Canada: IP: Social Media Series-Brand Protection

Copyright 2010, Blake, Cassels & Graydon LLP

Intellectual Property: Social Media Series-Brand Protection, September 2010

Communication on Web Goes 2.0 Ways

Moving Up to Web 2.0

The initial embodiment of the Internet was a one-way medium comprising static websites and search engines in which a user surfed from one website to another, often through the use of links. This Web 1.0 phase of the Internet enabled broadcast, point-to-point, and hub-and-spoke communication. Most of Web 1.0 can be characterized as a one-way street, with the user simply consuming content provided to him or her.

The current Web 2.0 phase of Internet activity is more dynamic and interactive, combining sources of content with increased functionality. This collaborative approach is not new on the Internet but has been greatly facilitated and expanded through new platforms. The creation and posting of material online is as much a part of the user's experience as the locating and viewing of it.

Users and content providers are now on a two-way street. Web 2.0, and particularly social media, allow user participation and interaction as content can be contributed to and edited by the author and the audience – users become creators and distributors of the message. Open communication, collaboration and the sharing and re-use of web content are key features.

Key components of the Web 2.0 environment are social media and user-generated content (UGC). UGC is content created by Internet users outside of professional practices and provided to a website on which it is published by someone other than the operator of the website. UGC may be entirely original to a user, may be obtained by a user from a third-party source without any original contribution, or may be a combination of remixed, or mashed up, content.

The widespread and increasing popularity of Web 2.0 has led many businesses and other organizations to utilize UGC on their own websites and on the social media websites of others. Websites that host or enable the creation and distribution of UGC include blogs, filesharing sites, wikis, social networking sites, aggregation sites and virtual worlds.

Types of Social Media

Social media can take many forms and are generally grouped into several categories, including blogs and microblogs, content communities and file-sharing sites, wikis and other collaborative projects, social networking sites, and virtual communities, including virtual game worlds.

A "blog", or "web log", is an interactive website, or part of a website, where users can easily post information, opinions, graphics and links to other websites on an ongoing basis. A blog is essentially an electronic medium for immediate citizen journalism but is also used increasingly by traditional journalists.

A blog may be external, accessible by the public or a segment thereof, or internal to an organization. Many businesses operate blogs, for purposes like customer feedback and contest submissions. TWITTER is a "microblog" social networking site through which users may send "tweet" communications of no more than 140 characters to "followers".

A "file-sharing site" is an example of a content community which provides and receives digital files over a network, usually through a peer-to-peer model, where the files are stored and served by user's personal computers. The most prominent example is YOUTUBE, on which users share multimedia UGC.

A "wiki" is a collaborative website which can be edited directly by anyone with access to it, such as the WIKIPEDIA online encyclopaedia. Wikis are increasingly used to engage contributors so they visit the website and view advertising thereon, such as ANCESTRY.COM, or to facilitate co-operation among businesses, including product development and marketing, like QUIRKY.COM.

A social networking site is a website whose primary purpose is networking among users, especially those who share common interests. The most prominent ones are FACEBOOK, MYSPACE and, in the business community, LINKEDIN. Some sites combine the functionality of social networking with other aspects of social media. For example, TUMBLR combines social networking with blogs. There are numerous other large regional, linguistic, subject matter and demographicfocused social networking sites. Increasingly, these sites are used by advertisers to reach users.

An "aggregation site" or a "social bookmarking site" gathers, links to and indexes content by themes based upon user recommendations, coupled with a social network to share content. Examples include DIGG and STUMBLEUPON.

Virtual worlds are three-dimensional simulated environments comprising content from both the operator and users. They permit multiple users to participate at once and in real time to communicate as well as develop and alter customized content. Some, such as SECOND LIFE, enable business functions, including the creation and sale of real estate, goods and services (see our May 2008 Blakes Bulletin on Information Technology).

Impact of Social Media

Despite widespread usage by individuals and businesses, as well as large amounts of media coverage, there is still skepticism about the value of social media. To many, social media are the purview of a small minority of young people, typically university students. Viewed through that prism, many question whether social media are a shift in communication or merely a passing fad. In order to understand how prevalent social media are, one only needs to look at the numbers.

FACEBOOK alone has over 500 million active users. In terms of sheer population, that is significantly more than the number of people who live in the United States, and behind only China and India.

Almost 50% of Canadians are on FACEBOOK and over 900,000 Canadians signed up in May 2010 alone. FACEBOOK is the second most visited site in the world, behind only GOOGLE. In Canada and the United States, FACEBOOK is visited more often than GOOGLE.

Over two million Canadians are on LINKEDIN. TWITTER is one of the top 10 most visited sites in Canada. In recent months, TWITTER has seen the number of "tweets" grow by an average of 16% per month.

The idea of social media as an arena of young people is not evidenced by the numbers in recent reports. The average age of a social network user is 37. 61% of FACEBOOK users are aged 35 or older and the average age of a TWITTER user is 39. LINKEDIN, with its business focus, has a predictably high average-user age of 44.

Not only is the scope of social media usage enormous, it is growing. A June 2010 study found that Americans spend nearly a quarter of their online time on social networking sites and blogs, a 43% increase from the previous year.

Businesses have also jumped on board the social media bandwagon. A recent report by the Retail Council of Canada indicated that just over two-thirds of Canadian retailers are using social media sites to reach their customers. Businesses have come to realize that consumers are increasingly turning to social media for product review. Over one-third of people who use social media have employed it as an outlet to rant, or rave, about a company or product. Nearly 50% of social media users say that reviews by friends or people they "follow" on social networking sites sway their interactions with companies or products.

The Social Media Series

Social media are not limited to the operators of sites like FACEBOOK and YOUTUBE. Businesses and other organizations increasingly host social media functionality on their own websites and participate in social media through the websites of others. With such participation comes a host of different legal risks and other issues which this series on social media considers. In this first instalment of the series, we consider trade-mark and branding issues on social media.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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