Apple and Cisco Settle Dispute!

  • Posted: 21 February 2007 07:03 PM

    Apple and Cisco Systems have settled their trademark dispute with an agreement to work together on interoperable products.

    How much will this push AAPL higher in the morning?

    Edited 02/22/07 to change topic type from sticky to normal.

         
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    Posted: 21 February 2007 07:08 PM #1

    This will help the upward momentum from today making it harder for the FUD to drag it down.  Now if the options thing can get resolved soon, we are off to the races :drool:

         
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    Posted: 21 February 2007 11:43 PM #2

    I wonder how much of yesterday’s climb was due to this slipping out early?

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    Posted: 22 February 2007 12:54 AM #3

    A rare and welcome display of reason triumphing over lawyers rolleyes

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  • Posted: 22 February 2007 01:21 AM #4

    [quote author=“oldmac”]This will help the upward momentum from today making it harder for the FUD to drag it down.  Now if the options thing can get resolved soon, we are off to the races :drool:


    exactly….what else is there to hold AAPL back now?? There is no bad news. Surely the sounds of increasing revenue from multiple sources will finally convince the nay sayers. The good news is everywhere.

    Just two examples are aTV and Safari.

    - aTV could add up to $5B in a few years time according to Deutsche Bank (IGM). This is a real story for AAPL.

    - Safari is making real gains according to Net Applications. It now commands 4.7% share. And not every mac user uses safari. I still see mac users persisting with IE5…why?  I don’t know… but they do???. But in any case if at least 1 in 20 computers is a Mac that is a significant share (It is probably significantly higher than that, but still…)


    And then there are the other stories: iPod, Mac, iTunes et al

    Where are the bad bits - the bits that need cutting off - the boat anchors??? There doesn’t appear to be any reason to be anything but enthusiastic for AAPL at the moment.

         
  • Posted: 22 February 2007 01:29 AM #5

    Cisco’s case was much weaker than they thought; Apple had been more thorough in evaluating the endgame. Cisco were clearly completely shocked by the iPhone launch with no trademark agreement (they initially announced that Apple’s acceptance of their terms must be in the post LOL ).

    What’s interesting is how they might cooperate in the future. The obvious area is in the replacement of much fixed line and mobile telephony by wirelesss broadband everywhere. Cisco can produce iPhone infrastucture components, and Apple iPhone consumer devices that use possibly proprietary protocols to deliver QOS (quality of service) and transparent switching between GSM/POTS and wireless broadband.

    In other words, together they can bring about the final merging of the home/office phone and the mobile phone into a single, low cost personal communicator, with service delivered over the internet rather than dedicated voice networks. They can occupy the sweet spot between Skype et al, and the old style telephony businesses. Both can make a lot of money out of this over the next ten years as the mobile and fixed telcos adapt to the final breakdown of the barriers that have protected their revenues.

         
  • Posted: 22 February 2007 02:56 AM #6

    This New York Times article fills in some details that reinforce my suspicion that SJ deliberately allowed Cisco to incorrectly believe all along that their rights to the iPhone name were solid. By negotiating but failing to finalise a joint CES/Macworld launch, Apple got all the product publicity, and Cisco none. Cisco were left floundering at the altar, which was necessary to prevent them preparing an independent product launch.

    In contrast to execs who have arrived at the top by a comfortable progression, one of SJ’s great strengths is being a “street-fighting business man”. He thinks through every conceivable outcome in detail and avoids challenging a competitors assumptions until the latest possible stage. He has consequently gained a reputation for “stabbing partners in the back”, but IMO this point of view is just sentimentality. Business relationships are not personal relationships.

    It would have been hilarious if Cisco had been lead by SJ’s twin, and they had both dropped the other at the altar, and announced iPhone products simultaneously! But there’s only one SJ.

         
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    Posted: 22 February 2007 02:57 AM #7

    Let’s not forget that Cisco can now use the iPhone trademark in those areas where Apple owned the trademark ie. pretty much everywhere outside the US.

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    Posted: 22 February 2007 03:41 AM #8

    [quote author=“wheeles”]Let’s not forget that Cisco can now use the iPhone trademark in those areas where Apple owned the trademark ie. pretty much everywhere outside the US.

    Interesting to see what will happen if another company (3Com? Palm? Nokia?) come out with a product called “iPhone”. Will “iPhone” become a generic term, indicating cellphones a cut above smartphones? Or will Cisco AND Apple fall on the other company’s back like a 16 tons of legal lead?

    To distinguish between the various “iPhones” around, (yes, there are cell-phone buying people out there who can’t tell the difference between Apple and an apple),  Apple will massively market the iPhone out of the usualy Mac/iPod customer base as the “Apple iPhone”. But the actual device will be branded ” :apple: iPhone” or just “iPhone”.

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    Tightwad.

         
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    Posted: 22 February 2007 03:59 AM #9

    The name iPhone is a valuable property due to the iPod. If another company starts using the name iPhone then expect Apple (but possibly not Cisco) to dump on them from a great height.

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    Throughout all my years of investing I’ve found that the big money was never made in the buying or the selling. The big money was made in the waiting. ? Jesse Livermore

         
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    Posted: 22 February 2007 04:45 AM #10

    Sleepygeek

    Those are sone really good insights.  I’m amazed at your business cunning.  8-)

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    Posted: 22 February 2007 04:51 AM #11

    [quote author=“macglenn”]Sleepygeek

    Those are sone really good insights.  I’m amazed at your business cunning.  8-)

    Nobody does conspiracy theories or contrarian conjecture better than Sleepygeek. One Sleepygeek is worth a thousand Rob Enderles :D

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    Posted: 22 February 2007 06:59 AM #12

    Who do you think settled this matter? The lawyers from both sides convinced the other side that it was in both their interestes to not go to trial over this and work together. Neither Apple or Cisco had air tight cases.

    I will add that this dispute was not hurting Apple’s stock much. Apple’s product was not shipping, and under the worst case scenerio it would have had to change the name and pay Cisco’s legal fees.

    [quote author=“Tommo_UK”]A rare and welcome display of reason triumphing over lawyers rolleyes

         
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    Posted: 22 February 2007 07:07 AM #13

    [quote author=“Terrin”]Who do you think settled this matter? The lawyers from both sides convinced the other side that it was in both their interestes to not go to trial over this and work together. Neither Apple or Cisco had air tight cases.

    I will add that this dispute was not hurting Apple’s stock much. Apple’s product was not shipping, and under the worst case scenerio it would have had to change the name and pay Cisco’s legal fees.

    [quote author=“Tommo_UK”]A rare and welcome display of reason triumphing over lawyers rolleyes

    Terrin,

    Whatever your thoughts on the relative importance of this news, or mine, AAPL popped 4% on it. You’re crediting investors with too much intelligence if you think that news such as this doesn’t impact the stock. The market HATES uncertainty. This removed some uncertainty. The stock popped smile

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  • Posted: 22 February 2007 08:47 AM #14

    [quote author=“Terrin”]Who do you think settled this matter? The lawyers from both sides convinced the other side that it was in both their interestes to not go to trial over this and work together. Neither Apple or Cisco had air tight cases.

    My view: I think Cisco had crummy lawyers, and because Apple was negotiating,  Cisco never asked the question: who would win in court if Apple unilaterally started using “iPhone”. 

    After the iPhone launch shock, they got the answer “umm, not sure” from their lawyers, “we think your lawsuit is silly” from Apple, and Apple had secured 90% of public mindshare for “iPhone”. The negotiations had been a sham, and 90% of what Cisco believed was theirs turned to dust in their hands. There wasn’t much time to extract some benefit from the final 10%. The lawsuit was a face-saving exercise to give a public appearance of strength during the real negotiation with Apple.

    Cisco may have salvaged a commitment to interoperability from Apple, but I bet Cisco’s commitment to cooperate on infrastructure hardware is in there somewhere, and is worth more to Apple, than Apple’s commitment to interoperate with Cisco. Cisco is already top dog in internet infrastructure and a major VOIP player. Apple is, at this moment, nowhere in telephony.

    The probability that Apple is actually paying Cisco anything is very small. Cisco needs consumer visibility now, but Apple doesn’t really need Cisco for a couple of years.

         
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    Posted: 22 February 2007 10:08 AM #15

    [quote author=“sleepygeek”]My view: I think Cisco had crummy lawyers, and because Apple was negotiating,  Cisco never asked the question: who would win in court if Apple unilaterally started using “iPhone”. 

    After the iPhone launch shock, they got the answer “umm, not sure” from their lawyers, “we think your lawsuit is silly” from Apple, and Apple had secured 90% of public mindshare for “iPhone”. The negotiations had been a sham, and 90% of what Cisco believed was theirs turned to dust in their hands. There wasn’t much time to extract some benefit from the final 10%. The lawsuit was a face-saving exercise to give a public appearance of strength during the real negotiation with Apple.

    Good analysis. Cisco appears to have been caught off guard. Once Jobs used “iPhone” at MWSF, there was essentially nothing that Cisco could do to stop the juggernaut. (I suspect that Apple had much more than 90% public mindshare—neat concept, probably more like 98%. I suspect that the Linksys iPhone has not been selling very well. If one reads the user reviews on Amazon, one can see reasons why that could be the case.)

    Cisco not only didn’t share in the good publicity, the publicity it did get was pretty negative. Most consumers don’t give a damn about trademarks and patents—they (WE!) just want cool stuff that works. Think of how many people use “Kleenex,” “Xerox,” and “supersize” as generic terms, even though they are trademarks.