It was announced this morning that Apple and Cisco settled their dispute over the name 'iPhone.' The terms were not disclosed.
The difference between an Apple iPhone and a Linksys iPhone, although technically not that different, are quite small to end users. Of course, Cisco will be a beneficiary of this deal (they had the common law precident of a mark registered in 2000) since Apple will use Cisco security and other technologies (undisclosed). Apple wins because they will explain that a WiFi phone is different than a GSM phone – and that a reasonable consumer will know and appreciate the difference.
Trademark disputes are something that we should expect more of as we go forward. That's because the rate of innovation – or new product introduction at least – is steadily increasing. The barriers to entry in markets due to new product introduction is falling through the increase in the type of direct to buyer channels. Grocery manufacturers for example, can build up momentum in a product category through web and inexpensive and highly targetted TV advertising (all those cable channels have to make a $ somehow). The web enables brand positioning right at the moment of search (or in my business at the moment of user education).
There are only so many good names that are descriptive and provide a degree of link between the name and the benefit. This is the problem with domain names too.
Here are a few posts on Apple-Cisco.
Wall Street Journal article February 22, 2007 [subscription may be required.]
