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As the Apple and Cisco legal battle over the iPhone name is taken to new heights, Apple may have to fend off the fiercest competition yet as rumours of Microsoft’s Zune music player developing into a mobile phone gather steam

Showing no signs of backing down on the trademark lawsuit against Apple, Cisco recently brought out an advertisement in the New York Times, displaying both the Apple iPhone and the Linksys iPhone.

According to the NY Post, Cisco bought a full page ad in the New York Times which apparently boasts about its upcoming iPhone, showing no signs of handing the name over.

The advertisement came three weeks after Cisco filed a lawsuit against Apple - whose own iPhone is set to debut in June - alleging trademark infringement.

The two companies have been bickering over the trademark name since the 9th January when Apple announced the eagerly anticipated iPhone with integrated iPod.

Cisco had believed it had reached an agreement with Apple which would allow them to share the iPhone name, yet Apple stood firm and refused to sign the contract, prompting the lawsuit from Cisco which continues to state that they have owned the iPhone name since acquiring Infogear. Apples first response to the law suit was that it was ‘silly’, yet it has now become a full scale war on both sides.

Apple fans will surely turn their noses up at Linksys’s version of the iPhone. It’s a wi-fi phone that is Skype compatible using Wireless-G, WIP320. Cisco’s iPhone will scan for a wi-fi access point before it fully boots its operating system. iPhone has lately received the reputation for being a ‘the new wave of mobile phone’, out doing anything which has been on our shelves to date.

One possible outcome of the Cisco/Apple name war is Apple releasing products that are compatible to each other under Cisco’s iPhone name. Talks have been going on for weeks, but to no prevail. Apple seems to have too much pride and do not want a smaller company beating them at their own game. Maybe calling the lawsuit ‘silly’ may not have been such a good move for Apple, who may be left red faced if things go Cisco’s way.

Cisco has agreed to extend the deadline of its lawsuit against Apple in hopes to reach some sort of peaceful agreement, which doesn’t seem likely to occur. Apple may have good grounds to fight if the case goes to trial.  There is a question over whether or not Cisco where really making use of the trademark names from the time they acquired it.

If its not lawsuits and legal battles, Apple are constantly needing to fend off touch screen competition which seems to be getting larger every day. The latest to rear its head is the much talked about ‘Zune phone’ from Microsoft. Apparently MS have been working on ideas for the Zune phone for months, yet nothing is certain. In all honesty, the only thing Microsoft need to do to take a step ahead in direct competition with the iPhone is to implement 3G to their handsets, add a 4 mega pixel or higher camera, and to have a touch screen with a nice interface.

One alleged feature of the Zune phone is its ability to sync with the Xbox 360 and stream video from the system to the phone via a wireless data connection. This would be pivotal in Microsoft’s production of its media ambitions. Not only does it already have millions of 360s in homes capable of downloading movies, it’d be able to distribute those videos directly to its phones. This being so, if all goes well for MS and the Zune phone does become a reality, XBOX gamers will be lining the streets to get their hands on the cross compatible mobile device.

It has been a tough few months for Apple with the likes of various mobile phone companies in a race to beat the iPhone off the top spot for phone of the year. But it now seems that Microsoft is now planning to battle Apple in not just computing and music, but now mobile phones. To succeed this year, Apple need to be strongly confident in their ability to bring a rich user interface and unique technologies to its audience before its competition gets their first, which seems likely since phones such as the NEO1973 are due to be released late February.