Undertaking an effective licensing strategy for museums and science centersby Wendy Heimann-Nunes, Esq.
Once upon a time, undertaking an effective licensing strategy from a museum/science center (MSC) perspective primarily meant licensing intellectual property (IP) from others at the lowest cost and with the least risk possible. Now, MSCs are clearing houses of their own IP (MSC-IP) and have the growing opportunity (and responsibility) to take advantage of MSC-IP by licensing it to others to increase their bottom line and enhance their brand. The following is a cursory overview of some important considerations when undertaking a MSC-IP licensing strategy.
The first step a MSC must take in establishing an effective licensing strategy is to identify aggressively all of its potentially licensable assets. Virtually anything protectable by IP laws is potentially licensable, so it is incumbent upon a MSC to be creative. An effective strategy in this regard often is to appoint an individual or group of individuals with a deep awareness of the MSC-IP to lead the identification process (e.g. a creative director, exhibit director, etc., as opposed to administrative staff or counsel). The more intimate an understanding of the property one has, the more likely an individual will be to identify the property as a potential asset.
• Photographic images of artifacts and artworks in MSC collections
• Audio recordings and publications
• Audiovisual works
• Multimedia productions
• Publications and educational material
• Databases of information about collections
• MSC name and identifying logo(s) or graphics
• Artist or creator name or signature
• MSC building (particularly if highly recognizable)
• Title of exhibition or program
• Packaging or color of MSC-based objects (often sold in gift shops)
• Works of art (where work is inherently tied to MSC in ways that patrons are reminded of institution or artwork)
For a MSC to achieve its financial objectives fully, however, it is important to identify potentially licensable assets that are not typically thought of as licensable. For example:
• Specialized collections management methods
• Preservation techniques
• Business methods and practices
• Database of patrons, donors and sponsors
• Organizational management structures
Once assets are identified, a MSC must understand fully the IP status of each asset it seeks to license in order to ensure the asset’s licensability. Does the MSC own the IP outright? Does the MSC have the right to sublicense IP it does not own? Are there underlying rights holders? Are their moral or attribution rights with which to deal? A MSC must be sure to obtain from third-parties all rights that are necessary to preserve its chain of title to, and hence ability to license, its IP. So, for example, a MSC may need to obtain copyright assignments or work-for-hire agreements (for MSC-produced content). The more thorough an analysis as to underlying rights, the greater a MSC’s ability to pre-determine with greater accuracy the overall strategy, related costs and associated risks. And, it goes without saying, that the more proactive a MSC is in securing rights when first obtaining or developing assets, the easier it will be to undertake a robust licensing program. A MSC should seek to obtain as wide a bundle of rights as possible when dealing with third-party rights holders. In this way, a MSC can preserve its ability to license as many of its assets as possible.
Once assets are identified, a MSC must have systems in place to manage them. Effective inventory and file management is critical in building an effective licensing program. In this way, a MSC can be assured that it has obtained and retains all rights necessary to fully capitalize on the value of its IP and avoid infringement claims, as well as ensure that its licensees are in compliance with all financial and quality control provisions (among others) in their license agreements.
Lastly, a licensing strategy would mean nothing without a good license agreement. When creating a license agreement, the underlying concept a MSC always should bear in mind is control – a MSC must maintain control over its licensees. The term of a license agreement, together with any renewals, should always accommodate the MSC’s workload and financial pressures. Financial provisions within a license agreement should always reflect the MSC’s cost structure in undertaking a licensing initiative and must ensure that the license is financially productive to the MSC. And, of course, securing quality control through robust approval rights, among other things, is critical to protecting the integrity of the MSC, its assets, brand, reputation and legacy.
While licensing can be very lucrative and presents a revenue enhancement opportunity that every MSC should consider, MSCs must be sure to undertake these initiatives carefully. Aggressive identification of assets coupled with mindful planning and management are great harbingers of a successful, lucrative, brand-enhancing licensing initiative. • • •
Wendy Heimann-Nunes, founding partner of Heimann Galen LLP, offers a unique expertise in location-based entertainment and the ever-growing intersection of entertainment and technology. Her biography may be viewed at www.heimanngalen.com.