Apple bites into iPhone brand name

Ground Floor: This is the last column in which I'll mention business idols for a while, but Steve Jobs has been in the news …

Ground Floor:This is the last column in which I'll mention business idols for a while, but Steve Jobs has been in the news so much over the last week that I had to give a bit of space to the iPhone.

Clearly, as an Apple fan, I'm always keen to see new products and I'm hoping that the company may have come up with a phone that stops me jabbing helplessly at keys and wondering how on earth I can access the function I want without having to go through a myriad of menus first.

Using Mac OSX already gives me an advantage, although (despite the gasps of awe from the faithful at the Macworld conference) the jury is still out on how well the phone itself can actually deliver the promised goodies.

The iPhone is due to ship in the US in June and Jobs is looking for sales of 10 million units. While this would only give it a 1 per cent market share, it would also give an immense boost to the company's share price.

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But before it goes anywhere, Jobs will have to sort out its conflict with Cisco, which actually owns the iPhone name.

Apple had previously held discussions with Cisco and most people believed they would come to an agreement; but announcing the iPhone prior to any settlement has resulted in Cisco instigating a lawsuit against Apple. Some analysts are suggesting that the dispute is a simply a means of generating additional publicity.

Apple is used to corporate arguments. The Apple Corps vs Apple Computer dispute has rumbled on over the years despite an undertaking by Apple Computer not to engage in the music business. (Clearly the original submission of the technology company was that it bore no similarities whatsoever to The Beatles's holding company.)

However, the launch of the iPod and iTunes was a major incursion into the music business, although Apple Computer claimed that its role was still very different. The dispute saw both companies back in court again and in May last year the UK high court ruled in favour of Apple Computer - although Apple Corps intends to appeal.

The whole issue of corporate brand names is a bit of a minefield. Branding is so central to a company's product that any suggestion of the brand being hijacked by someone else sends the lawyers into a frenzy. Sometimes, though, companies don't look hard enough at what's out there already - or sometimes they're hoping to ride on the coat-tails of success.

The web browser Mozilla Firefox used to be known as Firebird and was known as Phoenix before that. It turned out that Phoenix was already trademarked and Firebird was connected to another project so the guys at Mozilla had to do some snappy rethinking to get the lawyers off their backs.

Research in Motion, the company which brought us the ubiquitous BlackBerry, is currently in dispute with Samsung over its mobile device, known as the BlackJack, which it claims (not unreasonably in my view) will trick people into thinking that these phones are part of the BlackBerry family.

In 2001 the US brewery Anheuser-Busch lost a battle to sell Budweiser beer in Portugal. Under a 1986 treaty between the Czech Republic and Portugal, Czech company Budejovicky Budvar (known as Budweis) has the sole right to the name. The battle to use it has been going on for nearly a century (surely good news for the lawyers).

Apple has also been involved in corporate lawsuits, including against Microsoft, Creative Technology and Hewlett-Packard, and is no slouch when it comes to getting the legal staff involved in its business.

It is also used to locking horns with its own lawyers as well as those from rivals. Back in the early days, Jim Reekes, a software engineer, created one of the chimes on the machine. The Apple legal team suggested that the creation might infringe the "non-music" agreement with Apple Corps. Reekes, annoyed, wanted to call it Let it Beep, but the lawyers were having none of it. Eventually he came up with the name Sosumi. The lawyers agreed that it had a Japanese-sounding origin, but in fact it is the comment that Reekes made at the time.

However, the word has come into more common usage now and is the name of a sushi restaurant in Sydney, Australia, as well being used by a number of other companies. As far as I know, Apple hasn't sued yet!

You can see how it might be quite happy to engage Cisco on the iPhone front. From its point of view the brand name iPhone would be synonymous with an Apple product. However companies often change long- established brand names when it comes to global marketing, even if it causes intense irritation for their customers.

Few people of my age like going into a shop and asking for a Snickers. It's a stupid name and Marathon was much better (it gave more advertising tie-in opportunities too). Changing Opal Fruits to Starburst was another corporate decision but Opal Fruits encapsulated the product perfectly. Starburst is a rubbish name for a global market.

There is a strong association with the prefix "i" and an Apple product, although this hasn't stopped other companies from using it. Nevertheless Jobs will surely want to retain it for the phone since it's also a music player and he has marketed it as an iPod in a phone. Which makes me think he'll settle with Cisco.

As for the market and the company's share price, all that matters is that it works and that Jobs gets his 1 per cent market share. Anything else is irrelevant.

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