Optus suffered an embarrassing loss in the Federal Court yesterday with Justice Thawley granting Boost Mobile an injunction which will see Optus remove the “Boost” branding from their new Living Network products – but it’s the detail of the case that is most damning for Optus and should raise questions about the leadership of their Management team and CEO Kelly Bayer Rosmarin.
While the pub test alone could reasonably assume that Optus’ use of the word Boost in a product name was a bit sketchy, Trademark law is a complex beast and it wasn’t a simple task for Boost’s team of Lawyers in the Federal Court on Monday and part of Tuesday.
I sat through a whole day of submissions and presentations, including Optus making a strong case under the details of Law – most of which went right over my simple head.
Boost Mobile’s lawyers were a bit more to the point, showing examples of the use of the Boost name alongside the word Mobile, as well as areas where it was used descriptively to “boost” the speed of a product. Essentially, if I was to characterise their defence, the use of the word Boost with a capital B as a product name was where the Trademark infringement was taking place.
I’m not going to pretend to unpack the entire ruling, needless to say, the Judge found in favour of Boost Mobile and Optus has to bare the costs of that, as well as the trouble they need to go to in order to comply with the injunction and remove the name.
Leaving that aside, there was a document presented by Optus on the opening day of submissions, one that had not previously been submitted to the court for Boost lawyers or the presiding Judge to see.
The document was a Marketing Brief, which Optus classified as Confidential, so other than the Optus Lawyers, Boost Lawyers and the Judge – no one could see it – not Boost themselves, or anyone in the courtroom. However, some parts of the document were referred to in His Honour’s decision and frankly, they are damning.
A full written decision has yet to be published, but from my best shorthand speed-typing and recollection – here’s how it played out.
Optus Must have been aware of the risk
Justice Thawley said “I’ve taken into account Optus’ evidence of the costs of the injunction and the fact that it will suffer reputational damage.”
But here’s the kicker – he went on to say “ sympathy on that front is somewhat diluted by the fact that Optus must have been aware of the risk in choosing from the various words it says it considered to describe the services it was offering – the central trademark of one of its competitors.”
To put it simple, he said “It would be commercially naive to think that Optus did not closely consider the risks, if not even the eventuality, which is now playing out.”
How does this relate to the Managment and CEO of Optus? Well the document being referred to was dated 20 May 2022 – a full nine months before the “Mobile Boost” products were announced.
That a senior marketing manager allowed the Boost name to be used, let alone the CEO herself didn’t question the name when it was presumably brought up in a weekly or quarterly product briefing is staggering.
Boost Mobile has over 800,000 prepaid customers, and is one of the biggest threats to the big-three telcos Pre-paid subscriber base.
Everyone in the Telco industry knows about Boost, and Optus and Boost have history, not just as original network partners, but more recently as marketing protagonists in the Supercars.
Optus Did consider the Boost Trademark
Here’s the most damning thing Justice Thawley said yesterday: The evidence is that Optus did indeed consider Boost’s trademark when considering the use of the word boost.“
That marketing brief he said, “described the task in a way which indicates it was choosing names, which it would be “distinctive” and “ownable” and “associative”. The task was described in a way which might reasonably be understood as being to choose a name which was both descriptive and functioning as a badge of origin.“
The “badge of origin” comment is critical as it relates directly to the Trademark law case.
Worryingly for Optus, he also said that the Marketing Brief “showed that the word boost was chosen for reasons beyond it being purely descriptive.“
We’ll never know those reasons – as the document was deemed confidential and we won’t get to see it.
The absolute bottom line, and these are the words of the presiding Federal Court judge – “Optus knew there was an underlying issue with its plan. The marketing brief stated near the end, “we can’t call the boost products boost as this conflicts with Boost Mobile”, it’s unlikely that Optus rolled out the new features without investigating this issue closely.“
And with that, the injunction was granted.
The Singaporean owners of Optus would be looking on worryingly. The Data Breach was a huge blow to the company’s reputation and despite now being “customer positive” – that is to say, they do not have less customers now than they did before the breach according to CEO Kelly Bayer Rosmarin, the reputational damage from that event will be long-lasting.
Add to that this embarrassing loss in court and you’d have to wonder if they’re lining up CEO candidates. The loss alone might not be the issue, but the ruling and the information that shows the company knew that the Boost name would be a problem really is.
The good news for SingTel, Optus’ owners, is that there are plenty of great CEO ready candidates out there. Let me help them along with a list if the eight people I’d interview for Optus CEO if I were Chairman Paul O’Sullivan or SingTel CEO Yuen Kuan Moon.
8 Candidates for Optus CEO:
- Bill Morrow (Ex Vodafone and NBN CEO)
- When you want to recover from a crisis, you call in Bill Morrow. He got Vodafone back on track after their network woes in 2011, then came in and got the NBN in ship shape form.
- Pip Marlow (Ex Microsoft now Salesforce)
- Pip is one of Australia’s strongest tech leaders, previously Microsoft and then I think Suncorp, Pip is now at Salesforce but would be a tough get given the global potential for her within Salesforce
- Mel Silva (Google Australia MD)
- Mel is well known to Aussies after all the Media v Google issues of a year or two back, but regardless leading a business the size of Google Australia is no mean feat. Again, the issue would be the vision Ms Silva might have for a role at Google HQ
- Ben McIntosh (Ex Vodafone now Bunnings COO)
- Ben was in charge of Marketing at Vodafone until a few years ago, so knows the telco game as well as anyone in Australia. His new role as COO at Bunnings puts him on a path to CEO – but there’s no reason why that next step couldn’t happen at Optus.
- Michael Ackland (Telstra)
- Michael Ackland is the CFO at Telstra, so in terms of Telco knowledge and large scale Telco he’s your man. Previously CEO at GE Healthcare Australia, his role is one of the top three at Telstra. Given Telstra has a newly minted CEO in Vicki Brady, you’d have to think a step outside is the next option for Ackland – so a call from Optus might be interesting.
- Brad Whitcomb (Telstra)
- Brad Whitcomb is head of the Telstra Consumer business, and given Optus needs to win back consumers, I’d have eyes on Brad for sure. Interestingly though, he’s new to Telstra, having just come from NBN as Chief Customer Officer, and in his time NBN’s customer complains to TIO have been brought well in order so his customer focus would be keen, plus he has more Telco experience with time at Vodafone too.
- Clive Dickens (Current Optus Vice President, Television, Content and Product Development)
- Moving now to Internal candidates, Clive is a man who knows what customers want. He’s driven new and innovative experiences in Radio, TV and Telco. I first met Clive over a decade ago when he was at Absolute Radio in the UK, he then moved to Southern Cross Austereo, then the Seven Network and now Optus where he heads product development and content innovation. He’d be a breath of fresh air for a Telco that has always been a middle ground player.
- Gladys Berejiklian (Current Optus Managing Director, Enterprise and Business)
- Last but absolutely not least, former Premier Gladys Berejiklian. Gladys is a known and friendly face to Australians, her ability to relate to and communicate with Australians is second to none, and as the head of Optus I’ve no doubt she would take no prisoners at a management level, she’d never let the boost name cross her desk for approval, and she would shake things up and put all eyes on Telstra as the target as well as restoring customer faith in the brand.
So, there you go Optus and SingTel – best of luck with what’s next.