Trends in Trademarks 2000

Brandweek,  June 12, 2000  

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Web-usable brand names grow increasingly scarce, while in the new product game, "i" and "my" are where it's @.

Filings for new trademarks are a barometer of the economy, and that barometer exploded in 1999. The number of applications with the U.S. Patent and Trademark Office for new brand names, logos and other marks skyrocketed, with an unprecedented 32% increase over the year before. It capped a decade in which new applications for marks rose steadily in every year from 1992 on, tracking and predicting the decade-long economic boom in the U.S.

"The result," observes Glenn Gundersen, a partner at Philadelphia law firm Dechert Price & Rhoads and author of the book, Trademark Searching," is that each year it has become harder to find new brand names that are available, and in the last year, it has become enormously difficult."

That is just one of several remarkable points spotted in the firm's new Annual Report on Trends in Trademarks. Though Dechert has monitored trends in new applications for nearly a decade, the changes in 1999 were unprecedented, fueled in considerable part by businesses large and small that hope to profit from the new Internet economy "Companies and individuals can apply to register marks they plan to use months or years from now, not just brands they are presently using," said Gundersen. "This means that new trademark filings signal what marketers think will appeal to consumers in the future, and reflect their assumptions about the public appetite for new products and services." Not surprisingly trademark applicants were enormously bullish in 1999.

As the boom has progressed, the Internet world has established new rules about what types of dot-com names are most valuable, and they aren't necessarily the kinds that have traditionally received the greatest legal protection. Many new applications for retail services combine a generic term with ".com." However, the law has historically held that generic terms cannot be trademarks. Are Web capitalists building empires on would-be "marks" which can't be protected, or are the rules changing?

"The conventional wisdom about Internet branding and the traditional principles of trademark law are on a collision course," said Gundersen. "The stakes are sufficiently high that we're likely to see significant new cases determining the extent of protection for the best-loved Internet branding conventions: 'generic.coms,' descriptive words with '.com' and the flood of 'e'-brands and 'i'marks."

Boom Times, Brand Scarcity

When companies are confident about business and the economy, they are more confident about launching new products. About half of all trademark applications are for marks that are intended for future use, so the volume of Trademark Office filings is a measure of that confidence. The number of new trademark applications has been an accurate economic barometer over this decade, sagging during the 1991-92 recession, then moving steadily upward thereafter. It took nearly 10 years (from 1990 to 1998) for the number of new U.S. trademark applications to double from 100,000 to 200,000. Then, astonishingly in just one year, applications leapt by another 64,000 in 1999, fueled by a booming economy, the Internet land rush, and the ease with which individuals and small businesses can now file applications online. The 32% increase from 1998 to 1999 dwarfs the previous record for a single-year rise--the 18% upturn coming out of the recession in 1993.The sheer volume of new applications is also remarkable. In absolute numb ers, the 64,000 increase in 1999 applications amounts to 60% of all the applications filed in the decade's nadir year of 1991.

Tracking the Internet Age

From a trademark standpoint, the Internet is celebrating its fifth anniversary as a mainstream commercial medium--1995 was the first year that the Trademark Office received a significant number of applications for marks containing Web-related buzzwords, or which explicitly referred to the Internet or synonymous terminology when describing the applicant's products or services.

The number of applications for marks with Internet buzzwords follows a similar pattern, with big jumps in 1995 and 1996, and an explosion in 1999 (see chart).

Companies obviously want to signal to consumers that their products are Internet-related by giving them names incorporating "Web" and "Cyber," but the sheer volume of new applications for such marks--hundreds and hundreds each year--suggests that a company's first choice will often already be taken. Thus, companies have more recently looked for other ways to signal that a product or service is web-friendly--by using ".com" or the prefix "e"-or "i-."

It's a Dot-Com World

While buzzwords such as Net, Web and Cyber had an early vogue, nothing beats the current come-from-behind popularity of dot-com. Indeed, the prevalence of dot-coin in new trademarks is nothing short of remarkable. The first application for a mark containing ".com" was filed in January 1994, for clbooks.com. Later that year, amazon.com was filed. The next year, nearly 300 ".com" applications were filed, including ".com" versions of the Playboy, Opryland, Star Wars, Campbell Soup, DKNY and Nickelodeon marks. Still, dot-com did not become the most prevalent marketing buzzword until 1997, when the number of filings hit 1,000 and surpassed such previous favorites as Internet, Web and Cyber.