Singapore Telecommunications (SingTel) is being sued in a Singapore court for its use of the Mio brand name by Mitac International, which sells smart phones and GPS devices under the Mio brand through its Mio Technology unit.

The lawsuit was reported by Singapore's Straits Times newspaper on Monday. The report said SingTel executives claimed no trademark infringement had occurred because the company's use of the Mio trademark was for services that differ from Mitac's Mio devices.

A SingTel spokeswoman declined to comment on the lawsuit, saying the case was still ongoing. Mitac representatives were not available to comment.

Mio Technology was formed by Mitac in 2002 and shipped its first product, the Mio Digiwalker 168 PDA, in 2003. The company has since expanded its product line to include handheld navigation devices, PDA phones, and car navigation products. SingTel rolled out its Mio service in 2007, including broadband Internet, a pay TV service, and VoIP (voice over Internet Protocol) services that can be accessed using a landline or mobile phone.

A search of registered trademarks issued by the Intellectual Property Office of Singapore (IPOS) showed Mio was first registered by Mitac in April 2003, and approved as a trademark in January 2004. By comparison, SingTel filed for its Mio trademark in November 2006, and they were approved by IPOS in March 2007.

SingTel's trademark was originally filed under a different product class than Mitac's Mio trademark but SingTel amended its trademark on October 30, putting it into the same product category as Mitac's trademark, IPOS records show.

Branding is critical in the consumer electronics business, where established brands can charge a hefty premium over unknown brands, which earn thinner margins and are therefore less profitable.

Companies typically spend millions of dollars per year on advertising and promotion efforts that are built around brand names. These campaigns bring in sales and build trust and recognition among consumers. In some circumstances, established and well-known brands act as a barrier to entry for new competitors, who would be required to outspend incumbent players on advertising to establish their own brands.