Apple which is known for infringing trademarks and dealing with them later now faces a costly trademark challenge. Apple has to pay $1.6bn to Proview Technology (Shenzen) to retain (or rather buy) its brand of iPad and continue selling in the mainland.
By far, this could be the costliest trademark losses/purchases Apple has ever made. Proview Technology isn’t some brand name squatter. It has registered iPad way back in 2001, and sold the rights to rest of the world for 35000 pounds. Proview retained China rights.
Proview which was probably repenting selling iPad trademark rights for a cheap 35000 pounds saw a huge opportunity. To make up for the loss, Proview has set the Mainland price at $1.6bn to average things out.
Trademark infringements are nothing new for Apple. Since its inception Apple has a knack of getting in and out of trademark lawsuits. It started with the company name itself which was already taken by Apple Corp, the company running Beatles.
Apple made an initial settlement with Beatles Apple under which Apple should never enter the music business, which Apple later did. That too was settled and Steve Jobs pulled a coup by getting Beatles to sell their songs on iTunes. Jobs rank this as one of his achievements.
Apple then went into another $2 mn settlement for its Machintosh brand name. Mighty Mouse with Terrytoon and iPhone with Cisco are Apple’s other trademark romances. iCloud and iAds went through a similar routine.
Was any of the Apple’s trademark skirmishes war this expensive? No. Would Apple cough up the money? It’s a dangerous proposition for Apple.
Apple has 3 options :
1. Sell under a different brand name which isn’t already taken. This would be hilarious. Check what pad means in China, anglicize it and add its eponymous alphabet of i.
2. Settle with Proview for a lesser amount or pay up the $1.6bn.
3. Stop selling iPads in China.
All the three options come with their own set of pitfalls. Weighing options monetarily and with the brand value in the mind, this is a mighty tough decision for Tim Cook.
Apple doesn’t want to lose its brand value by any means and selling under a different name means brand sabotage. Coke is called Coke in all parts of the world and Apple wants the same experience for all its products. Apple’s move would be very interesting.
For what it’s worth : Welcome to the Mainland.
I reckon $1.6 bn is a lot of money even for a company with a war chest of $80 bn. Renaming iPad would be my obvious inclination and lot of fun too. Let’s crowdsource “iPad Naming for China”. What names do you suggest for iPad China?