Saturday, November 06, 2010

Not without my IP lawyer – Nexocial’s painful marketing lesson

The company Nexocial was forced by Apple (AAPL) to change the name of its nPad-tablet. Apple argued that the product name infringed on its trade marks. Nexocial also had to discontinue its nPad-website. It is unclear what new product name will be chosen by Nexocial. Hopefully this time they will check it with an IP lawyer first.

Nexocial was wise to comply with Apple’s demand. The nPad is the brainchild of Hugo Leijtens, the Dutch CEO of Chengdu–based Nexosial. He believes that the iPad lacks some important features. His tablet therefore is Windows 7-based in order to enable multitasking and support Flash. The tablet also has a USB-port and has a resolution of 1024 x 600 pixels. However, the battery life is only 4 hours; about half of Apple’s iPad. The two products also look uncanningly alike - which puts Nexosial in hot legal water by default. By blocking Nexsocial to use the nPad product name, Apple effectively prevented it from entering the market. By losing the momentum, Nexosial decided not to enter the consumer market anymore, since it is now (over)crowded. The company stills sees possibilities in the enterprise market, where a few companies are experimenting with it.

Legal actions, including patent trolling, are used as marketing techniques to prevent market entrance or market expansion by competitors. Companies, and especially start-ups that could be a threat for behemoths such as Microsoft, Google or Apple, need to seek legal advice before launching a product or entering a market.. The fallout could otherwise break the company.
Will Nexocial be able to weather this storm? Not likely, unless Leijtens has another marketing ace up his sleeve...

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