My Simple Explanation for the iPhone Apple/Cisco Fiasco

And make no mistake, it is a fiasco.

Here’s my interpretation of what happened. Please note, I have no factual data to back this up. Just comments from someone who has been reading the press like anyone else.

Apple wants the iPhone name. It begs. It pleads. It promises Cisco some case, and tie-ins to Cisco networking gear, and Steve promises to introduce Chambers to more of the cool crowd.

Cisco agrees in principal, and faxes over final contracts by Monday 8pm.

Steve feels like the deal is done, and doesn’t sweat the details of signing on the dotted line before the keynote.

Big announcement. Awesome. Amazing.

Cisco now realizes, wow, this trademark just became worth a whole lot more! I’m glad we didn’t sign anything.

Cisco tells Apple, it’s going to cost a lot more now. This violates Steve’s sense of fair play, and a lawsuit is born. The lawyers take over, and it’s all animosity until the posturing is done, and a richer deal for Cisco is worked out.

Dumb move, really, by Apple. Next time, sign the contracts or don’t announce the name. The product doesn’t launch until June anyway. You gave a fake name for Apple TV (iTV)… you could have done the same thing here.

Cool product, though! It would be cooler if it ran Skype

Update (1/11/2007):  Jim Cramer has his own theory on what the lawsuit is about.  He thinks Cisco wants to force Apple to let it into the “cool” club…