Netbooks, Notebooks and Cloud Computing

My response to the Are netbooks quietly driving us toward cloud computing? article turned into an article in its own right:

I’ve been saying for a long time that netbooks and cloud computing are intrinsically linked – indeed we developed something akin to a nettop 5 or 10 years ago at Australian Online Solutions but dropped it because web tools like SquirrelMail just didn’t cut the mustard compared to Gmail and its ilk (that and we’re a services company!).

A netbook (a portmanteau of “Internet Notebook”) is a single-purpose device whose hardware and software is tuned for web browsing. Adequate RAM and CPU are required (as opposed to “abundant”) but minimal local storage and graphics are called for. Indeed in terms of data loss and breaches read/write local storage is a liability!

Pixels are important though (if not physical screen size) and it’s good to see that devices like MSI’s new 13.4 inch X320 are finally shedding the shackles imposed by vendors like Intel and Microsoft, whereby discount chips and licenses were only offered for physically small devices so as to pigeon hole them and avoid cannibalising premium sales.

There’s nothing wrong with having an expensive Apple-style netbook (which by shedding features for supporting general-purpose use, like optical drives, magnetic media, graphics hardware, etc. are smaller, cheaper and run longer) and as you will see this year, nothing wrong with having a cheap, truly embedded single-purpose device running Linux on Arm. The third category (basically today’s netbooks) fall somewhere in between.

I expect the industry to settle on ~13.3 inch ARM devices that run customised linux distributions for a (business) day at a time, for us power users to opt for more capable generic devices and for the distinction between a “netbook” and a “notebook” to blur over the coming years (as it did with the “migration” from laptop to notebook).

In summary, netbooks are facilitating cloud computing as much as they are being facilitated by it. It is a symbiotic relationship and neither would be the same without the other (a netbook 10 years ago for example would be of limited utility without SaaS like Google Apps and similarly, netbooks can unlock much of the value proposition of cloud computing).

That’s part of the reason why we’ve formed the ‘Save the Netbooks’ grassroots campaign (http://www.savethenetbooks.com/) to protect the term, though the primary motivator is our disdain for intellectual property abuse (the netbook trademark was more akin to a minefield in the intellectual property wasteland than a valuable asset for the taking in our opinion).

PS ABI Research predict 35 million units will ship this year rising to 139 million in 2013.

Lessons learnt the likely loss of the “netbook” trademark

Reposted from the Save the Netbooks Blog:

There’s a number of things that Psion could have done to avoid losing the “netbook” trademark.

For a start, trademarks relate to a specific class of goods or services. The “netbook” mark #75215401 is just for “laptop computers”, as in the devices themselves. When Psion stop selling the devices (either permanently or by not shipping for 3+ years) then the trademark should self destruct.

Apple’s iBook trademark #75584233 on the other hand covers “computers, computer hardware, computer peripherals and users manuals sold therewith” so they’re good to go for as long as they offer peripherals. That said, in this kb article the definition of “obsolete” is quite clear:

“Obsolete products are those that were discontinued more than seven years ago. Apple has discontinued all hardware service for obsolete products with no exceptions. Service providers cannot order parts for obsolete products.

Aside from some quirks realting to California laws a “Petition for Cancellation” of the iBook trademark on the basis of abandonment could well be successful today.

Had they have held a stock of Netbooks and/or Netbook Pros for (restricted?) sale after manufacturing stopped may have been another way Psion could have avoided abandonment. Indeed not listing the devices as “discontinued” on their web site may have given them 3 years grace (e.g. through at least August 2009). Even an early announcement of a new netBook might have held off the dogs too.

An administrative error (that is, including a ‘Netbook’ rather than a ‘Netbook Pro’ brochure in the 2006 Combined Declararation of Use and Incontestability) led to Dell’s claim of fraud that may well be upheld.

But the ommission that undoubtedly caused the most damage was not acting quickly when others started using the mark. There are many ways to detect such usage – a Google Alert for ‘netbook’ or a Domain Tools alert for domain registrations would have resulted in an email alert within hours of the first [ab]uses and they could have acted quickly to stave off the onslaught.

Of course then the “netbook” industry wouldn’t be what it is today… the devices would have been called something like “webbooks” and none of this ever would have happened.

Conspiracy theories about Intel’s role in the “netbook” craze

The last few days working on Save the Netbooks have been enlightening to say the least. It’s surprising that something as mundane as a moniker for a generic class of laptops can be an outlet for the conspiracy theorists, but Mark “Sumocat” Sumimoto (the “Father of Ink Blogging” – which is interesting in itself) at least has got it in his head that Intel created the “netbook” moniker as “part of a move to undercut the OLPC project’s goal of supplying laptops to children in third-world countries“.

To his credit (and unlike most conspiracy theorists), Sumocat presents detailed (if flawed) arguments along with his claims like the Google Trends data on “netbook” usage. This correlates well with things like the February 2008 Bloomberg article where an Intel marketing drone gushed about their plans for “netbooks” that ran through CEO level, followed immediately by a fairly candid blog post which spoke about netbooks generically as a category rather than an Intel product. It predates, however, their full involvement later in the year through with things like the registration of netbook.com. Remember that Psion Teklogix waited until December before unleashing the hounds.

The theory culminates in a post entitled “How to Kill a Trademark” which focuses on prior use of the term “netbook” and suggests that if you “wield enough power [you] can bypass trademark protection”, as per Intel’s “deliberate campaign to genericize another entity’s trademarked name”. The fatal flaw with this theory is that a trademark requires continuous use and this one had been abandoned, both instantaneously and indefinitely by way of the End-of-Life notice (meaning “vendor will no longer be marketing, selling, or promoting a particular product”) and for longer than the 3 year limit on non-use.

Were the trademark still in use and had they acted in a reasonable period then it is very likely that Intel (and pretty much everyone else using the term) would have found themselves in a good deal of trouble. Even the smallest firm with a valid, in-use trademark could have enforced this given the probability of success (lawyers will take on this sort of a fight if there’s a virtually guaranteed payout at the end). However had Psion made a stink earlier in the year they likely would have been attacked by someone like Dell on the basis of abandonment then rather than now. There are similarities here with the Cisco/Apple settlement over the iPhone trademark.

Note that the “reasonable period” is perhaps open to debate but what is sure is that it’s shorter now in the days of the Internet than it was when the propagation rate of the mediums were slower (print, then radio, then television, now Internet). In the age of Twitter the entire lifecycle of a product can take place in the time it takes to even register a trademark and there are many things that can be done to modernise the rickety old trademark system. We’re doing our bit in that we’re working on surfacing “submarine” trademarks but this is just the beginning.

At the end of all this though, it simply doesn’t matter. Intel may have thought they were clever by getting behind these new devices (and only they know their real motives with respect to OLPC), but to assume they could link entangle “netbook” with “atom” (so to speak) was perhaps a bit ambitious, if not downright dangerous. The same applies to Microsoft who tried valiantly to keep the netbooks in the UMPC/ULCPC box with arbitrary restrictions on things like screen size at a measly and arbitrary 10 inches.

I’ve been saying the whole time that “netbooks” are “Internet Notebooks”. Given one of the key features for Internet productivity is screen size I am not at all surprised then to see the availability of full size netbooks out to 13.4″ already, and manufacturers like Acer (just yesterday) pulling out of the sub-10″ marketplace altogether. I’m also not surprised to see alternatives processors (most notably ARM based units like the Freescale) gearing up to take over the lion’s share of sales by being cheaper and more energy efficient.

Just as Microsoft introduced the XMLHTTPRequest object which ultimately led to a thriving marketplace of web based cloud computing applications (e.g. Google Apps), Intel has unleashed a monster that could well devour a large part of its revenue. It will be almost impossible for the WinTel alliance to match the new breed of competitors (at least in their current form of Windows 7 Starter on Intel Atom) so they’ll want to start thinking outside the box (like Windows Mobile 8 on XScale, except that they already sold it to focus on x86). Meanwhile AMD sees no future for [itself in] netbooks so the new kids on the block like Ubuntu Linux on Freescale currently have nothing to fear from the old school, let alone the infamous trademark.

Blogger fights Psion’s right to ‘netbook’ name

The Register: Blogger fights Psion’s right to ‘netbook’ name
‘Considerable chutzpah’

By Gavin Clarke in San Francisco

Posted in PCs & Chips, 19th February 2009 01:44 GMT

A campaign has been launched to thwart Psion Techlogix’s attempt to re-assert its trademark over the name “netbook”.

A blogger who claimed to have helped thwart Dell’s attempt to trademark “cloud computing” has called on OEMs and retailers to stand their ground and continue using the phrase “netbook” when describing sub-notebooks and their components past a deadline of March 31.

Sam Johnson has also called on Google to reverse an AdWords ban on the use of the phrase “netbooks,” for consumers to boycott “offending products”, and for journalists and bloggers to continue employing “netbook” and reject alternatives such as “ultra-portable”.

Johnson claimed one early victory, saying the Google AdWords netbook ban appeared to have been lifted. Asked about the potential changes, Google told The Reg it does not comment on specific keywords.

A cursory search online, meanwhile, showed both search engine companies and retailers continue to use the phrase “netbook” in their search terms or their product description pages. Google, MSN and Yahoo pulled back pages that described “netbooks” from OEMs, while online and clicks-and-mortar retailers Amazon, Newegg, Buy.com, and Target among others continued to run product descriptions of sub-noteboks as netbooks.

Johnson, the chief technology officer for cloud services company Australian Online Solutions, is basing his campaign on the fact that the phrase “netbook” is too generic to be owned or enforced by a single company.

Accordingly, he has listed product pages from Asus, Dell, Hewlett-Packard, Fujitusu, Lenovo, Samsung, Toshiba, and Microsoft among others that directly refer to netbooks or netbook-related products.

The company’s claim is further weakened, he said, by the fact Psion is asserting its trademark now that the netbook market is turning into a multi-billion-dollar industry having let its own “Netbook” brand lapse. He complemented the company for “considerable chutzpah.”

The campaign comes after Psion last month issued a statement confirming that in December, it had sent hundreds of letters to OEMs and retailers asking they stop using the phrase “netbook” to describe sub-notebook machines, claiming it infringes on registered trademarks in the US, Europe, Canada, Singapore, and Hong Kong.

The letter gave recipients until March 31 to stop using “netbook” and find some alternative, while January’s smoothly worded statement (here (warning: PDF)) said litigation was a last resort.

Psion trademarked the name “Netbook” in 1996 and shipped its first device in 1999. That line stopped with the Netbook Pro in 2003 running Windows CE, and Netbook today refers to a line of accessories like battery packs.

Rather incredibly, Psion has argued the phrase “netbook” cannot be considered a generic term because there are so few devices out there.

OK.

Yet, it goes on, things reached some kind of mysterious tipping point in the third quarter of 2008. That’s because the industry’s continued use of the term “netbook” risked finding its way into consumers’ consciousness, producing a critical mass, resulting in the genericisation of the trademark.

“Even though ‘netbook’ is not yet a generic term for ordinary buyers of these products, it could become so soon if retailers (and others) persist in calling these devices ‘netbooks’,” the company’s statement claimed.

Psion did not respond to questions to answer what precisely happened on or about the third quarter to spur it to action. According to the statement, though: “Psion acted promptly once it became clear that the threat of genericisation was real and growing.”

The company was being cagey on what it planned to do should it scare people off using “netbook” so glibly. “We have been considering adding new models to our ‘Netbook’ line for a while, but our policy is not to pre-announce new products,” the statement said. ®

Psion Teklogix may lose Netbook trademark

Psion Teklogix, who own international trademarks on the term “netbook” relating to a product that was discontinued in 2003, had recently sent cease and desist letters to “literally hundreds” of recipients, including netbook enthusiast sites. The Save the Netbooks campaign was launched by an Australian firm “to fight the impending trademark threat” and has since declared victory and retired after only 48 hours. Having already had some success in their first mission to reverse the AdWords ban, they were in the process of filing a petition to cancel with USPTO when they discovered they had been beaten to it by none other than Dell Computer (who we discussed last year on the other side of a similar scandal relating to the “cloud computing” trademark). In the petition, in addition to abandonment and genericness Dell also alleged fraud, claiming that a Sr Product Manager at Psion Teklogix had given a false declaration of use under penalty of purgery back in 2006. In any case it is now very likely that the term “netbook” will be unencumbered and free for all to use (for better or worse).

“Save the Netbooks” campaign launched to fight impending trademark threat

The “Save the Netbooks” campaign is fighting the impending trademark threat
from Psion Teklogix, who have given until the end of March 2009 to cease using
the term, citing trademarks relating to a line of products discontinued over 5
years ago.

SYDNEY, Australia - February 17, 2009 AEST - The "Save the netbooks" campaign
was launched today to protect the next generation of personal computers from
the impending threat of trademark action starting at the end of March 2009.

In a written statement released last month, Canadian firm Psion Teklogix, Inc.
confirmed news reports that they had contacted "literally hundreds of entities
around the world" to "affirm" international trademarks. The applications filed
between 1996 and 1998 related to their Psion netBook™ product line that was
launched in 1999 and subsequently discontinued over five years ago in 2003
(except for providing accessories, maintenance and support to existing users).

"We have been unable to find any connection whatsoever between Psion Teklogix
and the recent explosive organic growth of the term 'netbook', nor any
evidence that steps were taken to protect the trademark prior to the batch of
letters sent on the eve of christmas last year", said Sam Johnston, Strategic
Consultant. "We also believe that the term is a generic description for a
class of products rather than the specific meaning they intended, and that it
should not have been afforded trademark protection in the first place as it
is merely descriptive. Furthermore, at $1,299 the device would not even have
met one of the key criteria for netbooks were it available today: price."

"A 'netbook' is a class of laptop computers designed for Internet access.
Often confused with the 'subnotebook' or 'ultraportable' segment, the recent
availability of full size netbooks dispels the myth that size matters", said
Johnston, adding that "Thanks to rapid evolution such as the introduction of
ARM chips and custom Linux distributions, as well as support from increasingly
robust cloud computing offerings like Google Apps, netbooks are well placed
to become the de facto standard portable computer for the foreseeable future".

According to Business Week they tend to be greener too "thanks to lower power
demands, fewer toxic components, and a resource-efficient approach to
computing". Their task-specific manufacturing allows them to be far cheaper
than their predecessors and for enterprise users the total cost of ownership
(TCO) is greatly reduced. As they have few or no moving parts and high
efficiency processors they run cool, quiet and for up to a day at a time on a
single charge, and they do not need to be upgraded or replaced for 5-10 years.

The term "netbook" is a portmanteau of "Internet" and "notebook", in the same
way that "netizen" is a blend of "Internet" and "citizen". It started gaining
in popularity following the January 2005 launch of the One Laptop Per Child
(OLPC) project and rapidly entered the public lexicon with the 2007 launch of
the Asus eeePC. During 2008 the "netbook craze" really took off with most
computer manufacturers launching a "netbook" class device, often under the
"netbook" moniker. Today netbooks are manufactured by Acer, Asus, Dell,
Fujitsu, Gigabyte, HP, Lenovo, Medion, MSI, OLPC, Packard Bell, Toshiba,
Samsung, Sony and many others (but notably not Psion Teklogix) and you can buy
them from hundreds of thousands of distributors and retailers around the globe.

ABI Research predicts that 35 million netbooks will be sold this year, which is
triple the 10 million sold in 2008 and almost two orders of magnitude more than
were sold in 2007. They estimate this will rise to 139 million in 2013. At a
conservative $200 per device this could be a $30bn industry within 5 years.

"Typically priced well below $500, netbooks are a breath of fresh air in a
tough economic climate and they have extended personal computers to people
who have never been able to afford them", said Johnston. "They are also a key
component of the cloud computing ecosystem and a compelling cost reduction
strategy for enterprises. We welcome Psion Teklogix to the marketplace with a
netbook class device, but we note that they have not yet ruled out litigation
and urge them to do so promptly in order to maintain a level playing field and
ensure the widest possible consumer choice."

In the 8 January statement prepared by Marcus Casadei, Marketing Creative Lead,
and entitled "PSION STARTS PROCESS OF AFFIRMING ‘NETBOOK’ TRADEMARKS", Psion
Teklogix maintain that their trademarks are enforceable despite conceding
that "in recent years the extent of use has been somewhat reduced". They have
ruled out selling or licensing the mark, wishing "to be free to use it on
[their] future products" at the exclusion of all others, and are currently
calling for 'transition to a different descriptive term over a 3 month term'.
They note that the term "could become [generic] soon if retailers (and others)
persist in calling these devices 'netbooks'" and plead for "responsible
retailers and manufacturers" to "understand that it is wrong for them to
contribute to, and be complicit in, making a registered trademark generic",
asking them "as a matter of principle" to "respect [their] trademarks".

We contend that trademarks are intended to protect established brands, that it
is wrong to abuse them to hijack any term from the public lexicon, and that it
takes considerable chutzpah to do so after waiting "to be sure that there was a
real danger" while watching a multi-billion dollar netbook industry take shape.

We call for manufacturers and retailers to to stand your ground by continuing
to make new and innovative products available under the "netbook" moniker.

We call for Google to reverse the unfair ban on AdWords ads using the term
"netbook" on the basis that it is both generic and descriptive.

We call for journalists and bloggers to take advantage of the offered amnesty
(as we have) by rejecting the proposed "ultra-portable" alternative and
continuing to use "netbook" generically when referring to "Internet notebooks".

We call for consumers to vote with your feet should the community granted
privilege of a monopoly be abused, by joining in a boycott of the offending
products, a negative review protest and other coordinated activities.

Most of all we call for Psion Teklogix to "Save the Netbooks" themselves by
abandoning the offending trademarks within their self-assigned six week
deadline and committing instead to play fair under the "Psion netBook" banner.

For more information visit http://www.savethenetbooks.com/.

About Australian Online Solutions Pty Ltd

Australian Online Solutions is a boutique consultancy that specialises in
cloud computing solutions for large enterprise, government and education
clients throughout Australia, Europe and the USA. Despite having prototyped
a $199.00 Linux PC around the turn of the millennium, it is a services
company that has no intention of entering the netbook marketplace.

Australian Online Solutions was successful in August 2008 in protecting the
term "cloud computing" from a similar trademark attempt by Dell Computer,
whereby the United States Patent & Trademark Office (USPTO) had issued a
"Notice of Allowance". This was cancelled within days of company founder,
Sam Johnston, revealing the discovery on a cloud computing mailing list.

Similarly, an October 2008 attempt by Arastra, Inc. to register
"Cloud Networking" was foiled after the phrase was defined in Wikipedia and
used extensively in a generic context. Arastra abandoned their application
this month after receiving a refusal notice from the USPTO in January.

Australian Online Solutions has also just launched a Google App Engine
application called 'indexifier' which is working on gradually surfacing
these "submarine trademarks" over the course of the coming year. To help out
link to http://indexifier.appspot.com/ and for the source visit Google Code.

Sam Johnston, Founder and CTO, is a prominent blogger on cloud computing,
security and open source topics. He maintains a blog at https://samj.net/

Press Contact:
Sam Johnston
Australian Online Solutions Pty Ltd
http://www.aos.net.au/
+61 2 8898 9090

###

Cloud Computing Doghouse Updates (Incoming): Psion / Netbook trademark

Many of you will remember Psion from their heydey of making PDAs and other consumer devices and will be surprised to see them being discussed in the context of cloud computing. I’ve already explained what the netbook class of laptops is before and why 2009 will be the year of the enterprise netbook. Basically these are laptops that are optimised for the Internet, not bloated operating systems running heavyweight local applications. They have just enough resources for that task and as a result are significantly cheaper and (having dispensed with many of the moving parts) are far more reliable. They run cooler and longer and are both economically and ecologically friendly (think $300-400 each and 5-10 year lifetime, or a couple of bucks a month). Sounds too good to be true? Well if Psion have their way, it will be (at least under the ‘netbook’ moniker to which we are all accustomed).

You see the thing is that a bunch of years ago Psion somehow managed to obtain trademarks (including US trademark #75215401 and EU Community Trademark #000428250) for the term ‘netbook’ which it used on a line of products abandoned over 5 years ago. While the trademark probably should have been rejected outright for being ‘merely descriptive’ (e.g. a network enabled notebook), it wasn’t and managed to proceed to registration and extension into other territories.

Despite significant generic usage of the term over the last year or two (sufficient that the vast majority of us don’t think ‘Psion’ when we hear ‘netbook’), just before christmas last year Psion’s lawyers sent out a bunch of cease and desist letters (like this one) – not only to vendors but also to bloggers! They later clarified that they were only going after those “profiteering” from the term while conceding that “the extent of use has not been that great” (they have just been “supplying ‘Netbook’ accessories and also providing maintenance and support to existing ‘Netbook’ users“).

To our surprise the USPTO enforced it as recently as last month in denying at least 3 other marks (here, here and here) containing the term ‘Netbook’ citing ‘confusing simularity’ with Psion’s existing registered trademark. Google only last week banned ads containing the term as well. Too bad for Dell, HP and anyone else with a ‘netbook’ line. Ultimately though it will be the consumer who suffers if Psion continue on this perplexing crusade. They still lack a netbook offering (even if they are scrambling to build one) and while their Symbian/ARM based product was quite revolutionary, it would not have been the first time a product failed because it was ahead of its time.

See trademarks are designed to give a legal monopoly such that an owner can build up a brand and prevent others from releasing similar products with the same identifying features. They’re essential for many businesses and generally good for consumers too – you know what you’re getting when you buy a can of Coke® but couldn’t be so sure were it not for trademark protection. In this case though the term ‘netbook’ grew organically and independently of Psion’s largely unsuccessful product (sufficiently so that it has been long since abandoned). Their choosing to wait until now to enforce the trademark rather than stamp it out when it first appeared (in which case we would have just found some other term) is damaging to the segment, damaging to the users and damaging to cloud computing itself.

That’s why they’re taking over from Dell in the cloud computing doghouse and will stay there until such time as they win (which would be a travesty of grand proportions) or the trademark is invalidated as descriptive and/or generic. If any vendors want to take on this fight then I’d be more than happy to provide an expert opinion, and I’m sure I’m not alone. To those of you who think Psion is playing fair, guess again – they had their chance and missed it by a full 5 years. If they want to get in the game now and compete on a level playing field then they are more than welcome, but resorting to the trademark equivalent of a ‘submarine patent’ is (in my opinion at least) playing dirty pool.