Nerd Alert: I was into video games since as early as I can remember. I first remember playing early games long Pong, Breakout and Donkey Kong on the Atari 2600. I then remember when my dad got my brother and I the first generation Nintendo. We were lucky enough to have many games including all of the Mario Brothers games, Ice Hockey, Excite Bike, Zelda, Tetris, etc.
Through the years, my brothers and I ran through many consoles including the Sega Genesis, Playstation, Xbox, Xbox 360 and finally the Playstation 3. I also played video games on the computer! As my brothers and I got older, we were mostly into sports games but I also loved third person shooter games.
Despite loving games, I never thought I would have the opportunity to have my work intersect with the video game industry. Luckily, given my line of work, I have had the great fortune of being able to negotiate some very interesting video game licenses.
Video game licenses can be lengthy and complex. There is no one size fits all. The following is a list of some of the issues to consider when reviewing or negotiating a video game distribution license
- Ownership – Are you purchasing the video game copyright or are you being given licensing rights to distribute the game?
- Exclusivity – Assuming you are a distributor, do you have the exclusive right to distribute the game worldwide? or are you limited to a territory?
- Maintenance and Support – Who will provide maintenance or updates to the game? The licensor or the distributor?
- License Fees – What will license fees be based on? Gross sales of the game?
- Marketing – Who is responsible for marketing the game? The distributor or the licensor?
- Sub-distributors – Can the distributor appoint sub-distributors or dealers?
- Trademarks – Who will register trademarks related to the video game in the territory that the distributor operates within?
- Governing Law – Which jurisdiction’s law will govern the contract? The licensor’s or the distributor’s?
- Buy-out Right – Will the distributor be given the right to buy out the ownership of the video game? Beware that if the distribution license is non-exclusive, the licensor won’t be able to permit a buy-out unless all other licenses are terminated.