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IP's Middle Child Grows Up

Trademark is the ignored middle child of intellectual property. But branding an idea is crucial.

On June 21, lawyers for Microsoft filed an application to trademark a stylish, logolike version of the term “.net.” Big deal? You bet. The following morning, the software giant unveiled its new .NET strategy, a “next generation Internet experience” that Bill Gates described as a bet-the-company plan to reinvent the way Microsoft does business. Analysts immediately hailed .NET as Microsoft’s most important announcement in years.

Amid the hoopla, Microsoft’s trademark application went completely unnoticed by the pundits. That’s no surprise, as Trademark tends to be the ignored “middle child” of intellectual property (IP) protection. Trademark’s little brother, Copyright, gets all the empathy because he’s getting beat up on the Internet by services like Napster.Meanwhile, Patent, the big sibling of the IP family, is stirring up controversies over genetics and online business models.Yet Trademark is often the most successful of the three-quicker than Patent and more powerful than Copyright.

Simply put, a trademark grants exclusive rights to a word, phrase, symbol or design that is used to identify and distinguish the goods or services of one party from those of others. That may sound like a funny way to protect technology, but Microsoft knows that the success of .NET depends most of all on winning over the hearts and minds of consumers. Thus,Microsoft’s effort to corner the brand names it will soon spend millions making synonymous with the next wave of personal computing. In addition to filing to protect its new .NET logo, the company filed to protect the words Office.net, Exchange.net, Passport.net, Msn.net and Word.net, among others.

Trademarking these names is all the more crucial because, technologically speaking, Microsoft isn’t doing
anything all that unique here. The .NET effort is based on XML, the Extensible Markup Language, a technology for making any kind of data or content portable among devices as diverse as cell phones, digital TVs, home appliances and previously incompatible computing systems. As such, XML will be a public-domain technology defined by standards bodies and owned by no one in particular.

Even though you can’t trademark the everyday use of common words-there are no Cell PhoneTM brand cell
phones-hardly any term or symbol is entirely safe from proprietary claims, least of all those that embody the
promise of the Internet. IBM, for instance, owns the trademark to an @-sign version of the letter “e” and has reserved its use for dozens of categories of e-products and e-services ranging from computing and financial offerings to possible uses as a logo on chocolates and jars of jam. Whereas the U.S. Patent and Trademark Office has rejected every one of the more than 500 various attempts to trademark “e-business,” IBM has nonetheless become closely associated with the term thanks to heavy use of its trademarked elogo in its advertising. Using the same strategy, Microsoft will likely create the impression that it owns “.net.”

Globalization has also done its part to magnify the importance of trademarks. Remember when Nike was almost blocked from selling apparel at the 1992 Olympics in Barcelona because a Spanish firm had already trademarked the word “Nike” locally? These days, when a major U.S. company is announcing a new marketing strategy, you can bet its branding effort will be global. According to Bill Ferron, who has represented Microsoft since 1984 as a partner with the Seattle-based Seed Intellectual Property Law Group, Microsoft has had its share of problems with name pirates and brand squatters both at home and abroad. “In the past, we’ve had issues because we haven’t made the effort to get the filings,” says Ferron. The coordinated worldwide launch of the .NET strategy and trademarks, he says, “reflects a more mature strategy.”

Sure, patents and copyrights are still important for making sure that people don’t steal your inventions or copy your computer code. But Microsoft and IBM know that the real power and the really big bucks are in building and maintaining a brand. Just ask William R. Bradley, a partner with Glankler Brown, the Memphis, Tenn., law firm that represents Elvis Presley Enterprises Inc. To better protect and serve Elvis, the estate in recent years has been on a trademark tear. It first trademarked the name Elvis Presley in the mid-1980s. Then the company trademarked Heartbreak Hotel, first for a licensed restaurant chain, then for use on clothing and drinking glasses. More recently came the trademarks for All Shook Up key chains and Love Me Tender golf balls.

Which brings us to the most remarkable aspect of our neglected middle child and his two siblings. Mr. Patent expires after 20 years. Mr. Copyright also lapses into the public domain after a certain point. But Mr. Trademark is endlessly renewable century after century. Which is why Elvis will live forever.

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