Chain of rights in game development: Who ultimately holds the rights to the game?

In game development, intellectual property is the most valuable asset. Every aspect of a video game – from the source code, graphics and music to the characters and story – is protected by copyright or related rights. The chain of rights provides a complete description of who holds which rights to the game and its components at any given time. A clear chain of rights is crucial in order to be able to market the game in a legally secure manner and avoid disputes later on. This blog post provides a legally sound explanation of how the chain of rights in game development works and who ultimately holds the rights to the game. The focus is on clarifying the rights to engines, assets, music, external service providers and AI-generated content.

In the further course, central contract types and clauses that regulate the distribution of rights are presented: Work contracts, license terms, the granting of rights of use as well as non-disclosure (NDA) and IP clauses. We then look at publisher agreements with typical clauses (such as right of first refusal, exclusivity, sequel and spin-off rights) and IP management relating to merchandise, DLCs, add-ons, sequels and genre spin-offs. Distribution contracts and their effects on the exploitation of rights are also examined. A separate chapter is dedicated to cross-media rights, i.e. the legal aspects when games are based on films or, conversely, films are made from games. Finally, a comparison is made with the contractual structures of the music and film industries in order to highlight similarities and differences.

The article focuses on German law, but also includes the US system and licensing models in Asia by way of legal comparison. Important legal norms and court rulings (from Germany and the USA) are cited to support the explanations. The presentation is in professional legal language and is aimed at clients from the games, media and music industries who are looking for sound advice on the rights chain in games development.

Copyright basics in game development

An understanding of the chain of rights in game development begins with the basic principles of copyright law. According to German copyright law, the author of a work is always the natural person who created it (see Section 7 UrhG). In the case of a video game, however, there are numerous authors: programmers, graphic artists, game designers, composers, etc. Each of them initially holds the copyright to their respective contribution. This means that the copyright arises automatically with the creation of the respective content and always remains with the creator. This copyright is not transferable (Section 29 (1) UrhG) – unlike ownership of an object, for example, copyrights cannot be “sold” in Germany. Only rights of use, i.e. the right to use a work in a certain way, can be transferred (Section 31 UrhG).

Personal intellectual creation and co-authorship: For content to be protected by copyright at all, it must be a personal intellectual creation (Section 2 (2) UrhG). Pure game ideas or simple concepts (such as a rough game design document) are not yet protected – only the actual design (graphics, level design, code, texts, etc.) is protected. Several people are often involved in a specific design. If they create content together in an inseparable manner, they can become co-authors (Section 8 UrhG). They are then jointly entitled to the copyright. In practice, however, each contribution to games is usually considered separately (for example, the programmer writes the code – software is a separate type of work according to Section 2 (1) No. 1, No. 7 UrhG – and the graphic artist paints the textures – works of art according to Section 2 (1) No. 4 UrhG). This results in many individual copyrights to the components of the game. These must later be combined into a uniform chain of rights.

moral rights: It is important to note that, in addition to exploitation rights, authors also have moral rights, such as the right to acknowledge authorship (attribution, Section 13 UrhG) and protection against distortion of the work (Section 14 UrhG). These personal rights always remain with the author and cannot be transferred or assigned. Although this plays a lesser role in game development compared to art (the general public rarely knows the individual level designer by name), it can become relevant in the case of credits in games or subsequent changes to the artwork. In practice, employees or service providers are often contractually obliged to refrain from being named as the author or to agree to changes where legally permissible. However, such clauses must observe the limits of Section 14 UrhG – an author cannot completely waive protection against distorting changes.

Rights of use and the principle of assignment of purpose: Because the copyright itself remains with the creator, the granting of rights of use is typically agreed in contracts. A right of use allows the owner to use the work in a certain way (e.g. to reproduce, distribute, make publicly accessible, see § 15 UrhG for the possible types of exploitation). Rights of use can be granted simply (non-exclusive, others may use the work in addition to the author) or exclusively (exclusive, only the rightholder may use the work, the author himself can no longer use it) (Section 31 (2) UrhG). In the games sector, the aim is for one company to ultimately have all the necessary rights exclusively in order to be able to exploit the game worldwide. The principle of assignment of purpose is central to this (Section 31 (5) UrhG): This states that, in case of doubt, an author only grants as many rights as are necessary to achieve the purpose of the contract. All rights of use not expressly granted remain with the author. Doubts in case of unclear contractual provisions are in favor of the author. This principle has been confirmed by the Federal Court of Justice (BGH) in its established case law – contracts on copyright usage rights must be interpreted narrowly because it is assumed that an author does not want to give up his rights beyond what is necessary. In practice, this means that contracts must clearly and comprehensively list the rights of use that the client or publisher is to receive. Otherwise, the developer could later argue that certain types of exploitation (e.g. a new platform or a spin-off) were not covered by the granting of rights.

Works involving several and collective works: A video game as a whole is often a so-called multimedia work that combines various forms of work (software code, graphics, music, text). Under German law, this does not automatically result in a uniform copyright to the “game”. Instead, each author has the right to their own contribution. However, there is the concept of the combined work or collective work (Section 4 UrhG): If someone combines individual works to create a new work (e.g. level designer integrates graphics, code and music to create a playable level), this overall work may itself be protected by copyright (as a collective work or database work), but without diminishing the rights to the individual works. In practice, contracts are used to ensure that the use of all individual parts is permitted and that the overall product can be used and marketed without interference. Ideally, this results in one company (e.g. the developer studio or publisher) owning all the relevant rights to use the game. The establishment of this rights chain – from the individual author via any intermediate stages to the final rights holder – is carried out through various contracts, which we will now discuss in detail.

Contracts with employees and external service providers (work contracts, NDA, IP clauses)

A key component of the rights chain are the contracts with those who actually create the game – be they internal employees of a development studio or external service providers and freelancers who work on the game. This is where the foundations are laid so that the company can later dispose of the exploitation rights to the game. We first look at the situation with permanent employees (employees), then with external service providers/freelancers (work contract partners), and then go into typical confidentiality and IP clauses.

Employed developers and employees

In Germany, the following also applies to employees: the employee programmer or graphic designer remains the author of the works he or she creates. Unlike in the USA, there is no general “work for hire” rule in copyright law, according to which the employer would automatically become the author. German copyright law only recognizes automatic transfers of rights to the employer in special cases. Computer programs are an important special case: Section 69b UrhG stipulates that the employer receives the exclusive right of use for a computer program created within the scope of an employment relationship, unless otherwise agreed. This provision considerably simplifies the chain of rights in the software sector, as the employer does not have to assign the rights to the source code to each developer individually – this is done by law. Example: If a permanent employee programs the code of the game engine or gameplay modules, the studio automatically acquires the exclusive rights to use the code in accordance with Section 69b UrhG. However, Section 69b UrhG only applies to software. Other creative contributions to the game (graphics, 3D models, dialog texts, story, sound effects, music, level design, etc.) are not computer programs in the strict sense and therefore do not fall under this automatic regulation.

Contractual transfer of rights in employment contracts: In order to close the gap, employment contracts in the games industry contain IP clauses that ensure that the necessary rights of use are also transferred to the employer for all non-software works created by the employee. Typically, it is formulated that the employee “grants the employer the exclusive rights of use, unrestricted in terms of time, place and content, to all copyrighted works created in the course of their work”. Such a clause covers, for example, concept graphics drawn by the employee or written story dialog. Important: The content, duration and territory of the granting of rights of use should be comprehensively described in order to comply with the principle of transfer of purpose. In most cases, the employer wants all conceivable exploitation rights (reproduction, distribution, making available to the public, editing, etc.) worldwide and for the entire term of protection (in Germany 70 years post mortem of the author). The contract therefore often contains a passage such as:

“The employee hereby transfers to the employer all exclusive rights of use to all work results, in particular to computer programs (§ 69b UrhG), graphics, texts, audiovisual sequences and other created works. The rights are transferred for all known and unknown types of use, unrestricted in terms of time, space and content. The employer is entitled to edit the works, redesign them, assign titles and combine the works with others. The employee waives the right to be named as the author. In addition, the employee shall consent to a separate written transfer of rights upon request, insofar as this is required for legal validity under foreign law.”

Such a clause effectively makes the employer the economic rights holder of all content created by the employee. However, it should be noted that a complete “purchase of rights” as in the Anglo-American area (Work Made for Hire) is formally a granting of rights of use under German law. The copyright itself remains – at least in theory – with the employee. In practice, however, the employee no longer has any exploitation rights and therefore no control over the use of his work.

Moral rights in the employment relationship: The moral rights of employees are a tricky point. These cannot simply be “switched off” by contract. However, an employer would like to be able to edit freely, for example, without the author asserting Section 14 UrhG (prohibition of distortion). In practice, agreements are therefore often made that the employee waives the exercise of his moral rights to the extent permitted by law. For example, they agree that the company may make changes to their graphics or texts (e.g. to translate them into English or adapt them to technical requirements). Attribution is also often waived by contract – games are usually published under the name of the studio or publisher, not with the name of each individual contributor. Such waiver clauses are effective as long as the core of the moral rights of the author is not undermined. For example, case law allows an author to waive the right to be named, as this may even be in his interest to remain anonymous. He may also allow changes in advance, provided there is no risk of distortion. Such clauses are common in the games industry in order to give the employer maximum flexibility.

International aspect – employees in other countries: Many studios work globally, with team members in different countries. It should be noted here that the rules on copyright in the employment relationship vary from country to country. In the USA, the concept of “work made for hire” applies : if an employee creates a work in the course of their employment, the employer is deemed to be the rightful author from the outset under US copyright law (17 U.S.C. § 201(b)). The employee then holds no copyright. A work-for-hire can also exist in the USA for freelancers if a written contract expressly states this and the work falls into one of the permissible categories (e.g. “part of a collective work” – which can be used, for example, to declare a game as a collective work). In the USA, this system means that games companies are generally considered to be the full authors and rights holders of the games developed. A similar principle exists in Japan, albeit subject to conditions: The work must have been created in the course of business duties and published under the company’s name, and there must be no agreement to the contrary (Art. 15 Japanese Copyright Act). The copyright is then transferred to the employer. However, computer programs are excluded in Japan – here again, a contractual regulation is required. In China, the legal situation is also interesting: according to Chinese copyright law, the creator generally holds the copyright, even as an employee, unless the work was created in fulfillment of official duties and it was stipulated contractually or in internal regulations that the employer is entitled to the rights. Many foreign companies therefore expressly agree to transfer rights to the company in employment contracts in China.

Summary of employee rights: For a German studio, it is essential to have a written agreement with each employee that covers all conceivable rights of use – despite Section 69b UrhG, which only covers software. Internationally active studios must consider which law is applicable (the contract often stipulates that German law applies if the employee works abroad, but this only applies to a limited extent). It is important that there is no “legal loophole”, such as an artist abroad who would still have rights under local law. Contracts should therefore clearly stipulate that the result of the work is available to the company for comprehensive use.

External service providers, freelancers and work contracts

In addition to permanent employees, many developers and publishers make use of external service providers: be it a freelance concept artist, a composer, a dubbing artist, an outsourcing studio for 3D animations or even test players and consultants. These external partners do not have an employment relationship; their cooperation is usually regulated by contracts for work or service contracts. From the perspective of the rights chain, the risk here is even higher than with employees, as the full copyrights remain with the external service provider without clear contractual regulations! Sections 69b UrhG or work-for-hire do not automatically apply, as there is no employment relationship.

Contract for work vs. contract for services: First of all, the terminology: In a contract for work (Section 631 BGB), the service provider owes a certain result, typically the delivery of an agreed work (e.g. “creation of 10 3D character models according to specification X”). In the service contract (Section 611 BGB), the service provider only owes the effort of an activity, not a guaranteed success (e.g. “Consulting as a game design expert for 3 months, through regular meetings and feedback”). In the game industry, creative services are almost always formulated as a contract for work and services because concrete results are to be achieved. This also has an impact on rights: As a rule, a contract for work and services directly contains the agreement that the rights are transferred upon delivery of the work and payment of the fee.

Rights of use clauses in the contract for work and services: An external graphic designer who designs figures, for example, initially has the copyright to his drawings. Therefore, all necessary rights of use must be transferred in the contract. A typical clause could read:

“The Contractor shall transfer to the Client the exclusive right to use the works created under this contract (including all designs, graphics, models, animations, texts and other content) without restriction in terms of time, space and content. The granting of rights includes all known types of use, in particular the right to reproduce, distribute, make available to the public, exhibit, present, broadcast and the right to edit and further develop the works. The client is entitled to use the works in the context of the computer game [name/title] as well as for products based on it (e.g. sequels, extensions, merchandise) at will and also to grant or transfer rights of use to third parties. The agreed remuneration covers all rights of use.”

Such a comprehensive formulation ensures that the studio or publisher can use the material supplied by the freelancer as they wish, including modifications (important, for example, if the 3D model is later modified for a sequel) and follow-up products. It is also important to mention merchandising and other media, as this could otherwise be considered a different type of use. For example, an illustrator could theoretically prohibit his character designs from being printed on T-shirts if the contract only mentions “use in the game”. Therefore, use beyond the game (merchandise, trailers, spin-offs, etc.) is ideally also covered.

Work contracts with “delivery step by step”: In extensive projects, contracts for work are often divided into milestones. It is customary – especially in the case of larger contract developments – to transfer the rights step by step with the payment of the milestone. This means that once part of the work has been completed and paid for, the rights to it are transferred to the client. This is intended to prevent the client from investing money but ending up without rights if the project is canceled. Conversely, the service provider receives payment for each delivered part and retains a right of retention to the delivered files until payment has been made. This model (step-by-step transfer) has the advantage that the client can already use partial results should the contract end prematurely. Otherwise, the client might have paid a lot, but all rights would still be with the service provider, which would be problematic if, for example, you already have graphics in the game. In legal terms, it is often agreed in step-by-step contracts that the rights of use are automatically transferred exclusively to the client when each milestone is accepted and paid for.

Guarantee of the rights chain and warranties: Particularly in the case of external service providers, the contract must also stipulate that only own or appropriately licensed content is supplied. The developer does not want to run the risk of a freelancer incorporating third-party material (e.g. copying a texture from the Internet) to which he has no rights. For this reason, IP clauses almost always contain an assurance from the service provider that the delivered works are free of third-party rights and that they have obtained all necessary rights. It is often specifically mentioned that the service provider may not, for example, use any protected brands, logos, copyrighted templates or pieces of music belonging to third parties unless this has been approved by the client. If the service provider itself uses resources (e.g. stock assets, libraries), it must guarantee that the corresponding use in the game is covered by the contract. An indemnification clause is also agreed: If a third party does make a claim for infringement, the service provider indemnifies the client against all damages and costs. Such clauses are particularly important in an international context, for example when service providers come from countries where copyright is handled differently – the risk is contractually passed on to the service provider.

Special cases: Musicians and collecting societies: A typical stumbling block in the rights chain are musical compositions that originate from external composers. Many musicians are members of collecting societies such as GEMA. If a composer has a rights administration agreement with GEMA, he has already transferred almost all usage rights to his future works exclusively to GEMA. This means that even if the composer contractually grants the developer studio all rights to the game music, he cannot fulfill this promise because GEMA (on his behalf) watches over, for example, the public performance right or the reproduction right for sound carriers. In such cases, the studio must settle the music usage with GEMA – which can be expensive and complicated, especially because a game typically does not publish independent music recordings. For this reason, care is often taken to ensure that commissioned composers are not members of a collecting society. The contract with the composer then expressly states that he assures that he is not a member of a collecting society (e.g. GEMA). If they are, they must inform us and the contract can be terminated if necessary. German case law has developed the so-called “GEMA presumption”: According to this, it is presumed in favor of GEMA that it manages the rights to a piece of music if the author is a GEMA member and the piece has been published. This means that, in the event of a dispute, a game developer would have to prove that the composer is not a GEMA member in order to avoid having to pay. Hence the precautionary measure of not commissioning GEMA members in the first place, or if they do, then only by special agreement. – This example shows how important the unbroken chain of rights is: a carelessly engaged composer with GEMA ties could lead to the game not being allowed to be shown with music at trade fairs or streams without GEMA fees, for example. Appropriate contractual clauses and checks in advance are therefore a must.

Non-disclosure agreements (NDA):Non-disclosure agreements are concluded with both employees and external service providers. In the games industry, the potential partner often signs an NDA even before detailed discussions begin. In this agreement, he undertakes to keep secret all confidential information about the project that becomes known to him and not to pass it on to third parties or use it for his own purposes. An NDA is indirectly relevant for the rights chain – it does not protect copyrights, but it prevents ideas or unpublished assets from being leaked without authorization. For example, a developer may want to prevent a freelancer from publishing concept art for a new game on their website before the game has been announced. NDAs often also contain clauses that make it clear that all documents and materials remain the property of the client and must be returned or deleted at the end of the collaboration. It is also stipulated that confidentiality continues to apply after the end of the collaboration (often indefinitely, or at least until the public release of the project in question).

IP clauses and rights to preliminary work: In some cases, a service provider brings its own pre-existing materials into the project (e.g. a self-developed tool, its own template, etc.). Here, contractual IP clauses can regulate who owns these pre-existing materials and how they may be used. It is common for the service provider to retain the rights to it, but to grant the studio a right of use if it is incorporated into the game. Contractors also ensure that they receive reference rights – in the creative industry, a freelancer wants to be able to show the work created later as a reference in their portfolio. Many contracts explicitly grant this right, but only after the game has been released and often only in a limited form (e.g. excerpts, no complete source code or entire assets in the public domain).

Interim conclusion: external contracts: Contracts for work and services with external parties are a potential risk for the rights chain if they are not formulated in a watertight manner. All copyright usage rights must be clearly regulated and transferred from the service provider to the client. In addition, assurances must be obtained that no third-party rights will be infringed and confidentiality must be ensured. If this is successful, the freelancer’s contributions will fit seamlessly into the rights chain and the studio or publisher can later exploit the overall product without restrictions.

Special features: AI-generated content

AI-generated content is a comparatively new topic in the rights chain. Today, artificial intelligence can generate graphics, dialog texts or even music. Many developers use tools such as neural networks to create procedural landscapes or item descriptions. This raises the question: who holds the rights to a work generated by AI? And are there any copyright rights at all?

Copyright status of AI-generated works: According to the current legal situation in Germany, purely AI-generated content is not protected by copyright. § Section 2 (2) UrhG requires a personal intellectual creation – i.e. a human creation. A machine or software as such cannot be an author. So if, for example, a quest text is created using a text generator (without significant human editing), this text is not protected by copyright. No one – neither the developer nor the AI tool provider – has a copyright to it, as there is no human creator. As a result, any third party could theoretically use, copy or publish this text without asking the developer. The same applies to AI images from tools such as Midjourney: if they are used 1:1 in the game, they are not protected and can therefore be freely copied by others. For the rights chain, this means a break in the exclusivity claim: although the studio has no third-party authors who could assert rights, it also has no enforceable copyright itself. This means that there is no basis for prohibiting third parties from using the work. Especially if a game is based on striking character portraits or artwork created by AI, a competitor could use these graphics without a license – a considerable risk for marketing and monetization (e.g. in the form of merchandise).

Strategies for dealing with AI content: Practical experience has found the first answers. It is advisable to always rework AI-generated content so that a human level of creation is added. For example, a game artist could take AI-generated concept art as a basis, but then manually paint over it, add details and creatively redesign the result. This gives rise to the human editor’s own creative traits, and the end result in turn becomes a protectable work. The author would be the human editor. This approach – AI as an aid, not as an autonomous creator – makes it possible to exploit efficiency gains through AI without completely abandoning legal protection. However, it must be clear that the scope of protection then only covers the elements contributed by humans. The more substantial the human element, the more secure the eligibility for protection.

If AI content is used without (or with minimal) editing, it should rather be used for non-essential areas: for example, randomly generated NPC dialogs or background graphics where exclusivity is less important. The team should document what has been generated fully automatically and what has been adapted by humans so that it is clear later on which parts are protected by copyright.

Contractual and licensing issues with AI tools: Another facet: AI generators are often used on the basis of the provider’s terms of use (e.g. terms of service from OpenAI, Midjourney, etc.). These regulate who is entitled to the exploitation rights to the output. Providers often grant the user comprehensive rights to the generated output. This does not change the fact that no copyright arises, but at least contractually the developer may use the output and third parties (the AI provider) will not make any claims. However, many tools have clauses that require, for example, that you do not make any illegal prompt inputs or do not use output for certain purposes. So here is a new point in the chain of rights: license terms of the AI provider. A violation (e.g. if someone trains the AI with stolen images) can violate the license and theoretically give the provider the right to prohibit use. In the case of AI textures or AI sound effects, there is also the question of whether the AI provider may continue to use the output material or store it in its data sets – which can be problematic in terms of data protection or confidentiality law in the case of sensitive internal content (level design, secret character designs). This is why large studios are starting to train their own AI models on internal data so that nothing leaks out.

Third-party copyrights in training: An even more complex issue is whether the use of AI-generated content can infringe the copyrights of third parties. AI models are trained with vast amounts of data (images, texts, etc.), often collected from the internet. Naturally, copyright-protected works are also copied and processed in the process. Depending on the jurisdiction, the training itself may be considered permissible data mining (in the EU, Section 44b of the German Copyright Act (UrhG) contains a limitation rule that permits the automated analysis of lawfully accessible works under certain circumstances). However, there must be no reservation of use – many artists now have “do not train” notices in their images or there is metadata/watermarks that are intended to prohibit training. If an AI model has been trained in violation of such prohibitions, the training results could be tainted.

This means for game development: If you use a third-party AI model, you do not know for sure whether this model has been properly trained. If it turns out later that, for example, an AI image contains clearly recognizable elements of a protected third-party work of art (because the model has practically “reproduced” it), the author of the original could assert claims. Although the likelihood of a generic AI tool accidentally copying another person’s work is low, there have already been cases in which AI images had characteristic features of certain artists, which could affect their copyrights.

The major gaming platform Steam (Valve) has reacted: Valve refuses to publish games with AI-generated content as long as the legal situation remains unresolved. In a well-known case, a developer received a rejection from Valve for his game because it contained AI-generated graphics that apparently drew on copyrighted third-party material. Valve demanded proof that the developer owned all rights to the works contained in the AI’s training data set. A practically impossible request, as the developer had not trained the AI model himself. This strict stance shows that at least some market players consider the risk to be high and, in case of doubt, do not want to tolerate any unauthorized AI content in order to avoid encouraging infringements.

Conclusion AI in the rights chain system: For developers, this means that if AI is used, this should be done with caution. Contracts with external service providers could contain clauses that regulate the use of AI – for example, that the freelancer may not use an AI tool to create the commissioned work without consent. Internally, companies should determine when AI is used and how to ensure that the results are either harmless (because they are in the public domain or of low value) or can be protected by human processing. Until clarification in legislation or case law (the copyright protection of AI works is being discussed worldwide), the following applies: it is better to use AI as a creative assistant than as the sole artist – then the rights chain remains under human control here too. In case of doubt, it is better to refrain from using AI content where exclusive rights are required later (e.g. main characters, story illustrations) and to use AI for generic content.

Publisher agreements: Transfer of rights, exclusivity and typical clauses

Once a game has been developed or is in development, a publisher usually comes into play. Publishers take on the financing, marketing and distribution of a game – and demand extensive rights in return. The publishing contract is therefore at the center of the rights chain: this is where it is decided who ultimately holds the rights to the finished game and to what extent. We look at the typical clauses of a publisher contract from a legal perspective, in particular with regard to IP(intellectual property) and exploitation rights. Topics include the transfer of rights of use, exclusivity, options for sequels (right of first refusal), sequels/spin-offs and other standard industry regulations.

A rough distinction can be made between two models: Contract development (the publisher commissions the developer to create the game for them by way of a contract for work and services – in this case, the publisher usually retains the IP in the end) and license model (the developer has a finished or highly developed game and “only” gives the publisher the distribution and marketing rights – in this case, the IP can remain with the developer). In practice, there are many mixed forms. It is important that the contract clearly defines which party is or will be the owner of the rights to the game.

Intellectual property of the game: IP clause

A core element of every publishing deal is the IP clause, which determines who owns the intellectual property rights to the game. There are two extremes here and various intermediate stages:

• Publisher as IP owner: Frequently, especially with large publishers and financed projects. The contract can read something like: “The developer hereby transfers all copyrights and ancillary copyrights as well as other rights to the game and all associated materials to the publisher.” In German terminology, this would strictly speaking be a grant of exclusive, transferable rights of use to all works (graphics, code, audio, etc.), as authorship itself cannot be transferred. In addition, it is usually stipulated that the publisher is also covered for all future further developments, patches, add-ons etc.. This means that the publisher is the owner of the exploitation rights and can market the game as it wishes. In this model, the developer acts primarily as a contractor and no longer has any exploitation rights of its own after completion and delivery. This model corresponds to the classic “contract for work with purchase of rights”. It is often structured in such a way that rights are gradually transferred during development (as mentioned above) in order to protect the publisher in the event of payments.
• Developer remains IP owner: Particularly in the case of independent studios or so-called indie publishing contracts, the developer retains the intellectual property rights to their game. The contract then states, for example: “All copyrights to the game remain with the developer. However, the developer grants the publisher the following exclusive rights of use: …” This is followed by a list of rights that the publisher needs in order to publish the game (reproduction, distribution, advertising, etc.), often limited to certain platforms, territories and a certain period of time. Here, the publisher acts more as a service provider for the developer, similar to a distribution company acting on behalf of the developer. The publisher receives an exclusive license to commercialize the game in certain markets, but ownership of the IP (especially the brands and characters/story) remains with the development studio. This model is often targeted by developers who can compare multiple offers as it gives them more control in the long term. However, publisher services (marketing budget etc.) sometimes depend on whether they get the IP, so developers have to weigh up what is more important to them.
• Hybrid models: There are also intermediate solutions. Sometimes the publisher acquires the rights under a resolutive condition – for example: “for the duration of the contract plus 5 years thereafter, after which the rights revert to the developer”. Or the developer transfers the IP, but receives extensive participation and influence rights (e.g. a say in sequels or film adaptations, a share in the profits of all exploitations, etc.). In other cases, the developer retains certain rights, e.g. the rights to the underlying story world, and the publisher “only” receives the actual game. For example, a contract could stipulate that the developer retains the right to publish novels or comics in the game world, while the publisher has the exclusive rights to the game. However, such reservations are rather rare and must be clearly formulated in order to avoid conflicts.

Scope of the rights of use (scope of license): The decisive factor is that the right of use granted to the publisher is defined in terms of content, time and territory. As a rule, a publisher strives for the following points:

• Content: All relevant types of use. This includes in particular:
  • Reproduction (§ 16 UrhG): the making of copies (physical, digital). E.g. pressing DVDs, creating download files.
  • Distribution (§ 17 UrhG): putting the physical copies into circulation (dispatch to trade, sale).
  • Making available to the public (Section 19a UrhG): Making available for download or streaming (e.g. via Steam, app stores).
  • Exhibition/performance (§§ 18, 19 UrhG): Showing at trade fairs, events. Not so central for games, but can be relevant (e.g. setting up an arcade machine in public).
  • Editing rights (Section 23 UrhG): very important, as the publisher must often be allowed to make adaptations (localization: translation of texts, editing content for the protection of minors if necessary, editing patches/updates). The editing right is also required for ports to other platforms or remaster versions.
  • Ancillary copyrights: In addition to copyrights to graphics and code, there are ancillary copyrights, e.g. to music recordings, voice recordings (Sections 73, 77 UrhG) – the contract should therefore also regulate the rights to the performances of performing artists (such as voice actors). In most cases, the developer transfers the acquired rights to the publisher or ensures that the voice actors have signed the relevant consents.
  • Trademark rights: A game often has a title or characters that could be protected as trademarks. The publisher usually wants all rights to the game title and logos. Therefore, many contracts state that the developer agrees that the publisher may register and own the trademarks. Or it is agreed that an existing trademark of the developer is also licensed.

  Promotional rights should also be mentioned: The right to use trailers, screenshots, artwork etc. of the game for advertising. In legal terms, trailers are independent film works, while screenshots are reproductions of the artwork – for the sake of simplicity, contracts stipulate that the publisher is entitled to produce and distribute advertising material.

• Geographically: In which territory do the rights apply? Worldwide is common because games are distributed digitally worldwide. Sometimes, however, rights are divided up by territory – e.g. one publisher gets Europe, another USA/Asia. In this case, it must be precisely defined who operates where. A geographical restriction can also occur for regulatory reasons (e.g. a Western publisher works with a Chinese partner who publishes in China because cultural adaptations are necessary there). If a publisher only has a license for certain countries, the contract should also regulate whether the publisher has to geoblock the game for other regions or whether the studio delivers separate versions. Most common practice in large deals: worldwide rights to one publisher, as this usually takes over multi-territory marketing or uses sub-publishers.
• In terms of time: There are differences here. Some publisher agreements grant the rights for the entire duration of copyright protection (i.e. de facto until 70 years after the death of the last author – which practically means “forever” from a company perspective). Others limit the license to a specific period, e.g. 10 years from release. Limitations are particularly common in license models where the developer remains the IP owner and only permits exclusive exploitation for a limited period. After expiry, the rights revert to the developer (so-called reversion of rights). Large publishers prefer perpetual rights or automatic renewals in order to be able to plan for the long term – they want to avoid a game disappearing or the developer taking it to a competitor after a few years. However, a time limit can be an important lifeline for the developer if the publisher does little: if after 5 years, for example, sales are marginal but the publisher still holds the rights, the game could “gather dust in the drawer”. This can be counteracted with a contract termination clause or a term limit.

A rights reversion clause is particularly important if rights have been granted very broadly: For example, worldwide rights, but the publisher does not use some territories (it never releases the game in Japan, for example). In this case, some contracts stipulate that the rights for unused regions revert to the developer if the publisher does not release the game there within a certain period of time. Alternatively, it may be stipulated that the developer itself may publish there as a substitute or may use a third party if the publisher does not take action.

Exclusivity and non-compete clauses

Exclusivity is the rule in publisher agreements. This means that the publisher has the exclusive right to distribute the game in the agreed forms – the developer may not use another publisher or distribution channel for the same game in parallel or subsequently (as long as the contract is in force). Exclusivity refers primarily to the rights of use mentioned above: if these are agreed as “exclusive”, exclusivity is given per se.

However, there are often competition clauses that go beyond this. One example is a non-compete clause that prohibits the developer from developing or publishing competing games during the term of the contract (and sometimes for a certain follow-up period). The idea behind this: The publisher invests marketing in the game and doesn’t want the developer to release a very similar game at the same time, possibly on its own, that competes. A draft contract could state: “The developer will not develop, distribute or support any other video game that directly competes with or cannibalizes the success of the contracted game without the publisher’s prior written consent.” Such clauses must be narrowly defined – what does “in competition” mean? It is often limited to the genre or the IP. Example: If the developer releases a fantasy role-playing game with the publisher, the non-compete could prohibit the developer from making another fantasy role-playing game with a similar theme for another publisher at the same time.

Sometimes exclusivity goes so far that the developer is generally not allowed to publish any other games as long as they are working on the financed project – simply because their capacity should be fully tied up. Particularly in the case of smaller studios with limited staff, a publisher wants to ensure that all resources flow into their project. This type of non-compete is almost equivalent to an exclusivity-first look contract with the publisher and can severely restrict the studio.

Enforceability of non-competes: In Germany, post-contractual non-compete clauses are more difficult to enforce for self-employed persons than in Anglo-American countries. Overly extensive, indefinite prohibitions could be seen as a violation of § 138 BGB (immorality) or as a disproportionate restriction of professional freedom if no compensation is paid to the developer. Therefore, reputable contracts take care to set time limits (e.g. non-compete applies until X months after the release of the game) and to limit the scope (only similar games, not every activity). Note: In some jurisdictions in the US, non-compete clauses against individuals are now restricted or prohibited by law (e.g. in California). However, they are more likely to apply to companies. In practice, this point is often seen as less of a problem, as developers rarely run two competing projects in parallel on their own anyway; but it can become important if the studio wants to pursue other ideas.

Exclusivity of rights vs. involvement of third parties: Another exclusivity concerns the publisher itself: The developer wants the publisher to exclusively market its game in the genre, or to be fully involved. As a rule, you can hardly prohibit a publisher from also distributing competing products (a publisher often publishes several similar titles). What does occur, however, are “key man” clauses or priority clauses, which are intended to ensure that the developer project is not neglected. For example, the contract could stipulate that a certain producer from the publisher remains assigned to the project, or that the marketing budget must be at least X amount – these are indirect ways of ensuring “exclusivity” of attention. In essence, however, the publisher has exclusive rights to the game and the developer undertakes not to grant any competing rights.

Financing, remuneration and exploitation of rights

Even if this article is mainly about the rights, the rights issue is closely linked to the financing and remuneration in the publisher contract. After all, those who pay for the development usually have a stronger argument for controlling the rights. In addition, remuneration models often define the extent to which the publisher may use the rights and for how long.

Advance and royalties: It is common for the publisher to pay the developer a development advance (a kind of budget or milestone payment) and in return later retain the lion’s share of the proceeds until the advance has been recapitalized ( recouped). After that, developers and publishers share the profits according to an agreed formula(royalties). The legal effect of this financial construction is that the publisher has a strong interest in fully exploiting the game, but also that it may keep the game even if the developer is dissatisfied – as long as there is money in the game. There are cases where a game runs profitably but the developer takes a long time to break even due to unfavorable royalty conditions; meanwhile the publisher holds all rights.

Linking rights to payment: It is important for developers to have clauses that affect rights in the event of payment defaults. For example: “If the publisher fails to make due payments (e.g. milestone installments or royalty payments), the developer is entitled to terminate the contract for cause and demand immediate reversion of rights.” This provides protection in the event that the publisher becomes insolvent or breaches its obligations – the developer could then reclaim its rights to the game and look for a new partner, for example. Without such clauses, the developer would be left with a half-finished game and no rights in the worst-case scenario if the publisher defaults.

Term of the contract: A publishing contract often has a defined term, such as “x years from first publication” or “until the end of the protection period”. If the term is limited, it should also stipulate what happens after the end: ideally, the rights should be transferred back to the developer. Sometimes publishers retain certain rights even after expiry (such as continuing to distribute the game, but no longer exclusively). In any case, the term is a tricky point: a short contract gives the IP back to the developer in perspective, an open-ended contract means that the publisher can draw from the game “forever”.

Right of first refusal / option rights: Clauses for future projects deserve special mention. Many publishers grant themselves an option on the developer’s next game, or at least on sequels. The best-known model is the Right of First Refusal (ROFR), i.e. a right of first refusal in the broader sense: the developer must give the publisher the first opportunity to publish the next game (or a “successor” to the current game) before negotiating with others. A typical formulation would be:

“The Developer shall grant the Publisher a right of first negotiation with regard to the next video game planned by the Developer after completion of the game that is the subject of this Agreement. The Developer shall offer the concept of the next game to the Publisher in writing. The Publisher shall have 60 days from receipt of this offer to submit a contractual offer for the publication. If the publisher refuses or if the deadline expires without an offer, the developer is free to offer the game to third parties. If the publisher accepts, the parties will enter into negotiations on a new publishing contract on terms customary in the industry.”

This clause secures first access for the publisher. A more stringent variant is a matching right: even if the developer receives an offer elsewhere, the publisher may match the offer and is then awarded the contract. This means that the developer is effectively bound as long as the publisher goes along. From the developer’s point of view, such clauses are dangerous if the relationship with the publisher is difficult – it’s hard to get rid of them because you always have to give the old partner a chance first, and other potential publishers may be put off if they know they could end up being outbid by the old publisher.

Exclusivity for sequels and spin-offs: Closely related is the question of sequels and spin-offs. If a publisher controls the IP, it will naturally also want to release sequels itself (this is often the most economically attractive option). Strictly speaking, a publisher contract that has transferred the IP to the publisher does not need a separate sequels clause – the publisher owns the brand and can commission any developer to create a sequel without asking the original developer. However, it may be contractually agreed that the original developer has a right of first refusal to develop the sequel. This is the flip side, so to speak: It is not the publisher who has the right of first refusal, but the developer on the follow-up contract. However, such agreements are rare; it is usually the developer who tries to write in a chance for follow-up orders (“Publisher will give the developer appropriate consideration for sequels”).

In cases where the developer remains the IP owner, it is the other way around: the publisher would at least like to have the option of also being allowed to distribute a sequel. An option clause often appears here: “In the event that the developer develops a sequel or add-on to the game, the developer will make the publisher the exclusive offer to market this product on terms no less favorable than those of this agreement.” – This binds the developer insofar as he cannot simply run to the next best provider with the success of the first game without giving the previous publisher a fair chance.

Spin-offs and secondary uses: A spin-off could mean, for example, that the game engine is used to build a game in a different genre (e.g. an RPG is turned into a strategy game spin-off with the same characters). If the publisher is the IP owner, this usually also covers such modifications – strictly speaking, they are adaptations of the original work, which is usually covered by the acquired rights. If the developer was the IP owner and only licensed the specific game to the publisher, the question arises: Does this include spin-offs? Only contractual clarity can help here. Either you list spin-offs as part of the licensed rights (which would be unusual because spin-offs are hypothetical in the first place), or you leave it to the developer but give the publisher a right of first refusal.

Example to illustrate: A development studio publishes a successful platform game with publisher A. Now the studio plans to make a racing game (kart racer) with the same characters. Now the studio plans to make a racing game (kart racer) with the same characters. If Publisher A owns the IP outright, the studio cannot realize this project without A – A decides whether and with whom a racing game is created. If the studio had kept the IP, it could theoretically make a racing game spin-off with publisher B, provided the contract with A does not prohibit this. However, A could feel violated if B now profits from the established characters. Publishers therefore try to cover these cases contractually. One possible clause is that for the duration of the contract and X years thereafter, no game with the same characters/world may be published without A’s consent, regardless of the genre. Such restrictions protect the publisher’s investment.

Example clause spin-off prohibition: “The Developer shall not, without the Publisher’s consent, develop or publish, either itself or through a third party, a video game based on the same characters, storylines or game worlds as the Game that is the subject of this Agreement, unless it is an expansion that is subject to this Agreement.” – This wording would effectively exclude spin-offs, unless the publisher approves it (probably in return for participation or as a separate contract).

Other important clauses: Guarantee, liability, termination

In addition to the IP and license clauses, publisher agreements contain a number of other conditions that have an indirect influence on the rights chain:

• Guarantee of freedom from rights: Similar to contracts for work and services, the developer guarantees the publisher that the game does not infringe any third-party rights. Usually, the developer must guarantee that all contributors have valid contracts, that no third-party assets have been used without authorization, that no third-party trademarks have been infringed, etc. Should legal disputes nevertheless arise (e.g. a third party claims that a character has been copied from their design), there is usually an indemnification clause in favor of the publisher. The developer then has to pay for legal defense and damages. This can be a high risk for indie developers, which is why they try to at least partially limit their liability. Some publishers initially assume the defense of claims as a gesture of goodwill, but ultimately the contract will attempt to impose the risk on the developer. important: This guarantee in turn supports the chain of rights – the publisher can only market without worries if the chain from the author to the publisher is clean. If the publisher discovers, for example, that the developer has used unlicensed music in the game, it will insist on fulfillment of the contract (subsequent rights clearance or replacement of the asset) or, in an emergency, withdraw from the contract.
• Confidentiality and NDA: The publisher agreement itself usually also contains a confidentiality clause. Both parties are not allowed to pass on contract contents, business secrets, technical know-how, etc. to outsiders. From the developer’s point of view, it is particularly important that the know-how is protected: If the developer brings in its own engine or tools, for example, it should be contractually stipulated that the publisher may not use these for other projects without authorization (unless the engine was also sold to the publisher). This is where IP management comes into play on a finer level: who owns the tools and raw data? Internal tooling often remains with the developer, while the publisher has the right to use the end product.
• Termination rights: A publisher agreement will define detailed grounds for termination. It is common for the publisher to be able to terminate without notice in the event of certain breaches by the developer – e.g. significant delays, failure to meet milestones, the developer filing for insolvency or quality defects. Conversely, the developer also has termination rights, usually in the event of late payment by the publisher or if the publisher fails to meet its obligations (e.g. marketing, release within a certain period of time). The consequences of termination are tricky: the publisher often has the right to continue using parts of the game that have already been created, even if the parties part ways. For example, in the case of “termination for cause by the publisher due to the fault of the developer”, it may be agreed that the publisher may take all assets created so far in order to complete the project with another team if necessary. The publisher would then pay the developer a certain amount of compensation (or not, e.g. in the event of a contractual penalty). Conversely, if the publisher terminates without cause, the developer should get all rights back, ideally also be allowed to keep advances already paid as compensation: In Germany, the law grants the purchaser of a contract for work and services a free right of termination (Section 648 BGB) – the publisher could therefore theoretically terminate the contract at any time (even without cause) and then only have to pay the agreed remuneration less expenses saved. This can be disadvantageous for developers because you could be almost finished and suddenly the publisher terminates the contract. In practice, contracts try to restrict this right contractually (which, however, would be ineffective as general terms and conditions if it unilaterally excludes Section 648). This is often circumvented by constructing the publishing contract as a mixed contract, which mixes elements of service and work contracts, or by choosing foreign law in order to circumvent Section 648 BGB. In any case, it is worthwhile to clearly state in the contract what happens to the rights in the event of termination: typically -> in the event of justified termination by the publisher: publisher receives (partial) rights to previous work-in-progress; in the event of unjustified termination by the publisher or justified termination by the developer: rights revert to the developer.
• Example clauses from publisher agreements: By way of illustration, here are some example clauses as they may appear in publishing agreements – clearly paraphrased:
  1. IP transfer: “The developer grants the publisher an exclusive, worldwide and perpetual right to use the game ‘Project X’ and all associated content. This right of use includes in particular the right to publish, reproduce, distribute, make publicly available, broadcast, perform and edit the game or integrate it into other works (e.g. collections, compilations) under its own name. The publisher is entitled to grant sublicenses to third parties or to transfer the rights in whole or in part.” – Comment: Very broad clause, publisher has practically all rights.
  2. Name and trademark rights: “The publisher is entitled to register the title of the game as well as the names of characters, locations and other distinctive elements of the game as trademarks or signs. Any registered trademarks are the economic property of the Publisher, insofar as the Publisher is the owner according to the register situation. The developer will not use or protect any designations that are identical to the game title or could be confused with it without the publisher’s consent.” – Comment: Here the publisher also secures the trademark rights and prevents the developer from using the name in any other way.
  3. Sequel/ROFR clause: “Developer grants Publisher a right of first offer with respect to a potential sequel to the Game. The Developer shall notify the Publisher in writing within 12 months of the release of the Game if it plans to develop a sequel and give the Publisher the opportunity to enter into exclusive negotiations for the publishing rights to such sequel within 60 days. If no agreement is reached within a subsequent negotiation period of 120 days, the right of first offer shall lapse.” – Comment: Gives the publisher the first negotiating position for a sequel, but with clear deadlines so that the developer is free afterwards.
  4. Non-competition clause: “The developer undertakes not to develop or publish any other video game that is in direct competition with the subject matter of the contract, in particular no game of the same genre with a similar theme, from the conclusion of the contract until 12 months after the first release of the game. Excluded from this are already existing obligations that the publisher has approved in writing (see appendix… [list of exceptions, if applicable]). ” – Comment: Restricts the developer, but offers a time limit and the possibility of exceptions.
  5. Termination and rights case: “In the event of termination of this Agreement for any reason whatsoever, the following rules shall apply: (a) Upon regular termination of this Agreement after expiration of the agreed term, all IP rights originally contributed by Developer (to the extent this Agreement is structured as an exclusive license) shall revert to Developer. Upon request, the Publisher shall surrender to the Developer all materials required to exercise the rights. Copies already produced and in circulation may, however, be sold by the Publisher (sell-off period: 6 months). (b) In the event of justified termination without notice by the Publisher for good cause, the rights acquired up to that point shall remain with the Publisher; the Developer may not continue to use the Game or parts thereof without the Publisher’s consent. (c) In the event of justified termination without notice by the Developer for good cause (e.g. due to a serious breach of duty by the Publisher or its insolvency), paragraph (a) shall apply accordingly with the proviso that the Publisher must immediately cease exploitation of the Game.” – Comment: This clause finely regulates who has the rights and when. The difference between end after expiry (return to developer) and end due to termination (depends on fault) is important.

These examples show how complex and detailed publisher agreements can be in order to cover all eventualities of cooperation and separation. From the perspective of the rights chain, the aim of the publisher is to secure the most comprehensive and exclusive rights possible, while the developer will endeavor not to relinquish more rights than necessary and to have safeguards in case of problems. German law (UrhG and BGB) provides the framework – with the principle of transfer of purpose always in mind: unclear wording would tend to be interpreted by a German court in favor of the developer/author. Therefore, precision is in the interest of both sides.

Distribution agreements and their effects on the exploitation of rights

In addition to the development and publishing phase, another part of the rights chain is the distribution or distribution agreement level. By distribution contracts, we mean agreements that serve to distribute the finished game to the end customer. While a publisher often also organizes distribution, there are constellations in which development, publishing and distribution are distributed across different shoulders. For example, a developer may publish their game themselves (no external publisher), but work with a platform such as Steam or a physical distributor. Or a publisher may use local distributor partners for certain regions. These distribution agreements influence how the rights to the game are used commercially, even if they no longer change the ownership of the copyrights (this was previously determined). However, they are important for the exploitation of rights and monetization.

Direct digital sales (platforms, app stores)

Nowadays, the majority of games are distributed digitally via platforms: PC games via Steam, Epic Games Store, GOG etc., console games via the online stores of Sony, Microsoft, Nintendo, and mobile games via Apple App Store or Google Play. In all these cases, the rights holder (be it the developer or publisher) concludes a contract with the platform. In most cases, these are standard distributor agreements or the platform’s general terms and conditions, which leave little room for negotiation.

Granting of rights to platforms: The owner of the game grants the platform a distribution license that entitles it to offer the game to end customers. Typically, the platforms keep a certain percentage of the revenue (e.g. 30%) and leave the remaining 70% to the publisher/developer. These agreements contain clauses such as: “The publisher grants [platform name] the non-exclusive right to make the game [title] available to end users by download for a fee or free of charge and to make reproductions and promote the game for this purpose.”

Here you can see: The platform does not receive exclusive rights – unless an exclusive deal has been agreed separately (e.g. PC exclusivity in the Epic Store, which is then regulated in a separate contract). In the standard case, the publisher can also offer the game on other platforms in parallel. The game remains in the platform’s catalog until one party (often the publisher) removes it.

Contractual conditions of the stores: The obligations and restrictions in such platform contracts are of legal relevance. For example, all major stores require the publisher/developer to guarantee that they hold all rights to the game and that no illegal content is included. Should there be any legal violations (e.g. copyright infringement or offensive material), the platforms reserve the right to take the game offline (keyword: content policy). This fits in with the rights chain: if an element somewhere in the game has not been clarified (e.g. unresolved music license), the game could be removed from the store.

Stores also have review processes (console manufacturers in particular check carefully, including legally, before they approve a game). Things like the protection of minors, trademark rights (e.g. are all brand names in the game licensed?), personal rights (avatars, real people?) and copyright play a role here. The platform wants to be sure that it will not be held liable for aiding and abetting later on. In the Apple/Google area, there are occasional disputes as to whether they are jointly liable – think of apps that infringe patents or copyright; there have been lawsuits in the USA, but as a rule, platforms see themselves as mere intermediaries.

End user license (EULA): In digital distribution, the end customer never becomes the owner of a copy (as was previously the case with a physical DVD), but only receives a user license. In most cases, an EULA (End User License Agreement) is displayed when a game is started for the first time, which the player must accept. It says things like: “The player is granted the simple right to install and use the game for personal use on their devices. They may not reverse engineer it, reproduce it other than for installation, create derivative works, cheat, etc. ” – This EULA represents the final stage of the rights chain: from the publisher (as rights holder) to the consumer (licensee). It severely restricts the rights of the user in order to protect the intellectual property of the developer/publisher (e.g. prohibition to use game content commercially or to sell virtual items outside the permitted ways).

In the case of digital contracts, the platform T&Cs may stipulate the minimum content that such an EULA must contain. In some cases, the EULA is also integrated into the platform T&Cs (e.g. Steam has a subscriber agreement that… (e.g. Steam includes the agreement to the Steam Terms of Use ), in other cases the publisher provides its own EULA. In any case, the following applies to end customers: They do not acquire any ownership rights to the game or the digital content, but only a limited right of use in accordance with the specifications of the rights holder.

Physical distribution and retail contracts

In addition to digital distribution, the physical sale of games (on data carriers such as Blu-ray, modules, etc.) remains a relevant market – especially for console games and collector’s editions. This is where retail and distributor contracts come into play. The publisher often concludes a contract with a distribution company that specializes in warehousing, logistics and delivery to retailers. This company acts either as a sales agent (sells on behalf of the publisher for a commission) or as a wholesaler (buys the games from the publisher at a wholesale price and sells them on independently).

From an IP perspective, the distribution agreement grants the distributor simple rights of use for reproduction (pressing of data carriers) and distribution – usually on an exclusive territorial basis. For example, a contract could stipulate that distributor X has the exclusive right to distribute the game in retail outlets in Germany, Austria and Switzerland. In return, the distributor undertakes to provide certain services (marketing support, minimum purchase quantity, achievement of sales targets) and pays either a lump sum or on an ongoing basis according to sales. It is important to note that such contracts do not grant any further rights: The distributor does not receive the IP to the game, only the limited distribution right. The contract usually contains clauses that terminate all distribution rights at the end of the contract (except for the sale of remaining stock). The IP remains with the publisher.

Effects on the exploitation of rights: Exclusive distribution agreements can divide the exploitation opportunities geographically. For example, a different publisher or distributor may distribute the game in region A than in region B. This fragmentation is desirable in order to utilize local expertise, but requires careful coordination of the rights chain: The main rights holder (often the original publisher) must ensure that all local partners are contractually bound and observe the same restrictions. For example, an EU distributor may not simply sell its copies in the USA if another partner has the exclusive rights there – corresponding territorial restrictions and perhaps contractual penalties ensure this. However, antitrust law also comes into play here: absolute territorial restrictions are problematic in the EU single market; there must be a certain amount of leeway for free trade (keyword: parallel imports). Contracts must therefore be designed in such a way that they protect the chain of rights but do not violate competition law.

In addition, distribution agreements should contain minimum performance requirements – for example, that the distributor ensures broad distribution within a certain time after release. Otherwise, a weak distribution partner could hinder the exploitation of the game. For this reason, a right of termination or recall is often agreed: If the distributor does not deliver the agreed performance (e.g. does not achieve minimum sales or fails to meet marketing commitments), the publisher can terminate the contract and reclaim the distribution rights. This means that the IP holder retains control of the exploitation chain and the game is not blocked on the market by third parties.

Licensing to platform holders (Console and Co.)

One particular aspect of distribution are contracts with platform operators such as Sony, Nintendo or Microsoft. Some of them act purely as store providers (for digital downloads), but have a dual role with consoles: they control the platform (through hardware and operating system) and often charge license fees per game. A developer or publisher must put a game through a platform licensing process (keyword “certification”). This requires a license agreement that allows the publisher to publish the game on the respective console. This includes the platform’s trademark rights (logos such as “Official Nintendo Seal” etc.) and technical specifications. The platform owner does not receive any content rights to the game, but typically demands them:

• that all rights to the game are held by the publisher (guarantee of the rights chain),
• that the publisher pays a license fee per copy sold (e.g. platform fee in the amount of platform fees gib).
• that distribution takes place via the platform (store) and that the known conditions (revenue split) apply there.

These contracts can also deal with exclusivity: For example, if Sony pays an amount for timed exclusivity, the publisher will promise not to offer the game on other platforms for a period of time. Such deals are ultimately marketing tools, but they take legal form as an additional agreement (e.g. “timed exclusive” clause). After expiry, the publisher can publish on other platforms.

In summary, distribution agreements play a major role in the practical exercise of rights: they regulate which partner brings the game to the end customer, but they do not change who owns the rights – this always remains the developer/publisher in accordance with the upstream contracts. Properly drafting these contracts ensures that the rights chain extends all the way to the end user: from the author to the developer, publisher, distributor, store and finally the player, who receives a simple license to use the game. Any break – be it a missing right in a territory or a contractual loophole – can jeopardize monetization.

Cross-media rights: games and films, series and other media

Video games are part of a larger media ecosystem. Successful games are adapted into films or series, and conversely, many games based on existing film, TV or book brands are released. These cross-media exploitations require detailed license agreements so that it is clear who holds which rights to the respective media content. Two directions are considered here:

1. Game is based on external IP (e.g. film or book) – the game developer therefore uses third-party intellectual property.
2. Game is adapted into a movie/series – a media company uses the game IP for a new work.

Games based on films, books or other brands

Many video games use the world, characters and storylines from films, TV series, comics or literary models. Well-known examples are the numerous superhero games (Batman, Spider-Man), Harry Potter games or games based on films such as Jurassic Park or Star Wars. In all these cases, the original IP (intellectual property) does not belong to the game developer, but to another rights holder (film studio, author, brand). The developer or publisher must therefore acquire a license from the original IP owner in order to make a game out of it.

License agreements for third-party IP: At its core, such a game is a merchandising product for the original IP. The license agreement grants the game publisher certain rights of use to the IP, limited to the “video game” medium. Typical features of such contracts:

• Limited scope: The license is often product- and platform-specific. For example: “Right to develop and distribute a video game based on the movie X for PC, PlayStation and Xbox.” Other media such as board games, film adaptations etc. are not included – the licensor retains these or grants them separately.
• Limited in time: Unlike original IPs, which a publisher exploits indefinitely, film/comic licenses are usually limited to a few years (e.g. 5 or 10 years from the release of the game). After that, the right of use expires. In practice, this means that the publisher may no longer produce new copies or offer the game digitally after expiry, for example, unless the contract is extended.
• Geographically limited: In many cases, licenses are granted territorially. For example, one publisher acquires the rights for Europe, another for North America, etc. In the case of global brands, however, large studios are increasingly granting global licenses to a single game publisher, who is then allowed to publish worldwide.
• Content control rights: The licensor (e.g. the film studio) will secure extensive acceptance and control rights. The contract usually states that scripts, character designs, gameplay concepts etc. must be submitted to the licensor and that the licensor can demand changes in order to maintain brand consistency. This is to prevent the game from damaging the brand (e.g. by portraying a movie character in the game in an atypical way).
• Remuneration: A combination of advance payment and ongoing license fee is common. For example, the publisher pays a fixed sum (minimum guarantee) and an additional royalty (often 10-15% of the game’s sales) to the licensor. The licensor therefore earns a share of every game sold. This means that the game publisher’s profit margin is lower for licensed titles than for its own IP – one reason why some publishers prefer to build their own brands.
• Rights to new elements: The interesting thing is who owns newly invented content. For example, if the game studio develops a new character or an expansion story within the licensed world, the contract usually stipulates that these innovations automatically accrue to the licensor (or that the licensor receives a free right to use them). Otherwise, the studio could claim to have copyrights to the new character, which would fragment the brand. Licensors want a uniform IP universe and therefore secure all “additions”.
• End of term and sunset clauses: At the end of the license term, the publisher must cease sales (typically after a sell-out period in the case of physical games). Digital games are then often removed from the stores. Example: When Activision’s license for Marvel characters ended in 2010, the Spider-Man and X-Men games had to be removed from sale. Contracts regulate this in advance, sometimes with the option of selling remaining stock for a few more months or offering the game for free as an “end-of-life” (so that fans can keep it). In general, however, the original IP owner retains sovereignty.

From a developer’s point of view, such licensed titles are a challenge: you have less creative freedom and must strictly adhere to the licensing conditions. At the same time, well-known brands offer a market advantage (a well-known franchise attracts customers). For the rights chain, this means that the final ownership of the rights remains with the external licensor. The game publisher acquires a temporary, limited license. In the end, the publisher cannot freely dispose of “its” game – the licensor holds the decisive strings.

Case law: A prominent US case shows just how important clear boundaries are: the publisher of the novel “The Godfather” (Mario Puzo) granted the film rights to Paramount Pictures in the 1970s. Decades later, Paramount licensed the production of a “The Godfather” video game to EA. Mario Puzo’s heirs sued because video games were not mentioned in the original contract – they demanded a share of the game revenues. The legal dispute ended in a settlement in 2012, with Paramount paying compensation to the Puzo estate. This case shows: If new types of use (in this case computer games) were not considered, the author or original rights holder can still make claims. For this reason, license agreements now cover all conceivable media, or at least assign them individually, in order to avoid such conflicts.

Games as a source for film adaptations and adaptations

The flow also goes in the other direction: successful video games are adapted into films (e.g. Tomb Raider, Resident Evil, Uncharted), series (e.g. The Witcher, The Last of Us) or comics and novels. Here, the game developer or publisher is the licensor. If a Hollywood studio wants to make a movie based on a game, it needs the approval and cooperation of the game IP owner.

Option and filming contract: It usually starts with an option. The film studio concludes an option agreement with the game publisher, which gives it the exclusive right to develop a film adaptation within a certain period of time (e.g. 18 months). During this time, the studio writes a screenplay, looks for directors, financing, etc. When the project becomes concrete, the studio “triggers the option” and the actual filming contract is signed. This contract regulates:

• Transfer of rights: The game publisher transfers to the film producer the right to make one or more films/series from the game. This is often referred to as audiovisual adaptation rights. Important: The publisher usually remains the owner of the underlying IP (characters, game world). The film producer receives the rights to use the work for the film. In practice, however, it is established that the film producer has exclusive control over the film produced, while the game publisher can continue to dispose of the games and possibly other media as long as they do not conflict with the film.
• Scope and subsequent rights: Film studios often grant themselves sequel and spin-off rights. This means that the film contract states that the studio may also produce parts 2 and 3 of the film adaptation (usually as an option) and may even make a TV series (“spin-off”) from the film universe. In return, the game publisher either receives additional payments or at least a share of the profits.
• Remuneration: The game IP owner typically receives a lump sum (license fee), often in the seven-figure range for major titles, plus possible bonus payments in the event of high box office success. A profit share is sometimes agreed, but is notorious in the film industry, as profits are rarely officially reported thanks to “Hollywood accounting”. Game companies therefore prefer fixed payments. In addition, it can be agreed that the game publisher receives a revenue share for merchandise related to the film if its characters are used.
• Creative control: A sensitive point is the extent to which the game developer has a say. In the past, many games were sold without any control (resulting in disappointing films such as Super Mario Bros. 1993, which Nintendo regretted afterwards). Today, major publishers insist on at least consulting rights. For example, representatives of the publisher often act as executive producers for the film in order to preserve the canon of the brand. Binding veto rights are rare, but they are at least allowed to give feedback on the script and characterization.
• Fallback clause: If the studio does not realize the film adaptation after all (e.g. the option expires or is canceled after the start of filming), the rights revert to the publisher. The publisher can then look for another interested party. In some cases, contractual penalties are agreed for non-utilization in order to persuade the studio to use or release the film.

Once the film adaptation has been completed, both sides hold the rights: the film producer holds the copyright to the film work, while the game publisher remains the owner of its original game IP. However, new elements are often created in a film adaptation (new characters, events). Contracts regulate who owns these. It is usually agreed that such new elements may be used jointly: The film studio may continue them in films, and the game publisher may adopt them for future games. In this way, both benefit from the expansion of the universe without separate chains of rights.

Cross-promotion and parallel exploitation: Cross-media projects also specify how the mutual promotion is to take place. For example, the contract could stipulate that the publisher publishes a movie-tie-in DLC in the game for the film release, or that the game is referred to in the film. Also important: sequence and timing. There are cases where a movie is produced based on an unreleased game – then the studio needs assurances that the game will actually be released (and the brand will become known). Conversely, the publisher wants the movie to arrive in time to boost game sales. Such dependencies make cross-media agreements complex.

Example: The Witcher is a special case: Originally a novel, CD Projekt RED licenses the game rights (but does not retain the film rights). Later, the author licenses the series rights to Netflix – the successful series is based more on the novels, but the games still benefit indirectly. If CD Projekt had once acquired the film rights, they would have had a share in the series. This constellation shows: IP management across media boundaries requires foresight. Nowadays, many game publishers try to keep all cross-media rights to their own brands in-house – see, for example, Ubisoft, which has founded its own film studio in order to film games such as Assassin’s Creed itself (and thus retain control).

To summarize, cross-media expansion requires very precise contracts. Both sides – games and film/music – must define who has sovereignty over characters, stories and brands in order to avoid later disputes. If the rights chains are properly dovetailed here, a brand can flourish in many media without unclear rights hindering exploitation.

Comparison of the industries: Games, music and film – contracts and structures at a glance

The games, music and film industries are equally based on the exploitation of creative content. There are therefore many parallels in the contractual structures – but also significant differences due to the characteristics of the works and market practices. Finally, a comparison of the rights chains and contractual standards of these three industries:

Common basic principles

• Copyright as a basis: In all industries, copyright initially lies with the creator (game developer, musician, screenwriter, etc.). This is converted into exploitable rights of use via contracts. The principle that moral rights (e.g. the right to be named or protection against distortion) remain with the author applies everywhere. However, the practical relevance varies: in music, the composer is often named (in the booklet), in film all those involved are listed in credits, in games individual authors often take a back seat (credits at the end of a game are less formalized).
• Exclusive transfer of rights to producers/exploiters: Whether games publisher, film producer or music label – all contracts result in a commercially responsible company receiving the exclusive exploitation rights to the creative end product. In the case of games, this is the publisher (or developer itself, if self-distribution), in the case of films the producer, in the case of music the record company (for recordings) and music publishers/collecting societies (for compositions). Exclusivity is necessary to protect investments and to have clear responsibilities.
• Combination of advance and participation: In all three sectors, exploiters often finance production with advances. The developer receives milestone payments from the publisher, the musician receives an advance from the label and the director/writer may receive an advance from the film studio. In return, the exploiters receive the first revenue share until the advances are covered, after which there are profit shares (royalties). Example: An indie studio receives an advance of €200,000; after release, the publisher receives 100% of the proceeds until €200,000 has been collected, after which there is a 70% publisher / 30% developer split, for example. Similar for music: label keeps revenue up to the amount of the advance, then percentage royalties to the artist. Film: creative minds (director, lead actors) often receive bonus payments or profit points after the budget is returned. This model divides the risk and success between the creative minds and investors.
• Option and follow-up clauses: Clauses that bind subsequent projects are common in all industries. In the book and music sector, option obligations have long been standard (e.g. authors must offer the publisher the next work first; musicians are exclusively bound for several albums with option rights for the label). This has developed analogously in the games industry: Publishers demand options on sequels or upcoming projects. In the film industry, contracts are often concluded with actors for several sequels (to ensure continuity if a series is successful). The core is always the same: the original partner should be able to reap the rewards of success in the future, if they so wish.
• Contract density and standardization: Contracts are highly complex in all sectors, but in the music and film industry there are sometimes unions/associations that enforce standard conditions. In the USA, for example, the Writers Guild or Directors Guild regulate certain minimum shares and credit rules for filmmakers; for musicians, there are collecting societies such as GEMA that charge standardized rates. The games industry is less regulated: Developers are rarely unionized (exception e.g. voice actor unions), collecting societies do not exist for gameplay content. As a result, game contracts are often more freely negotiable, but also more diverse. The principle of assignment of purpose in copyright law (which applies in Germany and the EU) affects music and film contracts in equal measure – here too, types of use must be specifically named. However, a lot of standard legalese has developed within the industry: e.g. record contracts almost always contain similar clauses on “All Phonograph Rights” etc., and film production contracts follow patterns. In games publishing, such standards are only gradually emerging; contracts are often a mixture of software license, production contract and distribution clauses.

Differences and special features

• Number of authors involved: In video games, there are potentially dozens of authors (programmers, graphic designers, musicians, storywriters). The same applies to films (screenwriter, director, cameraman, editor, composer, etc. – in Germany they are all considered co-authors of the film). In music, there are usually two creations: the musical work (composition/lyrics) and the performance/sound recording. The chain of rights in music is divided accordingly: Composers sign publishing contracts or go to GEMA, while performers/producers sign the label contract. In games, everything is bundled under the umbrella of the studio/publisher – the studio has to clarify all contributions internally (similar to a film production), but appears to the outside world as the uniform rights holder. Film production achieves this unity through a plethora of individual contracts (each creative person assigns their rights of use); game production does the same. The difference: In film, there is a legal presumption in favor of the producer (§ 89 UrhG: Contributors who have participated in the production of a film consent to the use customary in films), which facilitates the chain of rights. In the games sector, there is no such special standard – contracts and Section 69b UrhG (software rule for employees) are used.
• Character of the work and terms of protection: Pieces of music and films have clearly defined work characters with fixed terms of protection (70 years post mortem). Video games are complex: The software code is protected (70 years p.m.), graphics individually (70 years p.m.), soundtracks (70 years p.m. for composition; 70 years from publication for recordings as ancillary copyright). This means that a game does not fall into the public domain in its entirety after 70 years like a film – individual parts could still be protected. In practice, however, this is rarely relevant, as games are technologically outdated before protection periods take effect. Nevertheless, the chain of rights for an old film can become simpler after a number of terms have expired (e.g. for silent films whose music is in the public domain), while components of a game may still be protected even after many years. In the music industry, there are also ancillary copyright aspects (performers have rights to their performances for 50 or 70 years). In games, this applies to voice actors or musicians for soundtrack recording, for example – their ancillary copyrights must be granted by contract, as in the music industry.
• Roles of collecting societies: Collecting societies are central to music. A music author is almost always a member of a society such as GEMA, which administers his performance and reproduction rights worldwide. A music producer has services administered by GVL. These societies collect licenses (e.g. radio, streaming, public performance) and pay the authors/performers. This means that even if a label has all rights to the sound carrier, a radio station, for example, must pay GEMA and GVL, not (only) the label. – There are also collecting societies in the film industry (e.g. VG Wort/VG Bild-Kunst for authors of screenplays, camera etc., and GVL for performing actors in certain cases). Example: A director receives secondary exploitation royalties via collecting societies when his film is shown on television (so-called device and blank media levies). – In the games industry, there is nothing comparable for the actual game content. There is neither a collecting society for “game authors” nor for level designers. This means that all remuneration is regulated contractually between the parties; there is no collective exploitation. An exception is when the game contains music composed by GEMA members – in this case, GEMA is still payable for public reproduction (e.g. streaming). But in contrast to music and film, a game publisher does not have to deal with collecting societies as standard. On the one hand, this simplifies the rights chain (no external third parties such as GEMA are involved), but it carries the risk that without collective regulation, authors will come away empty-handed if they are not involved individually and appropriately for all types of use.
• Contract duration and reversion of rights: In the music industry, contracts were traditionally often unlimited in time for the recordings – the label usually acquires the recording masters permanently (until the end of the protection period). However, the artist’s exclusive rights are limited to e.g. 5-7 years or x albums. In the film industry, the producer acquires the full rights to the film work; however, contracts with distributors are often limited in time (e.g. 10-15 years for theatrical and home video rights, after which they can be renegotiated). In the games sector, large publishers tend to retain IP indefinitely, whereas in publishing deals without IP transfer, the license to the publisher may be limited in time (e.g. 5 years of exclusive distribution). Digital store contracts can also be terminated, meaning that a game can theoretically disappear from the store at some point when the contract ends. Overall, the rights reversion problem is more present in music and film: Musicians often fight to get their masters back after decades or to be allowed to re-record them (cue Taylor Swift, who re-records her albums because the label holds the originals). Film rights are sometimes transferred back to authors after a long period of time (in the USA there are “termination rights” after 35 years in certain cases). In the games sector, such reversion is rarely explicitly regulated by law; it depends on the contract. It is therefore all the more important to take precautions when concluding a contract, e.g. with reversion clauses.
• Content modification rights and moral rights: In the film world in Europe, the director enjoys a certain reputation as the “author of the film”, yet the producer has far-reaching modification rights (editing etc.). It is often agreed in contracts that the producer has final cut, but the director does not want to be named as the author if the film is changed completely against his will (this corresponds to moral rights – there have been cases where directors have withdrawn their names, famously as “Alan Smithee” pseudonyms). In music, the label can determine the final mix, but the artist has typically contractually agreed to deliver a certain artistic end result. In games, it is common for the publisher to have control over content – the developer owes a work according to specifications. Creative leads such as creative directors have internal influence, but legally the publisher can demand changes to contractual projects (e.g. remove levels, adapt features) without individual developers being able to object on copyright grounds. This is because in game development the work is seen as a team effort, and contracts ensure that the company (studio/publisher) is allowed to make changes. Overall, moral rights in the games sector are the least pronounced in practice (designers rarely make use of Section 14 UrhG). In music and film, there are cases where authors intervene – e.g. composers who do not want their song to be used in a politically undesirable context, or authors who distance themselves from a film adaptation. In games, such conflicts have rarely become public.

Example sentences of typical clauses in comparison

To illustrate the contractual parallels, here are some comparative typical clause formulations from all three sectors:

• Exclusivity clause:
  • Game: “During the term of this Agreement, Developer will not develop or publish any other game that directly competes with the Game covered by this Agreement.”
  • Music: “The artist undertakes not to produce or exploit any musical recordings for third parties for the duration of this contract. All recordings by the artist shall be released exclusively by the label.”
  • Film: “The director undertakes not to take on any directing work on other theatrical films that could interfere with the proper completion of the film [title] until post-production is completed.” (Here rather project-related; for actors often: no appearances in competing films until x months after release).
• Option for follow-up works:
  • Game: “The publisher has the right to publish a successor to the game under comparable conditions (sequel option).”
  • Music: “The artist grants the label an option to produce a third and fourth album. The label may exercise this option in writing within 6 months of the release of the respective previous album.”
  • Film: “The producer is granted the exclusive right to produce a direct follow-up film (sequel) based on the film as well as prequels or spin-offs with the same main characters. In the event of a sequel, the author shall receive remuneration of € X or, if requested by the producer, the right to write the screenplay for the sequel under the terms of this agreement.”
• Remuneration/participation clause:
  • Game: “After full repayment of the development advance of €1 million, the developer receives 20% of the net revenue from the distribution of the game as a revenue share, payable quarterly.”
  • Music: “The artist receives a royalty of 15% of the net sales price collected by the label per physical sound recording unit sold and 25% of the net royalty income from digital sales and streaming, in each case after redemption of the artist’s advance.”
  • Film: “The director receives a profit share of 5% of the net proceeds of the film, payable as soon as the production and distribution costs are fully covered (for definition of ‘net proceeds’ see Appendix… including an industry definition of ‘non-costs’).”
• Copyright transfer (employees):
  • Game: “The programmer hereby assigns to the employer all exclusive rights of use to the computer programs and game graphics developed by him. This includes in particular the right to edit, reproduce, publish and market in all media.”
  • Music: “The music author undertakes to transfer exclusively to the publisher all rights of use under copyright law to which he is entitled to the musical works composed within the scope of this agreement, with the exception of indispensable statutory rights and the exercise by GEMA, which the author must join.” (Here you can see: in music, composers typically go to GEMA instead of giving all rights directly to the label/publisher).
  • Film: “The cameraman transfers to the producer the exclusive right to use the image recordings made by him for the film and all uses derived from it (trailer, making-of, online clips, etc.). § Section 88 UrhG remains unaffected, a separate exploitation of the image sequences is not intended.”

These examples show that similar concepts exist across industries, but are adapted to the medium in each case. The music industry, for example, has separate contracts for composition and recording, while game developers have to cover both in one contract. Film contracts place a strong focus on credits and artistic task allocation, while game contracts tend to focus more on the delivery of milestones and technical acceptance.

Conclusion: Who holds the rights to the game in the end?

The initial question was: “Rights chain in game development – who ultimately holds the rights to the game?” The answer is: it depends – and it should never be left to chance. The chain of rights in game development is the result of numerous contractual agreements. Ideally, these are structured in such a way that in the end a clearly defined rights holder has all the necessary exploitation rights to the game and can use them freely. In practice, this can look different:

• In the case of a commissioned work for a publisher, the publisher usually holds the rights to the game (because the developer has contractually transferred all IP). The publisher is then entitled to distribute the game, make sequels, license merchandise, etc., without further consent from the original developer – who is paid a one-off fee or royalties, but is no longer the owner of the rights.
• In the case of an independently developed game that only has a publishing or distribution agreement, the developer studio often retains the rights. The publisher then “only” has an exclusive distribution license for a certain period or region. After the contract ends or is terminated, the rights revert to the studio, which can use them to pursue further plans (new editions, other publishers, sequels).
• If a game uses third-party IP (e.g. a Star Wars game), the core IP remains with the original rights holder (in this case Disney/Lucasfilm). Although the game’s publisher has rights to the specific game code and the assets it has created, it can hardly do anything with this material without the franchise owner’s permission. At the end of the chain, the IP licensor (film studio) therefore determines what happens to the game (e.g. how long it can be sold).
• In cases where a game uses many third-party components (engine, middleware, music from third parties), there is a network of licenses rather than a single “all rights owner”. The developer holds the rights to the self-developed part, but has acquired permanent usage rights from the engine manufacturers, asset suppliers, etc. As long as all these licenses are properly granted and perpetual, the developer/publisher can exploit the game as desired. It would be problematic if, for example, a license was limited or revocable – then part of the game could no longer be used in a legally secure manner after expiry. For this reason, critical third-party components (such as important engines) are almost always licensed for perpetual rights of use in order to achieve the “legally secure” final state.

For clients from the games, media and music industries, this means that the The rights chain is a matter for the boss. Every agreement – whether with employees, service providers, publishers, platforms or licensors – influences who ultimately holds which piece of the rights puzzle. A game can only be fully exploited commercially if the chain is unbroken and clearly defined ownership and usage relationships exist. German copyright law provides a guideline with the purpose transfer principle: rights are only transferred as far as necessary. This applies to contracts: You have to consciously and explicitly regulate what is needed. It is also advisable to consider future scenarios: new types of use (VR? cloud gaming?), new markets (Asia?), cross-media exploitation – all of this should be included in the contracts where possible to avoid a rude awakening later on.

Who ultimately holds the rights to the game? As a rule, the contractual partner who financed or initiated the development, i.e. often the publisher or the studio itself. However, it is important to note that this company only really holds “all” rights if it has involved all contributors. Any forgotten consent or negligent clause can lead to someone else claiming a slice of the cake. The best safeguard is to draft contracts with foresight:

• Developer studios should conclude watertight IP contracts with every employee and supplier (including any AI usage, in order to have clarity here).
• Publishers should define the necessary rights comprehensively and clearly in their contracts with studios, but also not demand more than is necessary – this maintains the relationship of trust and benefits both parties.
• In cross-media projects, the boundary between the media must be clearly defined by contract so that each can operate freely in its own area.
• Finally, it is worth taking a look at other industries: Lessons from music and film show that creatives should ensure appropriate participation (§ 32 UrhG – fairness paragraph – applies everywhere), and that rights holders need to think long-term (building a brand instead of selling in the short term can pay off – see many successful franchises).

In a short space of time, the games industry has caught up with the contract culture that has developed in film and music over decades. Today, publishing and developer contracts are highly complex, but also open to negotiation. Those who know and actively shape their rights chain ultimately hold the reins. Ideally, the question “Who holds the rights to the game in the end?” is not left open, but can be answered clearly: The one who has contractually acquired them with foresight – in agreement with the authors and for the benefit of all parties involved.