Digital IP Management Company Source3 Acquired by Facebook

Our global overlords at Facebook recently acquired the New York-based IP rights management startup Source3 in an effort to expand their efforts to monetize the massive social media platform. As Facebook looks to attract independent content creators to compete with Snapchat and YouTube they are looking to circumvent many of the rights issues that continue to plague the industry. In order to convince top tier talent to choose Facebook, the company needs to prove that it can protect individual creators’ rights without exposing themselves to the legal battles that inevitably find online media networks.

The Source3 technology will likely be used to enhance and support Facebook’s ability to identify and flag content that is using copyright protected content without permission. Copyright holders will now have the option to monetize the offending content rather than have it removed. Facebook will also likely begin offering user-generated content creators the option to quickly and easily obtain licenses for copyrighted intellectual properties. With Facebook taking a small slice of the pie of course.

Source3 founders Patrick F. Sullivan, Benjamin Cockerham and Scott Sellwood sold their music IP-focused management startup RightsFlow to Google back in 2011. They then turned their attention to Source3 which would focus on the growing 3D model and content marketplace. They leveraged an impressive team of Google and 3D Systems alumni to streamline and simplify the licensing process, allowing IP owners to opt into open-ended licensing deals that wouldn’t require endless contracts and negotiations. After launching in 2015 and raising $4 million in venture capital funding the company expanded beyond 3D content into a wide variety of markets, including music, entertainment, sports and fashion. It was likely this track record that attracted Facebook to the startup, which announced the acquisition on their website:

“Today, we wanted to let everyone know that we’ve decided to continue our journey with Facebook. We’re excited to bring our IP, trademark and copyright expertise to the team at Facebook and serve their global community of two billion people, who consume content, music, videos and other IP every day.”

Given Facebook’s surging interest in moving beyond social media and becoming an original content hub the need for IP rights management is quickly becoming a growing focus. While Facebook launched their Rights Manager software almost two years ago, results have been less than impressive. They continue to struggle to convince people to choose Facebook over other options like YouTube, despite being willing to pay television networks, movie studios and publishers for original content. However now that Facebook Live has started to become popular the site would like to be able to quickly identify and monetize copyrighted intellectual properties before it goes viral and exhausts its impressions.

Source3 is expected to remain based in New York, but they will be a fully operational arm of Facebook not a standalone company and they are expected to retain their current staff. It’s unclear if Facebook will use the experience of Source3’s existing staff to begin offering downloadable, and licensable, 3D content or if they were simply interested in the software. However it isn’t hard to imagine Facebook offering the designers of 3D printable content the ability to sell and distribute their work directly through their personal profiles rather than requiring people to visit an off-site marketplace. Discuss in the Source3 forum at 3DPB.com.