Confusion between Skype and Sky brands, EU court decides
The Luxembourg-based General Court of the European Union has ruled that there exists a likelihood of confusion between the figurative and word sign SKYPE and the wordmark SKY, the trademark owned by British broadcaster Sky plc (formerly BSkyB).
The dispute goes back a long time. In 2004 and 2005, Skype applied to the EU Office for Harmonisation in the Internal Market (OHIM) for registration of the figurative and word signs SKYPE as a pan-European trademark for audiovisual goods, telephony and photography goods and computer services relating to software or to the creation or hosting of websites.
In 2005 and 2006, British Sky Broadcasting Group (now Sky plc and Sky IP International), part owned by Rupert Murdoch's 21st Century Fox, filed a notice of opposition, pleading the likelihood of confusion with its wordmark SKY, originally filed in 2003 for identical goods and services. Although Sky is in Europe mostly known for its broadcasting activities, it also offers fixed line telephone services to consumers and businesses in the UK – a field where it is in theory competing with Skype.
In 2012 and 2013, OHIM backed Sky in its claim, finding, in essence, that there existed a likelihood of confusion of the signs - in particular, of their average degree of visual, phonetic and conceptual similarities. Skype then sought annulment of those decisions before the EU General Court. But on Tuesday, the Court dismissed Skype’s appeal and confirmed that there exists a likelihood of confusion between the two trademarks.
“As regards the visual, phonetic and conceptual similarity of the signs at issue, the Court has confirmed that the pronunciation of the vowel ‘y’ is no shorter in the word ‘skype’ than it is in the word ‘sky’. In addition, the word ‘sky’, part of the basic vocabulary of the English language, remains clearly identifiable in the word ‘skype’, in spite of the fact that the latter is written as only one word. Last, the element ‘sky’ in the word ‘skype’ can perfectly well be identified by the relevant public, even if the remaining element ‘pe’ has no specific meaning,” the court said in its decision.
It further pointed out that Skype's bubble-shaped logo, although not visually in any way similar to Sky's, is reminiscent of a cloud, which could be associated with the word 'sky'.
Skype has now one last option, by appealing to the European Court of Justice. Microsoft, Skype's owner, has already announced that they will appeal. According to BBC, the company's spokeswoman also said that the court case was not a legal challenge to Skype's use of the trademark, but only against its registration. However, it has been speculated that should Microsoft's appeal fail, the company could be forced to pay Sky plc to use Skype brand in Europe, raising also questions about a possible name-change.
Skype was launched on August 29, 2003, by six IT specialists and entrepreneurs from Estonia, Sweden and Denmark. The software was written by three Estonian developers - schoolmates Jaan Tallinn, Ahti Heinla, and Priit Kasesalu.
It was initially actually called Skyper, derived from Sky Peer-to-Peer, but due to the fact that domains under that name already existed, the name was changed to Skype.
Skype was sold to eBay in 2005 for 2.5 billion dollars, which in 2011 sold it to Microsoft for 8.56 billion dollars.
Skype still employs almost five hundred people in Tallinn.