Apple and Cisco have reached an agreement on the use of the iPhone name. Cisco surprised the Mac world when their Linksys division released and rebranded a variety of Internet Protocol (IP) phones under the name iPhone in December 2006. Cisco had acquired the trademark via a company they purchased in 2000, and claimed to own the term in the realm of phones. The iPhone name was widely rumored for years to be attached to a project of Apple's devising.

Then, Apple likewise surprised everyone by announcing an iPhone at Macworld Expo in January 2007 (see "iPhone Seeks to Redefine the Mobile Phone," 2007-01-15). Almost immediately, Cisco filed a lawsuit, saying that it had been in negotiations over Apple's use of the name and asserting its rights. Apple called the lawsuit "silly."

Both parties entered into settlement talks quickly. The agreement announced on 21-Feb-07 states that both parties recognize trademark rights that have been granted, and both can use the iPhone trademark on their products worldwide. Both Apple and Cisco will dismiss all legal actions against each other, and will work on interoperability, without any specific agreements.

No mention of actual cash money was mentioned, and it's entirely possible none was involved. This is pure speculation, but Cisco may have used the opportunity to force a bit more light into Apple's crevices to achieve better compatibility for its wide array of consumer and corporate gear, which could benefit its customers and bottom line.

What this deal means is that Apple's iPhone gets to be the Apple iPhone, although, due to the vagaries of how trademarks work, we might see it more commonly called - at least by Apple - "the Apple iPhone cell phone, music player, and Internet communicator."