In April this year Apple released their newest product – the Apple Watch. Only a few months after the release date a petition was filed in a Milan court accusing Apple of violating the iWatch trade mark. You may recall that in 2012 the tech giant agreed to pay $60m to Chinese firm Proview to settle a dispute involving rights to the “iPad” name. Now another high-profile dispute is on its way.
On 26 June an Irish software development company Probendi filed an urgent procedure concerning Apple’s use of the name owned by them – iWatch. Although their “iDevices” have been very popular, Apple did not use this name for their watch. It seems they have learnt their lesson from 2012 because their innovative watch is in fact called ‘Apple watch’. They probably knew this name was already owned by another company. The problem is not, therefore, in the name of the product.
Apple has, however, used the ‘iWatch’ name in another way. In our blog Bidding on competitors’ trademark in Adwords we wrote about Adwords and trade mark infringement. Both issues seem relevant in this dispute as well. It is a fact that Apple paid for Google AdWords to use the term ‘iWatch’. When users search for iWatch on Google, they are directed to Apple’s store even though this was not the actual name of this product. As Probendi’s petition claimed, “Apple has systematically used iWatch wording on Google search engine in order to direct customers to its own website advertising Apple Watch.”
While Apple managed to settle with the Chinese company Proview and buy out the rights in the ‘iPad’ name, it is more likely than not that they will not succeed to do this with Probendi.
Probendi co-founder and CEO Daniele Di Salvo said the company had warned Apple against using this term.
It is expected that the Irish company will take full advantage of its registered trade mark. Di Salvo said his company plans to develop their own ‘smart watch’ which will run on Android and have a touchscreen display too. It is not difficult to guess what its name would be. Probendi’s iWatch will benefit from all must-have features and undercut the Apple Watch in price.
Bloomberg reports about an audit conducted by Barzano & Zanardo valuing the iWatch trademark at €87 million ($97 million) – significantly more than the $60 million Apple paid Proview.
Many companies have tried to challenge Google or its advisers over trademark use but more often than not these actions have been unsuccessful. Google’s policy terms for its ad service states that trade mark complaints are dealt with on a case-by-case basis and that certain restrictions may be enforced. Probendi’s lawyer has said no action was taken by either Apple or Google following their requests and objections.
It is fascinating to explore how powerful the right branding strategy could be – out of curiosity I asked a number of my friends what they thought the name of Apple’s watch was. Unsurprisingly, all of them were convinced it was ‘iWatch’. That’s the power of strong intellectual property and excellent marketing strategy.
Even though Apple tried not to repeat the mistake from 2012, Techradar summarise the issue by saying that “Apple is being sued for not using the iWatch name”. We will be expecting more information on 11 November when the hearing Is scheduled.
So far when you type ‘iWatch’ into Google search, the top result will be an ad for the Apple Watch followed by link to the Apple’s website.