Music 2.0 - Exploring Chaos in Digital Music

January 13, 2007

Did Apple lose moral ownership of iPhone name?

Filed under: Music Industry — maths @ 11:43 pm

beauty-and-the-brick-v31.jpg

What a dramatic introduction of the iPhone we have had, coupled with the iPhone trademark battle sideshow between Cisco and Apple. While Steve Jobs has obviously calculated on winning in the court of public opinion, Mark Chandler, General Counsel of Cisco has cleverly used a weapon of the new economy by blogging Cisco’s point of view and approach.

The crux of the dispute is in the use of the “iPhone” trademark… if two companies release products in a similar category with the same name, it creates confusion among consumers and so the trademark law exists to distinguish the products. The Cisco approach for a resolution according to Mark Chandler is interesting…he has used terms like “sharing the iPhone trademark”, “open approach”, “interoperability” and yet stating that they wanted to “differentiate the brands in a way that could work for both companies and not confuse people, since our products combine both web access and voice telephony”….phew, some of that even sounds contradictory! A comment by a reader called Mandla on Cisco’s blog, catches them out on this with a salient point in that Cisco is actually trying

“to leverage the trademark to blur the distinction between the two products. That’s not what trademark law is there for now is it? A trademark is not supposed to be a crowbar for gaining access to other people’s products and IP. It’s there to protect your own products, not to prise open other people’s products.”

Many people have also turned on Cisco on these grounds but to be fair to Cisco, it is OUR assumption that a trademark should be settled in pure monetary terms and that has clouded many observers’ view of the Cisco case. Cisco is already rolling in the money as it currently has the highest market cap in Silicon Valley and it seems probable that mere financial gain is not its main motivation so instead, it is going about this in an unconventional manner. But to be fair to them, their approach is still in the realm of business negotiation. In simple terms, Cisco has something Apple wants and Cisco is asking for payment, albeit not in obvious monetary terms but in kind…so despite how others have analysed Cisco’s terms of engagement and accused them of trying to profiteer, this is a straight forward business negotiation – take it or leave it!

Even though it is mere speculation for all of us to debate the legal aspects of who is right or wrong ultimately in this case, it is important for us to separate the legal aspects from the moral areas, with Apple trying to dominate the latter. It is amazing to read the huge number of pro-Apple comments (and on the “enemy’s” blog too!) accusing Cisco of a multitude of transgressions when in fact, it is public knowledge that “Apple approached Cisco many times over the past five years to acquire rights to use the iPhone trademark, acknowledging Cisco’s rights to the trademark” – this is a clear example of Steve Jobs’ famous Pied Piper reality distortion field at work where even his evangelists are instead trying to claim the moral high ground.

It is a foregone conclusion that Apple has already won in the court of public opinion but some of the comments denigrating Cisco’s brick of an iPhone compared to the elegant, beautiful Apple iPhone crosses the line into reality distorting moral ownership claims along the lines of “How dare the nerdy geek have the homecoming queen as his girlfriend when the fairy tale dictates that she belongs to the football hero jock?”

It is one thing to praise the Emperor’s New Clothes even though the threads seem to be misappropriated in parts, but since we are on the subject of intellectual property, let’s also focus on the other major announcement of the day at MacWorld with the name change from “Apple Computer” to “Apple Inc”. So Jobs’ Apple has now moved beyond the confines of a strictly computer industry domain and is formally signaling its intent to devour other industries including consumer electronics and music. It was not too long ago that the Beatles’ “Apple Corps” was battling “Apple Computers” when the latter started moving into the music industry and in doing so flouted a previous agreement – Cisco has obviously noted that succinctly

“Today’s iPhone is not tomorrow’s iPhone. The potential for convergence of the home phone, cell phone, work phone and PC is limitless, which is why it is so important for us to protect our brand”

For a company that “is a very aggressive enforcer of their trademark rights” and even claims 200+ patents for its iPhone, it is damning that Apple’s very own company naming exercise itself was a result of arrogantly taking a forbidden bite out of another company’s name. As such, though Apple can count on winning in the court of public opinion and while we await a resolution either in the courts or on the negotiation table, Apple seems to have lost moral ownership of the iPhone name.

[maths does not own shares in Apple or Cisco and has no affiliation to either company but is the proud owner of a Linksys router and a video iPod and will probably want a piece of both iPhones, whatever they are called]

Update: 21 Feb 2007
So Cisco’s wheeling and dealing has paid off and they are likely to have gotten their interoperability pound of flesh from Apple…and Apple will now be free to use the iPhone name, and probably dominate and own it. The brief statement from Cisco follows:
SAN JOSE & CUPERTINO, Calif. – Cisco® and Apple today announced that they have resolved their dispute involving the “iPhone” trademark. Under the agreement, both companies are free to use the “iPhone” trademark on their products throughout the world. Both companies acknowledge the trademark ownership rights that have been granted, and each side will dismiss any pending actions regarding the trademark. In addition, Cisco and Apple will explore opportunities for interoperability in the areas of security, and consumer and enterprise communications. Other terms of the agreement are confidential.

2 Comments »

  1. I can’t disagree more. Legal arguments aside. The use of the “iSomething” was first developed by Apple. And led to a craze of unimaginative lazy companies just putting an ‘i’ onto their name in the hope that some of Apple’s lustre will rub off onto their shoddy and inferior offering. The use of ‘iPhone’ in association with Apple was widely used by pundits and consumers alike before Cisco decided to get onto the bandwagon.

    Finally, why all this Apple bashing. Apple has succeeded through the development marketing of superior products which people love (and are passionate about). They successfully linked iTunes with the iPod to create an unbeatable combination. People have voted with their wallets. We should celebrate this company for raising the bar. And inspiring us to demand better.

    And their competitors to do better.

    Without Apple we’d be stuck in a greyness of inferior products.

    Comment by Gavin Heron — January 14, 2007 @ 3:31 pm

  2. Most countries in the third world never respects intellectual property rights. piracy is so rampant in asian countries.~’;

    Comment by Gracie Parker — May 26, 2010 @ 2:59 am

RSS feed for comments on this post. TrackBack URL

Leave a comment

You must be logged in to post a comment.

Copyright © maths

Powered by WordPress