As an author, publisher, and a creative who works with many first-time authors, I have discovered there is a need for a deeper understanding of Intellectual Property (IP), the rights inherently contained in IP, and why IP is so important to all creatives. My goal is not to provide an exhaustive legal overview of IP (I am not a lawyer). Instead, my goal is to provide a basic understanding of IP, explain why it is so important, and provide a framework of understanding from which we can ask questions as you negotiate your own IP-related agreements.
The World Intellectual Property Organization states that IP “refers to creations of the mind, such as inventions; literary and artistic works; designs; and symbols, names and images used in commerce.” Basically, any work we create, from a novel to a blog post, to an article, to an invention—whether that creation is in words, imagery, symbols, or any other method—is our property. We own it.
And because we own our Intellectual Property, we can make money from our IP.
We can make money because, like almost any other type of property, we can sell it, we can lease it, we can give it away, and we can even use it to generate ad revenue or to generate leads for other businesses. We can also choose to sell our entire property or we can sell bits and pieces of it. These bits and pieces of our IP are known as rights.
The rights that make up our entire IP is what authors or creatives should care about most. In college, I had the concept of IP and rights explained to me this way: imagine Intellectual Property as a bundle of sticks. The entire bundle is the IP. Each stick contained in the bundle is a right and each right can be bought, sold, or even traded. The trick, of course, is to find a buyer.
These sticks, or rights, can range from the right to publish our property in print, ebook, video, audio, foreign translations, derivative works; to using it in whatever format is or may ever be in existence. A right is transferred or purchased by an entity (individual, company, organization, etc.) enabling them to use our IP to further their own commercial interests. Once purchased, that entity owns whatever right sold and they can own this right for a short duration or in perpetuity. They own the stick(s) for the duration of the contract.
For example, let’s say I have written a non-fiction book and a publisher is interested in publishing my book. I can sell that book - the entire IP - to that publisher lock stock and barrel. In effect, I can sell them the ownership of the entire work, every stick in the bundle. Usually, the publisher’s ownership is for at least 10 years, sometimes forever, and that publisher now owns my book outright. The IP is no longer mine.
When I sell the book to the publisher I could be compensated with an upfront fee (an advance) and a royalty rate for net sales of each book sold. In exchange, the publisher can and will publish the print book, ebook, audiobook, and any foreign language translations of that book, for as long as our agreement lasts. If I have sold them all rights (i.e. the entire IP), they can even create derivative work—like video—based on the book. I would likely receive royalties from this derivative work but ultimately the lion’s share of the revenue goes to the publisher.
What if I want to retain some of my rights? If, for instance, I’d prefer to retain part ownership, I can negotiate those rights. Let’s say I have a derivative work in mind, such as creating a workbook based on my book that consumers can only purchase from my website. I can negotiate that right (as long as the publisher agrees, of course). I can retain the audiobook rights if I prefer to do my own reading or want to do a series of podcasts based on my work. Each of these rights is worth a certain amount of money and a certain royalty rate. It is all negotiable.
Most purchasers of IP have standard agreements, and they tend to lock-in the rights they want in those standard agreements. The advice I give all new creators around IP is to understand and keep at the forefront the following concept: the work is yours, you own it, know exactly what you are selling or leasing.
The bottom line: Carefully read and ask quality (even “stupid”) questions about Intellectual Property. Do not skim that section of an agreement. IP is our work. We created it. Know what you are selling, trading, leasing, or even giving away.
And of course, it is worth the time and money to have an IP attorney, IP strategist, and/or an IP consultant review any legal document before proceeding. Seeking a professional’s advice is always a wise decision.
The next question is always; well, what about Copyright? What is it? How does it apply to my work?
I will save that topic for another post.
Hey Dawn, thanks for checking out the article! Jeffry is speaking from the place of a creator who has made a wholly original work and has yet to negotiate rights - something many creators on our platform aspire to to someday. In the case of Tongal, projects often ask creators to make something new out of existing brand assets, trademarks, copyrighted materials, characters, etc., which is why the IP rights stay with the client. Original content projects will typically have different rights transfer rules, so always make sure to read the project rules carefully. Hope this helps clarify!
