“The death of trademark” – study finds that AI could adversely affect brand usage

• New study looks at impact of AI and new technology on trademark doctrine
• Suggests current examples, such as Amazon search, show brand use at risk
• Academic tells WTR that trademarks could become “less important” in future

A new research paper has looked at how improvements in AI could affect trademark doctrine – and the results are not necessarily positive for brand owners. Talking to WTR, the academic behind the study claims that the findings suggest that “trademarks may become less important in the future”.

The paper, entitled ‘AI and the Death of Trademark’, was published earlier this month and was penned by Michael Grynberg, associate dean of research and faculty professional development and professor of law at the DePaul University in Chicago. It focuses on how advancements in technology – especially in AI – could affect trademark law, and imagines the impact in a world in which consumer purchasing decisions are outsourced to AI. Asked why he approached the topic in this way, Grynberg tells WTR that he began thinking about it a few years ago: “I was asked to contribute a chapter to a collection about the future of trademark law. The book was focused on potential reforms, but the request got me thinking about how trademark law might change in light of future technology and whether speculating about that question might inform our understanding of contemporary trademark doctrine.”

That question led to some potentially difficult answers for the future of trademarks – which may have already arrived. As Grynberg outlines, “the current trademark equilibrium is already under pressure from artificial intelligence” – with forerunners already in the marketplace, most notably products from companies including Amazon, Facebook and Google. If AI technology is using data to make decisions, the study says, then it may not take into account the subjective information of a brand or, if it does, it may do so in an infringing way. The dispute in Multi Time Machine Inc v Amazon.com Inc was referenced, wherein Amazon did not carry MTM watch products but, when users searched for ‘MTM watch’ on the Amazon platform, various watch products were still displayed. Nonetheless, the court ruled in Amazon’s favour, with the opinion accepting that the online world – and new technology in general – requires consumers to “sort through context”.

For brand owners, that means AI search tools “may or may not be compatible with the desires of trademark holders”. Indeed, that gives AI and search companies huge power to “de-emphasize trademarks”, says Grynberg, who points to the current example of Amazon’s shopping platform. Recent data found that 63% of Amazon Prime members “carry out a paid transaction on the site in the same visit” (compared to 13% of non-Prime members), with less than 1% of Prime members “likely to consider competitor retail sites”. Coupled with Amazon’s propensity to exclude trademarks from product search results (often prioritising affiliate brands), the role of brand names appears to be less prominent within the Amazon ecosystem. “Traditional trademark uses (eg, ‘which brand of pants should I buy on Amazon.com?’) are simply less important in the Amazon-mediated environment (eg, ‘which pants does Amazon suggest?’),” he adds – and it could become a more significant problem for brand owners if, in the future, consumers increasingly designate AI to make product purchasing decisions. As Grynberg suggests, “perhaps AIs will tend, for example, to make recommendations that rest on past consumer experience at the expense of novelty reflecting consumer inertia (in other words, consumers at the margin may, as a descriptive matter, prefer familiarity to change even when the change would be an improvement)” – meaning that new brands could struggle to break through into the marketplace.

There are, of course, numerous ways that new technology – especially the rise of AI – could change the role of trademarks in wider society. But for Grynberg, the risks are significant and already prevalent. As he concludes to WTR: “The technologies that have created some of the world’s most valuable brands (eg, Amazon, Google, Facebook) may adversely affect the value of brands in the long run. Ultimately, trademarks function in part to help consumers manage information about goods and services in order to arrive at a consumption choice. If technological tools emerge that give consumers alternative ways to manage information on the way to that decision, then that feature of trademarks – and the need to give it legal protection – may become less important.”

What could that mean for the future of trademark doctrine? For Grynberg, it may lead to trademark law “reducing its focus on consumer protection and becoming more explicitly about protecting brand value as embodied in, say, prestige goods – which is not something I’m advocating, but it seems like a possible outcome”. What is clear is that there are significant challenges ahead for the very concept of trademarks in some sectors – and rights holders should consider the implications for their brands in an AI-dominated world.

Article Source: https://www.worldtrademarkreview.com/brand-management/the-death-of-trademark-study-finds-ai-could-adversely-affect-brand-usage