Microsoft plans to appeal a EU court ruling that found its Skype brand is too similar to that of British satellite broadcaster Sky, which holds a European trademark on audiovisual goods, telephony and software-related services categories.
On Tuesday, the General Court of the EU found the Skype name and logo could not be registered as trademarks because they can be confused with Sky's.
Skype had sought to overturn decisions by Europe's trademark registry, the Office for Harmonisation in the Internal Market (OHIM), that also found confusion was likely.
Microsoft, which bought Skype in 2011, said it would continue the legal fight. "We're confident no confusion exists between these brands and services and will appeal. This decision does not require us to alter product names in any way," a Microsoft spokeswoman said in an email.
Skype applied to register the word "SKYPE" and its logo as an EU-wide trademark in 2004 and 2005 in several categories. These applications were opposed by Sky shortly after, arguing they would cause confusion with the word mark "SKY" that it filed for identical goods and services in 2003.
The EU's General Court agreed. Skype's bubble logo "does not affect the average degree of visual, phonetic and conceptual similarity," it said in a news release.
"Conceptually, the figurative element conveys no concept, except perhaps that of a cloud, which would further increase the likelihood of the element 'sky' being recognised within the word element 'skype', for clouds are to be found 'in the sky' and thus may readily be associated with the word 'sky,'" it added.
Moreover, confusion with Sky's word mark is also likely because the pronunciation of the vowel "y" is similar in the words "skype" and "sky". The word "sky" is part of the basic vocabulary of the English language and remains clearly identifiable in the word "skype", although the latter is written as only one word, the court said.
A Sky spokesman said the company's intention all along has been to protect the Sky brand.
This isn't the only trademark the companies have fought each other over. Microsoft changed the name of its cloud storage service SkyDrive to OneDrive in 2014 after it lost a trademark dispute with Sky, which was known as BSkyB back then.