app? Or is it better to look at trademarking the brand name, logo or color scheme used?
Trademarks and design rights push you to think about further uses of your brand. Are there opportunities for additional revenue streams such as merchandising down the line? If so, it makes sense to trademark your tag lines or logos.
It can be easy to neglect design rights in favour of more complex technical documentation, with businesses looking to protect the ‘mechanics’ of the project rather than the customer-facing brand. However, each user that downloads your product and forms a positive impression of your brand increases its potential reach. If your brand is not protected, you could lose out to imposter brands who leverage the goodwill attached to the name, logo or even your colour schemes of growing brands for their own profit.
Who Owns The Source Code for My Application?
In short: Whether or not you own the source code for your project depends on the terms and conditions outlined by your development partner.
Some developers opt for a similar approach to Netsells, in which measures are taken to ensure the client owns as much of the IP as possible, whilst other partners retain ownership over the source code and backend for your product, giving you full ownership of the front-end.
It is important to carefully consider all documentation provided by a partner prior to entering any kind of agreement. If, for example, you wanted to create an internal team or switch suppliers down the line, you will need to know how the ownership of different parts of the project would affect the migration process.
If your supplier retains ownership of the back-end and you want to take back control of the source code down the line, there are sometimes options to purchase the source code from them. However, this can prove incredibly costly and often requires a lengthy negotiation process.
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