Microsoft to rename SkyDrive in lawsuit settlement

Microsoft will rename its SkyDrive online storage product after reaching a settlement in a trademark case with British Sky Broadcasting (BSkyB).

BSkyB previously launched legal action against Microsoft, saying the software company’s SkyDrive product infringed upon the broadcaster’s Sky mark.

BSkyB argued that Microsoft’s use of the word ‘Sky’ in ‘SkyDrive’ was problematic because the broadcaster still ran other digital services, including Sky Broadband and Sky Go Video.

In June this year, an English court issued a judgement that Microsoft’s use of ‘SkyDrive’ did indeed infringe on the mark.

Microsoft originally said it planned to appeal the judgement.

But last week, the two companies released a joint statement announcing that they had reached a settlement in the case.

Under the settlement, Microsoft won’t appeal the judge’s decision. Also, Sky will allow Microsoft to use the SkyDrive name for a “reasonable period of time to allow for an orderly transition to a new brand”.

A Microsoft spokeswoman said that the “scope of the changes won’t be limited to one specific region”.

The joint release said that the settlement agreement “also contains financial and other terms, the details of which are confidential”.

Regarding the funds Microsoft has already spent on marketing the SkyDrive brand, one analyst described it as “a colossal waste of money”, saying “they might has well have flushed it down the toilet”.

A name change would likely involve more than redesigning marketing materials - the SkyDrive apps would probably need some level of redevelopment, for example - so a rebranding could be costly for Microsoft.

Some analysts said that instead of investing in rebranding, Microsoft may simply try to pay BSkyB for the right to use the name SkyDrive, Computerworld reported.