Trademarks: Pointing to Quality in Open Source

In my last two posts we have seen that intellectual property rights are important to open source and proprietary software businesses alike. Specifically, copyrights are not only relevant to the open source business, but copyright ownership is critical to differentiation, particularly within the dual-license and service-oriented business models, which are among the most prevalent in open source today. Another important means of differentiation is trademarks.

Protecting trademarks and branding might be the single most important action an open source company can take with respect to intellectual property rights. For open source and proprietary companies alike, trademarks associated with quality products can make a company or product stand out in a sea of customer choices. This effect is even more pronounced for open source companies, where the value of a product offering is often either software code that is freely available under an open source license or a service offering for open source code. In fact, in the open source world, a trademark might be the only means of significant differentiation.

In addition to the obvious differentiation benefits in branding, strong trademarks create other differentiation opportunities that benefit open source companies. The players in a competitive open source category will have access to virtually the same software with a focus on differences (minor in scope, but meaningful in substance) that might improve performance or add valuable functionality. These types of improvements can be done by the copyright owner itself, or by other related parties such as known developers and trusted partners. No matter who creates the improvements, an open source company will want to tie the good ones back to its own product offering by implementing a certification or partner program that establishes minimum qualifications and guidelines for use of the open source company's trademarks, with accompanying logos indicating compatibility and quality. Trademarks are the best way to tell customers they are getting the best product possible whether offered by the trademark owner directly or through partners.

Open source companies also need to devote time to developing a two-track branding strategy -- one naming scheme for proprietary offerings and another for open source projects. Without such a strategy, a company's efforts to establish strong trademarks that result in significant differentiation could be eroded, both in marketing and legal terms, by the community. Without proper usage guidelines and accompanying enforcement, use of a brand names on products modified by community members will confuse end users as to the origin of the product.

Registration and protection of trademarks is a relatively simple, low cost process and should be a primary focus of all open source companies. Because of this simplicity and low cost, open source companies should register names, brands, logos and other items in as many top tier jurisdictions as practical, and a significant effort should be made to establish certification programs that use special logos. Because trademarks can be so valuable, open source companies should also devote resources to policing and enforcing trademark rights.

Now that we have discussed two types of intellectual property rights that have great utility in creating differentiation and are relatively easy to protect and exploit, the next post in this series will focus on patents. No matter what philosophical position an open source company takes on patents, each must create a patent policy that is consistent with its business objectives and the expectations of its community.