Saturday, September 11, 2010

Austro-Daimler trademark

Frame and Wheel applied for the rights to the Austro-Daimler trademark in the United States. The company has retained counsel on this matter and applied to the USPTO in August to obtain the rights for the lettering and the logo. The rights to the logo expired in the United States back in the 80s when Steyr-Daimler-Puch USA stopped importing the frames in the wake of that company's breakup. The rights to the lettering are a little bit more complex given that the name Daimler is a reference to Gottleib Daimler, the founder of the company that produces Mercedez-Benz (and which is now known as Daimler AG). However, the trademark is not being used in commerce and the application states that it will be used in the distribution and marketing of bicycles, rather than automobiles. Most people of Frame and Wheel's generation have never heard of Austro-Daimler (but then again many were not racing in the early 80s).
Frame and Wheel decided on this strategy for a number of reasons. First, there are no barriers to entry in the bicycle industry. Anyone can retain a manufacturer in China to make open mold or custom frames for them and anyone can put any components or wheels they wish on to that frame. The only thing that is needed to differentiate one bike form the next is a brand name. What is in a name is the next question. Given that Frame and Wheel is not doing anything innovative with the actual frame or components (leave that to the experts in Asia), Frame and Wheel believes that it is pretty cheeky to name the frame after the founder of the company. So what are the other options?
How about restoring an old brand, the way BMW restored Mini Cooper? Frame and Wheel raced on an Austro-Daimler Superleicht in the 80s in New England, Colorado and France; the name has special significance for Frame and Wheel. You can see the old frame on this blog. Frame and Wheel knew the company went bankrupt years ago but realized that rights to the trademark had not been renewed with the USPTO. Frame and Wheel recognizes that to develop a brand from the ground up is probably a better route, but the fact is that there are greater chances of success if the company tries to improve something that has been mismanaged or fallen by the wayside than invest huge amounts of time and capital in building something up from the ground up. This is especially true given that Frame and Wheel is not a bike builder and cannot innovate the actual manufacture of the bicycle (Frame and Wheel however can innovate how bicycles are sold). 
Second, the Austro-Daimler trademark is certainly more recognized in the market than anything Frame and Wheel could conjure up. For some people (particularly for older riders) it will be noticed immediately and remembered for what it was: a premium racing bicycle trademark. This is important. Frame and Wheel is convinced that consumers want to be sure that their brand is noticed as either good value for money or worth the money they paid for it. This gets back to the intangible factors about brand perception etc. If a consumer spends thousands of dollars on something, they want other people to know that what they spent their money on is worth it or that it has cache or that it is a fine product. Much of this is signaled in the brand. Frame and Wheel believes that a good quality carbon frame coupled with a restored premium brand is a better market position than the same frame with a new but unknown brand. 
Finally, Frame and Wheel notes that there are few German trademarks in the bicycle industry outside of Stevens and Canyon. However, there are plenty of legendary German cyclists: Jens Voigt, Jan Ulrich, Erik Zabel, etc. Frame and Wheel appreciates that everything has been tried before and on the darkest days, Frame and Wheel recognizes that someone might have tried this before only to be rebuffed by corporate lawyers. Indeed, Frame and Wheel approached General Dynamics, the owner of one of the remains of Styer-Daimler-Puch and enquired about the trademark: they kindly said they had no information outside of some existing legal issues related to the trademark (probably the Daimler question). Frame and Wheel also enquired with Daimler AG: they never replied. Frame and Wheel enquired with IVM Engineering in Austria: they believe that they still own the trademark and did not want to entertain any ideas about restoring it. Perhaps that is why there are no Austro-Daimler bicycles in the market today.
However, there are compelling arguments supporting the application and Frame and Wheel will let his counsel make them, but the last thing Frame and Wheel wants is a long drawn out dispute as there are no resources for fighting corporate lawyers that have deep pockets. The timing for this application will take a long time, at least a year, and during this time Frame and Wheel will assemble some frames using the Austro-Daimler trademark to demonstrate that the company is not a trademark "squatter" and using the trademark in commerce. This is an important consideration for the USPTO. 




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