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Amazon may prevail in Apple "Appstore" suit

A judge has said that Amazon will likely be allowed to use the phrase ?Appstore.? However, the final decision may have little impact on Apple?s dominance among application marketplaces.

Application marketplaces like Apple?s iTunes App Store are an important part of the equation for companies that want to build out a vibrant ecosystem for a smartphone. As a couple of different pieces of news this week shows, companies like Apple, Amazon and HP are looking for ways to boost these marketplace whether via trademark protection or by adding new features.

?An app store is a integral part of the mobile ecosystem, so it?s no surprise that Apple is aggressively protecting their app store?s brand,? said Ryan Peterson, director of marketing at Ubermind, Seattle, WA.

?Apple?s presence is undoubtedly the strongest across all mobile platforms, and it has the luxury of not having to compete with other iOS app stores,? he said.

?Android-focused app stores are not so lucky?I suspect that many of these app stores will not be able to compete against stores operated by Amazon, Google, or carriers.?

Generic terms
Amazon launched the Amazon Appstore in March. Consumers can go to it to download software for Android devices.

Apple quickly followed with a trademark lawsuit claiming the value of its App Store would be harmed by Amazon?s move because consumers will confuse the two services. Amazon?s responded by saying that the term ?Appstore? is generic and that Apple does not have exclusive rights to it.

?Generally, a word or phrase that is either generic or merely descriptive of will not be protectable as a registered trademark under U.S. law,? said Jonathan Ezor, counsel at Olshan Grundman Frome Rosenzweig & Wolosky LLP, New York.

?The exception is if one user can show ?secondary meaning,? that consumers associate an otherwise descriptive term with a single company?s goods or services. This is not easy, and it appears that Apple has not or cannot do so,? he said.

The judge in the case said this week that she is probably going to deny Apple?s motion because the company has not been able to demonstrate confusion among consumers. She will review court filings before issuing a final statement.

The final decision will probably not have a big impact on Apple.

?It is a confusing space for consumers, as there are becoming more and more new ways to discover and download Apps,? said Kunal Gupta, chief executive officer at Polar Mobile, Toronto, Canada.

?I don?t think it is that important for Apple to own the ?App Store? trademark, consumers will understand that apps are available on every smartphone and tablet,? he said.

Apple moves forward
Apple, however, appears to be continuing its efforts to protect its use of the term ?App Store.?
The company reportedly sent a cease-and-desist letter to home server software company Amahi, which also uses the phrase ?App Store? for its application marketplace. The company is planning to rename the marketplace.

In other Apple news, the company is reportedly readying the launch of a new iPhone that will be powered by the same chip currently inside the iPad 2 tablet.

?In today?s era of Android superphones with dual-core processors and 4?+ screens, incremental changes to the iPhone that bring it to par are not going to be revolutionary,? said Alex Spektor, handset analyst at Strategy Analytics, Newton, MA.

?Nevertheless, Apple?s powerful brand, intuitive and polished UI, and strong industrial design should help them to continue growing volume and marketshare,? he said

App store differentiators
While companies like Apple continue to use trademarks to protect their position in the quickly growing mobile application space, others are looking for ways to differentiate their brands.

HP yesterday introduced the webOS Pivot, which will showcase a broad range of applications and complement its application marketplace the webOS App Catalog.

The HP webOS Pivot will provide users a way to discover webOS 3.0 applications for the HP TouchPad, which launches July 1.

Pivot will consist of original content by journalists and photographers, features stories on applications and reviews. The content will be catered to the interests of a given region.

?Pivot serves to organize and curate apps in our App Catalog making app consumption informed, entertaining and satisfying by providing a well-designed contextual editorial vision,? said Leslie Letts, a spokesperson for HP, Palo Alto, CA.

?Pivot is an extension of the HP webOS App Catalog,? she said. ?It presents another view of the app catalog.

Users can purchase apps showcased within Pivot or they can toggle to the category view of the App Catalog and get a list of apps by category.

The move is one of the ways HP is investing in its webOS platform, per Ms. Letts.

Ubermind, which is working with HP on some webOS initiatives, expects other app marketplaces will do something similar.

?Allowing users to discover new apps while they browse beautiful, relevant content is much more enjoyable?akin to reading a favorite style or architecture magazine?than is the scrolling through the endless table views,? Ubermind?s Mr. Peterson said.

?I think many app stores will follow HP?s lead and do something similar,? he said.

Final Take
Chantal Tode, Assoc. Editor, Mobile Marketer