A European Union court has ruled British consumers might have trouble distinguishing Microsoft’s Skype video chat software product from Rupert Murdoch-owned Sky TV and broadband services because the two words sound similar and Skype’s cloud-shaped logo may remind them of the clouds they see in the actual sky.
In its judgment, the court said that as regards the “visual, phonetic and conceptual” similarity of the two different marks, the pronunciation of the letter "y" in Skype was no shorter than it was in Sky, and the word sky – meaning the sky above our heads – was clearly identifiable in the word Skype.
In addition, said the General Court, which sits in Luxembourg, the word sky in Skype could be perfectly well identified by the British public even if the remaining "pe" element was meaningless.
The court also ruled that the Skype logo “could further increase the likelihood of the element ‘sky’ being recognised within the word element ‘Skype’, for clouds are to be found in the sky and thus may readily be associated with the word sky”.
It dismissed Microsoft’s argument that the Skype logo was highly distinctive and recognised by the public, declaring that even if the term "Skype" had acquired a meaning of its own for identifying the comms services provided by Skype, it would become a generic, descriptive term for services of that kind.
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Finally, said the court, account cannot be taken of the peaceful co-existence of the two marks up to now as a factor that could reduce the likelihood of confusion.
This is because, it said, peaceful co-existence in the UK concerned only peer-to-peer communications services and did not therefore lessen the likelihood of confusion in respect of other goods and services covered by the marks, such as satellite TV.
The case goes back more than a decade to 2004, when Skype – which at the time was not owned by Microsoft – applied to the Office for Harmonisation in the Internal Market (OHIM) to register its name as a trademark for audiovisual goods, telephony, photography and computer services.
This was swiftly knocked back by British Sky Broadcasting, now Sky, which successfully pleaded the likelihood of confusion with its earlier community word mark Sky, filed in 2003 for identical goods and services.
OHIM had upheld earlier decisions in 2012 and 2013 saying there was a likelihood of confusion due to visual, phonetic and conceptual similarity. The latest judgment is the culmination of Skype’s appeal for that decision to be annulled.
Further appeal likely
Microsoft and Sky have clashed before over the "sky" trademark. In 2013 the two companies settled a long-running dispute that ended with Microsoft rebranding its SkyDrive cloud service as OneDrive.
However, according to Microsoft, the latest ruling does not mean it will be forced to change Skype’s name.
“We're confident that no confusion exists between these brands and services, and will appeal. This decision does not require us to alter product names in any way,” Redmond said in a statement.
A Sky spokesperson said: “Our intention has been to protect the Sky brand with our research showing that similarities in name and logo have the potential to confuse customers."