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As first tipped by SmartHouse Apple and Cisco Systems are suspending their court battle over the iPhone. The end result could see a major relationship develop between Apple one of the fastest growing consumer technology Companies and Cisco the world’s leading Networking Company.
Cisco, which makes routers and switches to link networks and power the internet, has owned the trademark on the name “iPhone” since 2000 and began shipping its own line of iPhone-branded internet-enabled phones in late 2006. The spat according to insiders at both Companies is seen as not being worth a lengthy court battle; however both sides do see the value in a joint relationship which would allow Apple to have access to advanced networking, wireless set top box technology and Cisco a licence relationship for Cisco developed technology.
In addition Apple could well have an advantage in the delivery of Apple licensed content over telecommunication Company networks that are powered by Cisco routers.
SmartHouse revealed late last year that Cisco owned Linksys was working towards developing a proprietary “Connected Home” and Connected Office” structure which they are considering licensing to other CE Companies in the same way that Matsushita Electric did with their VHS technology in the 1970’s.
Michael Pocock the Senior Vice President and General Manager of Linksys said during an exclusive interview with SmartHouse News that Linksys through a series of acquisitions has been able to put together a team of R&D specialists who are today developing hardware and software capabilities that will give consumers and small medium business access to a seamless CE experience that is way beyond what is available today. Key to this experience is network and content he said.
During the past 18 months Cisco has acquired several Com
panies in the CE market including video start up Arroyo Video Solutions which they got for $92 million. Late last year they acquired Danish Company KISS who design and manufacture media centers and DVD players for $62 million. A middleware Company the KISS Brand according to Pocock is set to be killed off as Linksys move to cementing the Linksys brand globally.
Cisco also plans to integrate the Arroyo technology into its IP-NGN (Next Generation Network) architecture to help its approved partners distribute on-demand video content across various devices, including televisions, PCs and mobile handsets. Apple could well be a key beneficiary of this technology if a final deal is reached.
The spat over the iPhone gives Cisco a leverage position in negotiations with Apple. Cisco initially claimed that Apple’s new device is “deceptively and confusingly similar” to its own line of wireless phones from Cisco’s Linksys division. Apple says it’s entitled to use the name “iPhone” because its device operates over a cellular network, unlike Cisco’s phones, which use the internet. Apple plans to start selling its iPhone in June.
During a recent conference call with analysts, Apple’s Chief Operating Officer Tim Cook called the Cisco lawsuit “silly” and said Cisco’s trademark registration was “tenuous at best.” “If Cisco wants to challenge us,” Cook said, “we’re confident we’ll prevail.”
Under federal law, two companies may share a trademark as long as their uses aren’t confusingly similar. Apple has battled another Apple over trademark before: Apple Corps, the Beatles’ recording company, had sued the computer company over its entry into the music business.
Despite the more recent legal skirmish, Cisco is pushing ahead with its own Linksys iPhone. It took out a full page ad in Thursday’s edition of The New York Times to promote the product and included the small “R” for registered trademark next to the name. The ad, touting “iPhone: More than talk!” featured two women sitting back to back on a grassy field, one using a phone and the other a laptop – an Apple laptop.
