Applicability Of Rule Of Property In The Field Of E-Commerce

enter image title here

Intellectual property in legal terms can be defined as industrial property and to copyright and related rights. The term Industrial property itself comprises of the protection of patents, trademarks, industrial designs, and geographical indications. There are myriad of reasons that E-Commerce is important to Intellectual Property. E-Commerce, more than other traditional forms of business models more often than not involves selling products and services that are based on Intellectual Property and its licensing. Music, photos, designs, pictures, systems, software, training modules, etc. can all be traded through E-Commerce and intellectual property is the main component of value in the transaction. Intellectual Property is plays an important role and acts as protector as the things of value that are traded on the Internet must be protected, using technological security systems and Intellectual Property laws or else they can be stolen or pirated and whole businesses can be exposed to threat.

There is no universally acceptable definition of intellectual property World Intellectual Property Organization (WIPO) describes Intellectual property can be primarily categorized into copyright and industrial property. Copyright deals with the protection of literary works of artists or artistic creations. Industrial property deals with the inventions, trademarks, commercial names etc.

It also includes the protection of utility models, trade dress and layout-designs or topographies of integrated circuits, where such protection exists, and protection against unfair competition including/or protection of undisclosed information/trade secrets. Intellectual Property can be said is a type of property or asset which is as valuable as physical or tangible property, even though is intangible. In today’s world the value of Intellectual Property assets has increased considerably as compared to its counterpart physical property because of the importance of technology and creative works in the modern economy. Intellectual Property consists of whole broad range of novel ideas, original expressions of ideas, distinctive names, and distinct appearances that make products unique and valuable. Intellectual Property is often traded in its own right without trading in the value of an underlying product or service, by means of patent or other IP licenses from a rights owner to another.

How Is Intellectual Property Important to Ecommerce?

E-Commerce as compared to traditional or any other model of E-Commerce involves buying and selling products and services that are based on Intellectual Property and its licensing. The music, pictures, photos, designs, training modules, soft wares, systems, etc. can all be traded through E-Commerce and thus Intellectual Property becomes the major component of value in the transaction. Since these commodities are valuable Intellectual Property which are sale on the Internet must be protected, using technological security systems and Intellectual Property laws or they are in danger of being pirated which is huge loss to business. The Intellectual property is itself used in making of E-commerce. The arrangements that allow the Internet to function viz. software, networks, designs, chips, routers and switches, the user interface etc. all can be considered as forms Intellectual Property. If the concept of Intellectual Property had not evolved, hard work of these artists would have been at stake and spread around the globe without getting paid for their labour. There wouldn’t have been any incentive to improvise to create new works. The two key areas that an ecommerce should be concerned about are: • Safeguarding their own intellectual property • Violating someone else's intellectual property.

An E-commerce website contains product descriptions and images. The question is does anyone has the right to publish those descriptions and images without permission? Same is question is applicable to logos, videos, photos, clip art, icons, sound effects, and background music!

What is seen is that small level ecommerce entrepreneurs disregard intellectual property issues and seem to be following the dictum “internet is free for use”. The important and early step any E-Commerce business should make is, to make an inventory of Intellectual Property assets. This would include software, designs, music, photos schematics, software scripts, documentation or technical writing, user interface materials, artwork, web site designs etc.


Intellectual Property has made and facilitated the working of E-Commerce work. E-Commerce businesses and Internet related businesses are usually product or patent licensing based because so many different technologies are required to create a product. So what these companies do is that companies they outsource the development of some of the component of products, or share technologies through licensing arrangements. If each and every company would develop and produce all technological aspects of every product independently, development of high technology products cannot be achieved and it is nearly impossible. Thus economics of E-Commerce largely depends on various companies working together to share through licensing, the opportunities and risks of business. The striking aspect is that Intellectual property in ecommerce is perhaps the most neglected sector, when it has and is the highest value-bearing component of ecommerce business. The reason for same can be it is either less understood, or because the important connections to ecommerce are not apparent as of now.

Last but not the least E-Commerce based businesses usually hold a great deal of their value in Intellectual Property; so the valuation of your E-Commerce business will be affected by whether you have protected your Intellectual Property or not. E-Commerce companies, like other technology companies should have patent portfolios and trademarks that can enhance the value of their business and mitigate their risks against misuse.