In The News: Apple Tries to protect Trademarked iPad™ from becoming Commonized

This article analysis will be of special Interest to my ECON 2302 Students.  I suggest reading it and posting answers to the questions in the comments as they *may* be worth a few extra credit points. 


Very recently an article in USA Today discussed Apple Computer taking legal action to protect its trademarked iPad™ tablet computer from becoming commonized.  Commonization or genericization refers to the process of how a registered trademark becomes a common noun or verb used for an object, process or service.  For example, in the past Frisbee, Aspirin, Yo-yo, Zipper, Escalator, and Thermos were registered trademarks or brand names that lost their registered trademark status due to commonization.  


Over the years other registered trademarks have taken to marketing and legal action in order to protect the value of their name.  Band-Aid™ brand adhesive bandages modified it's jingle to add the word "brand" to emphasize its status as a registered trademark. Kleenex™ brand tissues did similar actions.  Liquid Paper™ correction fluid, Xerox™ copiers and Rollerblade™ in-line skates posted ads in The Writer magazine in order to remind authors of fiction and news articles that their registered trademarks were not to be used as common nouns or verbs, and that doing so could subject authors and publishers to legal action.  




Per the article:  "It's difficult to quantify how much revenue a company loses when its brand is deemed generic. But companies worry that it breeds confusion among consumers."  I'm sure the Frisbee trademark was worth something to the pie-tin company and later Wham-O toys.  I'm sure Zipper was worth a good deal of money to the BF Goodrich company that patented the fastener.  There was assuredly a lot of time, energy, and money put into developing and marketing those brand names.  And now Apple Computer is worried the same thing will happen with iPad™.

Personally I find it a little silly that Apple would do this, but given Apple's history, its largely a result of a lesson learned back in the 1980s.  The Apple and Apple II personal computers were wildly popular, but were expensive.  Apple did not take proper legal steps in order to license its Operating System, and as a result tons of cheap clones were sold for about half the price (i.e. the Franklin Ace).  When Apple released the Macintosh ™ computer or Mac for short, several companies created clones, but Apple sued the pants off of them and has pretty much been borderline fascist on protecting its trademarks, licenses, operating systems and brand names from clones and commonization by businesses, publishers, or any other entities that could use those items to earn revenue.  While most folks I know don't say iPod™ if it is some other brand of mp3 player or media player, the preparation of Podcasts (audio or video shows for replay on any media player, not just an iPod™) continues and the word has been used, with only some verbal sabre-rattling by Apple Computer.

Star Trek: TNG PADD

Some truth:  IBM, Microsoft and Xerox teamed up around 1999 and developed early Tablet PCs.  They were largely based on the use of the old pen pad hardware attachment that some personal computers used.  Dell and a few others developed some rudimentary Tablet PCs but they were not well received by the market largely due to heat and weight issues, as well as due to the lack of an intuitive user interface. Some of them were laptop computers  with a screen that flipped over and only would operate with a stylus, not the use of a finger.  In 2007, Apple introduced the iPod™ touch. I bought one largely because I liked the touchscreen interface, and because of how intuitive it was to use.  My then 5 year old daughter said "It'd be nice if they made a larger one like it."  It also reminded me of a smaller version of a tech concept from Star Trek: The Next Generation called the PADD (acronym for personal acccess display device).  On all of the Star Trek series that were set in The Next Generation time period, we saw Starfleet personnel using them.  And when the iPad came out in 2010, it reminded me almost exactly of the Star Trek PADD--and yet nobody from Paramount or Gene Roddenberry's estate has sued Apple yet.

Since the iPad™, Android, Samsung, RIMM and Motorola have produced their own Tablet PCs that have worked quite well.  Although they are not iPads, they work in a similar fashion.  Just the same, I personally doubt someone that uses a Galaxy™ or Xoom™ tablet PC will call them iPads.  I also figure anyone that asks "is that an iPad?" would be told by the user "No, it's a Galaxy tablet."

Questions to Consider:


1.  How much money do you think a business puts into creating a brand name?  How much is the brand name worth over time if the product is successful?  


2.  What kind of costs are incurred by creating a brand name?  What kind of costs are incurred in protecting it?


3.  In which market structures would brand names be most common in?  What are brand names an example of?


4.  How much value do you think was lost by Bayer when they lost the trademark to the brand Aspirin?  How much value would Apple lose in the event iPad™ became commonized and they lost the registered trademark? Would it cause Apple to take economic losses?


As always, thoughtful comments and questions are welcomed.

Success to you all!

Prof. Hank Lewis

In the News: Federal Reserve's Top Trader Quits

This article analysis will be of special Interest to my ECON 2301 Students.  I suggest reading it and posting answers to the questions in the comments as they *may* be worth a few extra credit points. 


In an article dated April 7, 2012, it stated that Brian Sack, a key trader with the Federal Reserve Bank of New York, has resigned his post.  Per the article:

Brian Sack

One of the key stewards of the Federal Reserve's unconventional monetary stimulus is parting ways with the central bank, a move that stunned Wall Street and left large shoes to fill in its all-important market trading section. Brian Sack, head of the markets group at the Federal Reserve Bank of New York, has tendered his resignation, according to a release Thursday from the New York Fed. Sack, 41, will stay in his current post until June 29, when the Fed's latest monetary stimulus program, known as Operation Twist, is set to expire. He will then be placed on leave until Sept. 14, during which he will have limited contact with the bank, the release said.

The departure comes as debate grows over the future of the ultra-easy monetary policy pursued by the Fed since the 2008-09 financial crisis. Investors and bond dealers are now intently questioning whether the Fed is prepared to embark on a third bond-buying program to boost the economy or is preparing for an eventual unwinding of those policies to tighten monetary conditions. With the economy improving, the question remains whether growth can remain sufficiently healthy without further monetary support while threats to the economic and investment climate continue from sources such as the euro zone's sovereign debt crisis.

"I'm dumbfounded," said Raymond Stone, co-founder of Stone & McCarthy Research Associates, which closely tracks Fed policy. "He laid the groundwork for a lot of things the Fed has done and communicated clearly to the market. He did an excellent job in a difficult environment." 

Per our reading in Chapters 9, 10 and 11 in the Rittenberg/Tregarthen Macroeconomics Book, The Federal Reserve serves as the US Central Bank and is the main agent of Monetary Policy.  The New York Federal Reserve has a permanent seat on the Federal Reserve Open Market Committee, which is in charge of conducting open market operations.

Questions for Discussion:


1.  What is the goal of Easy Monetary Policy?  Why has the Federal Reserve been enacting it since 2008/2009?  Has it been successful?  Why or Why not?


2.  What are open market operations?  How are they done in easy mode of Monetary Policy?  How to they affect interest rates, total spending the overall economy?


3.  Why does the New York Federal Reserve have a permanent seat on the Open Market Committee?  How does this change in a Key Bond Trader potentially impact Open Market Operations?


As always, thoughtful comments and questions are welcomed.

Success to you all!

Prof. Hank Lewis

Jobloft blows a done deal on Dragon's Den thanks to big mouthed Professor

As many of you know, I enjoy Dragon's Den and Shark Tank as these shows feature successful entrepreneurs as Venture Capitalists helping smaller entrepreneurs with big ideas but need funds to expand or take it to the next level.  Last night on the CBC, they did a reflection of the past several seasons regarding the most memorable moments on the show.  These moments included times when those making their elevator pitch broke down in tears at Kevin O'Leary's caustic response to ridiculous valuations, funny moments when the Dragon's clowned around, times when pitchers used scantily clad men or women to pursuade the Dragons, and even a time when a Food Pitcher served up a dish to the Dragon's that was revealed to be Dog Food!!!

However the most memorable moment came from the first season when the founders of JobLoft.com, an internet job site that would alert job seekers in service businesses such as restaurants, hospitality and retail stores, who was hiring in what areas via Text and enable faster application filing for those in those industries.



Jim Treliving, Franchise Baron of Boston Pizza and Mister Lube  was very interested, as were the other Dragons.  A deal was done--first deal closed of the first season.  However, at the closing, the founders of Jobloft (a group of University students) brought their mentor, a business professor, along for the signing of the deal and the cheque being issues.  However, that business professor (a bigger blowhard than I am) ruined things:


Suffice it to say, the Professor's behavior is very disappointing on many levels.  For one, the student entrepreneurs had made a successful elevator pitch and had a done deal, cheque written etc.  Although I am sure the Professor had good intentions, if he had ANY business sense AT ALL, he would have voiced his feelings about the deal PRIVATELY with those students he was mentoring and not done any grandstanding at the closing.

As someone who would be very pleased to help mentor students that are serious about becoming entrepreneurs or advancing into a career in business, and as someone who spent more than 16 years of his life in the Financial Services realm prior to teaching college & university students, I would consider it my role to advise anyone I was mentoring at appropriate moments and then step back and allow them to do what they felt best, including reject some or all of the advice I provide, and reap the benefits, or suffer the consequences.  That closing was Jobloft's moment to enjoy and their mentor should have just said "Congratulations" and been happy for them, rather than shoot his mouth off.  If I'd been in his shoes, I'd have  kept any ruminations about it to myself during the closing and would have been more jazzed to meet some of the Dragons.

Future participants on Dragon's Den learned a valuable lesson at Jobloft's expense:  BE  VERY CAREFUL who you invite to the closing of the deal.

Until next time,

Professor Hank Lewis

Chat with Entrepreneur Brooksy Smith of Jerry Built Burgers

NOTE TO STUDENTS AND ECON BLOG READERS:


This is a mirror post of my other blog HankOnFood.com.  Since Entrepreneurship is a topic we discuss in ECON 2301 and 2302, I figured this chat with a local partner of Jerry Built Burgers might be interesting, and maybe make you hungry as well!

Affable Restaurateur, Brooksy Smith, One of the
5 Partners that own and operate Jerry Built Burgers 

Recently I was informed by Brooksy Smith of Jerry Built Burgers contacted me to inform me that their Woodland's location located at 1335 Lake Woodlands Dr. would be opening up on March 31st, just 6 weeks after their first location at 3501 Holcombe had opened.  Brooksy invited me to come out to the new location for a preview and to talk a bit about some of what he learned in the first 6 weeks of the Holcombe location being opened.  Since eating there when they first opened, Jerry Built has become part of my regular rotation of burger joints that my son and I enjoy.  And I'm always up to get the inside scoop on the restaurants I love, so I gladly accepted.

When my son Jason and I paid the visit, they were putting the finishing touches on their marquis sign and getting their last round of staff training done.  I was able to see their larger dining room (5500 vs. 4500 at their Holcombe location), and get a feel for some of the knowledge Brooksy Smith, Jerry & Chad Glauser and the rest of the gang had learned over the past 6 weeks.

Every Thursday it Gets Better

Blueberry Skinny Lemonade
A Dr. Oz Inspiration

This is something Brooksy said during our visit that I was very happy to hear.  I have made a few discreet visits to Jerry Built since their grand opening on Feb. 18th.  These have largely been late Friday night, Sunday brunch or weekend afternoons.  Every time I have come in, the Holcombe location has been busy, cranking out home grown burgers, hot dogs, fries and such.

In my experience, what usually gives a good local place like Jerry Built traction is a mixture of Word of Mouth and good press.  Jerry Built has gotten both, but thanks to social media, blogs and Twitter, the word of mouth has been a thousand fold.  There has also been a direct mail campaign where I've seen many a customer coming in with those black Jerry the Bull mailers to try a burger.  Every one of those customers has said they would be coming back.  I've also seen a fair number of Medical Students mixed with Rice University Students and Soccer Moms with full broods from West University Place.

Industrial bins and crinkler
at Jerry Built Burgers'
Woodlands location

Brooksy also dropped some good news about the parking situation at Holcombe:  he's getting ahold of some adjacent property and parking is going to increase TREMENDOUSLY by May.  This will be a relief for those of us that live closer to Holcombe, especially the lunch crowd that has passed the location by due to the full lot.

Brooksy also shared how they'd vastly underestimated the volume they'd be selling on their french fries.  They had to buy industrial-sized bins and an industrial-sized fry cutter.  These aren't the ones they use for restaurants;  they're the ones that Ore-ida and McCain's  potatoes use for making the stuff they freeze and sell to the public!  Brooksy was also good enough to admit that this was a nice problem to have in the restaurant business.

New Products and working up the learning curve


Customers have proven helpful to Brooksy and company on 2 levels:

Jason enjoying a Jerry Built dog
in front of blueberry skinny lemonade
and Ginger Bull Shake

One customer had noticed how the fries, which had been prepared properly, had turned mushy in the bag.  They made a few suggestions to Brooksy and some changes were made.  Specifically, a couple of the corners were cut out of the fry boxes, napkins no longer placed on top of them and bag tops no longer rolled shut.  This has kept the fries crisper and better tasting.

Another customer suggested a way to make sure day old Ginger-Bull cookies weren't wasted:  take yesterday's Ginger Bulls, crumble them up, mix them in a Vanilla shake and you now have their #1 shake at Holcombe:  The Ginger Bull shake.

Fried Egg Tomato Grilled Cheese
note the inverted bun!

Other Customers came up with an Ernie's Style Burger (with grilled onions in Ernie's sauce), a Grilled cheese sandwich with the buns inverted, and also a fried egg and tomato grilled cheese sandwich that my compatriot Michelle had while we sat and talked with Brooksy.

Dr. Oz also served as another inspirational source for a product.  Brooksy indicated that he'd heard Dr. Oz that blueberries are one of the superfoods we should all eat due to its antioxidant properties, and so he crushed them up and mixed them in with his fresh squeezed lemonade (regular or skinny, made with Splenda™).

I was given samples of the Ginger Bull Shake and the Blueberry skinny lemonade to try and I can say they are both very, very good and will probably have one of them the next time I swing by the Holcombe location.

Willing to Consider good ideas from Customers, within Reason


One of the main points I felt Brooksy made to me was that despite the challenges starting up a restaurant like this from scratch has been, he's been willing to listen to good ideas from customers that are within reason.  And if he's not able to go with an idea, request or suggestion, he's not ever going to say "I don't care."  He's going to explain the nature of the restaurant business and the considerations he has to make regarding food, cost and waste issues.  That's not something that a lot of restaurateurs would do, which goes to show as I've said before, Jerry Built Burgers is NOT just another burger joint.

Artwork inside the Woodlands location of Jerry Built

As an Economics Professor in my main life, I very much enjoyed a chance to talk about this business with one of the partners.  There were many insights I gained that I can use in my teaching and I was glad to get more info to share in the blog.

New Location in the Woodlands Opens March 31st


Saturday, March 31st, it opens.  It has the same great features of the Holcombe location:  the windows to watch the process, the in-house ground and crinkled fries, the in-house baked buns, the hand-jacuzzi washing station, but on a slightly larger scale.  I advise all my Northside Friends, Family Colleagues and Coworkers to pay them a visit at:

Same Jerry the Bull,
but Woodlands signage
restrictions make it a tad
smaller sign

1335 Lake Woodlands Dr.
The Woodlands, Texas 77380
281-367-2874

Sunday - Thursday 11:00AM – 9:00PM
Friday - Saturday 11:00AM – 10:00PM

Go there and

EAT HAPPY, Y'ALL!!!