Can Apple Rescue the iPhone’s Fate?

It’s no secret that China is one of Apple’s (NASDAQ:AAPL) most important and rapidly growing regions, but the company is also focused on other under-explored markets that can give it the right growth spurt for the future. Apple chief executive Tim Cook had said at the start of the current year that the company had its eye on Brazil as an area of big opportunity. Those plans have now received something of a setback.

Spoke in the Wheel

According to Associated Press, a Latin America-based telecommunications analyst has said that Apple will have to pay a firm called Gradiente SA for the right to use the iPhone brand in the country. The Brazilian company has legal ownership to the name and began selling Google (NASDAQ:GOOG) Android smartphones under the umbrella last week.

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Gradiente requested for the right to use the iPhone brand name in 2000 — before Apple did — and received approval from Brazil’s trademark office in 2008 to own it exclusively through 2018. However, it had not made any use of the name until now because its “priority was to conclude a corporate restructuring process that ended earlier this year,” it said.

Gradiente’s iPhone sells for 600 reals, or $300, for a 3.7-inch touch-sensitive screen, Bluetooth, dual chip capability, 3G, Wi-Fi, and camera. The company said in a statement last week that it would “adopt all the measures used by companies around the world to preserve its intellectual property rights.”

According to Eduardo Tude, president of Brazilian telecommunications consultancy Teleco, “the most likely scenario” is that the two companies will reach an agreement where Apple pays Gradiente for the use of the brand, but that may take some time.

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