Earlier this month the European General Court upheld a ruling in Sky's favour, deeming that Sky and Skype's respective brand names sounded too similar and may lead to 'customer confusion'. This is the latest in a 10 year legal battle over Skype's right to have the word 'Sky' within their name.
So what does this mean? The good news for Skype is that they don't have to change their instantly recognisable name or logo, but it does mean that any new companies can register the name Skype if they wish. In practise though, it's unlikely that anyone would dare, lest they provoke the ire of Rupert Murdoch, who is notorious for aggressively pursuing those who breach his intellectual property. You only need to look back at the long history between Skype and Sky's legal battles to see why that might not be such a wise move.
The drama began in 2004 when Skype was very much in its infancy. The company applied to The EU courts to protect its name and likeness. The trademark they registered served as brand protection for the whole of the EU, saving the company from the slow, expensive and difficult process of applying for a separate trademark in each individual country. However, the catch is that a successful objection in any country has the effect of knocking out the trademark across the EU. Sky did just that, and to make matters worse they had the upper hand because they had a pre-existing trademark.
In 2010, the European trademark registry (the Office for Harmonisation in the Internal Market (OHIM)) ruled in Sky's favour once more, and again when Skype appealed that decision in 2012. OHIM was of the view that the similarity in names could lead to confusion. Unhappy with the outcome, Skype then turned to the General Court of the European Union in hopes of annulling the ruling but had no luck there either; last Tuesday's ruling being the latest in a long line of legal defeats.
The risk of 'customer confusion' between the two marks is debatable. If you were to tell somebody that you were going to Sky them later, I'm not sure they'd have a clue what you were talking about. On the flipside, if you asked them what time Skype were showing the football, they'd be equally perplexed. This type of evidence will have undoubtedly fuelled Skype's persistence and determination in pursuing the case. But whatever your thoughts on the matter, Sky has, over a period of more than 10 years repeatedly persuaded the powers that be that such a risk exists.
After the latest ruling a Sky spokesman stated:
"Sky is involved in a long-running dispute with Skype in relation to several trade mark applications filed by Skype, including, but not limited to, television-related goods and services"
As it stands Skype primarily focuses on its popular video chat software, but as they've evolved they've taken a stab at the telecommunications industry, giving customers the ability to call a phone number and be connected to somebody's house or mobile line from the comfort of their computer.
It's doubtful that the existence of Skype has any real negative impact on Sky's brand as things currently stand, but with the tech and media industries rapidly converging, no business wants to lose out on revenue or customer service by neglecting an aspect of the new media landscape. While there may not have been an issue with confusion when Skype initially launched their brand, should they start to offer similar services to Sky they'd be leaving themselves exposed to the possibility for future legal skirmishes. By opposing Skype's trade mark applications, Sky is effectively pre-empting the threat of a future rival, even though their current offerings don't directly intersect.