AR&D Reinventing Local Media

There is no sadder commentary on the conflict between the orderly modern world and the wild west of the Web than the legal moves the owners of the popular game Scrabble to control the game’s brand on Facebook. For those not familiar with the case, two brothers from India, Rajat and Jayant Agarwalla, created a Facebook application called Scrabulous when Facebook opened its platform to developers earlier this year. The interactive game, which, to be kind, “borrowed heavily” from the Scrabble game, quickly became one of the most popular Facebook add-ons. Hasbro, the owner of North American rights for Scrabble, sent its attorneys into action, and Facebook removed the application in the U.S. and Canada.

Mattel owns the rights beyond North America, and it quickly dispatched its lawyers into the fray. Facebook complied in all places except India, where the issue is being considered in the courts thanks to a lawsuit filed by Mattel. Hasbro has moved to create their own Facebook application for Scrabble through Electronic Arts to fill the void left by the loss of Scrabulous. The Agarwalla brothers are asking former Scrabulous players to move to another application of theirs called Wordscraper. It’s 21st Century drama all the way.

We’ll likely never learn the amount of money Hasbro and Mattel have spent on legal fees to protect their property, but it can’t be insignificant. And one has to wonder if there might have been a better way for them to respond, like perhaps just buying the application.

That’s what online movie social networking site Flixster has done in acquiring Carnegie Mellon University student Jeffrey Grossman’s iPhone application that lets users find show times, watch trailers and get maps to local theaters. It has been downloaded 250,000 times. According to TechCrunch, Grossman is joining Flixster as a consultant, a nice resume bump for a college sophomore.

I know the Flixster example isn’t the same as the Hasbro/Mattel conundrum, but on the Web, institutional businesses face the law of unintended consequences like no other marketplace before. The Facebook community is far more likely to support the Agarwalla brothers than the “big, bad corporations” that own the rights to Scrabble, and the memory of what’s taking place there will not be quickly forgotten. Before it was shut down, Scrabulous was averaging over 500,000 DAILY players, and that audience was growing rapidly. Will Hasbro and Mattel ever reach such a level with their own versions, and if they do, how much will it cost them?

This is the same brush that’s painting the record industry’s decision to sue its customers rather than let them share music they had purchased. Legal rights may protect your property, but it may actually be wiser not to press those rights in some circumstances. Hasbro and Mattel will win the legal battle and lose the war of brand contentment, and this lesson applies to anybody with a legacy business that’s trying to move its brand to the Web.

Oh, and Scrabulous is still available here, at least for now.