Thursday's New York Times Business section included a full-page ad for the iPhone -- but not the iPhone you're thinking of. This page showed three Cisco/Linksys VoIP phones, and it looked suspiciously like Cisco marking its territory in the battle with Apple for the right to use the name "iPhone."
Make no mistake about it, the iPhone is made by Cisco/Linksys -- at least according to this ad in the New York Times for February 2, 2007.
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The ad ran the day after the two companies announced they had gone back to the bargaining table to settle their dispute over the name.
The two companies have known they had a problem for years -- Cisco has used the "iPhone" name since it acquired a company called Infogear in 2000, and Cisco filed a lawsuit the day after Apple unveiled its iPhone at MacWorld.
(If you haven't watched introduction video that's posted at Apple's Web site you should. Not only does the iPhone look like a real winner, but Steve Jobs' enthusiastic and skillful presentation makes it an enjoyable hour-plus.)
While Cisco thinks it's got a trademark, the press and pundits have been speculating for years that Apple's success with the iPod would lead to an "iPhone" product from the company, so the name has been in use to describe something not sold by Cisco.
It's an interesting legal point, because trademark protection doesn't work like patents. There is, for example, something like a "reasonable man" test for trademarks: if a name is in common usage, it can't be trademarked, and trademarks can be lost because the name they protect has passed into the vernacular: If you say, "I need a kleenex" instead of "I need a Kleenex brand tissue" you've hit the issue squarely on the head. (I don't know whether Kleenex is still a trademark or not. Kimberly-Clark legal beagles, spare me your nastygrams.)
Generally trademark suits revolve around whether confusion over the name has done irreparable harm to the business or reputation of the aggrieved party. You'd think that would be Cisco in this case, but perhaps not.
Consider that reasonable man test. If you went up to 10 people on the street and asked them, "Who makes the iPhone?" I'll bet you 10 out of 10 would say without a moment's hesitation, "Apple."
Apple has built a great deal of brand value for "i-anything" with the iPod, and it could make a powerful argument in court that Cisco's use of "iPhone" was an attempt to create confusion in the marketplace and damage its business. Cisco has filed a
Apple and its Cease and Desist team at O'Melveney & Myers LLP have a long history of going after every little fanboy Web site that uses "i" or "Pod" (or now, "phone"), and even though the company has taken a lot of PR grief for it, there's a good reason. Trademarks must be actively defended against misuse, or they can be lost. That was why, for example, the Prema Toy Company was put in the awkward position of legally bullying a 12-year-old boy who used his nickname on a personal Web site, pokey.org, while Prema owned the trademarks on claymation icons Gumby and his horse Pokey.
But just defending it doesn't secure it. That may be the reason why Cisco has put its court case on hold and gone back to the table with Apple. Even ads in the New York Times, after all, are only worth the paper they're printed on.
My prediction: Apple will get "iPhone" without too much muss or fuss, and Cisco will get a face-saving concession, something it will claim it wanted all along, like the right to make Linksys WiFi routers that work in some theoretically special way with iPhones.
Cisco doesn't have anything to gain by standing in Apple's way, and it could have quite a bit to lose. Cisco's Linksys VoIP phones are going to sell by the thousands, whether they're called "iPhones" or not. Apple's multifunction phones are going to sell by the gazillions, whether they're called "iPhones" or not. If Cisco can actually hitch Linksys equipment to the Apple juggernaut, even a "Works with iPhone" sticker on the box will be worth more to Cisco's bottom line than denying Apple the "iPhone" trademark.
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