Brand Considerations When Launching Mobile Phone Apps

Unlike online media generally, where a business can publish and distribute software applications and tools under its own guidelines and parameters, development in the App medium is constrained by the guidelines and rules set forth by a limited universe of third-party smartphone providers (e.g., Apple, Inc. (“Apple”), Google, Inc. (“Google”), Research in Motion Ltd. (“RIM”), and Nokia, Inc. (“Nokia”)). Prior to launching an App, App developers are required to enter into one or more click-through App license agreements with the smartphone provider (“App Agreements”). These App Agreements contain detailed terms and conditions governing the creation and launch of the App, and provide for intellectual property licenses between and apportioning liability among the App developer and smartphone provider. As a general matter, these agreements are non-negotiable and binding the moment that the App developer clicks assent.

In general, App Agreements: 1) restrict how an App developer can use and display the smartphone provider's trademarks; 2) require the App developer to grant a license to its trademarks to the smartphone provider; 3) require the App developer to indemnify the smartphone provider for third-party intellectual property infringement claims arising from publication and use of the App (including an indemnification arising from use of the App developer's trademarks); 4) allow for modification of the relevant App Agreement, typically with notice-to and opt-out rights; and 5) allow the App developer to terminate the App Agreement upon 30 days written notice.