VR and AR in Consumer Goods: Regulatory Trends

GlobalData Thematic Research 21 December 2020 (Last Updated December 21st, 2020 16:36)

Virtual reality (VR) remains unregulated, but standard fair use policies, copyright acts, trademark acts, and anti-dilution acts are being applied in the wake of disputes related to content ownership, intellectual property (IP) theft, etc.

VR and AR in Consumer Goods: Regulatory Trends
As GDPR comes into effect this month, ISO introduces privacy standards for consumer goods. Credit: Blogtrepreneur

Virtual reality (VR) remains unregulated, but standard fair use policies, copyright acts, trademark acts, and anti-dilution acts are being applied in the wake of disputes related to content ownership, intellectual property (IP) theft, etc. Regulators are mostly concerned about the protection of personal data and users’ privacy. Given the maturity level of VR, any vigorous attempt to regulate runs the risk of stifling the evolution of the technology. As a result, most regulators are taking a wait-and-see approach.

Regulatory Trends

Listed below are the key regulatory trends impacting VR and AR, as identified by GlobalData.

Legal challenges

Intellectual property (IP) infringement is seen as a prime legal risk by nearly 30% of companies developing immersive technologies, according to a 2019 survey by Perkins Coie and the XR Association. Augmented reality’s (AR) ability to replicate a wide range of images, properties, and other content in virtual spaces creates the potential for IP disputes around trademark, copyright, and patents. While patents are largely held by big firms, many of the cutting-edge technology trademarks and copyrights are owned by start-ups.

Geo-tagging in outdoor AR games has legal implications as well, mostly concerning the privacy of non-participating individuals. Given the current maturity level of AR, vigorous attempts to regulate it could stifle innovation.

Data privacy

The growing awareness of the need to protect user data stems from a raft of data privacy regulation including the European Union’s (EU) General Data Protection Regulation (GDPR), Japan’s Act on the Protection of Personal Information (APPI), and California’s Consumer Privacy Act (CPA).

Adopting an extraterritorial approach, GDPR and APPI require companies to process locally generated data, especially biometrics, within the region itself, irrespective of their base stations. The regulations also mandate companies to have transparent privacy policies in place, stipulating the purpose and use of user-generated data. Companies must also equip users with features to request, access, correct, and suspend their personal data from privacy centres.

Self-regulation

US-based VR companies have created their own ethical guidelines to protect their businesses from outside interference. The XR Association, previously known as the Global Virtual Reality Association (GVRA), includes Google, HTC, Oculus, Samsung, Sony and Acer and promotes the growth of immersive technologies through the development and sharing of best practices for the immersive tech industry.

This is an edited extract from the Augmented Reality (AR) and Virtual Reality (VR) in Consumer Goods – Thematic Research report produced by GlobalData Thematic Research.