Your Web site is loaded with appealing graphics, convenient
buttons leading to information, and interactive features that
enable customers worldwide to order products online. But you're
getting more traffic than expected, and the designer you hired
doesn't have enough capacity on his server. Your customers have
to wait so long to make a transaction, many give up and go
elsewhere. Time for a change! Unfortunately, when you tell the
developer you want to move the site, he says as creator, he owns
all rights to the graphics, content and HTML. Your choices are to
either pay up, or start all over.
A well-designed Web site can boost your business and help you
reach new markets. Because of the technical nature of Web site
design, you'll probably hire an expert to develop the site for
you. Be careful with the contract, however, to make sure you not
only get the features you need, but that you also end up owning the
legal rights to your own site; otherwise, you can't change it
without the original designer's permission.
"The law is [currently] playing catch-up with
technology," says attorney Timothy Labadie of Butzel Long in
Detroit, whose practice specializes in business transactions.
"People are starting Web businesses and only drawing up the
contract as an afterthought."
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Not that your Web site developers won't hand you a contract.
Don't assume, however, it will protect your interests. Jose I.
Rojas, an attorney with Broad and Cassel in Miami and chair of the
firm's Intellectual Property and Technology Practice Group,
says clients sometimes contact him after problems develop with a
contract. "They'll say `It looked like a form
contract,' " he says. "You can make even the
most complicated contract look like a form."
Before lining up an expert to develop your Web site, consider
the following:
- The firm's reputation. Scrutinize the firms
you're considering. There's no shortage of people and firms
offering Web site development; some are excellent, but some are
fly-by-night outfits eager to take your money and run. Find out
where the company is located, get referrals, and check out Web
sites they've created. For a major project, have two or more
firms submit proposals.
- Specifications. Asking someone to develop a Web site for
you is just as complicated as asking someone to build you a custom
house--and furnish it, too. There's far more to think about
than just the site's appearance.
"Get as much detail on the front end as possible,"
says Kenneth Zucker, a partner with Pepper Hamilton LLP in Berwyn,
Pennsylvania, who represents Web site developers. Remember,
however, things said in sales presentations aren't binding
unless they're in the contract. Include functional
specifications, such as the site's loading speed, whether
it's compatible with Web browsers customers might use, and
whether users will be able to place orders online. Before signing a
contract, work with the developer to draw up specifications that
include sketches of the site's design and functions of the
various buttons.
- Domain name. Every site needs a domain name, the address
customers use to access the site. It's important to ensure that
the domain name is registered under your business name, not the Web
site developer's. The easiest way to accomplish this is to
register it yourself. It's a simple and inexpensive process
that can be done online at http://www.networksolutions.com
- Intellectual property rights. Under the Copyright Act of
1976, all rights to a created work belong to the author or creator
unless otherwise provided in a contract. Since a Web site counts as
intellectual property, be sure to address the question of rights
before it's created.
One way to address the problem is by specifying in the contract
that the project is "work for hire," which means the
product created belongs to your company. Although this is a common
practice in the industry, don't assume it's in the
contract. In some states, independent contractors engaged on a
"work for hire" basis count as employees, entitled to
benefits. Also, it's not entirely clear that every aspect of a
Web site fits into one of the categories that may legally be
classified as work for hire. A second option is to let all rights
remain with the designers during the development process, with a
provision in the contract that they'll transfer all rights to
the content and HTML to your company upon completion of the
project.
- Licensing of software. A typical commercial Web site
might contain "java scripts" that make your trademark
dance across the screen, interactive features that enable the user
to communicate with the company or purchase products online, or a
custom-designed "shopping cart" that the developer wants
to use for other clients. The computer programs that make these
features possible might belong to the developer or, more likely, to
a software company. Have the designer help you obtain licenses to
use any necessary software so you can move your site to another
host if you choose. Make sure you get copies of the software along
with your Web site files.
- Copyrighted material. Do you have music or photos on
your Web site? Have the developer agree in the contract to obtain
permission to use any copyrighted material, and warrant that all
other work is original and doesn't infringe on the copyrights
of others.
- Hidden fees. Some developers offer low initial fees but
raise their prices for updates. "Address that early on in the
contractual process," advises attorney Alan Sutin, head of the
information technology practice at Greenberg Traurig in New York
City. "Or you could be at the developer's
mercy."
If the developer hosts the site, the monthly fee agreed to in
the contract might include a certain number of updates or changes.
Make sure the server hosting the site has enough bandwidth to carry
expected traffic.
- Who's the host? While it's common for designers
to host the sites they develop, you may not want to keep your site
on their server forever. It's important to negotiate separate
contracts, one for developing and one for hosting. Make sure the
hosting contract addresses price increases as well as the costs of
updates and additional bandwidth.
- Who's in control? "Include a provision that all
content on the Web site is controlled by the client," Rojas
says. "Otherwise, for example, the developer could put in
banner ads for XXX-rated Web sites."
- Security. What security will the developer include to
guard against hackers? Who will have access to your customers'
credit card information? Is the site host free to sell customer
names garnered from e-mail communications to other businesses? Any
reputable service provider carries insurance, so ask for a
provision indemnifying your business in case of security
breaches.
"Contact a lawyer who has experience in this area,"
advises Sutin, who notes that a specialty in Internet law is
becoming more and more common. Have the lawyer help you draw up the
contract or modify the one offered by the developer. "The
better you plan in advance," he says, "the more likely
the relationship will be successful."
Steven C. Bahls, dean of Capital University Law School in
Columbus, Ohio, teaches entrepreneurship law. Freelance writer Jane
Easter Bahls specializes in business and legal topics.
Contact Sources
Broad and Cassel,http://www.broadandcassel.com,
(305) 373-9421
Butzel Long,http://www.butzellong.com
Greenberg Traurig,sutina@gflaw.com, (212)
801-9286
Pepper Hamilton LLP, 1235 Westlakes Dr., #400, Berwyn,
PA 19312, http://www.pepperlaw.com