Palm Computing, of course, is intimately aware of power of the brand and the value of the trademark. A reader, who's also a Palm developer, recently forwarded me a letter Palm Computing had sent to their developers. The purpose of the letter was to explain Palm's trademark and branding position to independent developers and to tell those developers who were inadvertently putting Palm's trademarks at risk that they (the developers) needed to stop doing so.

You see, Palm Computing has a difficult problem. They've had some really bad luck with their brands. It's like those funny "I have good news, I have bad news" stories. The good news was that they established really well known brands for both "Pilot" and "PalmPilot". The bad news was that as they got super-successful, the Pilot Pen Corporation of America felt that their pre-existing trademark to "Pilot" was being threatened. OK, fine. So Palm Computing changed the name of their device to the Palm III and the name of their platform to the Palm Computing Platform. The good news was that Palm again managed to establish a strong brand in "Palm", the bad news was that Microsoft then introduced the "Palm PC".

After much effort, what Palm describes as "expending significant resources pursuing that litigation", Palm reached a settlement with Microsoft that says, according to the letter, "Microsoft shall not adopt or use any name, mark or term containing 'palm' … to identify products in the handheld computer category." The letter goes on to say that, "The settlement agreement with Microsoft does allow Microsoft to use the phrase 'palm-size PC' to identify the category of handheld computers, and we realize this concession still causes some confusion in the marketplace. Nevertheless, we believe our efforts were steps in the right direction because they prevented Microsoft from using PALM as a trademark."

There are a couple of other considerations. The way Microsoft used the Palm PC term had the potential to reduce the proprietary nature of the Palm brand. There are certain aspects of trademark law (and I'm not, thankfully, an attorney so this is only a rough explanation) that allow a trademark to lose it's value -- and, in effect, to become generic.

For example, many of us think of Kleenex when looking for a tissue, Xerox when making a copy, and so forth. But these are the trademarked brands of their respective companies. In order to protect a brand's equity, it must be, officially, used as an adjective, as in "Kleenex tissue", "Post-It note", "DAY-GLO paint", and "GORE-TEX fabric". In fact, it's so important to these trademark owners to actively protect the use of their marks that they even buy ads in magazines like Writer's Digest imploring writers to use the marks in a way that supports the manufacturer's trademark rights. I pulled a dusty June, 1996 issue off my shelf and counted ten such advertisements on two pages, from the likes of Kelly (the temps, not the blue book), Weight Watchers, DMO (which I'd never heard of, but The Prudential seemed to think was so important that they actually implied court action against the writer-readers of Writer's Digest -- in an ad, no less!), CITIBANK, GORE-TEX, DAY-GLO, Post-It, Mace (the spray, not the utilities), Kleenex, Whirlpool, and KitchenAid.